Brief Commentary on The Church Scandal

Just remember that Thomas Becket was sainted largely for his insistence that priestly offenders be tried in ecclesiastical courts, not civil courts.  (see also here)

In late 1163 Henry decided to abolish certain privileges enjoyed by the clergy, which exempted them, when they were accused of crimes, from the jurisdiction of the civil courts. Criminous clerks, as they were known, were instead allowed to stand trial before a bishop in the ecclesiastical (church) courts, which usually resulted in much milder punishments.

So the Catholic Church has been defending it's criminals for thousands of years, while granting its highest honor to those who protect them.

We Have Eaten the Low-Hanging Fruit. What Next?

The Health Bill is now Law.  I'm not sure how it will work out.  I think it will benefit me personally.  The rest of us may have to wait to find out.

One thought that I haven't seen anywhere else.  Let's be generous and assume that the deficit reduction mechanisms actually work, and this bill is deficit neutral (or even slightly beneficial as the CBO claims).  Now, I don't really believe it will work that way, but let's say they do work.

The mechanisms involve roughly one trillion dollars in higher taxes on the rich, and savings in Medicare.  No skin off my back (for now).  These are, to some extent, the easy fixes, the most politically palatable, the "low hanging fruit" in the battle to decrease our deficits.

One trillion dollars is a lot of low-hanging fruit.  Instead of using them to pay down the deficit, we have eaten them.  Eaten them for a reasonable cause, but eaten them.  They are gone.  When the time comes to really tackle the deficit, we will have to reach higher.  One trillion is "easy" deficit reduction is gone.  Get ready for higher taxes that impact the middle class, and large cuts in other government programs.


Upon further searching, I noticed that Greg Mankiw makes a similar point here.

Clever media reporting on the CBO numbers

Most of the news articles say something like:

"cut federal deficits by an estimated $138 billion over a decade. 

Congressional analysts estimate the cost of the two bills combined would be $940 billion over a decade."

Now, maybe I'm missing something, but the only way this math works is if the bill involves a tax increase of 940+138 billion.  Which is 1.078 trillion. According to the WSJ,

        "The answer lies mainly in new taxes and curbs on Medicare spending."

Duh, so I was half right.  Wish the rest of the media would be more honest.  The New York Times does mention, in passing

"it would reduce projected federal budget deficits by $138 billion over the next decade, with additional tax revenue and Medicare savings."

I like their use of "revenue" and "savings".  Next time Republicans want to cut a government program, I assume the Times will call that "savings", not a "cut".  Sure they will.  Buried near the bottom are the hard figures of $438 billion in new taxes.   (Same for the Yahoo article)  The L.A. Times, somewhat more honestly, calls them "cuts in federal Medicare expenses", which, of course, are certainly not cuts in your Medicare benefits.  No sirree Bob.  Nice spin by the mainstream media.

Anyway, hope that clarifies things for anybody else who was confused.  Now, the benefits of the bill and greatly increased coverage will, all in all, likely be worth the extra taxes and Medicare cuts.  Especially for those of us who aren't rich and aren't on Medicare.  :-)  I just wish both sides could have a serious discussion of these vital issues and act like grownups.

re: Jim Bunning. Paul Krugman, like many is wrong

Paul Krugman writes an editorial that can't get two sentences without being wrong.

"For days, Senator Jim Bunning of Kentucky exploited Senate rules to block a one-month extension of unemployment benefits"

Jim Bunning did not exploit some obscure Senate rule.  The Senate asked for unanimous consent on a bill and he said no.  Surely well within his rights - if all Senators are required to unanimously support all bills, there's no point in having them.  Apparently, Krugman is unaware of the whole purpose of the Senate, to vote yes or no on things, and thinks that voting no in itself is an evil, exploiting a Senate rule.

Actually, Bunning wanted the Senate to follow it's own rules, "PayGo", and pay for the$10 billion expense.  Note that one of those links leads to the Democratic Senate Budget Committee website, which says:

However, this point of order is not self-enforcing like the sequestration process; a Senator must raise the point of order against any violating legislation.

In other words, Bunning followed precisely the rules, as created by the Democrats, to raise the point of order about Paygo.  To balance the cost, he proposed, quite reasonably, using some TARP funds.  He also proposed removing the "black-liquor" tax-credit.  But this was nixed on a procedural issue by Sen. Barbara Boxer (D-Calif).   Nobody is writing how she exploited Senate rules to block his bill.

Some of the angst was that the benefits were about to expire in days.  True - real people would be affected, and that would be painful.  Harry Reid decared it an "emergency", as one of his aides wrote:

“The short term extension of expiring provisions is designated emergency spending because in economic downturns of this magnitude the Senate has traditionally treated extraordinary assistance to the unemployed as an emergency,”

Now, the Senate knew a long time ago that unemployment was running out for some recipients.  Was the Senate suddenly surprised that the economy is in bad shape?  Did they have a mass fantasy that millions of new jobs would be created in February?  No, they are too lazy to plan ahead, and rushed through some last minute bill.  Hmm, that does sound "traditional" for our representatives, so I agree with that part of the statement.

All Harry Reid had to do was

1. agree quickly to spend TARP funds
2. agree quickly to allow Bunning's black-liquor amendment to proceed
3. Call for a cloture vote.  Presumably, it would pass about 98-2, and the Bill would then get passed.

But the Senate leader chose to try to make a political point, trusting the press to misreport the facts.  As Paul Krugman, unsurprisingly, did. See here for a blog about more misreporting of Bunning's actions as a "filibuster".  But it may have backfired - enough people are getting the truth to realize that Bunning may have picked the wrong time and place for his solitary stand, but he definitely had some right on his side.

One later addition.  As part of his column, Krugman writes that Republicans are in a weird moral universe, and that extending unemployment is "textbook economics".  However, as James Taranto points out, in Krugman's own textbook, Krugman wrote:

"Public policy designed to help workers who lose their jobs can lead to structural unemployment as an unintended side effect"

 Now, these are unusually tough times, I don't think that this one instance of extending unemployment insurance will cause structural unemployment, but a good find by Taranto.

A Proposal for a New Source of Tax Revenue

Citizen's United v. Federal Election Commission opens the door for a lot more political advertisements in upcoming elections.  And there's already a lot.  In 2008, the total cost for US Federal government campaigns was 5.3 Billion dollars.  (roughly half was the Presidential campaign, half for others)  A decent chunk of this is advertising.  For example. President Obama and Senator McCain spent about 20% of their funds, 500 Million, on advertisements.  State contests cost money too.  Here in California, Meg Whitman will spend millions of her own money, and Democrats are responding.

In my opinion, this massive spending, and the fund-raising required to compete in a race, is a corrupting influence.  However, as a vaguely Libertarian, and a firm believer in the Bill of Rights, a lot of this involves Speech, and especially political speech, which should have the highest protection.  So, I'm torn.  (I'd support a reasonable Amendment that corporations are not persons).  But, frankly, my opinion doesn't matter.  Attempts to control this spending have all failed miserably.  If you will, government imposed "price controls" and "regulations" have failed, as they often do.  Let's apply a more traditional government approach, especially in this time of fiscal problems.

Let's tax the heck out of political advertisements.

I'd set a low floor, under which there is no taxation.  Say, $25,000.  So those running for School Board, small town sheriffs, etc. aren't affected.  (I hope, not sure what gets spent on those campaigns!)  Above that, a steeply progressive scale, topping out at 50%.  So, for the big races, for each dollar spent on a political ad, the people get a dollar.  Ads for federal offices would pay taxes to the feds, ads for state office pay the states.

Now, part of me was worried that this just makes the glad-handing and lobbyists more powerful, cause politicians will have to raise twice as much money.  I am no longer concerned.  We already know what the politicians are.  We are just haggling over price.  Let's get a cut of the action.

Why Canada is better than the USA

In Canada, they don't have the USA-Canada hockey game on a cable channel in low def!  Pestering us between periods with ads for their political talk shows.

Come on NBC/MSNBC, this is a big game, why isn't it in hi-def on a real channel?  What kind of weak crap is that?

As for why the USA is better than Canada, we don't have that cheap-shot punk Scott Niedermeyer throwing opposition players into the boards way after the period is over.  And right now we are leading 3-2, but there's still a period to go.

Here's wishing a cold Molson for all the Canadian fans anxiously watching.  Good luck, and congratulations on a well-run Olympics in a fabulously supernaturally beautiful area of the world.  BTW, the Czech-USSR game was great.

More Depressing Goldman Sachs News

  One could have an entire blog devoted to depressing Goldman Sachs news, but here's a recent snippet.  According to a New York Times article, "Wall Street" (mainly represented by Goldman Sachs) helped mask or obscure the true extent of Greece's debt problem.

 "...financial derivatives played a role in the run-up of Greek debt. Instruments developed by Goldman Sachs, JPMorgan Chase and a wide range of other banks enabled politicians to mask additional borrowing in Greece, Italy and possibly elsewhere.   ...
Critics say that such deals, because they are not recorded as loans, mislead investors and regulators about the depth of a country’s liabilities."

  Now, these deals were apparently perfectly legal, and most of the blame, IMO, rests with the overspending politicians and those who elected them.  And the accounting rules that don't count these future liabilities as "debts" are silly too.  But still, the banks profited from the addictions of countries like Greece and Italy.


  In related news, Mark Pittman, an investigative reporter, filed a Freedom of Information Act (FOIA) request in September 2008 with the Fed for details of the bank bailout.  He was rebuffed - the Fed didn't even bother to answer.  Mark Pittman died in November 2009.  Unfortunately for would be conspiracy fans, there seems to be no conspiracy, which probably convinces them that there is one.  :-)

  Fortunately for the rest of us, Bloomberg News has taken up the mantle with a lawsuit, Bloomberg L.P. v. Board of Governors of the Federal Reserve.  Last summer, District Judge Loretta A. Preska ruled in favor of Bloomberg, but the ruling was appealed by a consortium of banks to protect “the substantial interests of its members in confidential information that they provided to the Federal Reserve.”   They argue that if people knew which banks were taking loans from the Fed, there could be a run on the bank, or that it's reputation would be damaged.  Yeah, sure, banks are held in such high regard, it would be terrible if they were stigmatized.  The Fed did bring up one interesting argument:

"The Fed, meanwhile, has worried that if the appeals court rules for Bloomberg, then savvy traders could quickly get their hands on such data in the future and use it to their advantage even as the government was trying to stabilize the markets."

 People everywhere are very skeptical of the bank bailout.  No need for me to cite any links even for that one.  It seems to have saved greedy institutions who took huge risks in order to make huge bonus payouts.  I'm no wild-eyed socialist or populist, and I believe that those who truly create something useful for society deserve ample compensation, but I find it hard to believe that bankers truly create all that much.  I usually disagree with Paul Krugman, but I completely agree with him that banking should be boring.

  If the bailout were truly needed, and did save banks and the American (and world) economy from a disastrous collapse,  one would think that The Fed would want us to know the facts.  Ex-President Bush, Fed Chairman Ben Bernanke, and President Obama et. al. would want us to know.  Because it would make them look good, proving that they were rapid responders who risked public disapproval to save the economy, and they are not dupes nor tools of Wall Street.  Since they haven't provided these facts, I conclude that the bailout was a scam or a panic.

  Perhaps there will soon be a book with hard facts about the bailout.  Anybody know of one?  From what most can see, it rewarded bad behavior, and the banks are going back to the same bad habits, with no shame or remorse.  Not sure what anybody can really do about it.  For my extremely small part, Tim Geithner went to my Alma mater, Dartmouth College.  This year they will get no alumni donation from me.  Take that!