“One Little Hour”

Learn the difference between Keynes and Hayek in this clever rap.

Great post on the mytwocents blog. Let’s hope that more young fundamentalists start speaking out.

Compare the mapped results of today’s election (Scott Brown over Martha Coakley) in Massachusetts to the map of Barack Obama over John McCain and the map of John Kerry over Jeff Beatty.

Here’s the line:

Brown (R): 52%, Coakley (D): 47%

Obama (D): 62%, McCain (R): 36%

Kerry (D): 66%, Beatty (R): 31%

Democratic pundits have got to be freaked out. That’s a 21 point or better swing in 14 months. In Massachusetts. For Teddy Kennedy’s old seat.

Imagine if a redo national election were held today with an across the board 21 point swing. Barack Obama would have lost every state except for Hawaii, Vermont, and Washington DC. Sure, there’s no way that that would actually happen, but even the spinning-est of Democratic operatives has to realize that today’s election bodes ill for progressive Democrats nationwide.

During the 1980s a cadre of supply side economists and conservative politicians argued that tax cuts would be an effective way to shrink the government bureaucracy. Rather than pushing for budget cuts or directly eliminating agencies, they reasoned that cutting taxes and mandating balanced budgets would force the government to cut spending. This plan, a key tenet of “Reaganomics,” had the advantage of being more politically palatable (who doesn’t like lower taxes?) than trying to drum up support for legislation to cut vote-getting programs.

It hasn’t worked.

Many states, like California, have used creative accounting to avoid the budget mandates while continually enacting new entitlements and expanding existing ones. When finally confronted by the reality that they can no longer leverage their way out, state governments have left the most egregious entitlements untouched while making cuts in the most legitimate government programs.

In Philadelphia, when the city council’s appeal to the state legislature for a tax increase seemed close to failure, Mayor Michael Nutter threatened to enact a dreaded “Plan C” that would have closed the entire library system, stopped weekly trash pickup, closed all city recreation facilities and stopped park maintenance, fired nearly 1,000 policemen, eliminated six firefighter companies, close a quarter of the city health centers, and stopped issuing construction permits. This would have shaved about $157 million off the annual budget.

This doomsday scenario was a distraction. About 60% of Philadelphia’s budget goes toward employee payroll and retiree pensions. That’s $2.2 billion. In Philly, as in California, unionized civil servants can retire in their fifties and collect up to 90% of their salary for the rest of their lives. City employees often draw on medical benefits and a pension for longer than they were actually employed. 

The entire $157 million could have easily come from an across the board paycut or a reduction in pension benefits. But unions are part of the entrenched establishment in Philadelphia. Far easier to scare people by cutting funding to the most visible (and ironically, the most incidental as a proportion of total government spending) government programs. Government entitlements are the last thing that will be touched.

So it appears that government, rather than shrinking its evergrowing entitlements, scares voters into tax increases with the threat of stopping legitimate government functions.

Reaganomics was the original attempt to “bend the cost curve.” It has been a resounding failure. I think that all fiscal conservatives instinctively know that it is much easier to expand rather than decrease the extent of government, but we underestimated the resilience of the State in protecting its prerogatives.

[Addendum 1/21/10: Dan Henninger takes a stab at explaining growth in government spending on payroll and pensions.]

Living in Philadelphia has opened my eyes to the full extent of America’s welfare society. Every week as I travel to Temple University for classes, I pass through North Philadelphia. Nestled among street after street of urban blight you come across rows of beautiful, spankin’ new homes provided to mostly single mothers by the US Department of Housing and Urban Development.

Folks in my income bracket can apply for free heating assistance (LIHEAP), help with water bills (UESF), and electric bills (CAP, MEAF, LIURP). (more…)

NPR – wonders will never cease – delves into the motives of doctors who gave Hassan a pass.

What’s next!? A news story critical of Obama?

Andrew Curry wrote an excellent article on the boardgame Settlers of Catan for Wired Magazine. Really good stuff and not just because I am a Settlers afficianado; he uses an article about a boardgame to touch on trends in the gaming industry and to provide insights into German culture, psychology, and economics.

Justin Taylor posted an eight minute video that investigates the meaning of the prosperity gospel to West Africans. I like the cinematographic choices: long clips of services with sparse narration. I also appreciate the humble tone in the conclusion.

Check out this article. This paragraph is particularly interesting:

Peter Bjerregaard from Denmark’s National Institute of Public Health has noted that while Greenland’s suicide problem began in 1970, almost all the deaths involved people born after 1950—the same year that Greenland began its transformation from remote colony to welfare state, as the Danes resettled residents to give them modern services and tuberculosis inoculations. Hicks, the Canadian researcher, said the correlation is present in other Inuit societies as well.

This is what you get when you too-rapidly transform communal norms, traditions, and institutions. Conservatives rejoice!

George Will and Charles Krauthammer both took Obama’s foreign policy decisions to task this weekend in the Washington Post.

I’m surprised that Will didn’t insinuate that Obama has pushed off the Afghanistan decision because it will fracture his party at a time when he needs the Democrats unified around healthcare. If true, Obama may be sacrificing success in Afghanistan in order to screw with American healthcare policy.

Funny that we’re less than a year into Obama’s term and we’re already printing “Don’t blame me. I voted for McCain” bumperstickers. It took at least two years for Bush!