Democratic Leadership

I hope this isn't a harbinger of what to expect of Democratic leadership in Congress. Matthew Yglesias wants Democrats to not take any leadership on confirming or rejecting Bob Gates (he went to my high school, I can call him Bob).

My initial read -- subject to revision as we learn more -- is that they should take advantage of the presence of some hard-core wankers in their caucus. Blocking Gates is problematic. Giving Gates a seal of approval is also problematic. So, if Webb wins, let Gates come to the floor and let him be confirmed by 49 Republicans plus some combination of Lieberman, Ben Nelson, and Dick Cheney. That way Bush gets to keep running Bush's war Bush's way on Bush's say-so and Bush gets to keep reaping the blame when things keep going poorly.

So rather than take the lead and vote the way they feel, Yglesias is promoting an avenue that allows Democrats to be unaccountable. Because Gates is almost assured of being confirmed, they take no risk by actually voting for confirmation and if Gates' Iraq strategy doesn't work, they will have no blame. If Gates comes in and does a wonderful job, they can say they voted against him because of Bush's record of nominating cabinet members. No pain either way. I don't really see how this approach could be considered working with the President.

Then there's this little piece of non-leadership from Kevin Drum before the election on Tuesday.

Golly. You mean the Democratic document didn't have a whole section about exactly which taxes Nancy Pelosi wants to raise and by exactly how much? I wonder why? Kinsley then follows up this faux bumpkinism with a complaint that the Democrats also fail to present a plan for crushing the Iraq civil war, even though he admits one sentence later that neither does anyone else. If it weren't for the 800-word limit on op-eds, I figure the next paragraph would have been a complaint that Democrats lack a plan for turning water into wine.

Once again, the Democrats are afraid to actually say how they're planning on paying for their plans. Isn't this what they've been criticizing Republicans for for 6 years?

I don't know how to feel. I'm glad the Republicans aren't in charge of Congress any more because a divided government that actually has oversight works better than one party rule. On the other hand, I disagree with just about everything the Democrats stand for on the economic side of the table and it appears they will show no leadership whatsoever. They'll just try to position themselves to win the next election, which is what the Republicans have been charged with for the past 6 years. I guess I don't get how anything really changed.

Smoking Ban and Gambling

While reading the link from Radley's post about smoking ban silliness, I came across this little piece:

The new smoking ban applies to bars that serve food and those that don't have keno licenses. Some bars have applied for keno licenses to keep their smokers happy, and a few decided to give up food instead of smoking.

The state/city is increasing it's customer base, it's not about public health, it's about more establishments getting keno licenses and increasing state/city revenue.

By the way, calling 911 to report a smoker is a dangerous activity that threatens dispatcher's ability to actually, you know, handle more important things, like immediate danger reports.

Evil Waltons

How could Wal-Mart do this to the people? The Waltons, with their $19B each should quit exploiting the people. Now 8600 more have volunteered to be exploited, with a waiting list of over 45,000.

War on Wal-Mart

The other night I watched a little of the CNBC documentary about Wal-Mart. It's a real interesting show that explains their culture and processes to keep prices low. I believe there is nothing inherently evil about Wal-Mart, even if I prefer Target.

Unfortunately, labor unions see Wal-Mart in a different light and Democrats are listening. The WSJ has an excellent op-ed today explaining the phenomenon (I don't usually like to excerpt a whole article but I don't have a free link).

Wal-Mart may be expanding in the People's Republic of China, but here in capitalist America the low-price retailer has become the Democratic Party's favorite pinata. The media like to portray this as a populist uprising against heartless big business. But what they don't bother to disclose is that this entire get-Wal-Mart campaign is a political operation led and funded by organized labor.

We've done a little digging into the two most prominent anti-Wal-Mart groups, and they might as well operate out of AFL-CIO headquarters. An outfit called Wal-Mart Watch was created by the Service Employees International Union (SEIU), probably the most powerful union in America after the National Education Association. Wal-Mart Watch is backed by Five Stones, a 501(c)3 organization that received $2,775,000 in 2005 from the SEIU, or 56% of its $5 million budget. According to financial records, SEIU also gave Five Stones $1 million in 2004 to launch the anti-Wal-Mart group, and SEIU president Andy Stern is the Wal-Mart Watch chairman.

A second group, Wake Up Wal-Mart, is more or less a subsidiary of the United Food and Commercial Workers Union (UFCW). Wake Up Wal-Mart refuses to divulge its funding sources, but here is what we do know: The group was founded by the UFCW, is housed at UFCW headquarters, and its campaign director's $135,000 salary is paid by the UFCW.

Wake Up Wal-Mart also has close ties to the Democratic Party. Its union-funded campaign director is Paul Blank, who was political director of Howard Dean's failed Presidential campaign. The group sponsored a 19 state, 35-day bus tour across the U.S. earlier this year, staging anti-Wal-Mart rallies. Nearly every major Democratic Presidential hopeful has joined in the Wal-Mart-bashing, including Senators Joe Biden and Evan Bayh, New Mexico Governor Bill Richardson, and trial lawyer-turned-man-of the-people John Edwards. They all seem to believe they have to take this line to pass union muster for 2008.

Even Hillary Rodham Clinton has joined in the political fun. Never mind that she served six years on the Wal-Mart board during her time in Beltway exile as an Arkansas lawyer and, according to the Arkansas Democrat-Gazette, was paid $18,000 per year plus $1,500 for every meeting near the end of her tenure. Most recently, Mrs. Clinton returned a $5,000 campaign contribution from Wal-Mart to protest its allegedly inadequate health care benefits. Maybe someone should ask her if she's returned her director's pay, with interest.
* * *

Most of the local protests against Wal-Mart are organized through the left-wing activist group ACORN, an acronym for the Association of Community Organizations for Reform Now. ACORN is the group that put the squeeze on the Chicago City Council to pass an ordinance this summer to require Wal-Mart, Target and other big-box stores to pay a minimum $10 an hour wage and $3 an hour in benefits by 2010. (Democratic Mayor Richard Daley vetoed the bill.) ACORN also pretends it is a locally organized and funded voice of the downtrodden masses. But guess where ACORN gets much of its money? Last year the SEIU chipped in $2,125,229 and the UFCW $165,692.

Then there are the anti-Wal-Mart "think tanks," if that's the right word for these political shops -- notably, the Economic Policy Institute (EPI) and the University of California at Berkeley Labor Center. The job of these two outfits is to publish papers backing the economic claims of Wal-Mart critics. The UC Berkeley group recently asserted that Wal-Mart "reduces total take-home pay for retail workers."

The UC Berkeley Labor Center has received at least $43,550 from SEIU. The Economic Policy Institute received $100,000 from the SEIU and $40,000 from the UFCW in 2005 and has published several anti-Wal-Mart studies, particularly on the benefits of the Chicago ordinance. By the way, Andy Stern also sits on the EPI board. He's a busy guy.

Now, we're not predisposed to be pro- or anti-Wal-Mart. We've criticized Wal-Mart lobbying on policy grounds -- for example, when the company supported a minimum wage increase to court some nice publicity while also knowing this would harm any lower-priced competitors. However, it is simply fallacious to argue that Wal-Mart has harmed low-income families.

More than one study has shown that the real "Wal-Mart effect" has been to increase the purchasing power of working families by lowering prices for groceries, prescription drugs, electronic equipment and many other products that have become modern household necessities. One study, by the economic consulting firm Global Insight, calculates that Wal-Mart saves American households an average of $2,300 a year through lower prices, or a $263 billion reduction in the cost of living. That compares with $33 billion savings for low-income families from the federal food stamp program.
* * *

Alas, what's good for working families isn't always good news for unions and their bosses. They hate Wal-Mart because its blue-coated workforce is strictly non-union -- a policy that dates back to the day founder Sam Walton opened his first store. Today the company employs 1.3 million American workers, and its recent push into groceries has made life miserable for Safeway and other grocery chains organized by the service workers or the UFCW.

Wal-Mart pays an average of $10 an hour, which is more than many of its unionized competitors offer. And typically when a new Wal-Mart store opens in a poor area, it receives thousands of job applications for a few hundred openings. So Wal-Mart's retail jobs of $7 to $12 an hour, which the unions deride as "poverty wages," are actually in high demand.

But as we say, this campaign isn't about "working families," or any of the other rhapsody-for-the-common-man union slogans. If Wal-Mart were suddenly unionized, Big Labor's membership would double overnight and union leaders would collect an estimated $300 million in additional dues each year to sway more politicians. Short of that, their goal is to keep Wal-Mart out of cities so their union shops have less competition. That's what the war against Wal-Mart is truly about.

I guess because Democrats aren't in charge of anything they don't get branded with the catering to special interest stick. But, when do you ever see them turning down union money or doing something the unions don't like? The 2 shining examples of this are Wal-Mart bashing and support for public schools.

More Shelf Blogging

The shelves may be a little hard to see, but there's 4 of them there. We needed some shelves in the girls' closet to hold their winter clothes while we go through this Indian summer. Bonus points for me because these shelves had to be extra sturdy so my 20 month old girls couldn't pull them down. I believe I accomplished that mission. Also, we kissed the vertical blinds in the living room goodbye and hung up some horizontal blinds with a valance. I give you Shade Blogging!


For more Shelf Blogging check here, here and here.

Political Questions

If you're like me, and for your sake I hope you're not, you find yourself flummoxed to come up with questions when a politician comes to your door soliciting a vote. I have opinions and I want these people to tell me what they believe, but I don't want them to just give me the standard little "I'm for this, this and this and against that, that and that."

Also, typically the people trawling around in my neighborhood are candidates for city council, state representatives or some other local office. These are some of the most important offices for me, but, I typically can't come up with a question to ask these people on the fly, so I'm looking for the kind of questions that get at the candidates inner beliefs. The kind of thing Democrat and Republican used to mean.

For example, I would want to know if they believe in free trade, what they think the role of government is in this country etc. Those aren't questions John Q. Campaigner are typically ready to answer, but they're important for Campaigner to have an answer. Especially because today's local politician is tomorrow's national politician. I don't want to be electing someone for local office when I don't believe in what they think on national issues.

So, in light of this I'm going to email some of the bloggers I most respect and see what they think. I'm looking for pretty general questions that aren't stacked to get an answer a certain way like, "do you think it was worth thousands of American lives to start an illegal war in Iraq?". If the question's loaded, Campaigner will know how I want him to answer it.

R.I.P Buck O'Neil

I was saddened to learn last night via the Bottom Line on ESPN that Buck O'Neil had passed. Buck was probably the most famous Kansas Citian, certainly the most loved. It's like a piece of the city died. But, I know that Buck O'Neil meant a lot to people outside of Kansas City as well. Wright Thompson, a former KC Star reporter, has a nice tribute to Buck on ESPN.

We've all lost that magnificent baritone voice now, and the world is poorer for it. Not in the way we normally are when a famous person dies. No, O'Neil's voice was truly a gift to all of us. It taught us that love is more important than hate. It taught us that forgiveness is more important than bitterness. It taught us to live life now, to eat dessert always, to never let a red dress pass by.

When he didn't get into the Hall of Fame this year, people rightfully howled. As the news reached him, a final denied dream in a life full of dreams denied, he just smiled.

"God's been good to me," he said that day. "If I'm a Hall of Famer for you, that's all right with me. Just keep loving old Buck. Don't weep for Buck. No, man, be happy, be thankful."

On a day that should have been the pinnacle of a life dedicated to helping others, he showed up at the podium in Cooperstown anyway to help honor the Negro Leaguers who did make the cut, and he led the crowd in a song that will never be heard again:

"The greatest thrill Â… in all my life Â… is loving you."

He sang those words to the folks there and to those at home. Sitting here now, trying to imagine a world without Buck, I can't stop thinking about that song. As a former reporter for The Kansas City Star, I had my share of interaction with Buck. I heard him make cynical school children stand and sing in loud voices. It's clear to me now that knowing and loving Buck has been the greatest thrill in my professional life. It's been a thrill for all of us who knew and loved Buck, either in person or in spirit.

Thompson felt it appropriate to point out that he worked in KC in his national article. I think that's appropriate, Buck was one of those people that made you proud to be a Kansas Citian. He was our own and we loved him.

I met Buck once and got my picture taken with him. He had taken hundreds of pictures with people that day (it was a Royals open house) but, he took the time to ask my name and several other questions. He was particularly interested in the girl I was with, I remember.

Sometimes I would see Buck at Royals games and I would wave, he would wave back like he knew me. It always made me feel like he remembered me from the day we took that picture. I think he made everyone feel that way whenever he was around.

Craig, over at Royals Authority, has the text from Buck's Cooperstown speech here as well as his personal Buck stories.

Alright, sit down. This is outstanding! I’ve been a lot of places. I’ve done a lot of things that I really liked doing. I hit the homerun. I hit the grand slam homerun. I hit for the cycle. I’ve had a hole-in-one in golf. I’ve done a lot of things I liked doing. I shook hands with President Truman. Yeah. Oh, man, I took — Oh, [shook hands] with the other President and I…hugged his wife, Hilary. So I’ve done a lot of things I liked doing. But I’d rather be right here, right now, representing these people that helped build a bridge across the chasm of prejudice — not just the ones like Charlie Pride and me that later crossed it. Yeah. This is quite an honor for me.

Next, Negro League baseball. All you needed was a bus, and we rode in some of the best buses money could buy, yeah, a couple of sets of uniforms. You could have 20 of the best athletes that ever lived. And that’s who we are representing here today. It was outstanding. And playing in the Negro leagues — what a lot of you don’t know. See, when I played in the Negro leagues — I first came to the Negro leagues — five percent of Major League ball players were college men because the major leaguers wanted them right out of high school, put them in the minor league, bring them on in. But Negro leagues, 40 percent of Negro leagues, leaguers, were college men. The reason that was, we always spring trained in a black college town and that’s who we played in spring training, the black colleges. So when school was out, they came and played baseball. When baseball season was over, they’d go back to teaching, to coaching, or to classes. That was Negro League baseball. And I’m proud to have been a Negro league ball player. Yeah, yeah.

And I tell you what, they always said to me Buck, “I know you hate people for what they did to you or what they did to your folks.” I said, “No, man, I — I never learned to hate.” I hate cancer. Cancer killed my mother. My wife died 10 years ago of cancer. (I’m single, ladies.) A good friend of mine — I hate AIDS. A good friend of mine died of AIDS three months ago. I hate AIDS. But I can’t hate a human being because my God never made anything ugly. Now, you can be ugly if you wanna, boy, but God didn’t make you that way. Uh, uh.

So, I want you to light this valley up this afternoon. Martin [Luther King] said “Agape” is understanding, creative — a redemptive good will toward all men. Agape is an overflowing love which seeks nothing in return. And when you reach love on this level, you love all men, not because you like ‘em, not because their ways appeal to you, but you love them because God loved them. And I love Jehovah my God with all my heart, with all my soul, and I love every one of you — as I love myself.

Now, I want you to do something for me. I’m fixin’ to get off this stage now. I think I done my six minutes. But I want you to do something for me. I want you to hold hands. Whoever’s next to you, hold a hand. Come on, you Hall of Famers, hold hands. All you people out there, hold hands. Everybody hooked up? Everybody hooked up? Well then I tell you what. See, I know my brothers up here, my brothers over there — I see some black brothers of mine and sisters out there — I know they can sing. Can you white folks sing? I want you to sing after me:

The greatest thing — come on everybody –

The greatest thing in all of my life is loving you.

The greatest thing in all of my life is loving you.

The greatest thing in all of my life is loving you.

The greatest thing in all my life is loving you.

Thank you, folks. Thank you, folks. Thank you, folks. Thank you, folks. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Now, sit down. Now, sit down. I could talk to you 10 minutes longer, but I got to go to the bathroom.

DDT's New Friend

Finally the World Health Organization has come around and approved the use of DDT to eradicate malaria in undeveloped countries. The WSJ has a nice editorial outlining my thoughts.

Malaria is the number one killer of pregnant women and children in Africa and among the top killers in Asia and South America. It's long been known that DDT is the cheapest and most effective way to contain the disease, which is spread by infected mosquitoes. But United Nations health agencies and others have for decades resisted employing DDT under pressure from anti-pesticide environmentalists. After tens of millions of preventable malarial deaths in these poor countries, it's nice to see WHO finally come to its senses.

The agency's malaria chief, Arata Kochi, told reporters that "one of the best tools we have against malaria is indoor residual spraying. Of the dozen or so insecticides WHO has approved as safe for house spraying, the most effective is DDT." He also said, "We must take a position based on the science and the data."

Mr. Kochi's intellectual honesty is commendable and all too rare among public health officials in this debate. For decades, the science and empirical data about DDT's effectiveness have been distorted or suppressed. Nevertheless, and Rachel Carson's scare-mongering notwithstanding, there is no evidence that DDT use in the amounts necessary to ward off malarial mosquitoes is harmful to humans, wildlife or the environment. Period.

By contrast, there's plenty of evidence -- from the U.S. and Europe to Australia, India, Sri Lanka and Brazil -- that spraying DDT is the best intervention. According to Pierre Guillet, another WHO official at Friday's press conference, South Africa temporarily stopped using DDT in 1996 because green groups were opposed, not because it wasn't working. Malaria takes a heavy toll on a country's economy by discouraging foreign investment and incapacitating otherwise productive people, so these anti-DDT alarmists have been helping to impoverish those they don't kill. There is something other-worldly, or worse, about well-heeled greens trying to deny the world's poorest people the very tool used by rich nations to eradicate this disease.

Even if WHO's decision won't change those minds, its stamp of approval on pesticide use matters in the public health world. Other organizations, ranging from the World Bank to Aid for International Development to Doctors Without Borders, look to WHO for guidance and will now likely reassess their own guidelines. The U.S. is typically the largest donor to these international agencies, and the recent efforts of Republican Senators Sam Brownback of Kansas and Tom Coburn of Oklahoma, who have called for DDT intervention and more responsible allocation of aid dollars generally, no doubt played a role in WHO's decision.

One insecticide won't end malaria, and DDT's proponents don't claim it will. But by keeping more people alive and healthy, DDT can help create the conditions for the only lasting solution, which is economic growth and development. It's encouraging that even a U.N. health agency seems to have figured that out.

Emphasis mine on my favorite sentence. Development is the malaria eradicator, not DDT, but DDT supports development.

Democrats Vs. Wal-Mart

I love it when George Will really lays into something.

Liberals think their campaign against Wal-Mart is a way of introducing the subject of class into America's political argument, and they are more correct than they understand. Their campaign is liberalism as condescension. It is a philosophic repugnance toward markets, because consumer sovereignty results in the masses making messes. Liberals, aghast, see the choices Americans make with their dollars and their ballots and announce -- yes, announce -- that Americans are sorely in need of more supervision by . . . liberals.

Before they went on their bender of indignation about Wal-Mart (customers per week: 127 million), liberals had drummed McDonald's (customers per week: 175 million) out of civilized society because it is making us fat, or something. So, what next? Which preferences of ordinary Americans will liberals, in their role as national scolds, next disapprove? Baseball, hot dogs, apple pie and Chevrolet?

No. The current issue of the American Prospect, an impeccably progressive magazine, carries a full-page advertisement denouncing something responsible for "lies, deception, immorality, corruption, and widespread labor, human rights and environmental abuses" and for having brought "great hardship and despair to people and communities throughout the world."

What is this focus of evil in the modern world? North Korea? The Bush administration? Fox News Channel? No, it is Coca-Cola (number of servings to Americans of the company's products each week: 2.5 billion).

Next up is football (too violent), beer (fattening and causes drunkenness) and television (should be exercising or reading).

Consumer Choice in Health Care

I've been reading, for the past 2 days, all the lefty bloggers tut-tutting about the Rand survey that studied medical care that a group of seniors was getting. Now, I admit that the results of the test were pretty damning (the patients rated their care higher than the quality it actually was). But, it still didn't sit right with me. I don't think a third party can determine what I like better than I can. Let's call this the Totino's pizza corollary. I like the $1.50 Totino's frozen pizzas better than I like the $5.99 Digiorno frozen pizza. I'm sure that in a taste test among 250 of the top pizza experts the Digiorno pizza would come out a huge winner. But for me, I like the crisp crust and the ratio of sauce to cheese on the Totino's (for those that haven't had the pleasure, Totinos doesn't have a lot of cheese). Does the fact that the experts would agree that Digiorno is better invalidate my opinion? I would argue, no.

Greg Mankiw takes my Totino's Corollary to new territory today;

What if the quality of the health care were judged not by the consumer but instead by an employee of the postal system? Or, worse, by a random member of Congress, while he was running for reelection and accepting campaign contributions from a variety of health-care providers? Yes, decision making in health care is hard, so mistakes are inevitable. But is there any reason to think that collectivized decision making is usually better than individual decision making?

Granted, my Totino's Corollary certainly makes light of educated health care opinion, but I also believe that a medical treatment that the consumer believes in has a much better chance of succeeding than one which is foisted upon them when they have very little choice in the manner. Especially a treatment that is determined by what would be a gigantic bureaucracy that kowtows to political interests.

Free to Choose in Estonia

Greg Mankiw excerpts John Tierney's column about Estonia, the Baltic Tiger. I wrote a couple of papers in graduate school about the reforms that Estonia undertook and how American businesses can capitalize on those reforms. What I find most interesting is how Laar instituted the flat tax and other Friedman ideas in a formerly Soviet republic.

Earlier today I read this post on Drum's blog.

Nonetheless, we desperately need radically more attention paid to full employment policies; to labor organization in service industries; to the distributional inequities of free trade policies; to national healthcare; and to significantly more progressive taxation.

I read Drum to remember why I am not a Democrat. Everything he is advocating in that sentence is everything that Friedman, Estonia, Ireland and other success stories would strongly stand against. Estonia has a very free market and their distribution inequality is virtually nonexistent in relation to the US. Why is that? Government policies aid in making the poor poorer, not free market economic policies.

Liberal School Choice

Let the schools pick the students. Anything to give more power to public bureaucrats instead of to the people.

Betts suggests this: first fund the schools equally on a per-student basis. Then distribute trade-able rights to admit highly advantaged students; and allow schools to auction those rights. Schools would then be forced to figure out how much they valued the money they were spending relative to the highly advantaged children they wanted. We don’t know what the outcome would be. At one end of the spectrum you’d have schools with high concentrations of advantage and not much money; at the other end of the spectrum high concentrations of disadvantage and loads of money. It would probably take a few years for administrators to work out what the real costs of disadvantaged children were; but they would have a powerful incentive to work it out.

I'm just about speechless.

Chicago Living Wage

Cafe Hayek's Russell Roberts takes down a proposed law in Chicago. The Chicago city council has a proposal to force big box retailers (defined as more than a billion dollars in sales with stores greater than 90,000 square feet) to pay workers $10/hr plus $3 in benefits. Target and Wal-Mart have responded by suspending plans to open more stores and deciding whether to close additional stores. Mayor Daley would also like to know how the aldermen in Chicago are going to replace the 8000 lost jobs if Wal-Mart doesn't continue its expansion.

Of course, if this plays out where the "living wage" is enacted and Target and Wal-Mart leave, then we're left with the unseen effects of such a law. With no big boxes prices will gradually rise to levels seen in the non-big box retailer world. Of course, this effect will be slow and unseen, therefore no one will really complain about it. There will just be 20,000 less jobs in the greater Chicago area. But that's not what gets aldermen elected, raising people's wages with a law gets them elected. Unfortunately, this law not only won't raise anyone's wages it will end up lowering wages by having more people fighting for fewer jobs in the retail sector.

In addition, the unskilled teenagers who can't find work stocking shelves or whatever unskilled kids do at Target are not going to get any job experience. With fewer business unable to give a teenager a job because of wage standards that teenager never gets a chance to get a toehold in the labor force. How's he going to get started? What happens is the kid gets public assistance at the first opportunity, then becomes involved in the neverending circle of government dependency. This dependency is what draws him out to vote for an alderman who will raise the wages of the poor by imposing some minimum wage. The cycle starts again, relegating another generation of teenagers to government dependency.

Global Warming Skeptic

Coyote Blog once again makes a coherent and unvitriolic case against global warming alarmism. Of course, to question the conventional wisdom of future doom from global warming is to be the ultimate in wingnuttery. But until climatoligists can come up with a model that works for the past 50 years, I don't necessarily believe their model for the next 100.

City Busybodies

Mike Hendricks takes the city of Kansas City to task for outlawing selling gas to someone who hasn't already paid for it. It seems the city is tired of enforcing theft laws so they're putting the onus on business owners. Hendricks asks the next logical question.

Will bank lobbies be outlawed because that’s where bank robberies often occur?

Capitalism and Freedom

I'll let Kevin Drum's post on public vs. private education lead off my review of "Capitalism and Freedom" by Milton Friedman.

First, there's that 8th grade reading score, which is a whopping 5.7 points (about half a grade level) below that of private schools. That's a big difference.

Second, these scores confirm a widely-reported and disturbing trend: public schools seem to do OK at the elementary level, but student scores start to drop significantly in secondary school. In this study, the delta between public and private schools dropped 6.8 points in reading and 3.5 points in math between 4th and 8th grades. If the study had been extended to 11th grade, I suspect that decline would have continued.

I don't have any answers here except for a guess: namely that the pedagogy wars don't really matter much. Phonics vs. whole word? New math vs. old? Open classrooms vs. strict discipline? Without disparaging the people who work hard trying to figure this stuff out, it seems as if practically any of these approaches can succeed or fail depending on how well they're implemented.

But what does seem to show up over and over again is the effect of concentrated poverty. Nearly everything I've read suggests that when the number of kids in poverty reaches about 50% in a school, teaching becomes nearly impossible — and that this matters much more in secondary school than in elementary school.

(First off, Drum asserts that there really isn't much of a difference between public vs. private; the portion that I selected doesn't make that clear, but I was mostly interested in the paragraphs selected. Sorry, if I misrepresent the point of Kevin's post.) Friedman addresses the point of concentrated poverty on the public schools in "Capitalism and Freedom". His policy suggestion is vouchers which allow parents to choose their child's school based on factors they deem important rather than having the state decide based on geography. Friedman argues this would alleviate some of the problems of concentrating poverty in certain schools. Of course, another reason of poverty being concentrated geographically is the state's entry into building housing for those poverty, concentrating all of the impoverished into a small geographic area. Friedman's solution to this is to give the poor cash to use how they wish. The main part of this cash would come in the form of the negative income tax, which today is called the Earned Income Tax Credit.

Friedman's writing is truly inspiring (admittedly, I am predisposed to believing in what he is writing). Above, I chose 3 policies that I believe the government has failed it's citizens; housing, education and poverty. As Friedman argues, government control in and of itself is to blame. This control has really affected other aspects of the system, for instance Housing and Urban Development affecting the education system. Whereas, giving the power to the people would not have affect the schools as much as concentrating poverty in one location.

Friedman's argument is against the concentration of power instead, to borrow from George H.W. Bush, of the thousand points of light. This week is the FDA's 100th anniversary. Friedman also takes down the idea of giving licensing function to the government, specifically the FDA and licensing of doctors. In this OC Register editorial by Satya Thallam, you can find the Friedman influence.

The FDA requires that a manufacturer of a new drug must prove both safety and effectiveness (the latter mandate added in 1962). By increasing the time and cost necessary to bring a drug to market, fewer drugs are developed, and even approved drugs forgo years of beneficial use. Fortunately, things have been improving, with the FDA now on par with the speedier approval times of similar agencies in Europe.

Economist Sam Peltzman has shown that the number of new drugs approved declined precipitously after imposition 44 years ago of the effectiveness requirement. He also showed that the proportion of inefficacious drugs didn't change in wake of the added requirement, writing that the "penalties imposed by the marketplace on sellers of ineffective drugs … left little room for improvement by a regulatory agency." His conclusion has been confirmed by other researchers.

But even if the FDA does little in the way of ensuring effectiveness, we should sing its praises for keeping us safe, right?

Noble intentions aside, any reasonable concept of safety is at best relative. The safe use of a drug is dependant on innumerable particulars, unique to the individual. By attempting to create a safety standard for something as variable as physiology, the FDA imposes onto the marketplace a rule that is at once clumsy and constricting.

Manufactured insulin may be essential to some and deadly to others. Radiation therapy and the AIDS cocktail often entail debilitating side effects. What should be the rule for considering them safe or not?

While the regulation of dosage, side effect and precautionary information helps the FDA mitigate this one-size-fits-all problem, the agency's failure to account for variation is seen in significant off-label usage, the unregulated prescription of drugs for uses other than the ones they were approved for.

Consumers are protected by a dynamic mixture of expert consultation, individual experimentation, independent and industry certification and the tort system. The FDA should be mindful of this existing system, because no one lobbies for the patients who die, or delay treatment, while waiting for a promising therapy to be approved.

The FDA's mission is ubiquitous; it affects every aspect of our lives. And so the story goes, we have the sausage- (and law-) making process to thank.

The policy prescriptions Friedman espouses in "Capitalism and Freedom" will probably never be extremely popular, but generations will read this book and be inspired by it's expression of freedom. It is a wonderful book that is as relevant today as it was in 1962.

The Wikipedia page for the book describes the impact of "Capitalism and Freedom".

The effects of Capitalism and Freedom were great yet varied in the realm of political economics. Some of Friedman's suggestions are being tested and implemented in many places, such as the flat income tax in Slovakia, a floating exchange rate which has almost fully replaced the Bretton Woods system, and school vouchers for Hurricane Katrina evacuees, to cite a few prominent examples. However, many other ideas have scarcely been considered, such as the end of licensing, and the abolition of corporate income tax (in favor of an income tax on the stock holder). Though politicians often claim that they are working towards "free trade," an idea the book supports, no one has considered taking his suggestion of phasing out all tariffs in 10 years. Nevertheless, Friedman popularized many ideas previously unknown to most outside economics. This and other works helped Milton Freedman to become a household name. The Times Literary Supplement called it "one of the most influential books published since the war." However, many of the ideas described in this book remain radical (or, according to critics, reactionary) and controversial to this day.

To see Friedman explain his theories, Radley has a link to a '60's era taxpayer subsidized television interview.

School Choice

When we stop calling school choice and vouchers a satanic idea maybe we can have a real debate about it. Milton Friedman explains his revolutionary idea from 50 years ago in the linked article.

“The fundamental thing that’s wrong with our present setup of elementary and secondary schooling is that it’s a case in which the government is subsidizing a product,” he says. “If you subsidize the producers, as we do in schooling, they have every incentive to have a status quo, and a non-progressive system, because they are a monopoly.”

Friedman finds it unfair that a mother who sends her child to private school should also have to pay to educate children whose parents send them to public school — an injustice made more egregious in his view by the fact that the private school mom probably has more money and so has already paid more in taxes.

But he is just as ticked off by what he sees as the great unfairness to poor kids.

“It’s very clear that the people who suffer most in our present system are people in the slums — blacks, Hispanics, the poor, the underclass.”

When I ask him about the “achievement gap” separating low-scoring black and Latino students from better-scoring whites and Asians, he blames my “friends in the union.”

“They are running a system that maximizes the gap in performance. . . Tell me, where is the gap between the poor and rich wider than it is in schooling? A more sensible education system, one that is based on the market, would stave off the division of this country into haves and have-nots; it would make for a more egalitarian society because you’d have more equal opportunities for education.”

But how would overburdened minimum-wage workers be expected to find the time to research a slew of school options, I ask — hearing the patronizing tone of my question as it crosses my lips.

“Who’s in a better position?” Friedman asks.
...
“In the last 10 years, the amount spent per child on schooling has more than doubled after allowing for inflation. There’s been absolutely no improvement as far as I can see in the quality of education. . . .
The system you have is like a sponge. It will absorb the extra money. Because the incentives are wrong.

“Would you really rather have your automobile produced by a government agency? Do you really prefer the post office to FedEx? Why do people have this irrational attachment to a socialist system?”

Friedman says that Americans have benefited enormously from free market competition in virtually every other part of their lives. He thinks it’s a matter of time before consumers demand the same right to choose how their children’s minds will be nourished as they do in deciding what food to feed them.

Kitchen Confidential

Over the past several weeks I have been enjoying "Kitchen Confidential": Adventures in the Culinary Underbelly by Anthony Bourdain. Bourdain has a show on the Travel Channel where he goes to exotic locales and eats their local fare. Fox had a sitcom last season based on this book starring Bradley Cooper, or as I refer to him, Sack Lodge. I liked that show which was a behind the scenes look at a kitchen at a fine dining restaurant. Wow, what an introduction.

The book was eminently enjoyable. There were no punches pulled by Bourdain. He describes kitchens as unbridled cruelty and pain, what I like to refer to as scraped knuckles. There is no coddling in a kitchen; slice your hand open? Stick it in ice water, wrap it up, get back on the line. Burn your hand? Shut up and get back on the line. Get your feelings hurt? Leave.

Bourdain takes several enjoyable detours through his life story, such as items for your home kitchen, how to cook like a chef, and what not to do at a restaurant; such as don't get fish on a Sunday. Bourdain's life story is rough. His early line cooking days were done as a junkie as well as copious amounts of weed and coke. Nowadays, just 7 or 8 drinks while doing a shift in the kitchen.

Bourdain tells a great story and his love of cooking shines through his surprisingly good writing, being that he's a cooking school graduate and never went to college. I'm probably the only person to put this combination together but "Kitchen Confidential" reminded me of "The Things They Carried". The way Bourdain tells story is not unlike how O'Brien tells a story. Towards the end of "Kitchen Confidential" when Bourdain is telling of how a chef he greatly admires runs a kitchen is completely unlike how he himself runs a kitchen, writes that everything the reader has read in the book before is obviously wrong. That reminded me of O'Brien's chapter explaining that it didn't matter whether a war story actually happened because it could have happened. Bourdain's explanation just struck me as being similar.

"Kitchen Confidential" was a very enjoyable read. I will probably read Bourdain's new book, "The Nasty Bits" and another book called "Heat" which has interested me on the New Releases table at Barnes & Noble. Having never worked in a restaurant before, yet loving restaurants, I enjoy the look that Bourdain gives.

Worst People in America

The folks at Right Wing News (a funny title for a 'news' organization) compiled a survey of right of center bloggers, as to who are the worst people in America. They used the definition that Keith Olbermann is using for his upcoming book "The Worst Person in the World: And 119 More Strong Contenders"; "It's a euphemism for somebody who's wrong and egregiously stupid and abusing their own position."

Some interesting names on the list are Pat Robertson and Fred Phelps. So, I must conclude that Robertson and Phelps basically offend most people, not just one side of the political spectrum. The not so interesting names are Barbra Streisand, George Clooney and Natalie Maines. They're just lightweight celebrities without the power to make drastic change and, I believe, when they speak, most people take what they say with a grain of salt. Of course, the usual suspects, Hillary and Bill, Al Gore, Barbara Boxer, Howard Dean and Harry Reid are strongly represented, no real surprise there.

The people on the list that I would include are Noam Chomsky, Paul Krugman, Michael Moore, Jesse Jackson, Ted Kennedy, Cynthia McKinney, Nancy Pelosi, Jimmy Carter, Phelps and Robertson. Chuck Schumer made Honorable Mention on their list, but, he would definitely have a spot on mine. I would also throw in Dick Durbin, Ann Coulter, Michelle Malkin, Mike Nifong, Morgan Spurlock, Don Fehr, Dusty Baker, the investigator who raided Jason Grimsley's house and Dennis Hastert. Coming up with 20 is kind of hard so Baker has to be included. I don't like to pick on people because they have opinions and express them, right or wrong. The people on my list, I believe, have opinions, but express things they don't believe to further their own careers in a niche that they've carved out for themselves. Offer suggestions in comments if there's anybody I missed who should be on this list.

Bias

I've been enjoying for the past couple of days the 'discussion' between Jane Galt at Asymmetrical Information and Henry Farrell at Crooked Timber about alleged bias in an Economist story. Without giving away my feelings on the issue at hand, organized labor and immigration, I enjoyed Ms. Galt's eloquent refutation of the perceived bias in the Economist article.

it's the natural human tendency to find things more believable when they agree with what you already believe. Mr Farrell, I'd suggest, simply doesn't notice it in other papers because, well, they agree with him more, and hence he finds them more believable. The Economist is no less methodologically rigorous than any other paper anyone I know has written for; indeed, it is rather more rigorous than most about things like fact-checking. The difference is that The Economist states its opinions, rather than maintaining a facade of neutrality while slanting the article so that the readers come to the same conclusion that the reporter did. This, of course, is more irritating if you happen to disagree with the analysis, but it is not measurably more "objective".

I have the same view. Fox News is nearly universally hated in the liberal blogosphere for being 'right-wing hacks', but what if they only feel that way because watching Fox News makes liberals question the story because they viscerally disagree with how the story is presented, balanced. I'm not saying that Fox News is balanced, but I definitely think it's more balanced than CBS News or CNN. Liberals just can't see the bias in CBS because they believe the stories presented.

Shelf Blogging

For Father's Day, I was tasked with hanging some shelves. I'm very pleased with how they turned out. I measured, used the level, employed some power tools and now I have 3 very sturdy shelves which I can use to hold picture frames so the desk is a little less cluttered.

Inspiration for shelf blogging comes from Radley. I'm sure he'd be as proud of this as being cited in Breyer's dissent from Hudson.

North Korea Photos

Every time I see photos of North Korea, I'm always amazed at the empty roads. More depressing pictures can be found here.

Bare Breast Being Broadcast Briefly

If you're going to fine someone $325,000 per incident of indecency, you should probably define indecency.

The bill does not apply to cable or satellite broadcasts, and does not try to define what is indecent. The FCC says indecent material is that which contains sexual or excretory material that does not rise to the level of obscenity.

Basically this bill will ensure that what we see on network TV will be increasingly more vanilla and cable networks such as FX, Comedy Central, Bravo and TNT will be the go-to places for real comedy and drama. Next will come an FCC power grab to regulate the cable networks, because they're showing T&A all evening long.

After I saw Janet Jackson's breast on the Superbowl, I knew this would happen. I can't believe (actually I can) that people are so offended about a bare breast being broadcast briefly. Maybe I could understand a little more if it was Bea Arthur's breast instead of Janet Jackson's.

Breast-Feed or Else

The New York Times yesterday ran a story explaining Tom Harkin's bill to put warning labels on cans of formula expressing the supposed virtues of breast feeding. Of course, I find this whole business utterly annoying. For the mothers of multiples, breast feeding, while not impossible, is certainly much more difficult and pretty unhealthy for the mother. In addition, several women don't produce enough milk to adequately feed their children. In any case, it's ridiculous to put a warning label extolling the supposed virtues of breast feeding on formula. Clark has more outrage at this proposed bill.

Library Lurking

I can't believe reporter Carl Monday could look himself in the mirror after reporting this story. The incident happened 2 years ago and Monday just baits the poor kid who has no idea what this interview is about. Very poor journalistic ethics, but, sadly, that's the case with most of these types of investigative reporters.

1776

During my vacation I read"1776" by David McCullough. I've always been more of a Revolutionary period buff than WWII or Civil War and greatly looked forward to this book. Fortunately for me, McCullough delivered a wonderful book. I'm not much of a war book reader, more of a fan of Constitutional Convention history, but the beginnings of the Revolutionary War are pretty interesting when written well.

The interesting things I learned were George Washington's relative ineptitude in early 1776 and while not a surprise, the ragtagitude of the Rebel army. It is shocking that the Rebels were able to overcome the beginning of the war and defeat the vastly superior British army and navy. The other interesting thing was the contempt the British army felt for the rebels. McCullough points out that the Americans had a higher standard of living in 1776 than any other people in the world at the time. The British could not understand why these relatively wealthy people would revolt against the king and held them in very low regard because of their rebellion.

The revolution could have very easily gone the other way, but for the, in retrospect, utter ridiculousness of the British generals deciding to sit out the winter and allowing the rebel army to take the offensive and do a surprise attack that turned the tides of the war. In late December of 1776, Washington was able to muster a master strike against the sitting British army that put them completely on the defensive. This battle forced the British to employ a new southern strategy that wasn't focused on in the book but extended the war for several years.

"1776" didn't really focus on any of the ideas of the founders that eventually found their way into the Declaration of Independence, instead focusing on tactics of the war. Nevertheless, it was an interesting and quick read, that was very fitting to read over Memorial Day weekend. Reading about how much our first soldiers suffered over the first winter campaign in American military history really puts in perspective how lucky we are to live in the greatest country in the history of the world and just how trivial many of the matters we fight about are in the grand scheme of things.

Vacation

Sorry to my regular readers, I've been on vacation for the last week and neglected putting up any posts while away. I'm back now refreshed and ready for regular posting.

School Closings

Some are worried about No Child Left Behind school closings. With the closings, they believe, students will struggle trying to find new schools and class sizes will increase. However, that's not the case, charter and private schools can pick up the slack, espescially with vouchers for children who have been cheated in a failing school.

A problem many charter schools have, though, is finding space to hold classes. The school from "Our School" had that problem. Well, public school closings help fill that need as well.

"If we could get the building this year, it would be awesome," said Murdock, whose plan is to open the Nia Community Public Charter School in a Baptist church annex that she expects to outgrow in three years. "I would hate to see [the school system] close down facilities and let them sit vacant when charter schools could use them."

For charter school officials, who are marking the 10th anniversary of the launch of their movement with festivities this weekend, the downsizing of the regular school system is a golden opportunity to relieve a longstanding space crunch. The District's pricey real estate market has forced many of the independently run schools to hold classes in less-than-ideal places -- community centers, church basements, warehouses, even spaces above or beneath convenience stores.

Now they are eyeing the six schools that Superintendent Clifford B. Janey wants to close, as well as space in nine other school system facilities that would be available for leasing under his plan. The school board plans a final vote June 28 on the proposal, which would eliminate 1 million square feet of space. The board has promised to shed another 2 million square feet by August 2008.

"This is the best opportunity we've had to solve the facilities problem," said Robert Cane, executive director of the advocacy organization Friends of Choice in Urban Schools (FOCUS), which is sponsoring a gathering in Anacostia Park and open houses at most city charter schools tomorrow to celebrate the anniversary of the law allowing such schools to be established in the District.

There are currently 51 D.C. charter schools, with more than 17,400 students, while the school system's enrollment has dropped from 80,000 to 58,000 over the last decade. Members of the D.C. Council and Congress have pressed the school board to lease the unneeded space to charter schools, which are spending $16 million a year on leases in the commercial real estate market.

Charter school officials have long complained about difficulties they've faced in getting hold of former public school buildings, and the closings plan could increase those tensions. A dispute already has broken out over whether federal law gives charter schools a right of first refusal on the buildings to be vacated this summer.

Political Posturing

Radley's Fox column this week is about political posturing in the face of high gas prices. Politicians, typically, are pretty free market until the laws of supply and demand produce results that make their constituents jumpy. The best thing to do, of course, is let the market play out, alternative energy sources will become profitable and energy prices will go down.

The really perverse thing about all of this is that at the same time they're carrying on about high gas prices, the same politicians are talking about the importance of alternative energy and our "oil dependence." But alternative energy sources will emerge the day they become more efficient and profitable than gasoline.

So long as gas is cheap, gas will continue to be our preferred source of energy. Once gas grows scarce, and consequently more expensive, other fuel sources will become lucrative -- at which point someone will develop them, sell them, and get rich from them.

But politicians can't just sit back and let the market take its course. They need to control things. So even as they're bending over backward to keep gas artificially inexpensive (staving off market incentives to develop alternative fuels), they're giving billions of taxpayer dollars to research and development boondoggles (read: corporate welfare) to find replacements for gas. It's waste stacked on waste stacked on waste.

Brewing Up a Business

I read Brewing Up a Business: Adventures in Enrepreneurship From the Founder of Dogfish Head Craft Brewery by Sam Calagione. If you live in the midwest it's doubtful you've ever heard of Dogfish Head, actually if you live on the east coast you're probably just as likely to have never heard of Dogfish Head brewery. Sam Calagione founded Dogfish Head because of his love of craft brewing and experimenting with different beer styles. Calagione likes to use nontraditional ingredients and infuse them into traditional beer styles making them his own. His brews are the premium of the premium, costing, in many cases $10/6-pack. Beers such as Immort Ale and Raison D'Etre are not really accessible to Joe Six-Pack swilling Budweiser sixers, but to beer geeks these are great flavors and interesting brews.

Anyway, Calagione tells of his experiences, failures and successes in opening his microbrewery and brewpub. It's an interesting story, expecially for someone who enjoys entrepreneurial stories, small business and most of all beer. It's like the perfect storm of stories for me. Dogfish Head Brewery would fit perfectly in the "Small Giants" book. Calagione is seeking to make the most creative brew, not necessarily the beer for the average beer drinker. Dogfish Head beer is for the beer geek and is pushing the bar for breweries nationwide.

Calagione tells a compelling and entertaining story. His management and leadership insights are fun and well reasoned, citing real situation examples that really cement ideas in your head better than many management books. "Brewing Up a Business" is a real accessible management book, much more accessible than their beer, which I've never tried. Sam if you read this send me a sixer, I'd love to try it. If you really want I'd like to have it on tap at the house. At the very least, I'll look for it on my next trip east.

Willis Shocker

Bruce Willis apparently digs the Shockers.

In answer to Clark's question, I'll bet he's a fan of Blueberry Tofu.

Sutcliffe Drunk

Great audio of a drunk Rick Sutcliffe (one of my favorite ex-Cubs) joining the Padres broadcast booth for an inning. Apparently Sut had hoisted a few with buddy Bill Murray before and during the game.

Liberal Litmus Test

Jane Galt joins Dan Drezner in taking Atrios' liberal litmus test. When I first read this list (paraphrased here by Kevin Drum), I was opposed to most of the items immediately but was most blown away by the triviality of most of the items, they were basically feel good items for liberals with no real effects. So here goes my feelings on the items:

Undo the bankruptcy bill - No, it does help creditors and I don't see it as a huge impediment to those who really need to file for bankruptcy.
Repeal the estate tax repeal - No, basically inconsequential and I can't think of a reason why the government would feel entitled to this money, it's already been taxed once.
Increase the minimum wage and index it to the CPI - No, doesn't have the intended effects and will worsen recessions
Universal health care - Never in a million years
Increase CAFE standards - Market will increase MPG in autos
Pro-reproductive rights, getting rid of abstinence-only education, improving education about and access to contraception including the morning after pill, and supporting choice. On the last one there's probably some disagreement around the edges (parental notification, for example), but otherwise. - Kind of a broad topic, but, I wouldn't limit access to contraception, wouldn't want the government involved in sexual education in any case, and can support 'pro-reproductive rights', so NO.
Simplify and increase the progressivity of the tax code - Simplify yes, but progressivity would not be a deciding factor, flat tax is the way to go.
Kill faith-based funding. Certainly kill federal funding of anything that engages in religious discrimination. - I'd be all for getting rid of a lot of funding, so yes.
Reduce corporate giveaways. - Pretty generic, but, any subsidies and tariffs should be looked at and probably eliminated so Yes.
Have Medicare run the Medicare drug plan - Get rid of Medicare and the Medicare drug plan, No.
Force companies to stop underfunding their pensions. Change corporate bankruptcy law to put workers and retirees at the head of the line with respect to their pensions. - Worst idea ever!
Leave the states alone on issues like medical marijuana. Generally move towards "more decriminalization" of drugs, though the details complicated there too. - Yes, legalize, tax and regulate.
Paper ballots - Inconsequential, Luddite and No
Improve access to daycare and other pro-family policies. Obviously details matter. - No, no government intervention needed.
Raise the cap on wages covered by FICA taxes. - Only if that money is used to fund a private account system, otherwise no.
Marriage rights for all, which includes "gay marriage" and quicker transition to citizenship for the foreign spouses of citizens. - I'll go with a yes, but overall pretty inconsequential.

So I have 11 No's on 16 questions. I am decidedly not a liberal in Atrios' eyes. However, I received a questionnaire from Chairman Ken Mehlman of the Republican Party. I disagreed with much of the questions on that questionnaire, so I'm probably not a Republican (at least in good standing). I sure do wish there was a viable 3rd party.

The Postaffluent Society

I think George Will took a wrong tack last week when he wrote about John Kenneth Galbraith's ideas and writings.

Galbraith brought to the anti-conformity chorus a special verve in depicting Americans as pathetic, passive lumps, as manipulable as clay. Americans were what modern liberalism relishes -- victims , to be treated as wards of a government run by liberals. It never seemed to occur to Galbraith and like-minded liberals that ordinary Americans might resent that depiction and might express their resentment with their votes.

Advertising, Galbraith argued, was a leading cause of America's "private affluence and public squalor." By that he meant Americans' consumerism, which produced their deplorable reluctance to surrender more of their income to taxation, trusting government to spend it wisely.

If advertising were as potent as Galbraith thought, the advent of television -- a large dose of advertising, delivered to every living room -- should have caused a sharp increase in consumption relative to savings. No such increase coincided with the arrival of television, but Galbraith, reluctant to allow empiricism to slow the flow of theory, was never a martyr to Moynihan's axiom that everyone is entitled to his own opinion but not to his own facts.

A better strategy would be to just quote Galbraith and let the reader come to their own conclusion that those ideas are bankrupt, as Robert Samuelson did today.

"Automobiles have an importance greater than the roads on which they are driven," he wrote scornfully. "Alcohol, comic books and mouthwash all bask under the superior reputation of the [private] market. Schools, judges and municipal swimming pools lie under the evil reputation of bad kings [government]." The book argued for more government spending and less private spending.

The World Is Flat

Over the weekend I finished reading "The World Is Flat" by the mustache of understanding, Thomas Friedman. All jokes aside about how Friedman doesn't really understand metaphors and the fact that he's an egomaniacal starf***er, I typically enjoy Friedman's writing. I think he gets a lot of criticism because he doesn't fit neatly into the liberal/conservative worldview of the United States. Instead he has his own ideas (which I don't agree often) but he's able to present them and his support for them without denigrating others' ideas, which is increasingly rare.

In "The World is Flat", Friedman explores the triple convergence of events that has, in his words, flattened the world. The factors of production can be almost anywhere and work on almost anything. The increased use of the internet, workflow tools and standardized software packages has flattened the world because of increased collaboration between citizens of different countries. Of course, this is a giant "well, duh" but Friedman explores the causes and the effects of these changes that have occurred since he wrote "The Lexus and the Olive Tree", another good book.

I did like "The World is Flat", Friedman consolidated some thoughts I had had. But, while reading, the thing that struck me the most was the hopefulness of Friedman. There was a palpable sense of optimism in the book and that made even more enjoyable for me. Friedman explored a favorite topic of mine, how easy it is for the world's poor to plug into the global marketplace. All it takes, in many parts of the world, is an internet connection and an ebay account and you can have your own marketplace. The problem lies in government regulations and red tape that hinder an individual's ability to start their business.

I think Friedman did an excellent job at presenting the world as he sees it. And, in turn, it was fun to read. I don't think there were too many great insights from Friedman, but he did get me thinking about several ideas. If a book can get me to think, I will typically enjoy it, "The World is Flat" got me thinking and I did enjoy it.

Costa Rican Flat Tax

The Costa Rican President-elect, Oscar Arias, is poised to introduce a flat tax on corporate and individual earnings. Taking a cue from the successful Eastern European countries, Arias hopes it will increase Costa Rica's competitiveness. Mary Ansastasia O'Grady had a nice editorial in yesterday's WSJ about Arias' plans.

Yet the flat tax has already proved an effective way to fight poverty in a host of developing countries. (See nearby table.) For individuals, tax evasion goes down and tax collection goes up because of better compliance. Low corporate rates attract capital, spurring economic growth and job creation. That means there is more money in government coffers to help the needy. Without a laundry list of tax exemptions and loopholes, corruption is thwarted.

Emphasis mine, this thought of reducing corruption brings to mind John McCain saying recently he would rather have a clean government than free speech, he could adopt a flat tax proposal and significantly reduce tax complexity, thereby reducing corruption. Instead he seems focused on reducing free speech.

Another benefit of a flat tax and a good way to sell it would be as an offset of runaway gas prices. From Cafe Hayek:

The average price of unleaded 87-octane gasoline in 2004 was $1.88 per gallon. Today it's about $2.93 -- so, $1.05 per gallon more today than in 2004. Thus, at $2.93 per gallon, we Americans are spending $68.3 billon more per year for gasoline than we spent in 2004. (I'm crudely assuming that this higher price of gasoline doesn't cause the quantity demanded of gasoline to fall. Of course, to the extent that this higher price does cause quantity demanded to fall, the extra amount of money we spend on gasoline per year will be lower than $68.3 billion.)

Let's put this figure in perspective: According to this just-released paper from the Cato Institute, Chris Edwards reports that the annual cost in 1995 of complying with federal-income-tax requirements was $112 billion. In 2005, this compliance cost was up to $265 billion -- $153 billion more in 2005 than in 1995. Adjusted for inflation, this compliance-cost increase is $122 billion (in 2005 dollars).

Note that in 2005 our cost of complying with federal-income-tax regulations was $53.7 billion more, in real 2005 dollars, than the extra amount we're now spending compared to 2004, on an annual basis, for gasoline.

And Congress has the gall to pontificate about the alleged unacceptability of the higher prices now charged by oil companies.

To me, it's clear that a simplified tax code with a flat rate would benefit nearly everyone, clean up some corruption and make the United States even more competitive.

Back to Costa Rica:

The traditional Latin American method of curing the condition known as scarce resources is to raise taxes. But one reason the budget is already strained is that Costa Rica's steeply progressive income tax rates for individuals have provoked skyrocketing evasion. Government estimates say 70% of taxes owed are not paid.

On the corporate side, the current rate of 30% already discourages investment. And Costa Rica's special tax-free zones for exporters need to be phased out by 2009 if the country is to remain compliant with World Trade Organization rules. Thus there are strong incentives to create a new flat tax for both individuals, to boost compliance, and for corporations, to regain competitiveness.

Introducing a flat tax is analogous to hanging out a sign that says: Open for business. Just ask Slovakia, which in 2004 adopted a flat tax for corporations and individuals of 19%. Since then it has been drawing in large amounts of capital from Western Europe and its economy is growing rapidly. After Russia implemented a 13% flat rate for individuals, evasion went down and revenues rose sharply.

Mr. Arias already understands the connection between lower corporate taxes, investment and rising living standards. He has mentioned Ireland, with its 12.5% corporate rate, as a model for Costa Rica. The Costa Rican daily La Nación reported last month that he was considering special corporate tax zones with rates below 10%. Referring to a 15% rate under discussion in Congress, La Nación reported that "Dr. Arias asserted that one cannot fool himself thinking that anyone can compete at that high tax."

That's a promising start for the debate but to be competitive Costa Rica will have to avoid a policy of limiting low flat rates to special economic zones since other flat-tax countries don't attach strings. Moreover, as Chris Edwards of the Cato Institute points out, "Carving out special tax rates and incentives for particular industries and regions is not only inefficient, it is an open invitation for corruption."

There is growing support for a flat tax from some of Costa Rica's opinion makers. An April 10 editorial in La Nación supported the idea and an important former central bank president has come out in favor of it. If Costa Rica introduces a flat tax now, it could get a jump on its Cafta neighbors in attracting investment. With its highly literate population, a flat-tax Costa Rica could easily become a prime destination for multinational investment.

A recent KPMG survey reported that the average corporate rate for the Latin American region is over 28%. That means that any Latin country that adopts a simple, low rate for the entire nation will instantaneously grant itself a vast comparative advantage. Over to you, Mr. Arias.

At this point in Latin America, any country that is pro-business is welcome. Incorporating a flat tax with competitive rates really sends the message, as O'Grady puts it, that you're open for business.

Optical Inch

Hilarious ad campaign about a sensitive male issue.

Click all the links, the music video is priceless.

The longer you wait the longer your pubes get.

Denkinger

Last night, while watching the Sox-Yankee game I realized that the ESPN show "Top 5 Reasons You Can't Blame.." was on and it was about Deckinger's blown call in the '85 World Series. It's clear that Orta was out at first, but that play had very little real effect in the game or should have. The Cardinals virtually self destructed after that call. I maintain that champions can overcome the adversity that comes from a bad call. The fact that the Cardinals didn't even compete after the call is evidence of the fact that the Cardinals did not deserve to win that series.

Anyway, the show was fabulous (I've seen it several times and enjoy it every time) and really brings back to my memory those great days of that World Series. And it's always good to remember that the Royals not only won that championship, but they completely demoralized the Cardinals. Also, I learned from the show of the Keith Hernandez curse. How great is that!

Bolivian Nationalization

I've been thinking about Bolivia's seizure of the country's natural gas industry since I wrote about it yesterday. I didn't really give it any attention in that post because my natural reaction to nationalizing a previously private enterprise is entirely negative.

Since a country taking over a private company's assets is seen in the business world as completely negative and would affect investment in capital assets by private enterprise because without property rights that investment is basically at risk of becoming an expense. However, Ricardo's theory of comparative advantage dictates that a country should focus it's power on those industries it does best, would effectively turning off the spigot for foreign direct investment in your country and running an economy based on natural gas extraction be an advantage for Bolivia?

53% of FDI projects are extraction projects. If the state takes over those projects and lose all the rest (they haven't had any significant FDI projects in 2 years), and they trade natural gas for other products to sustain their economy, aren't they taking full advantage of their comparative advantage?

I would think my initial reaction that state control of the industry would not be beneficial for Bolivia, but I'm interested in if it could get Bolivia to (I don't know what the opposite of autarky is) complete specialization and if that would outweigh the state control (assuming, of course, a stable government).

Shocker Escort

How important are Shockers to baseball? The Red Sox traded for Doug Mirabelli yesterday morning. They then chartered a jet and arranged for a police escort to get Dougie to the game on time. Not too many times has a player received a police escort to a game in May. It must be because he's a Wichita State alum.

Curse of Natural Resources

Unfortunately Bolivia is going to experience the curse.

How to Make Something Worse

Add Rosie!

Supply and Demand for Dummies

The one-armed man (Krauthammer reminds me of the one-armed man from "The Fugitive") points to the reason gas prices are high; Supply and Demand. I'll say it again, let the pricing mechanism work.

Demand is up. China has come from nowhere to pass Japan as the number No. 2 oil consumer in the world. China and India -- between them home to eight times the U.S. population -- are industrializing and gobbling huge amounts of energy.

American demand is up because we've lived in a fool's paradise since the mid-1980s. Until then, beginning with the oil shocks in 1973, Americans had changed appliances and cars and habits and achieved astonishing energy conservation. Energy use per dollar of gross domestic product was cut by 30 percent in little over a decade. Oil prices collapsed to about $10 a barrel.

Then amnesia set in, mile-per-gallon ratings disappeared from TV ads and we became "a country of a million Walter Mittys driving 75 mph in their gas-guzzling Bushwhack-Safari sport-utility roadsters with a moose head on the hood, a country whose crude oil production has dropped 32 percent in the last 25 years but which will not drill for oil in the Arctic National Wildlife Refuge for fear of disturbing the mating habits of caribou."

I wrote that during the '96 witch hunt for price gougers. Nothing has changed. Except that since then, U.S. crude oil production has dropped an additional 12.3 percent. Which brings us to:

· Supply is down. Start with supply disruptions in Nigeria, decreased production in Iraq, and the continuing loss of 5 percent of our national refining capacity because of damage from hurricanes Katrina and Rita. Add to that the mischief of idiotic new regulations. Last year's energy bill mandates arbitrary increases in blended ethanol use that so exceed current ethanol production that it is causing gasoline shortages and therefore huge price spikes.

Why don't we import the missing ethanol? Brazil makes a ton of it, and very cheaply. Answer: the Iowa caucuses. Iowa grows corn and chooses presidents. So we have a ridiculously high 54-cent ethanol tariff and ethanol shortages.

Another regulation requires specific ("boutique") gasoline blends for different cities depending on their air quality. Nice idea. But it introduces debilitating rigidities into the gasoline supply system. If Los Angeles runs short, you cannot just move supply in from Denver. You get shortages and more price spikes.

And don't get me started on the missing supply of might-have-been American crude. Arctic and outer continental shelf oil that the politicians kill year after year would have provided us by now with a critical and totally secure supply cushion in times of tight markets.

The non-starter of reducing the ethanol tariff is probably the best thing Congress and the President can do to reduce gas prices. Of course, it will never happen, because there's important elections to be won in ethanol producing states. I don't hear any politicians calling for a halt to this tariff.

Making Beer Ever Lighter

The WSJ today has a good cover story today about Anheuser Busch's strategy of making Budweiser pleasing to every palate across America. How can they do that? By making it as bland as possible. However, with regional brewers like Sam Adams, Boulevard and Anchor and niche brewers like Dogfish Head, Abita and New Belgium as well as Miller Lite eating up Bud's market share and selling more flavorful beer, AB's strategy is no longer working.

For decades, Anheuser's aim was to develop a beer that would sell across America, one inoffensive enough to appeal to the nation's varied palate.

Now, that goal is out of step with a shift in consumers' tastes. From coffee to fashion to media, niche products are rising, especially ones that consumers can customize, and the great mass brands of the postwar period are under attack. Imported brews and smaller so-called "craft" beers with stronger flavors are more readily available and are selling fast, as are wines and spirits.

Moreover, for all its devotion to consistency, Anheuser concedes Budweiser has changed over the years. It quietly tinkered with its formula to make the beer less bitter and pungent, say several former brewmasters, a byproduct of the company's desire to create a beer for the Everyman.

The question of taste has created opportunities for Anheuser's rivals and has resulted in some ferocious marketing battles. Anheuser, an industry bellwether, used to shrug off such challenges. Now, among myriad other factors, it's begun to take a toll on Anheuser's financial performance and has led beer makers to a moment of self-reflection.

Anheuser's flagship brand, Budweiser, has been losing market share for more than 15 years. Two years ago, Anheuser as a whole lost market share as its Bud Light for the first time didn't pick up the slack. In 2005, after years of confidently raising prices, the brewer decided to discount cases of beer to retain customers. The brewer's profits last year slipped 18% and its stock fell 14%.

Anheuser says the earnings decline is unrelated to the taste of its beer. It also notes that Bud Light is on average more expensive than Miller Lite, which Anheuser says is a sign of the brand's continued strength. The company, however, has also acknowledged that the discounts were designed to combat SABMiller PLC's Miller Brewing Co., which has relentlessly poked fun at Bud Light's flavor in national TV ads. In part because of the discounts, Anheuser's shipments picked up late last year. The company is expected to report first-quarter earnings today.
...
In search of new drinkers, Anheuser last year threw more than 30 new products into the market. And, in a little-noticed move Anheuser is loath to discuss, the brewer recently added more hops to its beer to make it stronger.

After World War II, marketers strived to create products that would appeal to palates across the U.S. They succeeded, and partly with the help of the interstate highway system, built an unrivaled mass-market food industry. As refrigeration became widespread, it swiftly delivered products to every corner of the country at a reasonable price.

A diverse nation learned to like the same things. As regional varieties gave way to national brands, companies embraced soft-edged, broadly appealing formulas, which gradually lightened products from cigarettes to bread. It was a winning strategy that created success stories such as ranch dressing, Maxwell House coffee and Kraft cheese. A similar strategy in Hollywood produced the mass-market situation comedy and the Hollywood blockbuster. Market research fed the trend with its relentless tendency to find the common denominator.

For a long time, consumers were satisfied. Daniel Ennis, director of the Institute for Perception in Richmond, Va., a group that analyzes consumers' flavor preferences, says every person has an "ideal" taste for a beer or potato chip or cookie. But in the real world, companies create foods consumed by millions. "People live in suboptimal situations," says Mr. Ennis, who has consulted for Miller. "They don't send their kids to the best schools, they don't have the best jobs, they don't eat the best foods."

Or drink the strongest beer. From 1950 to 2004, the amount of malt used to brew a barrel of beer in the U.S. declined by nearly 27%, and the amount of hops in a barrel of beer declined by more than half, according to Brewers Almanac. Part of that decrease is due to improvements in how brewers extract flavor from hops. Nonetheless, beer's taste became steadily lighter. (Flowers of the common hop plant, Humulus lupulus, are used as a flavoring and stability agent in beer, helping create its characteristic bitter taste and aroma.)

The beer industry measures bitterness using a scale called International Bitterness Units. The higher number of IBU's, the greater the bitterness. Over the past twenty years the IBU's of most American-style lagers has dramatically declined, from roughly 15-20 IBU's to fewer than 10 today, according to the Siebel Institute, a Chicago laboratory and brewing school that tests beer.
...
The gradual move toward lighter tastes accelerated in the mid-1970s when Miller introduced Miller Lite. Anheuser followed with Bud Light several years later. Consumer tastes, influenced by the 1980's fitness and diet craze, gravitated toward products that promised fewer calories. Brewers followed and started tweaking the flavor of their full-calorie lagers as well, according to beer executives and industry analysts.

Bud's ever-increasing lightness worked for years. But lately, consumers have started cooling on mass brands in favor of smaller, often unknown rivals. The proliferation of new media gave consumers more information about niche products. Their tastes grew more sophisticated and aspirational, spurred by an increase in overseas travel.
...
"I think you're seeing an increased consumer acceptance that bitter is a positive characteristic in beer," says Keith Lemke, vice president of the Siebel Institute.

Last year, craft beer shipments by volume grew 9% to 7.1 million barrels, according to the Brewers Association, the craft beer industry group. Beer drinkers reached for tiny brands such as Fat Squirrel Nut Brown Ale, Obsidian Stout and Dogfish Head Chicory Stout. Likewise, imported beer volume grew 7.1% to 25.6 million barrels, according to information compiled by the Beer Institute, the industry group for the big brewers.

At the same time, domestic beer volume dropped 1.2% to 178.8 million barrels. While the sales of regular American beer still dwarf those of the upstarts, the momentum is not running in its favor.

Those who know me, know that I don't drink AB products. Miller Lite is my preferred brand while golfing and Boulevard and Goose Island products make up most of my other beer drinking. A beer with an IBU of 10-20 is just not flavorful enough for me to waste my time with. I prefer a really hoppy beer, one of my favorites is called Hazed and Infused. I've felt for a long time that Anheuser Busch has ruined Americans' taste for real beer. It's nice to see an article like this that points out AB's strategy and that more flavorful beers are catching up. Mostly, though, I was just interested in a WSJ front page article about beer.

Immigration Enforcement

I think Kevin Drum may be for greater enforcement of illegal immigration simply because George Bush doesn't enforce it, but I'm pretty sure he can't actually believe this.

But — there's an alternative. Don't worry so much about the workers themselves, and instead crack down on employers. If the total cost of employing illegals — i.e., actual cash wages plus fines and possible criminal charges — goes up, employers will simply decide it's cheaper and more convenient to increase the cash part of that wage equation and hire American citizens instead. And if jobs for illegal immigrants dry up, illegal immigration will dry up too.

And the best part is that it's free! Make the fines big enough and the enforcement consistent enough, and the fines pay most of the cost of the enforcement. Couple it with more generous quotas for legal immigration, and the whole "illegal" part of the immigration problem could dry up almost entirely within a few years. It's as close to a free lunch as you can get.

A free lunch does not exist when you're basically putting law enforcement on a commission. It leads to massive police corruption every time. For instance, if you're living in a community where the drug warriors get to keep your car if they find drugs in your car, the drug warriors are going to make sure they find drugs in every car. Who doesn't want a bigger budget? Red light cameras work the same way, they don't want to make the streets safer they want the revenue from the tickets. If they don't get enough revenue they quicken the yellow light so more people will run the red.

Never mind that we should remove all barriers to entry for immigrants, just document them in some way so they can pay into Social Security and the IRS and not be third class citizens with no police protection. But, the very idea that Drum would want to pay Immigration Control based on the amount of fines they can collect is the epitome of a police state. A police state is certainly not a free lunch.

Oil and Gas Windfall Profits Tax

In an effort for lawmakers to get reelected Bush and the Republican congress seem to be kowtowing to Democratic demagoguery by looking at an oil windfall profits tax and looking into charges of price gouging. Once again, the economic ignorance on display by politicians is astounding. These measures will cause shortages and lines for gas. The real problem is we don't have the refining capacity to keep up with demand and the oil companies have to charge more because of the scarcity of refined gas. Without the pricing signals of the market, we will all be a party to waiting in line for gas.

As the WSJ editorial board points out today, politicians could go a long way to alleviating some of the problem.

Beyond the ethanol fiasco, the oil markets are once again providing a tutorial in supply and demand in a global commodity market. Strong economic growth from the U.S. to China is driving up demand, even as political uncertainty in oil-producing countries such as Venezuela and Iran is leading to supply worries and some speculation. The Federal Reserve has also played a role by flooding the market with dollar liquidity that has produced higher prices across all commodity markets.

Congress could help a little in the short term if it asked the Bush Administration to end the 54-cent-a-gallon tariff on imported ethanol. That would especially help drivers in coastal states suffering from spot shortages. Naturally, however, the domestic ethanol industry is threatening retribution against any Member who suggests such a thing; so much for industry gratitude.

The GOP might also refocus its attention on legislation the House passed last year to reduce the number of "boutique fuels" to six from 17. These special gasoline blends are required in different parts of the country in the name of reducing pollution. Their primary effect, however, is to raise gas prices and make it difficult to move gas around the country during shortfalls. The Environmental Protection Agency could also ease environmental rules for those parts of the country suffering shortages.

Meanwhile, we're also hearing more about the country's reliance on "foreign oil." But if Congress wants to ease that dependence, it will have to open more of the U.S. up to oil and gas exploration. Had the Senate opened up the Arctic National Wildlife Refuge to exploration when the Bush Administration requested it in 2001, some of this oil might now be joining American supplies. The same goes for natural gas drilling along the Outer Continental Shelf. Yet the very Democrats who deplore foreign supplies and shout about high prices vote again and again to block domestic oil exploration.

The last time the U.S. had a gasoline panic, in the wake of Katrina, some quick Bush Administration action and private ingenuity eased the problem in record time. Gasoline prices that had climbed above $3 a gallon quickly settled back closer to $2. Markets will make the same adjustments today if they are allowed to send price signals without Congress getting in the way. Republicans can blame business all they want for high prices, but sounding like liberal Democrats won't save them in November.

Let the markets react. With the increase in gas prices, more people will switch to more fuel economy cars, oil companies will invest in more exploration like in the oil sands of Canada, meaning more oil will be supplied while less is demanded. Longer term solutions or alternative energies will emerge if oil prices keep rising. But, lawmakers discouraging profits in energy production will only hamper efforts.

Another elephant in the room is the increasing wackiness of Venezuelan President Chavez.

Venezuela's Congress, made up entirely of Mr. Chávez's allies, is considering sharply raising taxes and royalties on foreign companies' operations in the Orinoco River basin, the country's richest oil deposit. Major oil companies like Exxon Mobil Corp. and ConocoPhillips of the U.S. and Total SA of France have invested billions of dollars there to turn the basin's characteristically tar-like oil into some 600,000 barrels a day of lighter, synthetic crude.

Mr. Chávez, a left-wing populist who favors greater state control of the economy, also wants to seize majority control of the four Orinoco projects and force private companies who run them to accept a minority stake, according to a top executive at state-run oil company Petróleos de Venezuela SA, known as PdVSA.

The moves would up the ante in Mr. Chávez's long-running battle with foreign oil companies, which he accuses of making outsize profits amid high oil prices at the expense of a poor nation. The stakes are high because Venezuela, the world's fifth-largest oil exporter, holds the world's biggest oil reserves outside the Middle East and is the third-biggest supplier of crude to the U.S.

The Orinoco plan mirrors the terms of a recent takeover by PdVSA of some 32 smaller conventional oil-production projects previously run by private companies. That effort culminated in the seizure of two fields run by Total and Italy's ENI SpA. Yesterday, Oil Minister Rafael Ramirez said Venezuela has no plans to compensate Total and ENI for the lost fields.

If the latest initiative succeeds, it would eliminate the country's remaining privately managed oil fields.

"We would like all of the [Orinoco] associations to migrate to mixed companies," said Eulogio del Pino, the executive in charge of PdVSA's relations with private companies, in an interview published Saturday in Venezuelan newspaper El Universal. Mixed company is the government's term for an enterprise in which it owns 51%.

Under terms of the government's plan, oil royalties in the Orinoco region also would rise to 30% from the current 16.7% and taxes would jump to 50% from 34%. Higher royalties translate into less revenue for private companies and taxes take a bite out of their remaining profits.

Chavez is going to suck out any profitability for the oil companies in that part of the world and Venezuela will be sitting on tough to extract oil with no partners with the ability to extract it, which, of course, leads to a more reduced supply.

I'm sure we're going to have very high gas prices over the months to come, but the market will eventually alleviate the demand and supply pressures and offer alternative solutions. Certainly government taxes and tariffs are not going to alleviate any of the price signals.