Studying China's One-Child Policy

Thirty years ago, China decided to impliment its one-child policy because it believed that it's population was outgrowing its resources. This is one of the more dramatic social experiments of the modern era. Some of the effects of this experiment are highlighted in the following WSJ article. Interesting facts include:

• China appears to have achieved that goal: Initial census results released Thursday show China's population, the world's largest, rose to 1.34 billion as of last year, from 1.27 billion in 2000. That puts average annual growth at 0.57% over the decade, down from 1.07% in 1990-2000.
  The census, conducted last year, also shows that people over the age of 60 now account for 13.3% of China's population, compared to 10.3% in 2000. And the reserve of future workers has dwindled: People under 14 now make up 16.6% of the population, down from 23% 10 years ago.
• The number of workers aged 20-to-24 is already declining due to the lower birth rate two decades ago and a rise in the number of young people seeking higher education. China's traditional preference for boys also means the nation now has about 120 males for every 100 females. By 2020 China could be home to as many as 24 million single young men with little prospect of marrying or having their own children.

http://online.wsj.com/article/SB10001424052748704463804576291010133986864.html

Hopefully this will shut Trump up....Probably not

What the Government can do about rising gas prices, nothing you'd like

This is a great read from David Weigel at Slate. It has routinely been highlighted in political poling that a presidents approval rating can decrease as the price of gas increases. This is a somewhat nonsensical reaction as the president has little effect on the price of oil. Weigel discusses this fact by pointing out the falicies in some of the recent arguements for what President Obama should do to combat the increase in prices at the pump.

• "I think the fact that he won't allow exploration in the Gulf, doesn't allow exploration in the inter-mountain west, won't allow us to drill in Alaska, this is not helping the situation," said Boehner. "And then when you look at what the EPA is doing in terms of the number of rules and regulations comin' down the pike, those were his responsibility."
  It would be awfully convenient if new drilling licenses in the Gulf and relaxed EPA regulations could drive the price of oil down. They wouldn't.
  "If someone tries to dupe you into thinking we don't have enough refining capacity, that's bullshit," says Tom Kloza, the co-founder and chief oil analyst of the Oil Price Information Service. "It's a good soundbite, but if anything, companies have probably added too much capacity, and if they add more they have to focus on managing margins."
  It's a good enough soundbite that a lot of Republicans use it to argue that the White House's dithering on Gulf Coast drilling, in the wake of the 2010 Deepwater Horizon disaster, is responsible for rising prices. Oil companies, in this telling, are stuck in a sort of "permitorium." But the Deepwater disaster didn't have much of an effect on prices. When the rig blew on April 20, 2010, crude was trading around $84 per barrel. When the well was capped on July 15 the price had fallen to $76.
• A barrel of brent crude oil costs roughly $50 more today than it did back then. We have some idea why. The critical factor has been the unrest in the Middle East. According to industry analysts, prices have gone up because of worries both about what's already happening and what could happen. The civil war in Libya, a country that usually produces 1.6 million barrels of light, sweet crude every day, has added something like $20 to the price of a barrel of oil—a combination of decreased availability and speculative panic. Worries about what could happen in other OPEC nations are driving the price even higher...........This is where we get to the roles the president and Congress could play in controlling gas prices. The "Arab Spring" is blooming (and burning) mostly out of our control. The major role the United States is playing is as the military linchpin of the Libya intervention. It's an unpredictable, unhappy situation, but no one factor has more bearing on the price of oil.
• So what else can we control? ...........
  According to Bullock, American policymakers could drive prices down if they were willing to settle for less growth. It was less growth, after all, that was largely responsible for the falling gas prices of 2009. No one's calling for an increase in interest rates, but that could also drive down the international price of oil.
• None of this would be particularly easy for American politicians. Is there anything they could do? Why, yes. The president—or members of Congress!—could skip the coming, predictable assault on oil company subsidies, and take on speculators instead. Wars and economic distress are not new to the oil market. But the market for oil futures has never been as big as it is now. It's basically quadrupled since the start of the financial crisis, as investors and funds have sought ought safe, reliable commodities to invest in.
  
  That's the political opening. The only question is whether anyone's actually able to go through it. Theoretically, the president of the United States could talk about this aspect of the gas price problem and elevate it. Unfortunately, the president is Barack Obama, whose every economic move is labeled "socialism" by the opposition, and who has already alienated some of the hedge fund managers in the center of this. A move against the commodities trade from Obama would be less Nixon goes to China than Johnson goes to Vietnam.

http://www.slate.com/id/2292226/pagenum/all/#p2

The real Obama?

From Ezra Klein:
America is mired in three wars. The past decade was the hottest on record. Unemployment remains stuck near 9 percent, and there’s a small, albeit real, possibility that the U.S. government will default on its debt. So what’s dominating the news? A reality-television star who can’t persuade anyone that his hair is real is alleging that the president of the United States was born in Kenya.


Perhaps this is just the logical endpoint of two years spent arguing over what Barack Obama is — or isn’t. Muslim. Socialist. Marxist. Anti-colonialist. Racial healer. We’ve obsessed over every answer except the right one: President Obama, if you look closely at his positions, is a moderate Republican from the early 1990s.

Follow the link to read on......



http://www.washingtonpost.com/blogs/ezra-klein/post/the-shocking-truth-about-the-birthplace-of-obamas-policies/2011/04/15/AF6qINpE_blog.html?fb_ref=NetworkNews

China's empty city

Debt Ceiling Voting

Here is an interesting article by Gerald Seib in today's WSJ. This article highlights how partisan debt ceiling voting has been over the past ten to twenty years. Important excerpts include:

• Iowa has two Senators, one a Republican (Charles Grassley), the other a Democrat (Tom Harkin).
  Each has voted seven times since 2002 on a bill to raise the nation's debt ceiling. Look back at those votes, and an interesting pattern emerges: Every time a Republican president has needed the debt ceiling raised to keep government functioning, Sen. Grassley, the Republican, has voted to raise it, while the Democrat, Sen. Harkin, has voted against it. But when a Democratic president has asked for an increase, their votes reverse: Sen. Harkin has voted in favor, and Sen. Grassley has voted against it.
  That, in a nutshell, shows why it's so absurd that Washington is headed toward a showdown over debt and the deficit tied to the question of whether to raise the national debt ceiling. Few exercises produce as much cynical and overtly partisan behavior by elected officials as do votes on the debt ceiling.
• Donald Marron, an economist at the Tax Policy Center, has compiled figures showing just how partisan debt-ceiling votes are. In the House of Representatives, there have been three up-or-down votes in the last decade in which the vote was 100% partisan—that is, it passed solely with the votes of the president's party.
  In the Senate, the pattern is similar. When Mr. Obama needed a debt-ceiling increase in 2009 and 2010, he got one Republican vote the first time (from the now-retired Sen. George Voinovich of Ohio) and no Republican votes the second time. Similarly, when Mr. Bush needed debt-ceiling increases in 2003, 2004 and 2006, he got three, two and zero Democratic votes, respectively.

One would hope that our representatives would learn from this previous partisanship and address this issue in a more serious and thought out manner.....I'm not holding my breath though.

http://online.wsj.com/article/SB10001424052748703856704576284850332076820.html?KEYWORDS=seib

Political Sausage Making At It's Best

Despite that fact that many of the financial reform measures were either shelved after the mid-term elections or are currently being watered down due to financial lobbying, apparently hedge fund managers are still upset with the Obama administration and switching their donations to Republicans. Regardless of what side of the political spectrum you reside on, I think we all should be troubled by the expectations that campaign donations should buy political favor amongst our politicians. Please read the WSJ article for more information.

http://online.wsj.com/article/SB10001424052748703461504576231121265117538.html?mod=WSJ_hp_LEFTTopStories#project%3DHEDGE0425%26articleTabs%3Dinteractive

Highest Paying Sports Teams in the World

http://sports.espn.go.com/espn/news/story?id=6354899

Rank	Team	League	Average Annual Salary Per Player	Average Weekly Salary Per Player
1	Barcelona	La Liga	$7,910,737	$152,130
2	Real Madrid	La Liga	$7,356,632	$141,474
3	New York Yankees	MLB	$6,756,301	$129,929
4	Los Angeles Lakers	NBA	$6,540,690	$125,782
5	Orlando Magic	NBA	$6,367,114	$122,445
6	Chelsea	EPL	$6,020,741	$115,783
7	Inter Milan	Serie A	$5,999,643	$115,378
8	Boston Red Sox	MLB	$5,991,203	$115,215
9	Denver Nuggets	NBA	$5,990,174	$115,196
10	Manchester City	EPL	$5,863,585	$112,761
11	Utah Jazz	NBA	$5,829,643	$112,109
12	Bayern Munich	Bundesliga	$5,780,358	$111,161
13	Philadelphia Phillies	MLB	$5,765,879	$110,882
14	AC Milan	Serie A	$5,647,633	$108,608
15	Boston Celtics	NBA	$5,236,922	$100,710
16	Manchester United	EPL	$5,106,214	$98,196
17	Chicago Cubs	MLB	$5,001,893	$96,190
18	Houston Rockets	NBA	$4,972,115	$95,618
19	Philadelphia 76ers	NBA	$4,954,303	$95,275
20	Liverpool	EPL	$4,935,847	$94,920

CEO pay increases in 2011

HT: The Big Picture

U.S. CEOs received an average of $11.4 million in total compensation, up 23% for the year last year. The average CEO currently makes 343x the median wage. This figure has increased exponentially over the past 30-40 years from previous levels of roughly 40x the median wage.

From AFL-CIO

2010 Average CEO Pay at S&P 500 Companies
Salary	$1,093,989
Bonus	$251,413
Stock Awards	$3,833,052
Option Awards	$2,384,871
Nonequity Incentive Plan Compensation	$2,397,152
Pension and Deferred Compensation Earnings	$1,182,057
All Other Compensation	$215,911
TOTAL	$11,358,445
Source: AFL-CIO analysis of pay data from 299 companies, provided by salary.com.

http://www.aflcio.org/corporatewatch/paywatch/

Early Election Indicators

From WSJ

Federal Reserve will host first press conference next week

This video is pretty interesting and early clips will give you a taste at how bizarre some of the questions that congressmen/women ask of the Fed chairman during his bi-annual testimony to Congress. If you ever get a chance, you should watch this, although it may cause you to lose respect for some of your congressional representatives.

Russian Drinking Problem

From NY TIMES:
IN an effort to reduce both its sky-high alcoholism rate and its budget gap, Russia recently announced plans to quadruple the tax on the country’s eternal vice, vodka, over the next three years............

Russians consume about 18 liters of pure alcohol per person a year, more than twice the internationally recommended limit, a rate that President Dmitri A. Medvedev has called a “natural disaster.” Thanks in part to lifelong heavy drinking, the life expectancy for the average Russian man is now about 60 years, just below that of Haiti. Alcohol poisoning alone kills 40,000 Russians a year (compared with about 300 in the United States), and alcohol plays a role in more than half of all premature deaths.

http://www.nytimes.com/2011/04/17/opinion/17Schrad.html?src=twrhp

Interesting Info on Income Taxes

A couple interesting posts on Tax Day:

The following links to a tax receipt setup by Thirdway.org, you can input your federal taxes paid and find out where your tax dollars went.
For Example, someone who paid $10,000 in Federal Taxes paid $2,044.94 on Social Security, $2,017.15 on Defense, $469.15 on Unemployment, etc. (HT: The Big Picture)
http://www.thirdway.org/taxreceipt

Also, this link from the NY Times discusses how little Americans know about where they stand on the income and tax distribution. The area to highlight is that 67% of people making $250,000 or more believe their taxes are too high, 26% believe the taxes are just right, and 6% believe they are too low. 30% of these same people, however, believe that "Upper-Income" people pay too low of taxes. This means that a large percentage of people making over $250,000 don't believe that they qualify to be in the Upper-Income group.

http://economix.blogs.nytimes.com/

An Unstoppable Combination? Trump-Busey 2012

Economist Jeffrey Sachs on the Budget Debate

This is an interesting take on the Ryan vs Obama budget debate. Please take a look as it certainly adds to the general discussion on the subject.

http://www.huffingtonpost.com/jeffrey-sachs/de-mystifying-the-budget_b_850332.html

Are politics and suicide linked?

An article from the U.S. News reports on study published in Pediatrics in which 32,000 Oregon students were surveyed to compare the suicide risk and depression in gay students versus their straight counterparts. Some interesting data points:

• Lesbian, gay, and bisexual teens are five times more likely to attempt suicide than their heterosexual peers
• Lesbian, gay, and bisexual students who live in a supportive community are 25% less likely to attempt suicide.
• Gay teens who live in more politically conservative areas are more likely to attempt suicide due to the lack of school programs that support gay rights.
• Also of note, teens who used the internet enough to be considered pathological internet users are almost twice as likely to become depressed as other teens.

http://health.usnews.com/health-news/family-health/childrens-health/articles/2011/04/18/health-buzz-support-helps-prevent-suicide-among-gay-youth

When it comes to the budget, what do Americans really want?

I'm a word-for-word copy of the following Big Picture post to highlight how much Americans want to have their cake and eat it too. As you can see from the poll numbers, Americans are largely in favor of a balanced budget and reduced spending in general, but are opposed to specific program cuts. This creates a disconnect between what people say they want, and what they are willing to sacrifice to get it.

Bruce Bartlett points out that Americans want a balanced budget, so long as it does not require cutting entitlement programs or raising taxes.
If that sounds, well absurd, it reflects the lack of willingness of voters/taxpayers to engage in any shared sacrifice. This does not bode well for the future of fiscal prudence.
Consider these recent polling results:

An April 6 NBC News/Wall Street Journal poll found that 61% of people favor a balanced budget amendment to the Constitution, down from 71% in 1995. Support falls to 27% when people are told that this would require a 20% cut in entitlement programs.
An April 4 YouGov poll found that an overwhelming majority of people favor large budget cuts. However, majorities also favor increased spending for education and medical research, and a strong plurality favor increased spending on clean energy technology.
An April 1 CNN/Opinion Research poll examined peoples’ knowledge of how the federal government spends its money. It finds that most really have no idea what percentage of the budget goes to various programs.
A March 31 Pew poll asked people which among these programs the federal government spent the most on: Medicare, education, scientific research, or interest on the debt. Only 29% of people correctly said Medicare, 7% said education, 7% said scientific research, and 36% said interest.
On March 9, the Harris poll found strong opposition to cutting Social Security or Medicare benefits to deal with the budgetary problems of those programs. People are also opposed to raising taxes to fund them.
On March 2, a NBC News/Wall Street Journal poll found strong opposition to cutting spending for Social Security, Medicare, Medicaid, K-12 education, heating assistance for the poor, college student loans, Head Start, and unemployment insurance. There was majority support only for cutting nuclear power subsidies, aid to state and local governments, the EPA budget, and spending on transportation and infrastructure projects. The poll also found that 81% of people would support a surtax on millionaires to help reduce the budget deficit, and 68% would support eliminating the Bush tax cuts for those earning more than $250,000.
On March 1, the Tarrance Group issued a poll which found that 63% of voters incorrectly believe that the federal government spends more on national defense and foreign aid than it does on Medicare and Social Security. Also, three-fifths of voters believe that the budget can be fixed just by eliminating waste, fraud and abuse.

Bruce has posted a full run of polls, and their surprising conclusions, at The Fiscal Times.

http://www.ritholtz.com/blog/2011/04/balancing-the-budget-wo-spending-cuts-or-tax-increases/

Standard & Poor’s Puts ‘Negative’ Outlook on U.S. AAA Rating

I'm going to go ahead and guess that this is more noise than anything with substance, but it is still noteworthy.
From Bloomberg:

“We believe there is a material risk that U.S. policy makers might not reach an agreement on how to address medium- and long-term budgetary challenges by 2013,” New York-based S&P said in a report today. “If an agreement is not reached and meaningful implementation does not begin by then, this would in our view render the U.S. fiscal profile meaningfully weaker than that of peer ‘AAA’ sovereigns.”
http://www.bloomberg.com/news/2011-04-18/standard-poor-s-puts-negative-outlook-on-u-s-aaa-rating.html

Interesting Graphic from WSJ

Could this be the end to online poker in the U.S.?

From Reuters:
The owners of three of the largest Internet poker companies operating in the United States were accused on Friday of tricking regulators and banks into processing billions of dollars of illegal Internet gambling proceeds.
Eleven people, including the owners of Full Tilt Poker, Absolute Poker and PokerStars, were charged with violating U.S. anti-Internet gambling laws, according to charges filed by federal prosecutors in Manhattan.
Prosecutors also filed civil money laundering charges seeking to recover at least $3 billion from the companies, which are all based overseas, court documents said.
The Internet domain names of the companies were also seized. Representatives for the companies could not immediately be reached to comment on the charges.
Two of the men were arrested on Friday, one is expected to turn himself in to law enforcement and eight others are not currently in the United States, prosecutors said.
http://www.reuters.com/article/2011/04/15/us-gambling-idUSTRE73E6HW20110415

How valuable is Snooki's time?

Interesting post from the NY Times (HT:Freakonomics). It breaks down the value of an appearance at a club by Snooki. Like it or not, apparently she is a bargain at the price of $25,000-32,000 per appearance.

Mainstream media

14 mentions in daily newspapers, including the Toronto Star and Los Angeles Times. Also 1,161 mentions on News Web sites, 297 mentions on broadcast television including Conan and Chelsea Lately.

Mainstream news publicity value: $174,806

Blogs & Twitter

7,180 people commented on, linked to, Liked, bookmarked or voted for 2,098 blog posts

Blog publicity value: $136,017

15,169 tweets (including one very widely retweeted one from @time) received by a total of 26.9 million followers

Twitter publicity value: $35,012

Total Publicity Value: $345,835

http://economix.blogs.nytimes.com/2011/04/11/snookinomics/

Flying Car?

Key Facts on Corporate Taxes

HT: The Big Picture

Before you start to believe a lot of the talk about the onerous corporate tax structure in the U.S., take a look at the following.

http://demos.org/images/corporatetaxes_infographic.pdf

Josh Freese- Drummer and Master Salesman?

Tim Cadiente
From the WSJ.

Josh Freese, a drummer who has worked with bands like NIN, Weezer, The Vandals, and is on tour with A Perfect Circle this summer, has some interesting strategies to help with sales on his solo project titled "My New Friends". Some of his offerings include (directly pulled from article):

• For $5, you can download the disc at www.joshfreese.com.
• If you hand over $75,000 to drummer Josh Freese, he will join your rock group or become your personal assistant; present you with one of his drum sets; write and record a five-song EP about you; go for a ride around Hollywood with you in a Lamborghini owned by Danny Carey, the drummer for the group Tool; shop with you for matching outfits at Tommy Bahama; and give you 500 copies of "My New Friends" (Outerscope), his new EP.
• One of the $7,500 packages for "My New Friends" is a chance to fly with Dexter Holland of the Offspring in his private jet.
• $7,500 package that includes a trip with Mr. Freese and actor Johnny Knoxville to bet on the horse races at Hollywood Park and then visit a Build-a-Bear Workshop.
• For $10,000, you can have Mr. Freese's Volvo 940 station wagon, which, he points out, is perfect for hauling drums. Most packages include a meal at P.F. Chang's, preferably the one a few blocks from Mr. Freese's home, and a copy of his fifth-grade report card.

http://online.wsj.com/article/SB10001424052748704101604576248912488703724.html?mod=WSJ_ArtsEnt_LifestyleArtEnt_2

WSJ Compares Deficit Plans

http://online.wsj.com/article/SB10001424052748703385404576259903446373140.html?mod=WSJ_hp_mostpop_read

CNN-what country works the most each day?

http://business.blogs.cnn.com/2011/04/13/what-country-works-the-most-each-day/?iref=obnetwork

Home values still set to fall?

This is a great post from the Big Picture. The chart is by Steve Barry. It highlights housing values (adjusted for inflation) since 1890. You can see clearly how big the last real estate boom is and how far we could still fall if we revert back to the average.

Cultural Differences in Baseball

Interesting piece from the WSJ:

 

The above chart is a list of injuries suffered in the past few years by Japanese middle infielders. There have only been four middle infielders from Japan to play Major League Baseball and three of them have been seriously injured due to "takeout" slides by players looking to break up a double play. The article theorizes that the cultural difference between Japanese and American baseball is to blame due to the fact that this type of slide is not common in the Japanese game.

 

http://online.wsj.com/article/SB10001424052748703518704576258822289290998.html

 

Mexican Drug War Causes Greater Threat to Americans

From the WSJ:

• For the first time in Mexico's drug war, the U.S. government said its employees and citizens could be the targets of drug gangs in three Mexican states, a disclosure that could signal danger for Americans south of the border.

• Last year, 107 American citizens were victims of homicide in Mexico, according to the State Department, up from 77 homicides the year before.

• This year has included some grisly slayings of Americans. In January, Nancy Davis, a 59-year-old missionary was shot in the head after being ambushed in her car near San Fernando. Her husband raced her car across a border bridge against traffic into Texas, where she later died. And last year David Hartley, an American riding a jet ski on the Mexican side of a lake on the Texas border was abducted, his body never found. Shortly afterward, the severed head of a detective on the case was found in front of a Mexican army barracks.

This warning is in addition to several other warnings from the US in regards to American tourists. Unbeknownst to many Americans is the fact that several tourist towns like Acapulco and Zihuatanejo (Andy Dufresne's hometown, I hope he and Red are safe) have experienced sever drug war violence in the past couple of years.

http://online.wsj.com/article/SB10001424052748703518704576259332428064652.html

Democracy in Action: Handguns on Campus

It appears that the resistance of college professors and students to the proposal to allow students to carry guns on college campuses in Texas is proving to be influential.  The TX legislature has not been able to gather enough votes in the Senate to pass the legislation and the bill may be dropped. This is due to the fact that the majority of people directly affected by this legislation (students/professors/administrators) never wanted to carry guns on campus in the first place.

Excerpts:
Then students and administrators from the state's universities mobilized in opposition, swaying two Democratic lawmakers who had supported the bill. Without them, the bill's sponsor hasn't had enough support to get a vote in the state Senate. Two attempts in the past week have failed, and the measure is now struggling to survive in a state that usually embraces guns and their mythical connection to the old West.

Hundreds of current students turned out for Capitol rallies, saying they didn't want to take a test sitting next to someone who might be carrying a gun.
They got a big boost from the nine-campus University of Texas System when chancellor Francisco Cigarroa wrote a letter to Perry and lawmakers telling them college officials worry guns will lead to more campus violence and suicides.
Two Democrats who had supported the bill, Sen. Eddie Lucio of Brownsville and Sen. Mario Gallegos of Houston, withdrew their support last week.

http://www.msnbc.msn.com/id/42560159/ns/us_news-life/

Ezra Klein on Ryan Budget

This is a great review from Ezra Klein that I encourage you to read fully. First off, Ezra points out his lack of bias in regards to Rep. Ryan:
Just over a year ago, I wrote a column praising Rep. Paul Ryan’s Roadmap. I called its ambition “welcome, and all too rare.” I said its dismissal of the status quo was “a point in its favor.” When the inevitable backlash came, I defended Ryan against accusations that he was a fraud, and that technical mistakes in his tax projections should be taken as evidence of dishonesty. I also, for the record, like Ryan personally, and appreciate his policy-oriented approach to politics.
So I believe I have some credibility when I say that the budget Ryan released last week is not courageous or serious or significant. It’s a joke, and a bad one.

He then goes on to point out the several problems he has with the proposal, including:

For one thing, Ryan’s savings all come from cuts, and at least two-thirds of them come from programs serving the poor. The wealthy, meanwhile, would see their taxes lowered, and the Defense Department would escape unscathed. It is not courageous to attack the weak while supporting your party’s most inane and damaging fiscal orthodoxies. But the problem isn’t just that Ryan’s budget is morally questionable. It also wouldn’t work..................

His proposal says the federal government’s contributions to Medicare and Medicaid can’t grow at more than the rate of inflation. Then he told CBO to score his plan based on that assumption. That’s where his money comes from. But it’s nonsense.
Health-care costs don’t grow at the rate of inflation. Ever. Previously, Ryan acknowledged that. His Roadmap capped federal contributions between inflation and the actual cost of medical care. He then developed a more bipartisan version of the idea with Alice Rivlin, who founded the Congressional Budget Office and directed the Office of Management and Budget under Bill Clinton. That one was capped at the growth of GDP plus 1 percentage point. Both targets were far more plausible than the fantasy target Ryan is now using.
So why the switch? He has not said. I suspect he couldn’t make the numbers add up without tax increases.........

But unlike Ryan, Democrats not only have a plausible proposal for controlling health-care costs, they have a law.
The Affordable Care Act

Again, this is a great read, please take a look.

http://www.washingtonpost.com/blogs/ezra-klein/post/column-ryans-bad-joke/2011/04/12/AFyvg2PD_blog.html

Student Loan Debt Growth

This is one trend that I have definitely participated on.....


http://www.nytimes.com/2011/04/12/education/12college.html?_r=1&hp

Court holds back Arizona Immigration Law

From my perspective this is a good argument for why having three branches of government works well as the court system appears to have a little better perspective than the AZ legislature/governor.
From the AP:

PHOENIX, Arizona — A US federal court upheld the suspension of key parts of a controversial Arizona immigration law which came into force last year.
Arizona's governor slammed the ruling -- and vowed to appeal to the US Supreme Court if necessary -- but the Mexican government and rights groups welcomed the decision to maintain a freeze on the law's most disputed parts.
"It sends a very clear message, both to Arizona and to other states that might consider doing something like this, that this is an unconstitutional road to go down," said Omar Jadwat of the American Civil Liberties Union (ACLU).
"There were a lot of nails already in the coffin of this approach, but this is should be final blow," added the ACLU lawyer following the decision by the Ninth US Circuit Court of Appeals.

More interesting analysis can be found on the Washington Post's blog:
I examine these opinions in some detail for two reasons. First, preemption doctrine requires a close reading of the statute and analysis of its purpose. Objections to a state statute cannot be brushed off because the federal government is “not doing its job.” That may be true, but this is a political and not a legal argument. Second, if immigration exclusionists think they are going to get a more satisfactory analysis from judges than the one rendered by Judge Noonan they are, I would suggest, kidding themselves. A decision making, at best, Swiss cheese of the state’s law, an indication of how difficult it is to skirt the federal government’s dominance in the field of foreign policy and border control.
A final observation: Conservatives are making a principled argument regarding Obamacare on the Constitution’s commerce clause in support of the federal system of government. That same structure that limits federal power also limits state power. They should be faithful to the words and intent of the Constitution in both situations.
http://www.washingtonpost.com/blogs/right-turn/post/the-9th-circuit-strikes-down-arizonas-immigration-law/2011/03/29/AF34ViLD_blog.html

WSJ chart on deficit reduction plans

Pretty interesting stuff from today's WSJ.

http://online.wsj.com/article/SB10001424052748703841904576257263426340504.html?mod=WSJ_hp_MIDDLETopStories

Health care spending in the U.S.

From the WSJ's Real Time Economics blog:

The U.S. spends 141% more on health care, per person, than the average OECD nation. Other quotes:

• A new report finds that the U.S. spends far more on health care than any of the other 29 OECD nations, and gets less health for its money. Annual public and private health-care spending in the U.S. stands at $7,538 per person, 2.41 times the OECD average and 51% more than the second-biggest spender, Norway. Meanwhile, average U.S. life expectancy is 77.9 years, less than the OECD average of 79.4.
• Interestingly, the type of system doesn’t seem to matter much. Countries with state-run systems do about as well on average as countries with private systems. Among the things that do matter: Consumers need to have some skin in the game, through mechanisms such as co-payments; care needs to be well-coordinated among doctors’ offices, hospitals and nursing homes; providers of care need incentives to do a better job, such as pay for performance; and the price and quality of services should be better monitored and easier to see.

http://blogs.wsj.com/economics/2011/04/09/number-of-the-week-u-s-spends-141-more-on-health-care/

The most self righteous man in America?

Shutdown avoided

Tool and Math-Incredible

This is a terrific blogpost found initially on The Big Picture but written by Kent Thune of "The Financial Philosopher". His writing is complex enough that I don't want to spoil it so I will use his words verbatim:

Whether you are an investment trader, a music fan, a mathematician, a curious observer wishing to learn more about human nature, or any combination thereof, you will appreciate this lesson on the Fibonacci Sequence
The video, created by a college student to help explain the Fibonacci sequence, features images of space from the Hubble Telescope and music from the cerebral and progressive hard rock band Tool.  What makes the video and song incredibly compelling is the lyrics, which teach a lesson on pattern recognition.
For those non-traders and non-mathematicians out there, a Fibonacci sequence is a series of numbers where, after two starting values, each number is the sum of the two preceding numbers.  For example, the number sequence 2, 3, 5, 8 and 13 are a Fibonacci sequence (2+3=5, 3+5=8, 5+8=13, and so on).
Making the video and song more interesting is that the cadence of the lyrics (number of syllables of succeeding verses) follows a Fibonacci sequence.  What’s more, the meaning and lesson of the lyrics implies that humans are hopelessly addicted to looking for patterns everywhere they turn:  The “over-thinking” and “over-analyzing,” as the lyrics suggest, have an effect of dulling intuitive thought and often results in missed opportunities.
http://www.ritholtz.com/blog/2011/04/tools-lesson-on-fibonacci-think-lateral/#more-64676

The real cause of the government shutdown

After weeks of negotiation, it looks like the Federal Government will shut down this weekend. There will be a lot of noise regarding who is to blame for this but the following op-ed from the NY Times (amongst several sources on this), points out the major points of contention holding up negotiations. Rather than pure dollar figures, the main conflict currently focuses on social issues. From the article:

Republicans are refusing to budge on these ideological demands:
• No federal financing for Planned Parenthood because it performs abortions. Instead, state administration of federal family planning funds, which means that Republican governors and legislatures will not spend them.
• No local financing for abortion services in the District of Columbia.
• No foreign aid to countries that might use the money for abortion or family planning. And no aid to the United Nations Population Fund, which supports family-planning services.
• No regulation of greenhouse gases by the Environmental Protection Agency.
• No funds for health care reform or the new consumer protection bureau established in the wake of the financial collapse.

http://www.nytimes.com/2011/04/08/opinion/08fri1.html?partner=rssnyt&emc=rss

http://blogs.abcnews.com/nightlinedailyline/2011/04/should-abortion-be-part-of-the-budget-discussion.html

World Alcohol Usage

Interesting graphic from the World Health Organization on alcohol consumption by country. FYI, the US is 14th in the world for alcohol consumption per capita. Russia is #2, Moldova is #1.

WSJ/NBC poll on shutdown

Its amazing to look at the difference between what Democrats and Tea-Partiers want. This probably doesn't bode well for avoiding a shutdown.

http://online.wsj.com/article/SB10001424052748704101604576247100322182190.html?mod=WSJ_hp_LEFTTopStories#articleTabs%3Darticle

DEATH CAB LIVE VIDEO

Death Cab For Cutie found an interesting way to be different yet again... http://seattletimes.nwsource.com/html/matsononmusic/2014698679_death_cab_for_cuties_experimen.html?cmpid=2628

Five Myths About Gas Prices

This is a great article by Robert Rapier in today's Washington Post. The myths addressed:

1-Fighting in Libya is sending gas prices higher

2-Tapping the Strategic Petroleum Reserve is a smart way to reduce gas prices

3-Oil companies produce less in the spring to make gas prices increase

4-The Obama administration is driving up gas prices

5-American's can't live without cheap gas

Please give this a read.


http://www.washingtonpost.com/opinions/five-myths-about-gas-prices/2011/03/18/ABaUtbQB_story.html

More on the Ryan Budget

HT: Ezra Klein
Quotes from the Congressional Budget Office (CBO):
Medicare:

Under the proposal, most elderly people would pay more for their health care than they would pay under the current Medicare system. For a typical 65-year-old with average health spending enrolled in a plan with benefits similar to those currently provided by Medicare, the CBO estimated the beneficiary’s spending on premiums and out-of-pocket expenditures as a share of a benchmark: what total health-care spending would be if a private insurer covered the beneficiary. By 2030, the beneficiary’s spending would be 68 percent of that benchmark under the proposal, 25 percent under the extended-baseline scenario, and 30 percent under the alternative fiscal scenario.

Medicaid:

Federal payments for Medicaid under the proposal would be substantially smaller than currently projected amounts. States would have additional flexibility to design and manage their Medicaid programs, and they might achieve greater efficiencies in the delivery of care than under current law. Even with additional flexibility, however, the large projected reduction in payments would probably require states to decrease payments to Medicaid providers, reduce eligibility for Medicaid, provide less extensive coverage to beneficiaries, or pay more themselves than would be the case under current law.

http://www.washingtonpost.com/blogs/ezra-klein/post/cbo-looks-at-ryancare/2011/03/28/AFhweLlC_blog.html

Ins and Outs of the Ryan Budget Proposal

This is an interesting graphic from the WSJ comparing the Obama and Ryan budgets. The only thing I would add to this is that on percentage terms Rep. Ryan is proposing a 38.62% cut to Medicaid, a 14.4% increase in Medicare, and a 0.40% decline in Social Security, meaning that Medicaid is disproportionately affected by this proposal. The cynic has to point out that most of the beneficiaries of Medicaid (pregnant women, children, poor people, and the permanently disabled) don't vote in the same strength as the beneficiaries of Social Security and Medicare (elderly citizens).


I would also add the following excerpt (HT: Incidental Economist) from Tyler Cowen, a renowned libertarian economist (just in case some think this is a liberal post) regarding the privatization of Medicare:

2. Ryan nails our dysfunctional, “who is really responsible for paying for Medicaid?” structure.  That said, I’ve long preferred the federalization of Medicaid.  [...]
3. [...] Medicaid should be one of the last parts of the health care budget to cut.  [...]
4. [...] I would urge maximum transparency.  Health care costs are increasing by about five percent a year.  That means a fixed value voucher loses about half its real value, in terms of command over health care resources, within fourteen years.  [...]   If that is the decision we are going to make, let us understand it as such.  [...]
5. It would be nice to have a scientific estimate of how much fixed value vouchers would lower the rate of growth of health care costs.  I’m not convinced the effect here is large, but I’d like to see it studied more closely.
6. Ryan’s budget repeals ACA and thus in the semi-short run it could considerably increase Medicare costs.  There is no reason why Ryan’s plan shouldn’t keep the most fiscally responsible aspects of ACA.  Ryan exempts the current elderly from any Medicare cuts at all, see David Leonhardt’s remarks. [...]
8. As I’ve already blogged, the vouchers idea won’t help cut health care costs.  Let’s create some multiple public options within Medicare, some of which would allow people to trade health care benefits for cash. [...]
10. There’s not nearly enough on reforming the dysfunctional supply-side of our health care institutions.  Nor does science or basic research receive much discussion. [...]
13. [... T]he plan is not intended to be enacted into law.

http://theincidentaleconomist.com/wordpress/economists-agree/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+TheIncidentalEconomist+%28The+Incidental+Economist+%28Posts%29%29

http://www.marginalrevolution.com/

World's Economic Center of Gravity

HT: Marginal Revolution.

The graphic below shows the movement of the world's economic center of gravity away from the Atlantic Ocean (when the global economy was balanced between the US and Europe), towards China. The red dots are the projected movements through 2050.

http://econfix.wordpress.com/2011/03/27/wecg-worlds-economic-centre-of-gravity/

How does the Ryan proposal stack up with ACA (Obamacare)?

I've included a few links below to "The Incidental Economist" which, in my opinion, is the best source for unbiased information regarding health care on the Internet. One of the main themes of their blog is the fact that quality health care is comprised of three things:

• Cost- which has obviously been soaring over the past decade
• Coverage-we currently have 50 million people uninsured in the US, is this acceptable?
• Quality-what is the best way to look at the quality of care in the US versus the world?

Usually it is difficult to improve all three of these areas at the same time, in fact you often can only improve on two of these areas at the expense of the third.  As the blog points out, the Affordable Care Act's (ACA) goal was to increase coverage to roughly 95% of the population while pushing for methods to slow down cost inflation (which opened it up to criticism over quality). The Act called for this plan to be implemented over a ten year window so we have yet to see if it effective or not. Now, we compare the ACA with the recent health care provisions mentioned to Rep. Paul Ryan's budget proposal. Rep. Ryan language focuses on the cost.

Unfortunately, I believe,  this savings may come at the expense of coverage and/or quality. I say this because current ideas being thrown around include limiting medicare benefits to increases only at the level of general inflation (2-3%) as opposed to the much high inflation of medical costs (double this level). This means that every year the net benefit of insurance will decrease by this 3%+ gap. Also, there is talk of moving Medicare to a program less like a pension (where the government centralizes the contributions and expenses of the population) and more like a 401k (individuals have more say on what coverage they want to pay for). The main problems with this are the fact that individuals have a horrible track record with 401k-type investments, they routinely contribute too little and have a hard time planning for adverse events. Also, when it comes to health care, people may not put enough value into their own health risks which would lead to future burdens being place on the government anyways. For example, if I decide that I don't want to spend money on cancer insurance and reduce my contributions for this service, would the government eventually be left on the hook for my medical costs if I was terminally ill with cancer? Or would the hospitals/doctors simply refuse my service and let me die?

For much more insightful analysis on this debate, please follow this link.
http://theincidentaleconomist.com/