Saturday, June 16, 2007

Utopian View of Big Government

Now, I've only got a few minutes before the water boils for Mac n' Cheese but I wanted to throw a couple of pieces of info at you all.

1. The Washington Post actually posted a not-so-bad article on Ron Paul here. The not so good news is that it still paints him as a "long shot" candidate. If you haven't figured it out yet, "scientific" polls this far away from the primaries are completely useless. But if you think Ron Paul needs more media attention, the best way to do that is to donate to his campaign as it'll be hard to ignore him when the new quarterly numbers come out at the end of this month. Anyway, what does this have to do with Big Government?

It seems like any time there is some public exposure to his campaign, there are those that object to his "Free Market or Bust" economic philosophy (there is also a lot of sentiment out there, cultivated by the media that he's a nut... which couldn't be further from the truth). So the argument goes - if he became president, corporations would be able to run over the American consumer as there would be no government to protect us. I never really understood that point of view so I did some research to try to figure out where the idea that the government did a better job of protecting people than... you know... people... in the free market, came from. And I ran across this interesting podcast. One of the things they identify in the podcast is that people have an inherent distrust of corporations, insurance companies, etc... but at least some people don't have this same natural distrust of government. When something goes wrong - say, a plane crash - society tends to blame the free market, capitalism and corporate greed and demand that their government step in to protect them from those evil corporations. In my mind, nothing could be scarier than handing over more responsibility to the government, so why do people insist on it?

Obviously, the reason why they distrust corporations is because they see them as only looking out for themselves (which is certainly true), but what they don't see is that government is also only looking out for itself. Instead of governments greed being clearly being quantified in dollars and cents, it's measured in political power. See, money is power, political power is... uh... power. And we all know power corrupts. The money is just a means to an end. So the question is, do you trust the market (and therefore the consumers in the market) to look out for their own self interest, or do you put your trust in a government body that is driven by political self interest. From my close, personal, daily experience with the federal government over the last 10 years... I choose people in a free market.

You could argue that you could try to have both - which is what we have now in a way. The problem with government's involvement in anything is that they tend to consolidate power into just one place - and without competition or market forces in play to make sure that power is used correctly in the consumer's best interest. Where there is power, there will be corruption of that power. Let's say we need the government to regulate fuel consumption because the market isn't doing a good enough job (this is a common complaint, though the we don't actually have a free market, purely capitalistic society - what we have today is corporatism - government involvement in business certainly does lead to problems). Because the government now holds the keys to the cupboard, businesses that want to have inefficient cars will lobby their congress people to get them special breaks, tax incentives, etc. to get away with being inefficient. If the government didn't regulate fuel consumption, why would businesses bother lobbying congress? There's no power there. The free market can regulate fuel consumption quite well - witness the sharp decline in SUV sales in response to climbing gas prices that sent auto makers back the drawing boards. When gas prices go up, the market reacts. When the government gets involved, the market collapses :)

Okay, so the water is thoroughly boiled now

2. In my fanatical pursuit of Ron Paul news and interviews, I've really only found one mainstream media outlet that gives Dr. Paul a fair shake - and it's one that I really didn't have much respect for previously so it pains me to say this: Tucker Carlson on MSNBC has had Dr. Paul on pretty regularly lately and, while he responsibly grills the congressman, he always walks away impressed. Here's the latest entry. So what does this have to do with Big Government?

In the interview, Tucker tries to back Dr. Paul into a corner regarding how a smaller federal government would mean taking away services that people have come to expect their government to provide. In particular, hurricane/disaster relief (for example Hurricane Katrina) would require much more of local/state governments and personal contributions/charity. This sounds to some as if Dr. Paul is cruel or callous. Far from it. His response is classic - it's just as cruel (I'd argue more cruel) to say that the people who have just suffered from a natural disaster are now in the incapable hands of the federal government. FEMA is the disaster... and people want BIGGER government?

I love it when a politician is so consistent in their moral and philosophical views that instead of caving in the face of an opposing view or a "harsh" reality, they present the issue so that it's seen through their moral compass and present it in a way that makes it impossible to argue any further. Wait... has any other candidate done that?? :)
-Andrew Douglas

Wednesday, June 13, 2007

Why I Was Wrong - Government's Slight of Hand

I write, today, more disgusted with myself, with my party and with my president than I have probably ever been in my entire life. It started out innocently enough really. On a day when members of congress decided that those campaign promises to expose corruption and "earmarks" weren't really all that important as they only represented about 25 billion dollars [editor's note: I had originally put 2.5 billion, but it's actually 2.5% of nearly 1 trillion dollars]... Less than 24 hours after the White House's press secretary admitted on MSNBC (finally) that, yeah, the Immigration Legislation really does require everyone in America to have their "Real ID" in order to get a job because your employer would need to verify that you are legally allowed in the country or else face a $75,000 fine... In the face of media's "scientific" polls which continue to refuse to even include Ron Paul in the list of candidates to choose from despite him getting second place in the Utah Straw Poll.... I finally took the time to watch this:

Now, there are 4 parts to that, so be sure to get through it all because the first part is really just a funny introduction. If you start weeping for our Constitution and our liberty by the end of part 3, you may want to close your eyes for part 4. This is as fundamental a flaw in our government and the current administration than either the War in Iraq or the blatant disregard for fiscally and Constitutionally responsible government spending. And the sad thing is, I was duped... I was, to my own discredit, a neo-con, without even knowing what a neo-con was. I bought into Bush's campaign speeches of no nation building and humble foreign policy, but instead of backing that policy once he got into office, I backed the man. And when the man said that the Patriot Act was just, I believed him. And when the man said that the War was just, I believed him. And I became that which I now know to be evil - someone who would forsake freedom for safety.

This is why Ron Paul must win. This attack on our Constitution and our liberties must end. Period.
-Andrew Douglas

Tuesday, June 12, 2007

Foreign Aid is Stupid

I'll be honest. I'm no expert on this subject - specifically International Trade. It's a dizzying complex set of scenarios that requires a deep understanding of both macro and micro economic principals to even begin to get a basic grasp of the problem set. I only know enough to be dangerous in this area so in this particular case, I'm going to be relying fairly heavily on sources that have some credibility. If you think my sources are poor, please provide alternatives. To keep it simple for stupid (me), I'll be breaking down the discussion into a kind of Frequently Asked Questions for Foreign Aid.

Q: What exactly is the U.S. Foreign Aid policy, how much do we spend on it and what do we hope to get out of it?
A: This little document right here is a real page turner. In it, it describes the history, policies and objectives of our current foreign aid program. To put it succinctly - it's money spent out of the federal treasury to foreign nations in which we hope to achieve the following results:
  • Promote transformational development, especially in the areas of governance, institutional capacity, and economic restructuring;
  • Strengthen fragile states;
  • Provide humanitarian assistance
  • Supporting U.S. geostrategic interests, particularly in countries such as Iraq, Afghanistan, Pakistan, Jordan, Egypt, and Israel; and
  • Mitigating global and international ills, including HIV/AIDS.
"Promote transformational development?", "Geostrategic interests?", WTF?

So how much is the bill then, doc? In 2004, it was greater than $20 billion with a b NOT including Iraq reconstruction (another $20+ billion) or food aid apparently. Let's see... combined that would put us at least a 50 year high, since the early 1950's - and even if you exclude Iraq, it's at a 30 year high adjusted to today's dollar. Beat that Cold War!

Q: What constitutional authority does the Federal government have to spend money on foreign aid?
A: Absolutely none, whatsoever. Common defense? Nah, not really. General Welfare? Nope. The section where the members of Congress get to play Santa Claus to all the world's children must have been left on the cutting room floor of the Constitutional Convention.

Q: Do the people that get the foreign aid, want it?
A: Yes and No. Let me explain, a lot of the people that get the foreign aid are the corrupt political leaders of 3rd world countries. They certainly want it. The people in those 3rd world countries rarely actually get the aid. But do they want it? Signs point to no. You absolutely must read this article:,1518,363663,00.html

Q: So, why do we do it if it doesn't work?
A: Ron Paul nails it once again -
It is money that goes to help foreign elites, who in turn spend much of it on contracts with US corporations. This means US tax dollars ultimately go to well-connected US corporations operating overseas.
Q: You're just a cold hearted SOB aren't you?
A: Absolutely not. Charity given at the point of a gun is not charity. The government collects taxes from all of us and then sends it over seas. That's not charity, it's robbery.

Q: So how can we help those countries that do have poverty, educational and medical needs?
A: Individuals helping individuals is always best. Dumping billions of foreign dollars into an economy, dumping thousands of tons of food, and giving foreign governments weapons doesn't do anything but destabilize economies and give more power and control to the elites. Give what you can and tell our government to stop hurting these countries with our reckless foreign policies. Oh, and you could throw some support Ron Paul's way, too... if you're so inclined, as he's the only one running for Prez that will make it happen.

Monday, June 11, 2007

The Right construction of "General Welfare"

The term "General Welfare" is mentioned in two places in the Constitution - the preamble which we all know:

WE THE PEOPLE of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defense, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America.

and it also specifically grants the privilege to execute this duty to Congress in Article 1, Section 8:

The Congress shall have the Power to lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common defense and general welfare of the United States....

The history and the debate over what is actually authorized under the general welfare clause is something that has been discussed ever since. See, both sides, Left and Right, can use "the Founding Fathers intention" argument as there was significant disagreement between them (Hamilton and Madison in particular) in terms of what it meant. The ultimate decision of course comes down to the Supreme Court to determine whether the laws made by Congress pass muster, so to speak. In fact, when FDR was implementing his New Deal, he had to make significant changes in the Supreme Court in order for them to back his grand vision, because up to that point they had used a strict constructionist view. I'm not going to be able to solve this debate in this post, but I'll briefly describe what I think was covered by this phrase and how I think "General Welfare" should be handled in the future to prevent abuses of it by anyone.

In my personal view (and in the view of many others), General Welfare simply means that there should be no special privilege given to any group (implying an exclusion of others) by the federal government. Instead, measures taken by the federal government under the general welfare clause must be applicable to everyone. Many people are slightly more liberal, including at times the Supreme Court, that the test for General Welfare should simply be "local" versus "national", which is fair enough I suppose, but it leads to additional interpretation of "What does local mean?". For example, do you consider subsidies to farmers as a local issue because of uneven distribution of farmers and the fact that not everyone is a farmer? You could certainly argue the case that the food supply is a national issue though and therefore should be allowable under the General Welfare clause. But then, what about natural disasters like Hurricane Andrew. It was very localized (as opposed to something like Hurricane Katrina that had a very wide path, and so I'll leave it out of the debate for now :) ). I was actually in Miami at the time, and volunteered in what little ways I could. The devastation was horrendous. What kind of nation are we if we don't take care of the localities that are hit by these natural disasters? Do you see the slippery slope that's created by a loose interpretation of the General Welfare clause? This is the very core of the debate between the Left and the Right. The problem though is that the Republican party has slowly fallen victim to that slippery slope and so representatives elected by those people who want a strict view of General Welfare used for the purposes of legislation have a very hard time keeping the Right to the Right.

The same argument can't be said of the Left. It's incredibly difficult to convince someone on the Left that a strict constructionist view has it's merits because it's such a steep slope to climb. So what can those on the Right do? Well, I think a consensus view that does bridge the gap between the far left and the far right is as follows:
Measures taken by the federal government to provide for the General Welfare must be accessible universally and without qualification.
Hmmm. So under that strict interpretation, you could, for example, have a system that allowed for something like a Universal Single Payor Health Care system, right? Well, I would argue that doesn't work, but that's not the subject of this debate. What it does do is it solves the issue of local versus national. It solves my need to have a strict construction of the Constitution, it solves the left's need to be needy (sorry lefties :) ), and, to my way of thinking anyway, it brings the two sides together in an equitable way.

Now, there are some problems here. For one - lefties aren't going to like how this clears up the gray area that Congress has used for decades to pass laws that are not Constitutionally authorized. For example, Social Security in it's current form would be considered unconstitutional because I, as a 30 year old (or so) have a different set of qualifications then someone who's in their 50's (and really, everyone who is below retirement age or who isn't a "survivor" has yet to "Qualify" for it). By all means, I'm open to debate on the definition, but whatever your alternative is, it must provide for a cut and dry determination so that even the lawyers in Congress can't weasel out of it.

I think it's important to cover what's not up for debate. Foreign aid doesn't provide for the General Welfare (as so eloquently argued by Ron Paul). Disaster relief is, almost by it's very nature, a local issue and not a national one. And special interests and pork barrel spending are explicitly excluded as they do not meet the definition of General Welfare in any sense.

So, am I Right or what?
-Andrew Douglas

Sunday, June 10, 2007

Video - Ron Paul in a "nut"-shell

Why does the media insist on presenting this man as a nut? Are these ideas really that crazy?

On the issues - Health Care

I'll be breaking down my point of view on the issues that I think are important in the coming election. You may notice many of these refer to Ron Paul. I think he's got an incredibly good head on his shoulders, and even though I may occasionally disagree with him, I'll say right now that I support his candidacy.

Now on to the issue of Health Care. There was an interesting comment on this post and I just had to reply. See, Phil (the commentor) felt that Ron Paul's ideas would lead to a crisis in our health care system. Well, for one, Ron Paul does not have any plans to break the promises the government has made to care for those people who need these programs today, but he does plan to reform the system that is so obviously broken... and that's a good thing. So here's my reply:

Essentially the plan Ron Paul (and others) have for medical treatment is to give control back to the people. The problem we have now is that insurance companies (which are essentially government funded in a number of ways, not the least of which is that the government gives significant tax breaks to companies to pay for insurance but doesn't extend all of those tax breaks to individuals - so they are often left with no option but to use the insurance their employer provides) control what medical providers can provide, at what cost and even what medical provider you are "allowed" to go to. This is not a free market and therefore market forces can't work to keep prices low and quality of service high.

You create a free market by giving people the appropriate incentive to get off their arse and take their medical treatment into their own hands - or rather, by making them responsible for paying for their medical treatment themselves. That may sound harsh, but hear me out because there is a reasonable solution to this: health savings accounts. For those unfamiliar with it, what it means is that you purchase a high-deductible insurance plan for "the perfect storm scenario" so that you will only ever have a maximum amount of out of pocket expenses in any given year. Okay, so once you have this plan, that's actually fairly cheap, you then pay money into a health savings account - think of it like a separate checking account that you use to pay for all your medical needs. The list of "medical needs" includes things that most insurances don't even cover such as over the counter medications and other non-traditional treatments. If you hit your high deductible for the year, then the insurance plan kicks in. If you don't spend all the money in your account for the year, it rolls over for the next year. Don't have enough money this month? Don't pay into the account this month. It's okay! And the money left in your account can work for you in a lot of ways. One way is that it can be invested however you like. Another is that it's tax free so you get to keep more of your money. But then, let's say you retire or have your kids going off to college or something and you find yourself needing money from your health savings account. That's okay too, but you just have to be aware of the tax issues that comes from that.

Now, health savings accounts are already out there - but they don't get a chance to compete on the same level. For example, because of the way that I get to declare the insurance I pay for my family that I purchase through my company, not to mention the fact that my employer is contributing to the insurance for me... it would be a significant disadvantage to leave my companies insurance plan and move myself and my family to a health savings account. I'm essentially stuck with my employers medical insurance plan. But once you level the playing field and give the appropriate tax incentive to employers and individuals, then health savings accounts become a viable alternative to a lot more people. I'm not saying the plan is perfect for everyone - but make ppo's and hmo's compete with health savings accounts and you'll see a dramatic improvement in prices AND quality of service.

How? For one, you'll see that once medical providers start getting paid in cold hard cash (through the health savings accounts), and without the troublesome paperwork and hassle of insurance companies, medical providers will be able to reduce their prices because their costs have dropped. The other thing is that they will also be in direct competition with each other to do so. When it doesn't matter which doctor you go to because the price is going to be the same, why would they offer a lower price? If a doctor is always going to be able to charge the same price, what incentive is their to provide a higher quality of service?

The other part of it is that you should also make doctors compete against nurses. What I mean by that is that nurses are fully qualified to handle a large number of medical issues, but because of the licensing and regulation issues, they can't hand out prescriptions (such as birth control pills)... I mean, come on, those kind of silly monopolistic policies have encouraged high prices for the most basic services. Obviously though, (and I'm paraphrasing Ron Paul here), you wouldn't go to a Nurse if you needed brain surgery.

Couple more points that I won't elaborate on here but I think are helpful to mention:

1. If you want socialized medicine provided by the federal government, that's perfectly fine. I disagree with it but if the federal government is going to provide that service, we should follow the Constitution and explicitly amend the Constitution to allow the federal government the right to do so. If we don't follow the Constitution (which we didn't do for Social Security or medicare/medicaid), we have no rule of law. Get me 3/4 of the states that want it and it's yours, but even then I would also argue I should have the option to opt out of it.
2. Our monetary policy is causing a lot of the inflated costs of medical care. What other presidential candidate is even discussing this?
3. On the issue of states providing services such as socialized medicine - let the states compete in an open market and if they can't deal with things like a huge influx of people because the costs are too high, then that should tell you something. Socialism doesn't work in practice. But let's say a state got it right (we'll call it Utopia), if everyone happily left a state (we'll call it Dystopia) that didn't provide medical care or social security to go to Utopia because they got it right, Dystopia would want to compete by providing a valid option for their citizens. Why is that a bad thing?
4. Others have said it but I'll reiterate - obviously a capitalistic system requires a moral society of which charitable giving, volunteer-ism, etc. are part and parcel. The thing is, when you give people freedom to make their own choices and you give them the ability to truly take personal responsibility, they are significantly more likely to be charitable than when you culture an environment where everyone expects to be given to from the nanny state.

Alright, enough ranting. I think it's important to debate these issues - instead of debating who has the best hair of the "first tier" candidates... and differences of opinion are welcome. Thanks Phil for giving yours!