Saturday, April 17, 2010

The New Value

Michael Hiltzik hits the nail on the head in his LA Times column today. "Pointless deals line Wall St. pockets" illustrates what Chris Hayes at The Nation was talking about a few weeks ago when he described all the money sloshing around in the upper echelons -- but none of it is trickling down. Shows how hedge fund managers and investment bankers have been getting rich because they make good bets for their wealthy clients, but their activity does not add any value to the economy, and in the case of Goldman Sachs, one particular hedge actually helped make the damage for average consumers worse. They are professional gamblers helping the rich get richer, while the ....well, you know how it goes.

It shows that the free market has no values and simply lets the rich and powerful swoop in and game the system. When the government used to try and do big things - think NASA or fuel efficiency standards - those programs actually spurred innovation and technology that led to enormous growth in the private sector. But during the Bush years, de-regulation and small government policies ruled the day and instead of the economy creating growth and wealth based on innovation and technology, it created a housing bubble and "financial instruments" that have created vast wealth for small numbers of people without creating value or making life better for the average consumer. The wonderful free market of the past decade lured thousands of our best and brightest students and math minds away from inventing alternative energy or smarter computers and instead they have become stewards of vast empires of wealth.

Monday, April 12, 2010

"The Road to Serfdom"

One of the best examples of how Glenn Beck and Fox News mangle and distort their facts and why they are so dangerous is in this quote from one of Mr. Beck's recent shows:

"We will resist the total transformation of our country but we will do it peacefully. Yes. People did it under [Woodrow Wilson] and people did that here. Well, not so much because the people who are in [President Obama's] administration hated [Richard Nixon] and they didn't resist peacefully; they were setting bombs off. But we will resist peacefully."

How is giving the private insurance industry 30 million new customers, somehow a total transformation of our country? Where is the socialism? Where is the communism? There is none. The health care bill was really a health insurance bill that imposed much needed regulation on an industry that makes money by denying coverage to as many people as possible. And in the name of free-markets, that industry has made our country less competitive while our citizens have worse health outcomes than nearly every country with socialized medicine.

Beck uses the fear of Communism in exactly the same way Senator McCarthy did -- as a way to implement conformity and control -- and ultimately to incite people to violence, despite his non-violent rhetoric. Here's another quote from Mr. Beck's 4/8/10 show:

"Is it a coincidence that all of the above are or were advisers to the president? By the way, [Van Jones] was an adviser to the president and now he's with George Soros' group. Is it possible that maybe, by pointing out every night that there are radicals, Marxists and communists in the White House, maybe that struck a nerve?"

Sounds like something straight out of a House Committee on Un-American Activities meeting from 1950. Beck and his viewers are the shoeshine boys of the ruling elite and they don't even know it. By reducing every argument to a battle between Libertarianism and Communism, they eliminate the possibility of having a discussion that includes complexity or the reality of our hybrid government that combines democracy with a primarily capitalist, market-based economy and adds in a few social programs like Medicaid, Medicare and Social Security. This is hardly a centrally planned economy now that the health insurance reform bill has passed. Mr. Beck, please tell me: where is there a movement by Democrats or any other group to impose a centrally planned economy in the U.S.? Where is there an attempt by the current administration to roll-back constitutional rights?

George Orwell perhaps summarized it best in his critique of Friedrich Hayek's 1944 best-seller, The Road to Serfdom:

"in the negative part of Professor Hayek's thesis there is a great deal of truth. It cannot be said too often — at any rate, it is not being said nearly often enough — that collectivism is not inherently democratic, but, on the contrary, gives to a tyrannical minority such powers as the Spanish Inquisitors never dreamt of". Yet he also warned, "[A] return to 'free' competition means for the great mass of people a tyranny probably worse, because more irresponsible, than that of the state."

Hayek believed central planning and state control would inevitably lead to tyranny and totalitarianism, like it had in the Soviet Union. And that is what Beck and the Tea Partiers are worried is going to happen under Obama. Yet, the past 30 years of conservative dominance of U.S. politics and the stripping out of most New Deal financial regulation has led to exactly the kind of tyranny that Orwell warned against. And that was the tyranny against truth, justice and fairness in our governance and in our markets, which reached its pinnacle under the administration of George W. Bush and Dick Cheney. And it is that tyranny, which Mr. Beck continues and enables through his Tea Party movement.

Saturday, April 3, 2010

Top Lies about the Health Insurance Reform Bill recently posted an article, "True or false? Top 7 health care fears" in which they do a good job debunking some of the Fox News and Tea Partier hysteria about health care. However, they somehow managed to not include these two fears, which seem like the top two:

1. My taxes will go up!
2. It's Socialism in America!

Of course, neither of things are true, unless you are in the 1.5% of American households that make more than $250k per year -- then your investment income will be taxed at a higher rate.

With no new government run health system being put in place and no pubic option, there isn't much in this bill that could be considered socialist, except for a slight expansion of Medicaid. Mostly, this bill is the opposite of Socialism, funneling 30 million new customers into the private insurance industry.

It will be interesting to see if this bill helps expand coverage and lower costs. Certainly, it seems like we have a much better chance with this bill than letting the previous status quo of continually rising costs and decreasing coverage continue. Not sure how the Republicans think they can win in November by trying to repeal the expanded benefits and the bill's tough new regulations on the insurance industry!