Month: August 2004

A Word or Two for Ideological Purists

William Watkins at Southern Appeal has a post in which he quotes from James Bovard’s The Bush Betrayal. Watkins says of Bush:

No matter what his failings, so the argument goes, surely he is better than Kerry. Perhaps he is better than Kerry, but ought not we have higher standards than this? If John Kerry is the measuring stick, then I would venture that there are a large number of rascals who would be better leaders than him. But if we measure Bush by a legitimate standard, then we see much is lacking Here is a taste of Bovard’s indictment….[long quotations here]…So this is the man who is about to lead what used to be the party of limited government and fiscal responsibility. What a shame.

The quotations are about the Medicare prescription plan, a farm bill with “generous” benefits, steel tariffs, foreign aid, and education spending. William characterizes some of those measures as “vote-buying”; hell, they’re all vote-buying.

Now let’s talk about why the glass is half-full, not half-empty. What Bush gave with prescriptions he will try to take back (and then some) through partial privatization of Social Security. Farm subsidies are a bi-partisan addiction; find a president who can resist them and you’ll find a nation in which the electoral college has been abolished and most farm products are imported. Bush’s overall stance on trade is good, why get upset by a blatantly political and short-lived bit of protectionism? Almost everyone’s against foreign aid, but it’s almost inconsequential and it might actually pay long-term dividends in the war on terror. A successful push for vouchers — a key item on the Republican agenda — will have a much greater positive effect on education than the feeble negative effect of the No Child Left Behind Act.

Bovard and Watkins seem to live in the perfect world of perfectly rational, non-political politicians. It doesn’t exist. Kerry is the standard to which Bush should be compared — this year. And defeating Kerry must be number two on Bush’s agenda — this year. Number one, of course, is fighting the war on terror, which Watkins doesn’t mention. I hope he doesn’t think that’s unimportant.

Next year, if Bush has been re-elected, Bovard and Watkins can rightly complain if Bush continues to disappoint them. But before they complain they should consider Bush’s entire record, including — most importantly — his performance in the war on terror. If that doesn’t satisfy them they should do more than complain; they should actively support the nomination of a better Republican candidate in 2008.

But they should never lose sight of the fact that the real world of presidential politics — as opposed to their ideal world of ideological perfection — will almost always produce a choice between the greater evil and the lesser evil. The last time it produced a clear choice between evil and good was in 1964. And look what happened then: Voters mistook good for evil and evil for good, and evil ensued, both at home and abroad.

Would Bovard and Watkins prefer the unelected Goldwater or the elected Bush? I’m sorry to say that’s the sort of choice the real world usually offers, my friends.

Cold Mountain, the Movie

I finally saw the movie based on Charles Frazier’s best-selling novel, Cold Mountain. The movie is good, but disappointing. The novel draws its power from Inman’s long, perilous journey home to Cold Mountain, North Carolina, in the aftermath of the bloody battle of Petersburg (Virginia), where he almost perished. In the novel, Inman’s journey is intercut with the tribulations of Ada, with whom Inman had fallen in love before going to war, and Ruby, a mountain woman who “learns” Ada how to run her farm without a man. The story of Ada and Ruby, though suspenseful and fascinating in its own right, serves mainly to make Inman’s journey seem longer and more suspenseful. Inman’s tragic end, the emotional climax of the novel, follows his return and blissful reunion with Ada.

The movie spends too much time on Ada and Ruby, shortchanging the epic nature of Inman’s journey. The interaction of Jude Law (Inman) and Nicole Kidman (Ada) fails to match the attraction that leaps from the pages of Frazier’s novel. Perhaps it’s the script, perhaps it’s the direction, and perhaps it’s the actors. I think it’s the actors: Frazier’s Inman could have been played perfectly by a young Gary Cooper — strong and silent, in contrast to Law’s rather short and loquacious version. Frazier’s Ada could have been played perfectly by a young Vivien Leigh — who, in fact, played Ada’s prototype in Gone with the Wind.

Having said that, I must defend Renée Zellweger’s Ruby. Zellweger did not overplay the role, regardless of what some critics say. Those critics must never have met an up-country native of the Appalachians. Zellweger’s Ruby is a perfect characterization, in accent, attitude, and manner — rude, crude, suspicious of outsiders, and aggressively defensive. Zellweger deserves her Oscar.

The movie version of Cold Mountain deserves a viewing, but don’t expect more than 152 minutes of entertainment. You won’t remember it as one of the greatest movies ever made — not by a long shot.

How’s That for Credibility?

John O’Neill, a key member of Swift Boat Veterans for Truth, recently gave a revealing interview to the L.A. Times. A key paragraph says this about O’Neill:

He portrayed himself as a political independent — a Reagan Democrat, he said, if he had to have a label. Although he typically supports GOP candidates, he says, he voted for Democrat Al Gore in 2000. And although the “Swifties” have agreed to focus on Kerry and not to discuss President Bush, O’Neill made it clear he is no great fan of the president, whom he has described to several friends as an “empty suit.”

O’Neill may not represent all the SwiftVets — or even a small fraction of them — on that score, but it makes his anti-Kerry passion all the more convincing. The Vets, as a group, seem genuinely motivated by their justifiable hatred of Kerry’s perfidy and lack of moral character. Karl Rove couldn’t have invented them if he’d tried.

(Thanks to One Hand Clapping and Michelle Malkin for the tip.)

In the "It Could Be Worse" Department


Yesterday I attacked FCC commissioner Michael Copps, in particular, and the federal government, in general, for paternalistically and unnecessarily regulating the airwaves. Thanks to a tip from the proprietor of Occam’s Carbuncle, a Canadian blog, I’ve learned how much worse it is in Canada. As he says:

Copps would feel right at home in Canada, where our FCC equivalent, the CRTC, routinely sticks its nose in where it doesn’t belong. One of our better blogs, Trudeaupia, has been all over this issue.

(CRTC stands for Canadian Radio-television Communications Commission or, in French, Conseil de la radiodiffusion et des télécommunications canadiennes.) Anyway, here’s the issue, in the words of CRTC:

In a decision issued today,…CRTC…denies the application…for the renewal of the broadcasting licence for the French-language commercial radio station CHOI-FM Québec….

The Commission considered that offensive comments made by the hosts over the station’s airwaves tended or were likely to expose individuals or groups of individuals to hatred or contempt on the basis of mental disability, race, ethnic origin, religion, colour or sex. The Commission also considered, among other things, that the station’s hosts were relentless in their use of the public airwaves to insult and ridicule people….

According to CBC Montreal, reporting on August 26:

A federal court has made it official—CHOI-FM can continue broadcasting after its licence expires at the end of this month.

The controversial radio station has reached an agreement with the CRTC to keep broadcasting until a final decision comes down about the fate of the station….

Trudeaupia is skeptical: “Or is this just a delaying action until the protest dies down, then they’ll abruptly close it?”

So, it could be worse here in the U.S. of A. First, we could have to say everything twice: once in English, again in French. Second, we could have to put up with limitations on freedom of speech that dwarf the infamy of McCain-Feingold.

How could I forget that other bastion of freedom in the English-speaking world, our “mother country”? Well, here’s Eugene Volokh at The Volokh Conspiracy to remind me (quoting from

Ford Motor Co., the world’s second biggest carmaker, has had a television commercial for its Land Rover brand banned by the U.K. communications regulator after it was judged to “normalize” the use of guns.

The advertisement, which featured a woman brandishing a gun later revealed to be a starting pistol, breached the Advertising Standards Code and must not be shown again, Ofcom said in an e-mailed statement. The regulator received 348 complaints against the ad, many concerned that the commercial glamorized guns and made it “appear that guns are fun and cool.”…

Ofcom said glamorization is “part and parcel” of the advertising process but this commercial “normalized” gun ownership in a domestic setting. The pistol, fired by the woman into the air as a man got into his car, was used in “an apparent casual manner and just for fun,” Ofcom said….

George Orwell, wherever you are, call home.

Broder Boots Another One

David Broder of The Washington Post, called by some the “dean” of Washington pundits, is true to form in this wrong-headed column:

Policing Political Ads

By David S. Broder

Sunday, August 29, 2004; Page B07

…With total reported political contributions for this cycle already past the $1 billion mark — and the heaviest ad buys still to come — the character of the perpetual debate about campaign financing has begun to shift. Instead of focusing on who is giving how much, the argument now seems to be about who has the right to join in the spending spree….

With record sums available to both sides — either through their official committees or through the independent groups supporting them — the real issue is not one of finance but of accountability….

The institutions and individuals with a stake in the presidential election are far more numerous than two parties and two candidates. All sorts of other groups — from left and right, from environmentalists to anti-abortionists — have much riding on the outcome. By what logic are they to be prohibited from running their ads?…

The reality is that, in a nation with our Constitution’s guarantee of free speech and a government whose decisions affect every aspect of life, the flow of money from the private sector into the political world will be almost impossible to control.

What can be disciplined is the tendency of these ads to exaggerate, distort or flat-out lie. And the candidates who benefit from the ads are the ones who have the first responsibility — along with the media — to police them. The candidates ought to be judged by their willingness to tell their supporters when they have crossed the line.

The headline is scary, but it belies the message. Broder was doing well until the last paragraph. Then he booted it.

The only “policing” that’s needed is the policing that citizens do in the privacy of their own minds. It’s impossible to take at face value a candidate’s disavowal or repudiation of ads attacking his opponent. Is the candidate being sincere or merely observing the niceties of political decorum? In the end, citizens are left to make up their own minds about the validity of third-party attack ads, just as they are left to make up their own minds about the validity of candidates’ ads.

But Broder is just being Broder, a paternalistic Washington insider who doesn’t trust “the masses” to think for themselves.

Where the French Went Wrong

A review of Gertrude Himmelfarb’s The Roads to Modernity says it well:

…Now comes distinguished historian Gertrude Himmelfarb (married to Irving Kristol, widely regarded as the godfather of the neoconservative movement) to add some intellectual heft to the right’s Francophobia.

Himmelfarb’s basic contention, one she supports with great passion and wide-ranging scholarship, is that the great 18th century French Enlightenment has been vastly overrated and that the British and American Enlightenments have been comparatively underrated. Her goal in writing this book is to “reclaim the Enlightenment…from the French who have dominated and usurped it” and restore it to the British and Americans.

So who stole the Enlightenment and gave credit for it to the French? Himmelfarb never says so directly, but one can venture a guess: liberals in academia. Her critique of the French Enlightenment is twofold: First, the French philosophes, from Rousseau to Voltaire to Diderot and the rest, were anti-religious, and second, they were elitists who scorned the common people. The French so worshiped reason that they denied the value of faith, thus cutting themselves off from the multitudes.

The great Voltaire, Himmelfarb points out, opposed education for the children of farmers on the grounds that they were mired in religious superstition and thus largely unredeemable. This kind of elitist thinking, Himmelfarb tells us repeatedly, pervaded the French Enlightenment. So did totalitarian impulses, impulses embodied in the French Revolution and “the Terror.” Himmelfarb spends much space describing Rousseau’s concept of the “general will” and how it influenced Robespierre and hence “the Terror.”…

Exactly. Rousseau, the godfather of communism, believed that individuals had surrendered their will to the state by entering into an imaginary social contract (somewhat like John Rawls’s imaginary “veil of ignorance”). And it was all downhill from there. Now we have Rousseau’s descendants — modern-day Democrats — who want to regulate our lives for our own good. That includes, of course, denying a good education to poor children in the name of “public” education.

This Isn’t News

This has been blogged before, but it bears repeating:

Reuters Editor’s Email ‘Sad But Revealing,’ Pro-Life Group Says

( – A Reuters news service editor sent an e-mail to a pro-life group last week, criticizing the group’s stance on abortion as well as its support of the Bush administration….

According to the National Right to Life Committee, the email came “out of the blue” from Todd Eastham, a news editor for Reuters. Eastham was responding to a press release that the National Right to Life Committee sent to hundreds of news outlets after a federal judge in New York struck down a ban on partial birth abortion.

Eastham’s email read as follows: “What’s your plan for parenting & educating all the unwanted children you people want to bring into the world? Who will pay for policing our streets & maintaining the prisons needed to contain them when you, their parents & the system fail them? Oh, sorry. All that money has been earmarked to pay off the Bush deficit. Give me a frigging break, will you?”

Douglas Johnson, the National Right to Life Committee’s legislative director, called it “sad but revealing to see an editor for a major news service so casually and gratuitously express such blatant hostility to both the Bush administration and to the right to life of unborn children….

At the bottom of Eastham’s email is a statement that reads: “Any views expressed in this message are those of the individual sender, except where the sender specifically states them to be the views of Reuters Ltd.”

That “boilerplate material” invites Eastham’s readers to visit the Reuters website, Johnson noted. Johnson said he did visit the website, where he found a Reuters’ editorial policy, which said, “Reuters journalists do not offer their own opinions or views.”…

Normally they slip their opinions and views into the articles they write for Reuters, but with no more subtlety than Eastham’s email.

Entertain Me!

Michael J. Copps, a Democrat member of the Federal Communications Commission, believes

our broadcast media owe us more coverage of an event that remains an important component of the presidential campaign. Yet tonight, if people around the country tune in to the commercial broadcast TV networks, most will not see any live convention coverage. That’s not right.

Let’s remember that American citizens own the public airwaves, not TV executives. We give broadcasters the right to use these airwaves for free in exchange for their agreement to broadcast in the public interest. They earn huge profits using this public resource. During this campaign season broadcasters will receive nearly $1.5 billion from political advertising.

Where to begin? Let’s start with fundamentals and go from there:

1. American citizens don’t own the public airwaves. The federal government, acting through the FCC, regulates the airwaves in the mistaken belief that chaos would ensue if the airwaves weren’t regulated. If the FCC didn’t regulate the electromagnetic media, the users of the media would regulate themselves, just as surfers regulate themselves.

2. How much money broadcasters make is therefore none of the FCC’s business.

3. What broadcasters broadcast is therefore none of the FCC’s business.

4. Broadcasters should broadcast in order to maximize their profits. A concept that happens (through the magic of the “invisible hand”) to serve the interests of consumers.

If Copps thinks that people who watch political conventions actually learn anything they can’t learn by watching or listening to news programs, reading newspapers and magazines, surfing the web, and — best of all — reading political blogs of all persuasions, then Copps is a fool. But we already knew that, didn’t we, when he said that a convention is an “event that remains an important component of the presidential campaign.” That’s true only in the sense that a convention affords a major party the opportunity to grab some free advertising for its candidate.

Copps is more than a fool, however; he’s a paternalistic fool. He’s itching to force broadcasters to cover conventions because watching them would be good for us, the unwashed masses who, obviously, don’t know where to turn for our political news.

Well, Copps’s term as commissioner expires June 30, 2005. So, if Bush wins re-election, Copps won’t be around the FCC much longer.

Lame Protest of the Day

Here’s a member of “Billionaires for Bush” mocking Republicans for their purported monopoly on rich adherents:

Of course, there are some real billionaires for Kerry (including George Soros, Ted Turner, and Warren Buffet), and a bunch of Hollywood fat-cats who aren’t living on food stamps. In fact, most of the wealthiest zip codes in the nation are Democrat bastions. It just proves, once again, that you don’t need a lot of sense to make a lot of cents.

Skimming the Post

Today’s has two great headlines. First we find that “Edwards Says Kerry Plans to Confront Iran on Weapons”. Okay, so why is Edwards saying this instead of Kerry? Would it be too confrontational if Kerry says it? But it gets worse, because the Kedwards approach to confrontation boils down to this:

A John F. Kerry administration would propose to Iran that the Islamic state be allowed to keep its nuclear power plants in exchange for giving up the right to retain the nuclear fuel that could be used for bomb-making, Democratic vice presidential nominee John Edwards said in an interview yesterday.

Edwards said that if Iran failed to take what he called a “great bargain,” it would essentially confirm that it is building nuclear weapons under the cover of a supposedly peaceful nuclear power initiative. He said that, if elected, Kerry would ensure that European allies were prepared to join the United States in levying heavy sanctions if Iran rejected the proposal….

Heavy sanctions? Wow! I suppose France would vow never to repeal its headscarf ban.

Then there’s this headline, which in light of recent polling trends seems to be post-mature (pun intended): “Series of Misjudgments Cost President His Lead”.

Some days it doesn’t pay to get the paper out of bed.

Very Politically Incorrect

A study cited here suggests that women don’t compete well against men. If that’s true, it may have something to do with the effects of stress on cognition, as indicated by a test of female rats reported here.

All I’m doing is reporting the results of scientific experiments. Don’t shoot me.

The Crystal Ball Is Cloudy

The usually sensible Larry J. Sabato, a political scientist at the University of Virginia, publishes his prognostications on a website called Sabato’s Crystal Ball. This morning he talks about the likelihood of a Bush “bounce” from the GOP convention. He says, in part:

At best, President Bush faces an extremely difficult battle for reelection. First, as we have noted many times, no president but Truman who has done this poorly in the public polls of an election year has in the end been reelected. Could Bush be the second Truman? It’s possible, just as it is very possible he’s the second Ford (1976), Carter (1980), or Bush I (1992).

In addition, as the NBC/Wall Street Journal’s latest survey–and many others–strongly imply, the remaining undecideds are heavily female and anti-Bush, at least at this point….

The remaining undecideds are heavily (care to rephrase that?) female and anti-Bush? If that’s true, then Bush does have a chance. All the anti-Bush females I know have already made up their minds to vote for Kerry. Actually they had already made up their minds to vote for Bush’s opponent on January 20, 2001.

Does the CPI Overstate Inflation? And Who Cares?


Fed chairman Alan Greenspan, in recent testimony before Congress, suggested several ways to deal with the impending deficit in Social Security receipts*. One of those ways is to index Social Security payments to a “true” cost-of-living index. According to Greenspan, who is picking up on the findings of the “Boskin report” — a study done for the Senate Finance Committee in 1996 — the CPI systematically overstates increases in the cost of living.

How is that? Quoting from the executive summary of the Boskin report:

There are several categories or types of potential bias in using changes in the CPI as a measure of the change in the cost of living. 1) Substitution bias occurs because a fixed market basket fails to reflect the fact that consumers substitute relatively less for more expensive goods when relative prices change. 2) Outlet substitution bias occurs when shifts to lower price outlets are not properly handled. 3) Quality change bias occurs when improvements in the quality of products, such as greater energy efficiency or less need for repair, are measured inaccurately or not at all. 4) New product bias occurs when new products are not introduced in the market basket, or included only with a long lag.

I agree that the second, third, and fourth biases are a problem. But I disagree with respect to the substitution bias. Why? Let’s start with this excerpt of part IV of the report:

The “pure” substitution bias is the easiest to illustrate. Consider a very stylized example, where we would like to compare an initial “base” period 1 and a subsequent period 2. For simplicity, consider a hypothetical situation where there are only two commodities: beef and chicken. In period 1, the prices per pound of beef and chicken are equal, at $1, and so are the quantities consumed, at 1 lb. Total expenditure is therefore $2. In period 2, beef is twice as expensive as chicken ($1.60 vs. $0.80 per pound), and much more chicken (2 lb.) than beef (0.8 lb.) is consumed, as the consumer substitutes the relatively less expensive chicken for beef. Total expenditure in period 2 is $2.88.

The simplest comparison is to ask “How much more must I spend in my current situation (period 2) to purchase the same quantities that I purchased initially (in period 1)?”22 This is the question asked by the CPI. The price index for period 2 relative to period 1 uses the initial period 1 basket of consumption as the weights in the computation. To buy 1 lb. of beef and 1 lb. of chicken in period 2 costs $2.40. The price index for period 2 relative to period 1 is 1.20 (2.40/2.00), that is a 20 % increase.

Intuitively, it is easy to understand why such a computation imparts an upward (substitution) bias to the measure of the change in the true cost of living. It assumes the consumer does not substitute (cheaper) chicken for beef. In the real world, as in the hypothetical example, consumers change their spending patterns in response to changes in relative prices and, hence, partially insulate themselves from price movements.

Okay, consumers tend to substitute cheaper products for more expensive products as relative prices change. So what? The consumer was happy with 1 pound of beef and 1 pound of chicken before the price of beef went up relative to the price of chicken. Now the consumer will have to spend 20 percent more to be just as happy as she was before. That’s a good measure of the increase in her cost of living. Or to put it another way, she would have to spend 20 percent more in order to maintain a constant standard of living.

It’s true that tastes change with time, which is why the Bureau of Labor Statistics occasionally changes the “market basket” of goods and services it uses in computing the CPI. But, in the short run, the consumer is definitely worse off when prices rise, because she has to buy less of something she likes and more of something she likes less. In that respect, the CPI gets it right.

Aside from the substitution effect, how much does the CPI really overstate the cost of living? Table 3 in part VI of the report summarizes the effects of the various types of bias. As of 1996 — taking into account recent and prospective changes in the computation of the CPI — the report estimated that the CPI would overstate increases in the cost of living by 1.1 percentage points a year. But 0.4 percentage points of that total is accounted for by substitution bias. That leaves about 0.7 percentage points for other types of bias, which can add up over the years. In 10 years, for example, an overstatement of 0.7 percent in the CPI would cause Social Security benefits to rise 7 percent more than necessary in order to maintain a constant standard of living.

Bottom line: Greenspan may be right to urge the adoption of a more realistic cost-of-living index for Social Security, but that index won’t be realistic if it doesn’t handle the substitution bias correctly.


A working paper by Robert Gordon (a co-author of the Boskin report), published by the National Bureau of Economic Research in June 2000, says that changes to the method of calculating CPI made in the wake of the Boskin report have reduced the CPI’s overstatement of the cost of living from 1.1 percentage points to 0.65 percentage point. The changes, however, include corrections for the “bias” due to the substitution effect, which isn’t really a bias, as I argue above.

A note on the Bureau of Labor Statistics website, dated 02/20/02, discusses the creation of a new index called the Chained Consumer Price Index (C-CPI), which supplements but does not supplant the CPI. The C-CPI attempts to correct for the substitution effect across item categories (e.g., if the price of cigarettes goes up, consumers buy more bread). The same note says that the basic CPI was adjusted in 1999 to capture the effects of substitution within product categories (e.g., if the price of bourbon goes up, consumers buy more beer). So, in spite of all logic (or at least my logic), the CPI and its companion index have eliminated the so-called substitution bias.

Those are the key points I have been able to glean by searching the BLS website and by Googling. The business of computing price indices is exceedingly murky and complex. It’s safe to say that price indices are approximations wrapped in estimates surrounded by great statistical uncertainties. Changes in the CPI could well overstate (or understate) changes in the cost of living by 100 percent and we’d never know the difference. Anyway, as the BLS wisely says somewhere on its site (or perhaps it was in the Boskin report), the cost of living is a personal thing that can’t really be captured by an index.

I’m sorry I started this. I’ll never write on the subject again — I think.


*Of course, the real solution to the impending deficit in Social Security receipts is to privatize Social Security. But that’s another argument, which I’ve already made here.

A Historian Who Needs a History Lesson


Niall Ferguson, professor of history at Harvard and a senior fellow of the Hoover Institution at Stanford, writes in OpinionJournal at that Bush’s defeat would be good for the GOP. He supports this bold thesis by dredging one (just one) example from history:

Many [British] Conservatives today would now agree that it would have been far better for their party if [Prime Minister John] Major had lost the election of 1992. For one thing, the government deserved to lose. The decision to take the United Kingdom into the European Exchange Rate Mechanism had plunged the British economy into a severe recession, characterized by a painful housing market bust. For another, the Labour candidate for the premiership, Neil Kinnock, had all the hallmarks of a one-term prime minister. It was Mr. Kinnock’s weakness as a candidate that enabled Mr. Major to scrape home with a tiny majority of 21 out of 651 seats in the Commons. Had Mr. Kinnock won, the exchange rate crisis of September 1992 would have engulfed an inexperienced Labour government, and the Conservatives, having replaced Mr. Major with a more credible leader, could have looked forward to an early return to office.

I won’t go into the parallels Ferguson draws between Major’s next five years in office and what he expects of a second Bush term. Let’s just say that his assessment is about as good as that of the average anti-Bush protester who’s blocking traffic in Manhattan.

Ferguson — a Glaswegian by birth — must have a weak grasp of American political history. Parties in this country hold onto power by holding onto it, not by abdicating it. Thus the Jeffersonian Republican dynasty of 1801-25, the new Republican dynasty of 1861-85, the Democrat hegemony of 1933-69 (broken only by Ike’s winning popularity), and the Republican hegemony of 1969-2005 (interrupted only by Carter’s one-term debacle and Clinton’s Perot-assisted two terms).

I’m being a bit unfair to Ferguson, because he isn’t suggesting that Bush throw the election. He simply thinks that Republicans might be better off, in the long run, if Bush loses. But regaining power once it’s lost can be a hard thing to do. Losing tends to breed losing, here as well as in Britain. If Republicans are, at bottom, different than Democrats — and if they are likely to stay different — there’s a good reason many of us fear a Democrat dynasty. And, given the way of American politics, a Democrat dynasty might flow from a Kerry victory. Look how far down the road to socialism we marched during the Democrat hegemony of 1933-69.

Are such bad things bound to happen in a second Bush term that Republicanism will vanish into the same black hole as the British Conservative Party? I look at it this way: If Bush has made mistakes he has undoubtedly learned from them. Kerry, on the other hand, is a bundle of mistakes waiting to be opened.

Here’s to the continuation of Republican control of the White House — and Congress.


Ramesh Ponnuru of The Corner at NRO agrees with me (though I don’t think he’s read this post):

Ferguson says that a second term of hawkishness, big spending, and social conservatism will further divide the party rather than unify it. He also makes a comparison to 1956. Eisenhower had pursued regime change in the Middle East in his first term; he won re-election and had a disastrous second term; that led to the Democrats’ owning the 1960s.

We are supposed to believe that the party will be more unified if it has no leader. Maybe, but it’s not the way to bet. The Eisenhower comparison is a total failure. Ferguson’s own recitation of Eisenhower’s foreign-policy record undermines his claim that “President Bush can be relied upon to press on with a foreign policy based on pre-emptive military force”–on his telling, Eisenhower had switched gears by the end of his first term. (Ferguson blasts him for “incoherence,” without noticing he’s making his own argument incoherent.)

And Eisenhower’s second term wasn’t the prelude to a Democratic majority–it was an interruption of a Democratic majority. The Democrats had won the five presidential elections before Eisenhower, and won the two following him. Eisenhower’s massive popularity allowed the Republicans to hold on to national power during a time of Democratic ascendancy. Cutting the Eisenhower interregnum short would not have improved Republicans’ prospects in the following decade. It’s bad enough when predictions about the future are far-fetched; predictions about the past should be more solid.

It’s Make-or-Break for Democrats characterizes the GOP’s situation as “make or break”:

Make or break in Manhattan

Aug 27th 2004

From The Economist Global Agenda

The “Grand Old Party” will make its case for re-electing George Bush at a convention in New York next week. The tone will be inclusive, but Mr Bush’s proposals for a second term could look like a continuation of his polarising first four years….

So, it’s “make or break”? I guess the vaunted Economist can’t afford to subscribe to polls or doesn’t know how to call them up on the web.

As for those “polarising first four years” (I love those English spellings): Do you mean the four years that began with honked-off Democrats crying about the election that Gore almost stole? Democrats only got more honked-off as Bush finessed them on taxes, the war in Iraq, and (most recently) campaign-finance reform. If this be polarization, let’s have four more years of it.

Higher Math at Reuters

Paul at Wizbang quotes Reuters:

WASHINGTON (Reuters) – The U.S. economy slowed more sharply in the second quarter than first thought as oil prices rose and the trade gap swelled, the government said on Friday in a report that confirmed momentum faltered in the spring.

U.S. gross domestic product — which measures total output within the nation’s borders — expanded at a 2.8 percent annual rate…

Paul says, “I need someone to ‘splain this one to me.”

My answer: Reuters is simply showing off its advanced knowledge of mathematics. In calculus, the rate of change of a quantity is the first derivative — that’s the growth rate — which in this case is positive. If, however, the growth rate drops, then the change in the growth rate — the second derivative — is negative. Thus, a rigorous organization like Reuters, which is full of “advanced” thinkers, is correct in saying that the U.S. economy slowed, if by “slowed” Reuters is referring to the second derivative. Got it? I’m sure Reuters doesn’t.

Dealing with "Middle-Class Squeeze"

Arnold Kling writes about “Understanding ‘Middle-Class Squeeze'” at Tech Central Station. He debunks the notion of “middle-class squeeze” and concludes with these observations:

[P]oliticians who take on middle-class squeeze…as [a] public policy [issue] may be causing harm. Sending out a message that government is the solution may serve to weaken the cause-effect connections that people need to make in order to solve what are fundamentally personal problems. The damage caused by exacerbating the cause-effect disconnect that weakens personal willpower may far exceed the benefits of whatever actual remedy the government is able to deliver.

Well, let’s suppose that politicians are unable to resist dealing with “middle-class squeeze” — just as many of the middle class are unable to resist McMansions and fattening foods. What to do?

To the extent that there is such a thing as middle-class squeeze, it reflects a lack of fiscal discipline, which means that the middle class (on the whole) is spending more and saving less. If that’s the case, a public-policy solution would be to (1) increase taxes on consumption (perhaps by levying a national sales tax, including a sales tax on homes), (2) eliminate income tax deductions for property taxes and mortgage interest (for starters), and (3) reduce taxes that discourage saving (perhaps by eliminating all taxes on capital gains and interest).

That combination of actions — which could easily be made revenue-neutral — would have the effect of raising investment, thereby increasing productivity and real incomes. At the same time, by encouraging Americans to save at a higher rate, Americans would become less dependent on Social Security as a source of retirement income, which is another way of dealing with the coming “crisis” in Social Security.

The Republican Advantage in Presidential Elections

Republican presidential candidates must work harder for their electoral votes than their Democrat opponents, yet they have a statistically significant advantage over those same opponents. What do I mean by “work harder”, what is the statistically significant advantage, and what are its implications for future elections?

Working Harder — A Result of Long-Term Political Realignment

From the election of 1880 — the first post-Reconstruction election — through the election of 1928, the percentage of electoral votes cast for the Republican candidate was usually the same as, or greater than, the percentage of States won by the Republican candidate. That relationship reflected the tendency of Republicans to win the more-populous States of the Northeast and Upper Midwest, whereas Democrats could only count on the less-populous States of the South.

After the aberrant election years of 1932-1948 (spanning the Great Depression, World War II, and the Dixiecrats), the relationship shifted, and the realignment of party allegiances began. Eisenhower made inroads into the “Solid South” in 1952, and greater inroads in 1956, while holding onto traditional Republican States. Then, as the Northeast and Upper Midwest began increasingly to vote for Democrats, the South began increasingly to vote for Republicans. This realignment was complete by the election of 1980, when the Democrat (Carter) won only one Southern State — his home State of Georgia.

Although the population of the Southern States has grown faster than the population of the States in the Upper Midwest and Northeast, the net result of realignment, thus far, has been to the disadvantage of Republican candidates. That is, since realignment Republicans must win a higher percentage of States than they did before realignment in order to win a given number of electoral votes. That relationship will change, of course, as realignment persists and the South continues to outstrip the North in population growth. But it holds for now, even in the aftermath of the 2000 census.

The Statistical Advantage

Republican presidential candidates, in spite of their geographic disadvantage, have held a significant statistical advantage over Democrats since the 1950s. Perhaps it began with Eisenhower, survived the Goldwater debacle and Nixon’s disgrace, was renewed by Reagan, and wasn’t diminished by Clinton’s ephemeral and largely partisan appeal. Whatever the explanation, the share of Republican presidential candidates has been out of proportion to their share of the popular vote, which means that they have tended to do better than Democrats in populous swing states.

The effect of this phenomenon is shown by a statistical analysis of the percentage of electoral vote going to the winner of elections from 1956 through 2000. The best regression equation has only two significant explanatory variables: percentage of two-party popular vote and Republican Party affiliation.


If Republicans can hold onto their solid base of States in the South, Southwest, the Plains, and the Rocky Mountains — and if they do not destroy the trust in presidential Republicanism that seems to be the legacy of Eisenhower and Reagan — they can win the White House more often than not for decades to come. That’s not a guarantee, because those are big “ifs”.

Professor Krugman Flunks Economics

Paul Krugman, NYT columnist and ersatz professor of economics and international affairs at Princeton University, writes today about “America’s Failing Health”. Herewith, some excerpts and commentary by yours truly:

Working Americans have two great concerns: the growing difficulty of getting health insurance, and the continuing difficulty they have in finding jobs. These concerns may have a common cause: soaring insurance premiums. [Let’s see how he pulls this one off.]

In most advanced countries, the government provides everyone with health insurance. [The “government” means taxpayers, of course. I love the way these well-educated left-wing economists ignore the truth when it suits them. Of course, we know he’s about to slam the U.S. for not being as “advanced” (i.e., socialistic) as other Western democracies. And sure enough…] In America, however, the government offers insurance only if you’re elderly (Medicare) or poor (Medicaid). Otherwise, you’re expected to get private health insurance, usually through your job….

Some employers have dropped their health plans. Others have maintained benefits for current workers, but are finding ways to avoid paying benefits to new hires – for example, by using temporary workers. And some businesses, while continuing to provide health benefits, are refusing to hire more workers. [Written in a tone that suggests there’s a social law that says businesses must “pay for” health insurance, and that they must hire workers they can’t afford.]

In other words, rising health care costs aren’t just causing a rapid rise in the ranks of the uninsured (confirmed by yesterday’s Census Bureau report); they’re also, because of their link to employment, a major reason why this economic recovery has generated fewer jobs than any previous economic expansion. [Wait a minute, prof, when employers don’t subsidize health insurance premiums, they’re able to hire more employees and/or pay current employees more. Businesses simply do employees a favor by creating group plans, which pool risks and therefore yield lower premiums than individual policies. In the alternative, employers would offer higher salaries and let employees fend for themselves.]

Clearly, health care reform is an urgent social and economic issue. But who has the right answer? [The market has the right answer. So what you’re about to say is irrelevant, but let’s plough on, anyway.]

The 2004 Economic Report of the President told us what George Bush’s economists think, though we’re unlikely to hear anything as blunt at next week’s convention. According to the report, health costs are too high because people have too much insurance and purchase too much medical care. [True, that’s exactly right, it’s called “moral hazard” — a concept that Prof. Krugman seems not to know or care about. But there’s more to it than that, as I’ll explain at the end.] What we need, then, are policies, like tax-advantaged health savings accounts tied to plans with high deductibles, that induce people to pay more of their medical expenses out of pocket. (Cynics would say that this is just a rationale for yet another tax shelter for the wealthy, but the economists who wrote the report are probably sincere.) [Well, I’m sure that the economists who wrote the report appreciate your insincere endorsement of their sincerity — as if they care. Though how tax-advantaged health savings accounts are a tax shelter for “the wealthy” (those filthy people who earn a living) is beyond me.]

John Kerry’s economic advisers have a very different analysis: they believe that health costs are too high because private insurance companies have excessive overhead, mainly because they are trying to avoid covering high-risk patients. [If that’s true — and it’s not, Bush’s economists are right — the answer is to induce more competition in the health insurance business, which I’ll come to.] What we need, according to this view, is for the government to assume more of the risk, for example by picking up catastrophic health costs, thereby reducing the incentive for socially wasteful spending, and making employment-based insurance easier to get. [In other words, “government” (i.e., taxpayers) would foot the bill. But because taxpayers wouldn’t foot the bill directly, they’d be inclined to undergo unnecessary medical treatments (it doesn’t take much these days to get into the “catastrophic” range) Then we’d be right back where we were, except that medical costs would be even higher.]

A smart economist can come up with theoretical justifications for either argument. The evidence suggests, however, that the Kerry position is much closer to the truth. [Only the kind of evidence Krugman would believe.]

The fact is that the mainly private U.S. health care system spends far more than the mainly public health care systems of other advanced countries, but gets worse results. In 2001, we spent $4,887 on health care per capita, compared with $2,792 in Canada and $2,561 in France. Yet the U.S. does worse than either country by any measure of health care success you care to name – life expectancy, infant mortality, whatever….[The relevant measure is the effectiveness of particular treatments — things like life expectancy, infant mortality, and whatever are explained by demographic factors, dietary habits, and “whatever”. With respect to the effectiveness of particular treatments, guess what? The U.S. leads them all. Read about it here.]

And the U.S. system does have very high overhead: private insurers and H.M.O.’s spend much more on administrative expenses, as opposed to actual medical treatment, than public agencies at home or abroad. [So what? Results count, not phony cost comparisons. Public agencies get a free ride on a lot of their administrative expenses. And you may have noticed that health care delivered by public agencies is distinctly second-rate.]

Does this mean that the American way is wrong, and that we should switch to a Canadian-style single-payer system? [Ah yes, the famous Canadian system that has Canadians flocking to the U.S. for treatment.] Well, yes. Put it this way: in Canada, respectable business executives are ardent defenders of “socialized medicine.” [That’s because they prefer not to compete for employees by offering health-care plans, so they let the taxpayers foot the bill.] Two years ago the Conference Board of Canada – a who’s who of the nation’s corporate elite – issued a report urging fellow Canadians to bear in mind not just the “symbolic value” of universal health care, but its “economic contribution to the competitiveness of Canadian businesses.” [Right, Canadian taxpayers pay to make Canadian businesses more competitive. And Krugman thinks U.S. businesses are rapacious.]

That’s enough of that. Now, let’s talk about why the cost of health care is rising in the U.S. and what to do about it. The cost of health care is rising in part because demand is rising, mainly because of rising incomes, access to employer-subsidized insurance, and rising numbers of Medicare beneficiaries. The supply of health care isn’t rising as fast because of government regulation (e.g., medical licensing and FDA approval of drugs), which is endorsed by those who are being regulated. Then, there is regulation of the insurance industry, which inhibits entry and competition among insurers. (Insurers, by the way, are able to negotiate with health-care providers and drug companies to get lower prices for their insureds, a fact that Krugman chooses to overlook in his effort to paint insurance companies as evil entities.) Deregulation — or less stringent regulation — is part of the solution. (I’ve written before that this is not a high-risk solution. See here, here, and here.)

The rest of the solution is to keep government out of the act. The market — especially a less-regulated market — will provide health insurance that’s tailored to consumers’ needs. As employers scale back or drop their insurance plans, employees will seek insurance elsewhere. A competitive market will provide it. A competitive market will even offer insurance for the hard-to-insure, either through tailored policies or ad-hoc groups of hard-to-insure consumers — groups that insurance companies will compete to create.

But all of that seems to be beyond the comprehension of Paul Krugman, ersatz economist and strident socialist.

Election Projections Explained

REVISED, 09/21/04

In Method 1, I assign all of a State’s electoral votes to the expected winner in that State, according to A price of greater than 50 indicates a Bush win; a price of less than 50 indicates a Kerry win. (A winning bet of $50 on Bush at a price of 50 returns $100, for a $50 profit; a winning bet of $60 on Bush at a price of 60 also returns $100, for a $40 profit; a losing bet on Bush at a price of 60 pays off those who bet on Kerry; and so on.) If the price is exactly $50, I record the electoral votes as a tossup and don’t allocate them to either candidate.

In Method 2, I allocate all of a State’s electoral votes to Bush if the price is 55 or greater, and all of a State’s electoral votes to Kerry if the price is 45 or less. For prices between 45 and 55, I allocate a State’s electoral votes according to Method 2.

Method 3 translates the expected share of two-party popular vote into electoral votes, based on a statistical relationship for presidential elections from 1956 through 2000. I use the current results of the popular vote-share market at Iowa Electronic Markets to estimate the leader’s share of the two-party vote. I use that share in the following regression equation:

Fraction of electoral vote going to the leader in popular votes =

– 9.166 (a constant term)

+ 32.201 x the leader’s fraction of the 2-party popular vote

– 25.742 x the square of the leader’s fraction of the 2-party popular vote

+ 0.067 (if the leader is Republican, otherwise 0).

The r-squared of the equation is 0.948; the standard error of the estimate is 0.047 (that’s 4.7 percent); and the t-stats on the coefficient and three variables are -3.175, 3.083, -2.738, and 2.379, respectively.

In summary, Method 1 follows the winner-take-all rules of electoral voting where, with the unimportant exceptions of Maine and Nebraska, each State casts its votes en bloc. Method 2 gives a “safe” or “fairly safe” State to the likely winner in that State, but for “tight” races (i.e., races where the price is less than 55 but greater than 45) it allocates votes by the expected-value method. Method 3 translates the leader’s expected popular-vote share into expected electoral votes, based on a statistical analysis of the last 12 presidential elections.