2010 October 31 Sunday
China Oil Demand Continues To Grow

Another 6 hundred thousand barrels a day of oil used in China means less for the Western countries.

Purchases increased 11 percent to 23.29 million metric tons, or 5.52 million barrels a day, compared with a month earlier, according to preliminary data released today by the Beijing- based General Administration of Customs. That beat a previous record of 22.27 million tons in June.

Since world oil production is still well below 2005 production levels (and 2005 remains the oil peak period at the yearly level of granularity) China's growing oil demand means less oil consumption by the OECD countries. China will bid up the price of oil and Western economies will reel in response. China now makes more cars per year than the United States. So China's small existing car fleet is going to double and double and double again.

My advice: make your next car a hybrid or a small car. The approaching world decline in oil production is going to make gasoline very pricey.

Also, choose jobs and housing to minimize your energy demand, especially your demand for petroleum distillates.

By Randall Parker 2010 October 31 12:24 AM  Economics Energy
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2010 October 30 Saturday
Immigrants Displacing Americans In Job Market

American citizens are losing.

In the year since the official end of recesson in the United States, immigrants have seen job growth but native-born workers have continued to lose jobs.

That's the politically explosive conclusion of an analysis released Friday by the Pew Hispanic Center, a nonpartisan research group funded by the Pew Charitable Trusts.

Think about that. I remember as a child that the Democratic Party really aligned with the interests of American workers below the level of management. Industrial unions made up a major source of Democratic Party support. I bet Wall Street gives more to the Democrats today and the people on Wall Street aren't getting displaced from their jobs by illegal aliens. So they see no problem in this report.

The recession is over for the foreign-born. But for natives the recession is still underway.

In the year following the official end of the Great Recession in June 2009, foreign-born workers posted a net gain of 656,000 jobs, while native-born workers lost 1.2 million. The foreign-born category includes legal and illegal immigrants.

Blacks have to be especially hard hit by these results. They more directly compete with unskilled immigrants. But the less educated whites are also hit pretty hard. There was a time when the Democratic Party tried to represent the interests of less skilled blacks and whites. But now it just pretends to. Its elites in the media stand ready to call anyone a xenophobe who dares suggest that the elites are betraying the American people. So the Democrats get a pass on their abandonment of the black and white working class.

Big business wants a bigger population because total sales rise even if sales per customer declines. Big business is far less interested in per capita GDP than in total GDP. So business interests conflict with policies that would tend to raise quality of life (e.g. policies to cut immigration). Since business interests and ethnic group leaders (whose interests also align with larger growth in the sizes of their factions) control the Democratic Party the result is the party supports mass immigration regardless of the effects on existing citizens.

These numbers are a boon for capital since they mean labor costs are lower.

As a result, the unemployment rate for immigrant workers fell 0.6 percentage points during this period (from 9.3% to 8.7%) while for native-born workers it rose 0.5 percentage points (from 9.2% to 9.7%).  

The 2009-2010 recovery for immigrants, who make up 15.7% of the labor force, is also reflected in two other key labor market indicators. A greater share of their working-age population (ages 16 and older) is active in the labor market, evidenced by an increase in the labor force participation rate from 68.0% in the second quarter of 2009 to 68.2% in the second quarter of 2010. Likewise, a greater share is employed, with the employment rate up from 61.7% to 62.3%.  

These gains occurred at a time when native-born workers sustained ongoing losses. The native born engaged less in the labor market (labor force participation rate fell from 65.3% to 64.5%) and a smaller share was employed in the second quarter of 2010 than in the second quarter of 2009 (58.3% vs. 59.3%).

In the battle between capital and labor it is clear that capital is winning.

Update: In an interview Harvard labor economist George Borjas pointed out that immigration causes a shift in wealth from the (mostly poor, lower class) workers that the immigrants compete with to the (mostly more affluent) people who use immigrant labor. Do we really need another cause of wealth redistribution to the upper classes? Aren't the poor already poor enough?

Borjas: Yes. Let me make that very clear. At the time I wrote that initial paper, I was basically taking a relationship out of the labor demand literature—a X% increase in labor would lower wages by Y%.

That meant current immigration had lowered the total wage of natives by about 2%. And all that goes straight to the employers, to the capitalists. In the long, long run, some of that would filter down to the consumers also. But I didn’t do that in my paper. Nobody knows what the breakdown is between consumers and employers.

So the way we freeze the argument is: immigration redistributes wealth from people who compete with immigrants—namely workers who have the same jobs as immigrants—to people who use immigrants. For example, a California family—gardener, the maid, all this stuff.

Click thru and read the whole thing.

By Randall Parker 2010 October 30 10:52 AM  Immigration Labor Market
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2010 October 27 Wednesday
Physician Income Levels

Curious about how much doctors make? Wondering how much of rising health care costs are due to high incomes of doctors? These numbers do not strike me as radically high.

Using data from a representative sample of 6,381 physicians providing patient care in 2004 to 2005, J. Paul Leigh, Ph.D., and colleagues at the University of California Davis School of Medicine, Davis, compared wages across four broad specialty categories: primary care, surgery, internal medicine and pediatric subspecialties, and other. They also assessed wages among 41 specific specialties along with differences based on demographic, geographic and market variables.

Overall, clinicians earned an average annual income of $187,857 and worked an average of 53.1 hours per week. When compared with those of primary care specialists, wages were 48 percent higher among surgeons, 36 percent higher among internal medicine and pediatric subspecialists and 45 percent higher among clinicians in other specialties.

In the analysis of 41 specific specialties, neurologic surgeons ($132 per hour) and radiation oncologists ($126 per hour) earned the highest wages. The specialists who earned the least per hour were those in internal medicine and pediatrics ($50) and other pediatric subspecialists ($52).

Though I wonder: How much of a physician's income gets caught by a study like this one? Do hourly rates only capture fees paid for visits and consultations? Or are profit margins on tests also captured?

Substantial differences exist by specialty.

When compared with the reference group of general surgeons, whose hourly earnings were close to the median or midpoint at $86, wages were significantly lower for internal medicine and pediatrics combined ($24 less), internal medicine ($24 less), family medicine ($24 less) and other pediatric subspecialties ($23 less). Physicians in neurologic surgery, radiation and medical oncology, dermatology, orthopedic surgery and ophthalmology all earned $17 to $50 more per hour than general surgeons.

I'd like to know how much of total health care costs go to physicians. I've read that drugs are about 10% of total costs. Okay, where does the other 90% go? Anyone got a good source? Also, what are the trends? Which slices are rising or falling?

Also see my post Physician Income Up In Recession.

By Randall Parker 2010 October 27 12:34 AM  Economics Health
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2010 October 26 Tuesday
Globalization Makes Recessions More Severe?

Does globalization make economies recover more slowly from recessions?

By applying the same rules that explain how genomes evolve, Rice University physicists have shown that the world economy is more sensitive to recessionary shocks and recovers more slowly from recessions now than it did 40 years ago, due to increased trade globalization.

Their findings are available online and will appear in an upcoming issue of the Physical Review Letters.

"Standard economic theory suggests that trade networks with a more modular structure tend to recover more slowly from recessions, but using evolutionary theory we predicted the opposite, and U.N. trade data indicate we were right," said Michael Deem, the John W. Cox Professor in Biochemical and Genetic Engineering and professor of physics and astronomy at Rice.

Deem and co-author Jiankui He, a graduate student in physics and astronomy, studied United Nations trade data from the past 40 years and found the global economy has tended to react more sharply to recessions and to recover more slowly from them as globalization has increased.

One problem I see with global trade: As countries become more specialized if their specialties decline they are much harder hit. A highly diversified economy that satisfies a larger fraction of its internal demand can shift workers between industries as specific industries decline. But with higher specialization of each national economy there are fewer alternative industries for laid off workers to move into. Therefore an argument can be made for maintaining a larger number of industries so that restructurings away from declining industries can happen more easily.

By Randall Parker 2010 October 26 11:57 PM  Economics Globalization
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2010 October 24 Sunday
Housing Prices Turn Down Again

A graph at this link shows housing prices bottomed sometime in early 2009 and recovered some since that time. Now housing prices have turned down again but they are still above the early 2009 low.

TRUCKEE, Calif. – Oct. 22, 2010 – Clear Capital (www.clearcapital.com), is issuing this special alert on a dramatic change observed in U.S. home prices.

“Clear Capital’s latest data shows even more pronounced price declines than our most recent HDI market report released two weeks ago,” said Dr. Alex Villacorta, senior statistician, Clear Capital. “At the national level, home prices are clearly experiencing a dramatic drop from the tax credit-induced highs, effectively wiping out all of the gains obtained during the flurry of activity just preceding the tax credit expiration.”

A 5.9% drop in 2 months is a very sharp decline.

This special Clear Capital Home Data Index (HDI) alert shows that national home prices have declined 5.9% in just two months and are now at the same level as in mid April 2010, two weeks prior to the expiration of the recent federal homebuyer tax credit. This significant drop in prices, in advance of the typical winter housing market slowdowns, paints an ominous picture that will likely show up in other home data indices in the coming months.

Calculated Risk expects the CoreLogic and Case-Shiller housing price indexes to also show declines. This makes sense. Housing prices are still too high. Plenty more mortgages are going to default any potential buyers are afraid to buy and then see prices drop. The expectation of always rising housing prices is dead.

The economic conditions are ugly. A recent Gallup poll found the unemployment rate back above 10% for September and industrial production unexpectedly fell in September.

Historically, recoveries from recessions have been very strong with GDP growth running well above the historical average. This makes sense intuitively. The economy has to grow at an above-average rate some of the time to make up for periods of declining and stagnant economic activity. But the National Association of Business Economists projects only an average economic growth rate in 2011 with unemployment at 9.2% at the end of 2011.

The NABE Outlook panel cut its growth predictions for 2010 and 2011. Real gross domestic product (GDP) is now expected to advance 2.6 percent in 2010, down from the panel’s May prediction of 3.2 percent. While some of this reduction relates to historical data revisions, most of the markdown reflects worse-than-expected summer results and a dimmed outlook. Next year’s 2.6 percent gain shows the lack of a typical cyclical rebound and only matches the long-term growth trend previously expected by the NABE panel.

What I'd like to see: a measure of recessions by percentage unemployed per month above a baseline over some months. Translate the recession's total labor lost into cumulative percent of a year's total labor. So, for example, an extra 5% unemployed over 2 years is 10% of a year's labor. By that measure this recession would likely stand far beyond any other recession since WWII in terms of labor lost.

Even this projection might turn out to be excessively optimistic. We might be in the early stage of an extended period of low economic growth. Worse yet, oil price surges will at various points in the next 10 years choke off all economic growth. Once world oil production comes off its production plateau and enters permanent decline I expect a long period of economic contraction year after year.

I see lingering effects of the real estate bubble, the financial crisis, the coming oil production decline, globalization, and worsening demographic conditions in America (and other Western nations as well) all combining to make the next 10-20 years economically worse than the 1990s. The last 10 years will come to be seen as the transition period from the previous era of long term economic growth to a new era of austerity and declining living standards.

By Randall Parker 2010 October 24 11:37 AM  Economics Housing
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2010 October 22 Friday
Yet Another Report On California Financial Disaster

Mish Shedlock takes a look at a new Milken Institute report about California's massive unfunded pension liabilities. The disaster is epic in scope. What is most important about this problem: Governments are losing the ability to pay off all their major interest groups. Governments are going to be forced to deliver less year after year.

  • By around 2012 or 2013, the three major state pensions’ obligations will be more than five times as large as total state tax revenue.
  • Not only will California’s growing senior population depend on Medi-Cal and other state services, but public school enrollment is likely to rise in the coming years. The state can ill afford to fund pensions by cutting back on these services.
  • In 2009, the pension liability came out to $3,000 per working-age adult in the state. By 2014, it will triple to over $10,000 per working-age Californian.
  • Raising employee contributions alone will be less effective over time as the ratio of actively contributing members to benefit recipients continues to decrease.
  • Currently, the average state employee contributes to the system for 25 years, but will receive benefits for 26 years — and the number of benefit-receiving years is increasing as longevity improves.

Obviously retirement ages must be raised. People can't work for fewer years than they collect benefits. That's ridiculous and should be stopped pronto. You might think that the state pension funds deny the size of the problem and that maybe the outsiders complaining are just anti-government rabble-rousers. But no. The chief actuary of CalPERS (one of the 2 big Cal state pension plans) says the system is not sustainable. He's the chief actuary saying this. The unfunded liabilities hole can't be filled just with taxes.

The problem is not limited to just one state government. A former mayor of LA says the bankruptcy of Los Angeles is inevitable. Many state and local governments underfunded their public employee pension programs. Since state pension funds use unrealistic assumptions of 7.5% to 8.5% yearly average returns on their investments their underfunding is worse than their official claims. Imagine we go thru a 10 year period with near 0 returns on stock market. The unfunded liabilities of the states would balloon so large that bankrupcty would be hard to avoid. I expect The Impending World Energy Mess to slash state and local government tax revenues while also turning stock market returns negative.

So which interest groups will take the biggest hits? The hits might not be proportional to how much each group is getting now. Current government employees, retired government employees, poor folks, children, car drivers, firemen, school administrators, school teachers, bureaucracies that build low income housing, and assorted other groups will all lose something. How will the hits fall? Which groups have less defensible positions? Which groups are least sympathetic?

Government outlays could rise even as their perceived levels of delivered benefits decline. How? Partly because of interest payments. When interest payments rise faster than tax revenues then outlays for services today go down.

Also, retirement benefits deliver large numbers of tax dollars to a small fraction of the population (e.g. Cal state government retirees). So the surge in outlays for retirees means that a far larger number of direct and indirect recipients of smaller amounts of government outlays will feel the pinch. Everyone will experience worse roads for example. Parents will watch their local schools get their budgets cut for expenditures on current teachers, administrators, supplies, and buildings. Fewer police will mean more crime.

The fiscal disaster of US states such as California and Illinois has a lot of parallels with that of Greece and other PIIGS. What we see in California and Greece presages a much larger government funding crisis that is building up. This crisis is obviously important because of its impact on taxes and government services. But it is even more important because it effectively is a wall that the growth of the welfare state is running into.

Hitting the wall of government growth means resentment of elites will grow. It also means the elite factions and other factions will come into more direct conflict and settled issues will become unsettled again. Fixed entitlements will become unfixed. Decades long promises will be broken. As governments approach bankruptcy old settlements of political battles will be repudiated out of necessity.

Firemen have always been popular with citizens. But government employees are coming to be seen as having it much better than the masses. Conor Friedersdorf points to a great xtranormal video on extremely well-paid fire fighters in California.

Resentment of fire, police, housing agencies, and assorted pieces government will grow as people feel more economic pain. Lots more mocking and angry videos to come. On the bright side, we should get to watch some really good biting satire.

By Randall Parker 2010 October 22 08:08 PM  Economics Sovereign Crises
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Foreign Ideas And Societal Immune Systems

Mencius Moldbug takes a look at the beliefs of players in mid 20th century political developments.

For instance, when I state that US foreign policy in the 20th century is historically rooted in post-millennial Protestant theology, I can link directly to my favorite primary source - this TIME Magazine article from 1942.

It is simply a fact that in 1942, TIME's writers and its readers knew what a "super-protestant" foreign policy was, because it is a fact that this article was written, edited, and read. It could have been inserted in the TIME archive by crafty anti-Protestant hackers, or for that matter by aliens, but the student of history need not give these fantasies much weight. And without them, globalist foreign policy is the work of "organized U.S. Protestantism." Believe it or not, the YMCA is an important actor in the period. Now, it might be that some even more sinister group was behind the "Y" - the aliens, the Jews, the Ogpu, etc - but when we write the YMCA out of 20th-century history, we are writing bad history. And I can prove it, because I have that link.

The Mar. 16, 1942 Time article about an American Protestant program for a post-WWII world order will sound very familiar.

These are the high spots of organized U.S. Protestantism's super-protestant new program for a just and durable peace after World War II:

>Ultimately, "a world government of delegated powers."

>Complete abandonment of U.S. isolationism.

>Strong immediate limitations on national sovereignty.

>International control of all armies & navies.

> "A universal system of money ... so planned as to prevent inflation and deflation."

> Worldwide freedom of immigration.

> Progressive elimination of all tariff and quota restrictions on world trade.

Yes, these ideas already had currency during World War II. How many of these ideas will die out with the decline the Protestant Ascendancy and, with some delay, the decline of America?

As an aside, this article undermines the view that these policies originated with Jewish and Catholic immigrants. In 1942 the Protestant establishment was in firm control and these items (and more to follow if you click thru) were what they came up with. Open borders. They wanted open borders. The mind boggles. Were these liberal churches? How representative were they of most Protestant churches in America at that time? I suspect that since most of the issues in the Time 1942 article are about foreign policy they represent an elite Protestant view. One can see where George Bush Sr got his ideas from that article. Daniel Larison points out that elites come up with foreign policy and then sell it to the masses. Unfortunately, our elites come up with a lot of bad foreign policy ideas like open borders and occupation of Middle Eastern countries.

More than almost any other kind of policy, foreign policy is something fashioned at an elite level and then rationalized or justified to the public after the fact. Public opinion on foreign policy issues does not existy fully formed, but it is constantly being shaped by what the political class and media tell the public about these issues. Mead is actively creating the consensus that he pretends has always existed.

In the course of a long essay touching on any figures and developments surrounding WWII Moldbug makes an interesting point: A set of ideas moved between cultures will enter a new culture which lacks the immune response which allows the originating culture to prevent the set of ideas from causing great damage.

The division between Henry Wallace and Joseph Stalin, assuming for purposes of argument its reality, is a classic case of sectarian conflict on the left. Leftism is riddled with sects; Trotskyists versus Stalinists versus Maoists, and the like. There is no denying that American liberalism was broadly allied with Moscow in 1944, and broadly in conflict with Moscow in 1948. This is best seen as a sectarian schism in a single church; the "Cold War" is not an existential conflict of Left and Right, like the war on Hitler, but a fracture in a single global movement. As we speak of the Sino-Soviet split, we might speak of the "Anglo-Soviet split."

This is certainly not a point of view that leads us to agree with Hassell's Osservatore Romano, in its judgment that Bolshevism is "an indigenous European growth which by chance has matured in one country (Russia)." The opposite hypothesis is suggested: that Bolshevism is an exotic, non-European growth. Ie, an American growth. Ie, when America infects Russia with liberalism, the spore (lacking native enemies) grows into its malign form of Bolshevism. Contra Hassell, democracy and communism are two forms of the same disease.

Moldbug's specific way of applying this idea might be erroneous. Whether American liberalism mutated into Russian communism or British Marxism (Marx was in Britain when inventing Marxism) mutated into Russian Marxism one could argue that Russia was ill-equipped to handle this foreign system of beliefs. Ditto for China. Their immune systems lacked the dampening and restraining factors needed to prevent the worst excesses of communism. A society with a history of strong unchecked central rule is at greater risk of turning into a totalitarian Marxist totalitarian dictatorship than a society which has always had widely accepted mechanisms (e.g. independent judiciaries, free presses, and societal institutions that exist independent of government) for restraining the power of central governments.

Another argument can be made as well: Some ideas deliver benefits in their early stages of spread. But the ideas have dangerous flaws and as they spread their costs gradually become greater than their benefits. I think liberalism has mutated into something pathological in the United States. It has pushed its program into areas where it has overstepped its limits and amplified the damaging effects of its errors.

By Randall Parker 2010 October 22 08:08 PM  Civilizations Decay
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2010 October 21 Thursday
British Government Slashes Spending

While the United States seems stuck on an unsustainable growth path for its welfare state the Conservatives and Liberal Democrats in Britain have agreed to huge cuts in government spending.

After months of preparing citizens for the worst, the coalition government unveiled cuts of 19 percent on average across most departments. The ax will fall particularly hard on welfare benefits, and the government plans to raise the retirement age from 65 to 66. Only a few priority areas are being shielded, such as the iconic National Health Service (NHS).

The US needs to follow Britain's lead. We can not afford our current government. We need to step back from the madness of borrowing like there's no tomorrow in order to spend more on dubious dreamy policy ideas in education, health care, and foreign policy.

By Randall Parker 2010 October 21 11:43 PM  Economics Government Costs
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Reihan Salam: Make Government More Cost Effective

Reihan Salam says the question of how to make governments more productive gets far too little attention. I agree with Reihan.

But before asking taxpayers — any taxpayers — to dig deeper, I’d gently suggest that we look at public bureaucracies. If the Milwaukee Public Schools spend twice as much as choice schools to deliver the same results in terms of reading and math scores, I’d say MPS can dig deeper, ideally be restructuring compensation and giving workers more autonomy. If one-fifth of public dollars spent on infrastructure are essentially wasted, as Barry LePatner argues in his brilliant new book Too Big To Fall, which I’ll discuss in greater detail soon, I’d say the bureaucracies we’ve placed in charge of public construction projects can dig deeper, ideally by doing a better job of sharing data and using life cycle assessments. If we could reduce Medicare expenditures by 8% per year by creating a competitive pricing system, I’d say the federal government can dig deeper by making a commonsense reform that will leave the quality of Medicare unchanged if not markedly improved. 

Of course some libertarians argue that ineffective government is better than effective government. But that's not a serious position. One might as well as argue for anarchy if you really believe that. Certainly some things that government intentionally does are damaging. So if productivity of those damaging activities goes up we'll be worse off. But quite a few government activities are beneficial to the vast majority. Examples of useful functions of government: Catching criminals, keeping criminals in jails, fixing roads, stopping polluters, catching terrorists in order to prevent terrorist attacks, tracking habitat destruction.

Governments do some things that libertarians do not approve of as government activities such as funding the medical care of retirees. But that's not an argument for neglecting how well government performs this activity. The prospects for convincing the majority of the population to oppose this activity of government seem extremely slim. So I tend to approach this issue with the thought that better policies for just how to deliver medical care to oldsters could benefit the entire population. Changes in government policy on how it funds medical care have the potential to change incentives in ways that result in more rapid innovation to cut costs or to create better treatments that cure more diseases. So given that government is going to do an activity doesn't it make sense to support policy changes that boost the total benefit we get from the activity?

One can find no shortage of advocates for more spending and even some advocates of less spending. But far fewer political activists or policy wonks or politicians spend much time thinking about how to spend more effectively and efficiently. The two sides of the political spectrum spend so much time battling each other for power that the cause of good government receives far too little attention. Yet the US economy and government finance are on course for a fiscal disaster. We need substantial increases in the net benefit delivered per taxpayer dollar spent. We need government programs to create better incentives on the private sector.

Reihan says the competing images of government workers as villains or heroes are simply not useful to the cause of improving government. We need a more nuanced view that enables us to improve the incentives on government workers and agencies.

Why does no one care about how public money is actually spent? Part of it has to do with the fact that abstractions are appealing, particularly to conservatives but also to at least some egalitarian liberals who find abstract arguments for a more progressive tax regime more engaging than serious discussions of how public bureaucracies work. If we think of public employees as actual people who respond to incentives yet who generally want to do their jobs well — I can’t help it because I grew up around public employees, two of whom were my parents — you have a different perspective than if you think of public employees as cash-hungry villains or, more to the point, as selfless heroes constantly attacked by the tax-phobic right.

Better law enforcement has the potential to save the American people billions of dollars per year. For example, in the last year the FBI has and the US DOJ have busted several Medicare fraud rings. The Miami area has lots of Medicare fraud and some of the large scale fraudsters are getting caught.

Federal agents arrested four Miami-Dade healthcare operators early Thursday in one of the nation's biggest Medicare fraud cases, charging them with scheming to fleece $200 million from the taxpayer-funded program by billing for bogus mental health services.

Lawrence S. Duran, 48, of North Miami, and his company, American Therapeutic Corp., were charged along with other employees in a conspiracy indictment. The Miami-based company's chief executive officer, Marianella Valera, 39, was also among the defendants named in the indictment.

Yet billions still get lost to fraud every year.

Although Medicare under the Obama administration has improved technology to weed out fraudulent claims, the agency still loses billions of dollars yearly to fraud because it generally pays bills quickly without verifying them.

So I wonder: How many dollars of fraud are avoided per dollar spent on enforcement activities? If the ratio is greater than 1 then the US government is not spending enough on enforcement. The same holds for any other way that the US government loses money to fraud.

Armenia organized crime groups are ripping us off for big money in Medicare.

Armenian-American gangsters created a fictitious medical world, complete with fake doctors and fake patients, which they extended across the US in a scheme to defraud the Medicare system of more than $100m (£62.9m), federal prosecutors said yesterday.

The Armenian criminals operate nationally.

They then set up bogus offices and, using stolen beneficiary information, began billing for procedures that never occurred, according to a Department of Justice news release. Nationwide, the ring operated at least 118 phony clinics in 25 states and billed Medicare for some $163 million, officials said.

More Miami Medicare fraud:

Marquez, a former Miami Springs High pitching ace who almost played in the Major Leagues, was sentenced Thursday to 19 ½ years in prison for healthcare fraud. He schemed to bilk $48.8 million from Medicare by submitting false claims for purported HIV therapy.

Marquez's seven clinics in Miami-Dade and Orlando were paid $21.6 million, which he must repay the taxpayer-funded Medicare program.

Michigan Medicare fraud:

Collins, 39, pleaded guilty in May 2010 to one count of conspiracy to commit health care fraud. Collins admitted in court documents that he was responsible for submitting or causing the submission of approximately $6.96 million in false or fraudulent claims to the Medicare program between August 2007 and October 2009. According to the plea documents, in the late spring or early summer of 2007, Collins was hired by co-conspirator Muhammad Shahab to work as a nurse at Patient Choice Home Healthcare Inc. Patient Choice purported to provide home health services, including physical and occupational therapy services, to homebound Medicare beneficiaries.

According to plea documents, Collins solicited Medicare beneficiaries for Shahab and Patient Choice and offered them cash kickbacks in exchange for their Medicare patient information and signatures on medical documents. Collins admitted that he knew the beneficiaries he recruited were neither homebound nor in need of physical therapy services. Collins also admitted in court papers that he knew Patient Choice used the beneficiaries’ Medicare information to bill Medicare for physical therapy that was medically unnecessary and/or never performed.

Alex Tabarrok says we could save big time as a nation by doubling the number of police.

More generally, when one combines estimates of police effectiveness that come from myself and Klick, Steve Levitt, Bill Evans and Emily Owens and others with data on the costs of hiring police, it's clear that police are a bargain.  We could double the number of police in the United States and the costs of crime would fall by substantially more than the cost of police.  (Reallocating police and prison space from drug users to violent criminals would also help.)

We could get many benefits from government dollars spent more wisely.

By Randall Parker 2010 October 21 10:28 PM  Economics Government Effectiveness
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2010 October 19 Tuesday
Razib On The Skeptical Conservatives

Razib looks at an affinity group for skeptical conservatives and after noting that politics are not his main interest he offers his views on what is worth conserving.

But by disposition and outlook I have a preference for what can loosely be termed the bourgeois world which arose in the West in the wake of the Enlightenment, and would prefer to conserve it, and at most evolve it from within. I have come to reject excessive axiomatic constructs in political theory and politics, and also believe from an empirical evolutionary perspective that the methodological individualism at the heart of modern liberalism may at root be a quirk of the preferences of the intellectual classes in general.

Razib and I agree. But I tend to say the same thing with, well, lower brow prose. Axiomatic constructs? Methodological individualism? I need to learn how to talk like that. Not sure to who though.

I used to try to figure out which political philosophy or theory was correct. After all, renowned people subscribe to assorted political philosophies. Surely one of them must be correct. But as I got absorbed into and found unacceptable flaws in each major political school of thought it occurred to me that the people who buy into these schools of thought are unhinged. They build big systematic intellectual houses on rickety foundations, mostly wrong due to wrong models of human nature.

On types of individualism: I think individualism flows from an instinctual desire to not be dominated. Men who let themselves become dominated handed over too much of their hunting spoils or crops to people who used their wealth to out-reproduce them. So our desire for independence and freedom are an accidental outcome of evolution. That some people dress this up in elaborate philosophies (e.g. Objectivism) amounts to trying to rationalize one's instincts in order to rally more to your instinctual cause.

By Randall Parker 2010 October 19 11:05 PM  Politics Human Nature
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2010 October 17 Sunday
7 More Years Of Weak Economic Growth?

Yale housing economist Robert Shiller, famed for the Case-Shiller housing price index, points to economic research that predicts poor economic performance due to the recent financial crisis.

NEW HAVEN – Much of the talk emerging from the August 2010 Jackson Hole Economic Symposium, attended by many of the world’s central bankers and economists, has been about a paper presented there that gave a dire long-run assessment of the future of the world’s economies.

The paper, “After the Fall,” was written by economists Carmen Reinhart and Vincent Reinhart. Their work draws upon a recent book that Carmen Reinhart co-authored with Kenneth Rogoff, entitled This Time Is Different: Eight Centuries of Financial Folly.

According to the Reinharts’ paper, when compared to the decade that precedes financial crises like the one that started three years ago, “GDP growth and housing prices are significantly lower and unemployment higher” in the subsequent “ten-year window.” Thus, one might infer that we face another seven years or so of bad times.

We have more than just that reason to expect poor economic performance in the next decade and beyond. Huge US government deficits, pressures to raise taxes to pay for them, an aging population, Peak Oil and other problems I've pointed to make me expect economic contraction over the next 10 years.

Over at GNXP Thorfinn points to the rising anti-elitist sentiment as economic stagnation continues. I expect this feeling to become more widespread and intense. The feeling seems justified too. If the elites steered things in a direction where stagnation (or worse) will be the result then the elites do not deserve their high perches.

As Benjamin Friedman laid out in The Moral Consequences of Economic Growth; a tolerant, accepting society is predicated on running the growth treadmill. Simply being prosperous is not enough — people need to feel that conditions will steadily improve over time, or else populism, xenophobia, and other measures of intolerance go up.

So as we enter the a “New Normal” phase where the steady economic growth and low unemployment of the Great Moderation can no longer be sustainably maintained, there will be substantial political upheaval as well.

One manifestation of this is the strongly anti-elitist attitude espoused by anti-establishment political candidates, among others. Barack Obama (Columbia, Harvard Law) and Sonia Sotomayor (Princeton, Yale Law), for instance, have been attacked for holding Ivy League credentials.

Competition between factions for resources is going to become a lot ruder and cruder. Old folks, young folks, races, upper and lower classes, doctors, lawyers, CEOs, capitalists, education bureaucracies, welfare recipients: these people can't all be placated. As each group loses the demand will go out for even greater losses by other groups. What I want to know: How's this going to turn out? Who will lose the most? What sacred cows will cease to be sacred first?

I'm expecting means testing of old age benefits, welfare cut-backs, higher education subsidy reductions, education cuts (look at state and local budget cuts that show this is possible), and even a step back from guaranteed full medical treatment all diseases.

The biggest incentive for governments to pressure their central banks to cause hyperinflation in a contracting economy is that it will allow governments to avoid making explicit direct visible cuts from each faction's pie slice. "Oh sorry, you didn't keep up with inflation. We still boosted our expenditures for you. But the inflation we can't control took away even more. Bad inflation. Not our fault. We sympathize." The cuts will come. But they'll be done in a sort of back door way. Plausible deniability. That's a much more economically damaging way to cause the cuts. But many governments have done it and the US government will be sorely tempted.

By Randall Parker 2010 October 17 08:27 PM  Economics Business Cycle
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2010 October 16 Saturday
Angela Merkel Declares Multiculturalism A Failure

The Germans are coming to their senses. Multiculturalism is a dead parrot. Someone tell the Norwegians. The German Chancellor proclaims the utter failure of multiculturalism. Like the bulk of the Western elite, she is a slow learner. But better late than never.

"Multikulti", the concept that "we are now living side by side and are happy about it," does not work, Merkel told a meeting of younger members of her conservative Christian Democratic Union (CDU) party at Potsdam near Berlin.

"This approach has failed, totally," she said.

I hear Doctor McCoy saying "Its dead Jim". The German culture will dominate.

Horst Seehofer, the leader of the CDU's Bavarian sister party, CSU, told the same party meeting Friday that the two Union parties were "committed to a dominant German culture and opposed to a multicultural one.

"'Multikulti' is dead," he said.

This is a measure of how far European thinking has shifted on immigration and multiculturalism. Europe has come from behind and bypassed the US in a shift against immigration of incompatible cultures. The newly formed Dutch government adopted major planks from the small political party PVV which Geert Wilders leads. Anti-immigration parties are growing in Germany, Denmark, Sweden, and other European countries.

There is the matter of the 2.5 million Turks in Germany who remain steadfastly Turkish. They also do far worse in schools and the workplace. What to do about that?

Merkel spoke a week after talks with Turkish Prime Minister Recep Tayyip Erdogan in which they pledged to do more to improve the often poor integration record of Germany's 2.5-million-strong Turkish community.

Time for some out-of-the-box thinking: Has it occurred to Merkel or Erdogan that those 2.5 million Turks would integrate much better into Turkey? I mean, they are Turks after all. They could continue to retain their culture and successfully integrate if the German and Turkish governments were to help them move back to a culture that is the same as theirs. Think of it as reunification.

Imagine an American politician talking like this. Horst Seehofer, leader of the CSU, says certain groups of immigrants do not do as well.

Earlier this week, Horst Seehofer, the leader of the CDU's Bavarian sister party, CSU, said about integration that it was "obvious that immigrants from different cultures like Turkey and Arab countries, all in all, find it harder".

Muslim ethnics form their own parallel communities heavily isolated from the host society. Why should the host society inflict this on themselves?

By Randall Parker 2010 October 16 10:30 PM  Immigration Culture Clash
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2010 October 14 Thursday
Roissy: The Duke Rejection List

Roissy offers a uniquely perceptive take on the real story in Karen Owen's PowerPoint of her college jock hook-ups.

I’ve gotten more emails to write about this Duke slut Karen Owen than I have on any other topic. I wasn’t interested at first, having scanned the notorious Powerpoint (also at this link in case first doesn’t work) and concluded that it was just another story of a whore riding the (alpha) cock carousel who happened to forego discretion and publicize her sluttery, nothing to see here move along dystopia down the hall and to your left. But a closer inspection of Owen’s tell-all reveals a river of scorned subconsciousness that the mainstream feminist bloggers have predictably failed to notice –

this chick was rejected by each and every one of these high status men she banged.

“But how can that be?”, some of the duller among you will ask. “None of the men turned her down for sex.”

They all pumped-and-dumped her. Read the full tragic analysis. It is the story of millions of women who try to basically punch above their weight while young.

So then what happens? The implications are for continued decay of civilization.

By Randall Parker 2010 October 14 08:53 PM  Human Nature Mating
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South Park: It's a Jersey Thing

Great episode.

"If we don't do something South Park is going to become West Jersey".

"You can take the fetus out of Jersey but you can't take Jersey out of the fetus."

"I don't want to live in West Jersey any more than you do."

By Randall Parker 2010 October 14 08:31 PM  Civilizations Decay
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2010 October 12 Tuesday
Economic Cost Per Murder Calculated

By one measure each murder costs $17.25 million.

AMES, Iowa -- Murder takes an obvious toll on society in terms of the loss of human life, but what does it actually cost each time there's a murder? It's about $17.25 million according a recent study by an Iowa State University sociologist.

But it has to depend on who gets murdered. If a violent criminal kills another violent criminal then seems to me there might not be a net cost to the rest of society. By contrast, murder of a CEO or CTO of a high-tech firm would have a very high cost to the rest of society of the lost guy is not easily replaced.

Matt DeLisi, an ISU associate professor of sociology and director of the criminal justice program, led a team of five Iowa State graduate students on the study of 654 convicted and incarcerated murderers. Expanding upon earlier monetization estimates, they calculated the costs of five crimes -- murder, rape, armed robbery, aggravated assault and burglary -- in terms of the victim costs, criminal justice system costs, lost productivity estimates for both the victim and the criminal, and estimates on the public's resulting willingness to pay to prevent future violence.

A serial killer is especially costly. So if a brain scan could identity with very high probability that a known criminal will eventually commit murder would you see preventive exile to a deserted island as acceptable?

"That each murder costs more than $17.25 million still does not convey the true costs imposed by homicide offenders in the current sample," the authors wrote. "Since the mean homicide conviction was more than one, the average murderer in these analyses actually imposed costs approaching $24 million. For the offender who murdered nine victims, the total murder-specific costs were $155,457,083!"

Measures to catch criminals earlier in their criminal careers would save a lot of money.

The ISU researchers also calculated costs of rape ($448,532), armed robbery ($335,733), aggravated assault ($145,379) and burglary ($41,288).

By Randall Parker 2010 October 12 09:56 PM  Economics Crime
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2010 October 10 Sunday
QE2 To Cause Oil Price Surge That Suffocates Economy?

Jed Graham of Investor's Business Daily's Capital Hill blog suggests the anticipated Quantitative Easing 2 (QE2) from the US Federal Reserve could cause such a large oil price spike that the economy will derive no benefit from QE2.

The voyage might have to be aborted — or at least diverted — soon after QE2 leaves the dock because the Fed may be sailing into a political hurricane.

Even before the anticipated launch of the next round of Treasury purchases — it’s expected to be made official on Nov. 3 — the Fed’s unmistakable signals have fueled commodity price gains as the dollar has sagged.

Since the Fed’s Sept. 21 policy statement, crude oil had surged more than 9% to above $83 a barrel on Wednesday, approaching its highest levels since October 2008. (Oil prices did retreat on Thursday.)

If QE2 is enough to cause a large oil price spike then a real economic recovery will cause an even larger price spike. When I look at trends in global production and Asian consumption growth I do not see where the US can get the oil needed for economic growth. US oil consumption may already have peaked several years ahead of the global oil production peak (which Charley Maxwell expects in the 2015-2020 time frame with a slowing in production growth leading up to the final peak plateau). Well, economic growth with highly expensive oil and flat or declining consumption is going to be very hard and slow at best. Quite possibly economic growth might not be possible for a couple of decades.

I find the bigger context of sustained economic stagnation very important. Tyler Cowen argues that America needs continuing economic growth in order to buy off interest groups. Take away that economic growth and the social fabric will tear apart. Just what will that look like?

Japanese politics is less competitive and Japanese rent-seeking is less competitive than in the United States. Sustained near-zero growth in the United States would mean that interest groups tear apart the social fabric and grab too lustily at the social surplus. Whether we like it or not, we are "built to grow" and we use the fruits of that growth to buy off interest groups as we go along. Japan in contrast has greater capacity to stifle these grabs for new redistributions because their politics is more of an insider's game.

Suppose economic stagnation continues. The US is already in the biggest economic downturn since the Great Depression. Buy off interest groups? Revenue collapses at local governments are so severe that many cities are in the process of un-buying off interest groups. These revenue collapses mean most of the big state spending cuts still lie in the future. After pretending to produce a balanced budget the California legislature just passed a budget with a 11% deficit. Lots of states are at risk of default with California and Illinois the biggest fiscal basket cases. With huge unfunded retirement liabilities their problems are going to grow much larger even if the economy eventually recovers for a few years.

Even without considering the effects of Peak Oil Northwestern U economist Robert Gordon is already predicting very slow growth thru 2027.

Robert J. Gordon of Northwestern University belongs to the committee of distinguished economists who officially declared on Sept. 20 that the U.S. recession ended way back in June 2009. Don't mistake that pronouncement for optimism. According to Gordon's research into the long-term determinants of growth, America's next two decades are going to be disappointing. He predicts that between 2007 and 2027, gross domestic product per capita will grow at the slowest pace of any 20-year period in U.S. history going back to George Washington's Presidency. Although the data he examined closely go back only to 1891, he says that based on his knowledge of early American economic history, he thinks it is fairly safe to predict that the period will witness the slowest growth ever in GDP per capita and, therefore, American living standards.

.

This battle over immigration happens against a backdrop of worse than stagnating incomes.

The inflation-adjusted income of the median household—smack in the middle of the populace—fell 4.8% between 2000 and 2009, even worse than the 1970s, when median income rose 1.9% despite high unemployment and inflation. Between 2007 and 2009, incomes fell 4.2%.

Also, take a look at the declining returns per dollar spent on a college education. Higher costs and declining incomes. For someone in their 20s this means declining living standards as compared to previous generations. This reminds me of Jim Chanos' comments about declining returns on physical resources consumed in China.

American demographic problems with declining worker skill sets will contribute to slow growth or even extended economic contraction. Peak Oil will come on top of worker skill problems and also the big unfunded old age retirement benefits.

National debt above a threshold retards economic growth. The US is on course to cross that theshold

Researchers from North Carolina State University have identified a “tipping point” for national debt – the point at which national debt levels begin to have an adverse effect on economic growth. The findings could influence economic policy discussions globally, and will be distributed at the upcoming meeting of the International Monetary Fund (IMF) and World Bank Group.

“If a country’s public debt reaches 77 percent of its gross domestic product (GDP), bad things start to happen,” says Dr. Mehmet Caner, professor of economics at NC State and co-author of the study. “There is a tipping point for national debt, and if you exceed that point the amount of debt will have a linear relationship to declines in economic growth. The more debt you have, the slower your GDP will grow.

While the US national debt trajectory is on course to hit 90% by 2020 that date is just one point on a bad trend line toward even higher debt levels. But reality is even worse. I expect Peak Oil to cause that to happen much sooner. Then both the high national debt and Peak Oil will weigh on the economy much sooner. The pressure on the Federal Reserve to inflate away the debt will become severe. Living standards will decline.

Bottom line: the financial crisis of state and local governments will continue and worsen. US federal debt will rise to a level that will impede economic growth. The aging of the population and decline in worker skill levels will prevent productivity growth. Peak Oil will stall economic recoveries. The next 20 years look like really rough sledding.

My advice: prepare for harder times.

By Randall Parker 2010 October 10 03:30 PM  Economics Energy
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College Students Study Less Than They Used To

40 hours per week going to class and studying was just too hard. 27 hours per week opens up more time for sports, video games, parties, and of course seduction.

Using multiple datasets from different time periods, we document declines in academic time investment by full-time college students in the United States between 1961 and 2003. Full-time students allocated 40 hours per week toward class and studying in 1961, whereas by 2003 they were investing about 27 hours per week. Declines were extremely broad-based, and are not easily accounted for by framing effects, work or major choices, or compositional changes in students or schools. We conclude that there have been substantial changes over time in the quantity or manner of human capital production on college campuses.

WTF? I'd like to see these results adjusted for IQ or quality of college (mostly the same thing). Is the decline in hours studying due to more students of lower quality going to college? Certainly the percentage of the population going to college in 1961 was a lot lower than it is today.

On the bright side, few majors really teach job skills. So if students do not study as much there's little long term economic harm. I wonder whether students in economically important majors still study as much.

Check out how students spend their time. Has the percentage of time spent working gone up?

By Randall Parker 2010 October 10 10:56 AM  Education
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2010 October 08 Friday
Jim Chanos: China And Law Of Diminishing Returns

Back in January 2010 billionaire hedge fund investor Jim Chanos gave a good talk on the distortions in China's economy. China's central planners are throwing more and more resources at trying to maintain its growth rate. They can not sustain this approach and he sees a big bubble waiting to burst. Worth watching.

The best quote in the speech: "China has embraced capitalism to keep in place the socialist elites whereas in the West, apparently, we have embraced socialism to keep in place the interests of the capitalist elites". How true.

Chanos outlines the scale of the Chinese bubble. For example, the office space build-out was on course back in January to create 5 feet by 5 feet of office space for every man, woman, and child in China. The size of the overbuild is breathtaking.

He also wonders at the end whether China can move up the value chain the way, for example, South Korea has done. Beyond the current bubble that will matter most in the long run.

By Randall Parker 2010 October 08 08:41 PM  China
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2010 October 07 Thursday
Free Speech Blogging For Geert Wilders

Heeding the call, many bloggers have joined in to blog for Geert Wilders, freedom of speech, and Western Civilization. See OneSTDV's post Geert Wilders and Media Coverage of Muslims about the shaming tactics against Wilders used by the mainstream (i.e. left wing) journalists. These journalists are not much interested in freedom of speech. Far more important for them to assert moral superiority in the on-going American culture war. OneSTDV's previous posts about elite media use of shaming language are worth reading as well.

Roissy did not write a whole post about Wilders but he dedicated a post to Wilders. I think there's special symbolism in his choice of posting topic related to Wilders' opponents. But I haven't figured it out yet. Perhaps someone more penetrating can explain in the comments?

HBD chick (she calls herself the exception that proves the rule) does a short post supporting Geert but arguing against banning the Koran. Not sure if Geert is serious about that. More likely he's trying to make the point that the law he's being prosecuted under is ignoring a dangerous huge incitement to hatred and oppression.

doxRaven says we are being oppressed by political correctness.

NZ Conservative sees Wilders as fighting for local self-determination against international totalitarianism.

Half Sigma, in his post about Geert Wilders, argues that it is a historical coincidence that the Left took up the cause of free speech because they wanted to use it on behalf of communism. In his view the Left's commitment to free speech is weak. That sounds correct. The speech codes on college campuses (such as the one that former Clinton Administration cabinet member Donna Shalala put in place at U Wisc) were implemented by the leftists who totallly dominate academia. The extent of anti-free speech efforts by universities and colleges is stunning. What would Mario Savo think? Would he sympathize with the leftists or with the free speech advocates?

Bi-Coloured-Python-Rock-Snake (venomous?) announced his support for blog bombing for Geert and says "the result of the Wilders trial will signal whether Europe continues on the road toward mass censorship by the aggrieved." Islam seems to make Muslims feel aggrieved. Why is that? Since they feel that way restrictions on speech imposed for the aggrieved have the tendency of tilting the playing field for Islam and against those who favor a free society.

James at Athwart-History says the complaint against Wilders does not include a claim that he's made inaccurate statements. The objective truth is the enemy of those who restrict speech.

Dennis Mangan writes about the Dutch Inquisition against Wilders and says "That the Dutch government has put a brave truth-teller like Wilders on trial is itself a crime."

Who else have I missed? Let me know in the comments.

By Randall Parker 2010 October 07 11:33 PM  Freedom Speech
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2010 October 06 Wednesday
Geert Wilders Speech In Berlin

Dutch Member of Parliament Geert Wilders, on trial for speaking his mind about Islam, gave a speech in Berlin on October 2, 2010 which is worth reading in full. Here's an excerpt where he discusses how the Dutch government has tried to silence him in spite of the fact that it is Islam and not Wilders that is the real threat to the Dutch people.

As you know, I am standing trial in the Netherlands. On Monday, I have to go to court again and I will have to spend most of the coming month there. I have been brought to court because of my opinions on Islam and because I have voiced these opinions in speeches, articles and in my documentary film Fitna. I live under constant police protection because Islamic extremists want to assassinate me, and I am in court because the Dutch establishment – most of them non-Muslims – wants to silence me.

I have been dragged to court because in my country freedom can no longer be fully enjoyed. Unlike America, we do not have a First Amendment which guarantees people the freedom to express their opinions and foster public debate by doing so. Unlike America, in Europe the national state, and increasingly the European Union, prescribes how citizens – including democratically elected politicians such as myself – should think and what we are allowed to say.

Our leftist intellectuals have betrayed us.

One of the things we are no longer allowed to say is that our culture is superior to certain other cultures. This is seen as a discriminatory statement – a statement of hatred even. We are indoctrinated on a daily basis, in the schools and through the media, with the message that all cultures are equal and that, if one culture is worse than all the rest, it is our own. We are inundated with feelings of guilt and shame about our own identity and what we stand for. We are exhorted to respect everyone and everything, except ourselves. That is the message of the Left and the politically-correct ruling establishment. They want us to feel so ashamed about our own identity that we refuse to fight for it.

The detrimental obsession of our cultural and political elites with Western guilt reinforces the view which Islam has of us. The Koran says that non-Muslims are kuffar (the plural of kafir), which literally means “rejecters” or “ingrates.” Hence, infidels are “guilty.” Islam teaches that in our natural state we have all been born as believers. Islam teaches that if we are not believers today this is by our own or by our forefathers’ fault. Subsequently, we are always kafir – guilty – because either we or our fathers are apostates. And, hence, according to some, we deserve subjugation.

Our contemporary leftist intellectuals are blind to the dangers of Islam.

Read the whole thing.

If you are a blog author then do a blog post about Wilders, freedom of speech, and Islam in Europe.

By Randall Parker 2010 October 06 09:30 PM  Freedom Speech
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2010 October 05 Tuesday
Americans, Unlike Dutch Politicians, Support Free Expression

While Dutch political leaders schemed to silence Dutch MP and political party leader Geert Wilders for saying things about Islam that are unpopular with Muslims here in America we are pretty much resolved that people should be able to say unpopular things (excepting those ideas suppressed by the forces for Political Correctness). An overwhelming majority of Americans believe we should be free to express unpopular ideas without fear of our lives.

While most Americans said they valued freedom, Baker wanted to learn more about just what "freedom" meant to them, so he asked "To what extent do you agree or disagree with each of these statements:"

"Freedom is being left alone to do what I want;" and

"Freedom is being able to express unpopular ideas without fearing for my safety."

Only about a third of Americans agreed that freedom is being left along to do what they want. But over 90 percent of Americans agreed that freedom meant being able to express unpopular ideas without fearing for their safety. "There was no difference between liberals and conservatives. The vast majority on both sides agreed," Baker said.

But some Americans have expressed ideas about Islam in ways that forced them to go into hiding. A cartoonist formerly known as Molly Norris has gone into hiding with a new identity. So in addition to having to worry for her life, she has to move somewhere and get a job doing something without being able to demonstrate what she's done in the past. That's harsh.

At the urging of the FBI, the Seattle cartoonist behind "Everybody Draw Mohammed Day" is "going ghost" — leaving town, changing her name, creating a new identity because of the death threat issued in July by an Islamic cleric linked to the failed Times Square bombing, the Seattle Weekly says of its former contributor.

This Islamic cleric, Islamic Cleric Anwar al-Awlaki, was born in New Mexico.

She's not the only American on that Jihadist kill list that the FBI is advising to change their lives.

By Randall Parker 2010 October 05 09:44 PM  Freedom Speech
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Obama One Third The Way Toward Employment Goal

U Chicago economist Casey Mulligan explains European government policies have been responsible for a much lower rate of employment in Europe. Part of this shows up in higher European unemployment rates. But fewer people in Europe even try to find jobs.

Employment has been consistently lower in Western Europe, with an average employment rate gap of 10 percentage points over the years 1980-2007. Our recent sharp drop still leaves two-thirds of the European-American employment gap that was there a few years ago.

So far Obama has managed to close only one third of the gap that the US has with Europe in terms of employment. He's got to keep the unemployment rate high in order to drive more people out of the labor force and onto welfare (masquerading as extended unemployment benefits) to make the US more like the European welfare states. Can he do it?

Some might argue that lowering the US employment rate is not a long term Obama goal. But it is an obvious predictable outcome of the policies he prefers. So he either does not mind this effect or he wants it. Either way he's effectively aiming for it.

The resulting lower labor market participation rate lowers tax revenues which makes his social programs less affordable. But he wants to solve that problem with higher taxes which will further lower the employment rate to make it closer to Europe. This will lower output and living standards. Seems unavoidable.

Mulligan does not expect the US employment rate to return to as high as it used to be. The government is growing and its policies work against employment.

Our future is likely to have a permanently larger role for government, and that means employment rates may never be as high as they once were. We might enjoy some of the European lifestyle, or recover the jobs lost during this recession, but not both.

I think the United States has peaked in many ways. Tragic. But there it is. We've got too many things working against us now. Hard to make way against such strong head winds.

By Randall Parker 2010 October 05 09:23 PM  Economics Labor
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2010 October 04 Monday
First Day Geert Wilders Free Speech Trial

Geert Wilders is on trial for severely criticizing Islam. Since I've personally said things as critical about Islam as Wilders is on trial for I feel very fortunate to be protected by the First Amendment of the US Constitution. Wilders says freedom of expression by Dutch citizens is on trial.

He faces a hefty fine or a year in jail if found guilty on five charges of inciting hatred and discrimination against Muslims and insulting their religion for likening, as he routinely does, the Qur'an to Adolf Hitler's Mein Kampf and describing Islam as fascist.

"I am on trial, but on trial with me is the freedom of expression of many Dutch citizens," he told the Amsterdam district court. "I can assure you, I will continue proclaiming it."

Mr Wilders faces five charges of inciting racial hatred between Oct 2006 and Mar 2008. If found guilty, Mr Wilders faces over a year in prison or a £6,600 fine.

Speaking at his trial yesterday, Mr Wilders said: "I am sitting here as a suspect because I have spoken nothing but the truth. I have said what I have said and I will not take one word back."

We should not have to live in fear of Islam or to hold our tongues about Islam.

If you are a blogger write a blog post about this trial on Thursday which is the day I've suggested a coordinated set of postings for Geert. See my post Modest Proposal: Protest Day For Geert Wilders. Tell other bloggers in email. Announce your intention to do so in a blog post and ask other bloggers to also write blog posts on it on Thursday.

Baron Bodissey has more on the trial at Gates Of Vienna.

You can watch Wilders' video Fitna about Islam and also Submission by Ayaan Hirsi Ali and the murdered Pim Fortuyn. Decide for yourself whether your government should have the power to prevent you from watching such videos.

A January 2008 interview of Geert Wilders about his film Fitna. These views are on trial.

What matters most: Is he right? I am struck by reasonable and moderate in tone he is. But he's saying that generations of Dutch politicians made a mistake with multiculturalism and they do not want to admit the scale of their mistake.

By Randall Parker 2010 October 04 08:48 PM  Elites As Enemies
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2010 October 03 Sunday
Cal Welfare Payments Funding Gambling And Cruises

The Los Angeles Times poked in some California state data on where welfare cash cards get used and found some of the cards get used on cruise ships, in Miami, and on Hawaiian islands. But Las Vegas (lost wages, or lost welfare) is the number one for out-of-state spending destination by welfare recipients.

More than $69 million in California welfare money, meant to help the needy pay their rent and clothe their children, has been spent or withdrawn outside the state in recent years, including millions in Las Vegas, hundreds of thousands in Hawaii and thousands on cruise ships sailing from Miami.

Penny-wise, pound-foolish budget cuts for welfare fraud investigation are making the situation worse.

An anti-fraud unit in Orange County, which won praise from state officials last year for saving the state millions, has since had to slash its budget and lay off 15 investigators, said Paul Bartlett, commander of the county district attorney's Bureau of Investigation. Those cuts saved $900,000 in operating expenses but allowed "an estimated $9.6 million in suspected fraud payments out the door," according to an Orange County Grand Jury report released in May.

For every jurisdiction in America I'd like to know the marginal dollar amount saved per dollar spent on welfare fraud investigation. How many places have a ratio greater than 1? Ditto for Medicare fraud investigation and other forms of investigation of fraud against government. Do governments generally underspend on efforts to prevent fraud?

By Randall Parker 2010 October 03 11:03 PM  Economics Entitlements
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Arizona Sheriff: Obama Hands Around Throat

Larry Dever thinks Barack is insincere about border security. Sure 'nuff.

Sheriff Larry Dever of Cochise County, Ariz. told CNSNews.com that President Barack Obama has “got his hands wrapped around our throat” as his administration sues the state of Arizona for trying to enforce the immigration laws that the federal government itself will not enforce.

Dever repeats a familiar argument: Obama is holding border security hostage in exchange for amnesty. Worse yet in my view: the USG will not make the border secure even if the elites get another amnesty. They want more unskilled immigrants who will vote for the Democrats while simultaneously lowering living standards for the lower classes. They do this while pretending to represent the interests of the lower classes. Cheeky devils.

Dever also said he has “zero confidence” Obama will secure the border before his presidential term is up in two years and that the president is putting the people who live and work in Cochise County at risk by willfully failing to secure that border so that he can maintain political leverage for his goal of winning an amnesty for illegal aliens.

This battle over immigration happens against a backdrop of worse than stagnating incomes.

The inflation-adjusted income of the median household—smack in the middle of the populace—fell 4.8% between 2000 and 2009, even worse than the 1970s, when median income rose 1.9% despite high unemployment and inflation. Between 2007 and 2009, incomes fell 4.2%.

A rational person who had the best interests of the American people at heart would see these results and recognize the need to stop the influx of immigrants from south of the border. If we can't have a government that pursues policies in the national interest then I really want to join the top 1% who are having a party.

Since Hispanics are the most rapidly growing portion of the US population and they aren't exactly tearing up academically it bodes poorly for the future median income of America that Hispanics have a high rate of poverty.

The Census report showed increases in poverty for whites, blacks and Hispanic Americans, with historic disparities continuing. The poverty rate for non-Hispanic whites was 9.4 percent, for blacks 25.8 percent and for Hispanics 25.3 percent. The rate for Asians was unchanged at 12.5 percent.

You can see how things are going per ethnic group in America with figure 1 of Mish's post on the lost decade. I'm pretty confident that we are starting into another lost decade. Too many factors are working against rising living standards in America.

By Randall Parker 2010 October 03 10:39 PM  Immigration Economics
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More On Female Promiscuity And Divorce

The Social Pathologist again takes up the effects of female promiscuity on marital stability.

Each additional sexual partner increased the odds of infidelity by 7% while increasing years of education seem to decrease the risk by 10%. Very roughly speaking each addition partner negates the benefit of a year of education with regard to infidelity risk. Yet another study demonstrating the effect of promiscuity on relationship exclusivity/stability.

Social science data is useful and should help guide you in making life decisions. Really.

You can catch on his previous postings on sluts and divorce here. It is a cautionary tale for guys who are thinking about marriage. Remember, divorce court is not exactly cricket. Unless you are marrying a woman who earns a large yearly income be very concerned about her sexual history. Either marry an 18 year old virgin or a 30 year old specialist MD who makes $300k+ per year.

By Randall Parker 2010 October 03 09:50 PM  Human Nature Mating
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Modest Proposal: Protest Day For Geert Wilders

Geert Wilders is on trial this week in the Netherlands for using his basic right to free speech (said right not recognized in the Netherlands) to advocate against the Islamization of the Netherlands. It occurs to me we should choose a day when all bloggers who support a basic right to free speech ought to write posts protesting the prosecution for Geert Wilders.

Since Wilders is on trial this week on Monday, Wednesday, and Friday I propose Thursday October 7 as the day to write posts excoriating the Dutch government for this unjustified and unfair prosecution of Geert Wilders.

If you are going to do this then write a post immediately that alerts your readers and other bloggers that you will be doing this. Also, tell me in the comments of this post along with a link to your blog. Also, send emails to blogger friends who are likely to be sympathetic to this idea.

I hear George Orwell:

Freedom is the right to tell people what they do not want to hear.

Update: Many heeded the call.

By Randall Parker 2010 October 03 02:18 PM  Freedom Speech
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The Objectivist Movement Commits Suicide

Do you have an interest in Ayn Rand's philosophy of Objectivism, or just an interest in how intellectual movements splinter and toss out dissidents who refuse to defer to authority? An interesting new split in the Objectivist movement has just occurred involving the resignation of Stanford professor John McCaskey from the Ayn Rand Institute. On this topic see The Objectivist Movement Commits Suicide by Robert Tracinski. He places the latest turn of events into a larger pattern involving unreasonable demands for deference to philosophical authority.

The Objectivists have a history of such splits. The most famous involved Ayn Rand's much younger lover Nathaniel Branden and his wife Barbara Branden. You can read their books on the subject for an inside look at Ayn Rand, Alan Greenspan, and others around Rand at the time. Another split came in 1993 when George Reisman and his wife Edith Packer were condemned by people associated with the Ayn Rand Institute. The letters at that URL will give you a sense of how these splits play out, with anyone who won't defer to Leonard Piekoff's judgment getting condemned as immoral. This demand for deference is what amazes me. It is so much like Plato's philosopher-king idea that I marvel at the capacity for the dedicated believers in reason and evidence to reject the physical world as secondary to philosophical ideas.

Note: My favorite comment from Tracinski's article is about how scientists have done a better job at epistemology than philosophers. I've long thought that. I expect neurobiologists and artificial intelligence researchers to do a better job at philosophy than the bulk of philosophers just as physicists have done in the past.

One of my own objections to Objectivism is that its model of human nature is not based on biology. The same is true of all the political ideologies which are built on mythological views of human nature which are incompatible with real human nature.

By Randall Parker 2010 October 03 05:39 AM  Politics Factions
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2010 October 02 Saturday
Burqa Ban And Halving Of Immigration In Netherlands

It is still possible for a Western government to take steps to stop demographic deterioration. The political party headed by Geert Wilders (whose Fitna video about Islam is worth watching) has made a deal with the newly formed minority government of the Netherlands to cut back on immigration and ban burqas.

They also announced tougher measures on immigration and public security and said they will propose a ban on the burqa and other full-body robes worn by some Muslim women.

The tighter rules on immigration reflect the influence of the anti-Islamist Freedom Party. This party, also known as the PVV, has promised to support the minority government, which will consist of the Liberal Party VVD and the Christian Democrat Party CDA.

In northern Europe efforts to cut back on immigration are achieving success. More rightward leaning parties are coming to power and cutting back on the importation of people whose religions and cultures are not compatible with Western Civilization. We need these policies in America.

Wilders wants an end to Islamization.

The announcement came yesterday from anti-Islamic MP Geert Wilders.

"A new wind will blow in The Netherlands," Mr Wilders declared in The Hague. "We want Islamisation to be stopped."

Hurray Mr Wilders. He is achieving these successes in spite of an attempt by the Dutch elite to use the legal system to silence him. The Netherlands does not recognize a right to free speech.

The leader of the PVV anti-Islam party faces five charges of religious insult and anti-Muslim incitement in the trial, which begins on Monday.

I am reminded of George Orwell:

"The controversy over freedom of speech and of the press is at the bottom a controversy over the desirability, or otherwise, of telling lies. What is really at issue is the right to report events truthfully, or as truthfully as is consistent with the ignorance, bias and self-deception from which every observer necessarily suffers. "

During times of universal deceit, telling the truth becomes a revolutionary act."

I especially like this one:

"Freedom is the right to tell people what they do not want to hear. "

A proposal: A number of blogs should organize a day to protest to the Dutch government the prosecution of Geert Wilders. We should all write posts about Wilders that day and also organize emailing, physical mail letters, and other forms of protest against the Dutch government's attempt to silence Wilders.

The coalition expects to cut immigration in half.

The coalition will aim to halve immigration, emulate Denmark in making it difficult for the spouses and children of immigrants to join them, and deport immigrants found guilty of crimes meriting sentences of 12 years.

The coalition will make it especially hard for unskilled immigrants.

The government said it plans to make it harder for immigrants already living in the Netherlands to bring other family members here and also would make it tougher for unskilled immigrants with little chance of finding work to move to the country.

Progress is even possible in Sweden.

The anti-immigration Sweden Democrats, whose videos for last week's election showed a veiled woman overtaking a pensioner in a rush to collect welfare cheques, now hold the balance of power between the center right government and the opposition.

Meanwhile, Barack Obama is still pushing for another big immigration amnesty in the United State.

By Randall Parker 2010 October 02 01:01 PM  Immigration Culture Clash
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