Norway Prices & the US “peso”

I recently took a trip to Norway. In addition to being interested in a debate about transmission lines strung high above picturesque fjords I was also astounded at how high their prices were (when converted into US dollars).

A drink at the crappiest, “dive-iest” bar in Bergen (Norway’s 2nd largest city) will set you back $11 USD. A drink at a regular restaurant or a hotel will frequently cost you much more. Above you can see one glass of wine and one beer (admittedly a good pour from a local brewer) and 200 Norwegian Kroner. At current exchange rates 200 Kroner is about $35-$40 (let’s say $40, because it makes the math easier and is close enough) or each Krone is worth 20 US cents. That means that these two drinks, with tip (if you leave one, optional) costs about $40.

Here’s another sign of how upside down it is. I saw this cool mini-bar self dispensing fridge in a friend of ours’ hotel room. The prices in the mini-bar in a Hilton were competitive with those of a regular bar! I guess at some point you reach an absolute price ceiling on alcohol and the fact that a hotel mini-bar is competitive with outside prices means that you are there.

There are other factors at play with alcohol in particular; the government levies high taxes in order to deter consumption. The long arctic nights apparently encourage heavy drinking and if nothing else the government is compensated for your sins (it didn’t seem to do much to deter the locals from drinking, but it worked a bit for me).

It isn’t just alcohol that is almost prohibitively expensive when you are paying with the US “peso” (or Euros – the Norwegian currency is punishingly high against everyone unless maybe you were paying in Swiss, Brazilian, Chinese, Canadian or Australian dollars). I split a “Deal Meal” in McDonalds with someone (it was 2 Quarter Pounders plus fries and one drink) because it too was around $20 USD when you did the conversion (I think it was 125 Kroner). Let’s compare that with the US…

There are other odd indications of a currency upside down, or where the local economy has become so un-moored from the rest of the world that things are just “different”. Why not drive a 5 series BMW AS A CAB? I think our trip from the airport to downtown Bergen was something like 700 Kroner… I guess that is about $140 USD or so (we took the bus back when we returned, we can learn). So at that rate you might as well drive a 5 series BMW, which must be brought in country at a prohibitively high exchange rate, as well.

One thing about America; apparently it is very cheap to 1) get drunk 2) buy tons of unhealthy food 3) take a cab. I had a great time in Norway by the way it was a beautiful and exceedingly well-run country with a highly educated workforce. I still don’t know how they can pay the bills, though, unless local salaries are completely outrageous.

Cross posted at LITGM

Putting Alternative Energy and Government Workers First… Before Medical Care for the Poor

California faces intense budget challenges. The budget gap is approximately $10 billion, and instead of “fixing” them, their budget has optimistic assumptions such as extra revenue due to an improving economy and many other sleight-of-hand items. The California executive and legislative branches are all solidly in the hands of Democrats, who control the agenda but must at least negotiate with the Republicans on the topic of tax increases (because a super-majority is needed to raise taxes).

I wrote here about how the State of California has a super-aggressive (and expensive) plan to move to “alternative energy” even though the cost / unit is much higher than traditional forms of energy, especially when transmission is taken into account.

In contrast with other states where the government is attempting to make their union workforce pay more for insurance and pensions, the completely captured Democratic officials don’t even attempt to reduce compensation, benefits or pensions.

Thus how does California intend to balance their budget, when they 1) won’t reduce government union worker pay or benefits 2) won’t back off their alternative energy zealotry?
By reducing medical care to the poorest citizens in their state. This article in today’s Chicago Tribune is titled “Health Law Model State Eyes Drastic Surgery” describes the situation in California’s medicare system which covers 6 million children and poorer residents.

California spends less per beneficiary than any state. It is now seeking waivers from the federal government to impose copays of $5 for office visits and prescriptions, $50 for emergency room visits and $100 for hospital stays.. (they) would drop reimbursement for a standard physician visit to less than $12.

It actually is a bit worse than that. The co-pays would have to be collected by the doctors, and if they can’t collect the money, then their reimbursement will fall further.

And what would the likely impact be of these cuts? Per the article:

Many doctors have already closed their doors to Medicaid patients. Other providers are following suit.

It is telling that the Democratic-controlled executive and legislative branches have decided that protecting the salaries and benefits of their union workers has a higher priority than providing basic medical care for the poorest residents in their state. They also believe that an incremental (and insignificant) move towards alternative power, which costs billions, rises above the needs of the poor for medicine.

This is analogous to the teachers’ unions that put their needs and benefits ahead of the children, who suffer through some of the worst schools in the country here in Chicago.

I can only imagine the smug outpouring of punditry that would occur if the Republicans abandoned a core principle to the same degree that the Democrats in California are abandoning the poor in this instance. Like this article in the Chicago Tribune and LA Times, the fact that the Democrats are abandoning the poor and instead focusing on their own direct needs isn’t even mentioned, since it apparently isn’t a fact that they believe their readers need to know. The situation is presented as a sad part of the budget sideshow rather than as a calculating prioritization decision made on the part of California’s Democrats, which it actually is.

Cross posted at LITGM

Around Chicago September 2011

Upper left – at the Cubs for a beautiful Saturday in September for a day game. Love the trash-talking T Shirts, especially the one with a picture of Jesus on it saying “Don’t Do Nothing ‘Til I Get Back”. Upper middle – people lining up for donuts at “The Doughnut Vault“, in River North, where they start serving doughnuts at 8:30am until they are all gone. Upper right – the plaza in front of the Hancock building with a fountain and people lounging around on a Saturday night. The number of tourists now on Michigan avenue seems to be at an all-time high. Lower left – the Aon Building lit up pink, with the new Prudential building adjacent. Lower right – looking up at the Hancock, with green lights installed.

Cross posted at LITGM