The End of the European Welfare State As a Comparison Point for the USA

For years articles about everything from family leave to medical benefits started with the premise that

The United States is the only modern Western economy that doesn’t do or provide “X” for their workers

Thus the premise was the our economies were roughly equivalent and the USA was “mean” or “backwards” because we didn’t provide all those benefits and worker protections that the other countries were (apparently) able to absorb.

In the Sunday Business of the NY Times we can see where this has finally led, however – in an article about retraining European workers titled “Fake Jobs with Real Benefits” this is the end statistic:

But in a reflection of the shifting nature of the European workplace, most are low-paying and last for short stints, sometimes just three to six months. Today, more than half of all new jobs in the European Union are temporary contracts, according to Eurostat.

These jobs don’t have the famous protections for working mothers and stay-at-home dads and for medical benefits and pensions and everything else; they just set you up for a few months at a time and can just not renew your contract for any reason, including if you are legitimately hurt or ill. These are the ruthless “McJobs” that have been decried for years in the USA.

In parallel, Spain is now lurching into a political crisis similar to what is happening in Greece. Here are some statistics on Spain per this Foreign Policy article:

The Eurozone as a whole is a disaster. Whereas the United States’ economy is nearly 10 percent larger than it was seven years ago, the Eurozone’s is 1.5% smaller. And Spain is faring even worse; it’s economy is still 5 percent smaller. Nearly one in four Spaniards, and one in two young people, are unemployed. In the European Union, only Greece’s unemployment rate is higher. Many people have dropped out of the labor force (or immigrated to countries where there are jobs to be found). A lost generation is in the making.

And the governmental statistics are sobering:

Spain still has the largest fiscal deficit, as a share of the economy; in the entire EU: 5.8% of GDP last year. Public debt as a share of GDP rose by more last year than anywhere else in the eurozone and is set to top 100 percent this year.

The few remaining permanent full-time jobs are often in the governmental sector; this is closely linked to corruption. In Spain the corruption of the ruling parties contributed to their drubbing in local elections.

The net of all this is that comparing the USA to Europe is now mostly a fools’ errand. Not only has growth and productivity stalled across most of the EU, the cherished benefits that are held up as the “gold standard” are accruing to fewer and fewer workers as the young frankly have no work at all and many of the adults that do work are on these short term contracts where those protections rarely apply.

Whether or not the USA should enact various protections to our workers is a good question, with pros and cons on both sides of the ledger. However, the blanket statements that we are the last modern economy to not do “X” should be tossed in the dustbin of history, because it doesn’t apply anymore.

Cross posted at LITGM

Why Doctors Quit.

Today, Charles Krauthammer has an excellent column on the electronic medical record. He has not been in practice for many years but he is obviously talking to other physicians. It is a subject much discussed in medical circles these days.

It’s one thing to say we need to improve quality. But what does that really mean? Defining healthcare quality can be a challenging task, but there are frameworks out there that help us better understand the concept of healthcare quality. One of these was put forth by the Institute of Medicine in their landmark report, Crossing the Quality Chasm. The report describes six domains that encompass quality. According to them, high-quality care is:

1) Safe: Avoids injuries to patients from care intended to help them
2) Equitable: Doesn’t vary because of personal characteristics
3) Patient-centered: Is respectful of and responsive to individual patient preferences, needs and values
4) Timely: Reduces waits and potentially harmful delays
5) Efficient: Avoids waste of equipment, supplies, ideas and energy
6) Effective: Services are based on scientific knowledge to all who could benefit, and it accomplishes what it sets out to accomplish

In 1994, I moved to New Hampshire and obtained a Master’s Degree in “Evaluative Clinical Sciences” to learn how to measure, and hopefully improve, medical quality. I had been working around this for years, serving on the Medicare Peer Review Organization for California and serving in several positions in organized medicine.

I spent a few years trying to work with the system, with a medical school for example, and finally gave up. A friend of mine had set up a medical group for managed care called CAPPCare, which was to be a Preferred Provider Organization when California set up “managed care.” It is now a meaningless hospital adjunct. In 1995, he told me, “Mike you are two years too early. Nobody cares about quality.” Two years later, we had lunch again and he laughed and said “You are still too years too early.”

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Trains are Indefensible

I remember as a kid watching “Lawrence of Arabia” where he led Arab raiding parties against the Turkish train lines in WW1.  Per this PBS article about Lawrence:

With the Ottoman army spread thinly across the empty vastness of the Arabian Peninsula, the Hejaz Arabs found it relatively easy to strike and sabotage Turkish lines of communication and supply. With the Red Sea firmly in British hands, the Turks had no option but to use the Hejaz railway to move their men, supplies and munitions.  

Lawrence and the Arabs spent much of their two years on the road to Damascus destroying sections of the railway. Small units of men laid charges on the track. Then as the Turks defended the track, Lawrence’s men formed large moving columns capable of rapid hit-and-run operations. 

In the recent train crash in the East Coast there are discussions of a “projectile” hitting the train and distracting the conductor.  While this hasn’t been confirmed, it is relevant to consider how difficult it would be to secure train lines from attack or sabotage.

This discussion is much more relevant in the context of “high speed trains”.  There is a broad theme among many that the US is behind because we have not invested large sums of public money in high speed trains, that we are “falling behind”.  Per wikipedia the Japanese high speed trains (similar to the Chinese high speed trains) typically have more than 1000 passengers on each of their trains.

The USA has far larger distances than the Japanese trains.  If you built a train from Chicago to New York, for example, it would be almost 800 miles long.  This is for a single rail line.  Obviously to connect the major cities of the USA you’d have thousands of miles of train lines.

How would these train lines be defended?  It would be easy for a terrorist to just cut through the fence somewhere and park a cement truck on the tracks, for instance.  The ensuing carnage would easily accomplish what 5-10 hijackings could accomplish.

If you think that the Homeland Security plans are over-reaching, just wait to see what it would take to defend hundreds or thousands of miles of track.  Instead of having a bottleneck at the airport, the entire line would be a potential point of attack.  Even if defenses were erected, they would only have to overwhelm them at a single weak link in order to assault the train.

No one is incorporating this into their cost estimates for high speed trains; they likely have fences and barriers but are not contemplating stopping a determined, armed attack by terrorists.  They should, because after one such attack a giant post-haste effort would emerge kind of like our early days of the TSA.  They should contemplate and include a giant, armed, unionized Federal bureaucracy in their midst and add this into their cost estimates and see how it compares against highways and aircraft.  The numbers, already dubious, would then be far, far in the red.

Cross posted at LITGM

Make Them Own It

Today we see that the latest bond offering from the Chicago Board of Education will be priced at over twice what a BBB offering demands. That is brutal. I still won’t touch that with a ten foot pole.

It is inevitable that the State of Illinois and City of Chicago and their organs will be having major financial issues, to say the least, within a year or two. It could be Detroit on an inter-galactic scale.

My question is this – why don’t the Republicans make the Democrats own these massive boondoggles? I understand that in Illinois, many of them are in on the fun – however, the State of Illinois, City of Chicago and Detroit have all been essentially run by Democrats for literally generations – and it is all blowing up.

Is the issue too complex for Joe Six Pack to understand or care about? Are the Republicans afraid to be held to a higher standard? I just don’t understand why they wouldn’t shout from the mountain tops at how much graft, corruption and incompetence it takes to completely tank a city with as much potential as Chicago and a State with so many potential positives as Illinois.

Paying Higher Taxes Can be Very Profitable (rerun)

(Originally posted in January 2010now an April perennial)

Chevy Chase, MD, is an affluent suburb of Washington DC. Median household income is over $200K, and a significant percentage of households have incomes that are much, much higher. Stores located in Chevy Chase include Tiffany & Co, Ralph Lauren, Christian Dior, Versace, Jimmy Choo, Nieman Marcus, Saks Fifth Avenue, and Saks-Jandel.

PowerLine  observed that during the 2008 election season, yards in Chevy Chase were thick with Obama signsand wonders how these people are  now  feeling about the prospect of sharp tax increases for people in their income brackets.

The PowerLine guys are very astute, but I think they’re missing a key point on this one. There are substantial groups of people who stand to benefit financially from the policies of the Obama/Pelosi/Reid triumvirate, and these benefits can greatly  outweigh  the costs of any additional taxes that these policies require them to pay. Many of the residents of Chevy Chasea very high percentage of whom get their income directly or indirectly from government activitiesfall into this category.

Consider, for starters, direct employment by the government. Most Americans still probably think of government work as low-paid, but this is much less true than it used to be. According to  this, 19% of civil servants now make $100K or more. A significant number of federal employees are now making more than $170,000. And, of course, the more the role of government is expanded, the more such jobs will be created, and the better will be the prospects for further pay increases.

If one member of a couple is a federal employee making $100K and the other is making $150K, that would be sufficient to allow them to live in Chevy Chase and occasionally partake of the shopping and restaurants. But to make the serious money required to  really  enjoy the Chevy Chase lifestyle, it’s best to look beyond direct government employment and pursue careers which indirectly but closely benefit from government activity…which are part of the “extended government,” to coin a phrase.

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