Economics & Finance

An Important Qualifier

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Via Instapundit comes a major  (albeit British) media report that the Tea Party protest in Washington turnout could be as high as two million.

As impressive as that no doubt upper-limit estimate is, I think that the raw number leaves out an important qualifier.  To be    truly accurate, the report should say:

Two million people with jobs…

Getting hundreds of thousands of kids, the professionally unemployed  and government workers to show up isn’t that hard (especially if someone buys the bus tickets). Getting two million middle-class, middle-aged people with jobs, careers, children and businesses is way, way more impressive.

We can safely assume that for every individual who made it to the protest that there are dozens of people whose grown-up obligations prevented them from attending.

That thought should keep Obama and Pelosi up at night.

[update (2009-9-13 10:17pm): I should point out that I don’t think anyone really believes that two million people showed up in Washington. One percent of the entire U.S. population is 3 million people so two millions gets you two thirds of the way to one percent of the entire population. I don’t think there is a city in world that could handle that big an influx of people. Washington D.C. itself only has a population for 590,000 so having nearly four times the population of the city show up is really not credible no matter what the senior Democratic leadership thought. On the other hand, having hundreds of thousands of people, most who have never protested before, show up is significant and puts the tea party in the big leagues no matter how you cut it.]

[update (2009-9-13 6:53pm): For unknown reasons, all comments by Hippeprof were deleted from the thread below. This issue is being investigated and we will try to recover the comments. If anyone else saw their comments disappear please email me at the link to the upper right.]

[update (2009-9-13 8:02pm): 20 comments were found to have been removed by the spam filter. We have restored them and I will be cleaning up duplicates and removing the “hey, what happened to my comments?” post in order to keep the thread clean.]

[update (2009-9-12-10:16): The technical problems have resurfaced. Your posts may not show properly. We may have to freeze the comments. If you have an important point to make  you can email at the link to the upper right and I will add your comment to thread manually as time permits.]

Health Care and the Crypto-Marxist Model

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From the Presidents latest health care policy speech:

Despite all this, the insurance companies and their allies don’t like this idea. They argue that these private companies can’t fairly compete with the government. And they’d be right if taxpayers were subsidizing this public insurance option. But they won’t be. I’ve insisted that like any private insurance company, the public insurance option would have to be self-sufficient and rely on the premiums it collects. But by avoiding some of the overhead that gets eaten up at private companies by profits and excessive administrative costs and executive salaries, it could provide a good deal for consumers, and would also keep pressure on private insurers to keep their policies affordable and treat their customers better, the same way public colleges and universities provide additional choice and competition to students without in any way inhibiting a vibrant system of private colleges and universities.

There’s a lot that’s revealed in this paragraph about how Obama views the world. Most importantly, I think his statement about profits being inefficient reveals his crypto-Marxist model of economics.

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“In the United States of America, no one should go broke because they get sick.”

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Thus spake President Obama.

What remained unsaid was that he thinks it’s OK if insurance companies go broke.

Whatever you may think about insurance companies, they provide insurance. If they are driven out of business by government mandates that raise their costs — and Obama’s expansive, intrusive program will raise their costs, significantly, if it’s implemented — health insurance will be less available from the private sector. This means that under his scheme health insurance will become increasingly and inevitably a government-provided service.

Obama also said that he isn’t against insurance companies. Maybe he’s not, I don’t know. But he wants them to change their behavior in ways that will increase their costs and reduce their profits. Whatever he says he wants to do, and wants other people to do, he can’t force anyone to provide goods or services. Companies will eventually choose to go out of business if their alternative is to lose money in perpetuity. And on the margin a future of money-losing alternatives is what President Obama offers to health-insurance companies (and perhaps also to drug companies, medical-device manufacturers, hospital operators and many physicians) under his plans.

Healthcare: The Supply Side

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Here’s a thought experiment. Suppose the year is 1902. Automobiles exist, but they are rare and expensive. The assembly line has not yet been invented, and car manufacturing, such as it is, is done entirely by craft methods.

Now imagine that our politicians decide that every American family, as a matter of national policy, should have its own automobile. (Let’s also stipulate that the trades involved in automobile-building–machining, welding, carpentry, etc–are tightly controlled by guilds.)

What would happen?

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Compare and Contrast

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Murdoc very kindly gave us a heads up to this fascinating photo blog. Pictures taken in Normandy during the 1944 invasion are compared side-by-side with images taken from the very same spot today. Looks like they cleaned up the place a bit since then.

Uncle points us to this photo array. The weekly food intake of families from various parts of the world are shown in graphic fashion, and the money spent is tabulated. Makes me proud to be an American.

Well worth your time.