When the Facts Aren’t the Facts and the Checker is Checkered: “If you like your health care plan, you can keep it”

‘PolitiFact has named ‘If you like your health care plan, you can keep it,’ the Lie of the Year for 2013,” said the online site. “Readers in a separate online poll overwhelmingly agreed with the choice.” ‘

‘Not only did Obama sell the lie that we can keep our insurance, he was aided and abetted in the lie by none other than PolitiFact.

Talk about irony.

Even PolitiFact admits of this, although they do so in the “half-true,” weasely way that they reserve for something that they support policy-wise, but know is being touted through lies.

At the time Obama was touting Obamacare as something that wouldn’t change the health insurance industry or the healthcare industry, Politifact rated the claims as either “half-true” or “true”.

And they did so, in part, by using one of the Big Lies the administration later tried to use to cover his gaffe.

You know why the administration tried to foist the blame for cancelled policies not on the law itself, but rather on the insurance companies?

Because they got the talking point directly from Politifact in 2009.

“We concluded that nothing in Obama’s proposal proactively forced such changes, and the bills clearly intended to leave much of the current health care system in place,” said PolitiFact in response to Obama’s claims in September 2009 that employer plans wouldn’t have to change as a result of Obamacare proposals.

Said Obama at the time: "If you are among the hundreds of millions of Americans who already have health insurance through your job, or Medicare, or Medicaid, or the VA, nothing in this plan will require you or your employer to change the coverage or the doctor you have."

No caveats on that. PolitiFact rated that claim as “true.” ‘ - Obamacare Big Lie Came from “Fact Checker” PolitiFact Talking Point, townhall.com, 12/13/2013

Link to entire article appears below:

http://finance.townhall.com/columnists/johnransom/2013/12/13/obamacare-big-lie-came-from-fact-checker-politifact-talking-point-n1762613


　

　

　


　

Politico action: “self-interest in a self-interest”? -Or- for those with a political agenda: “greed in a greed”?

Consider voluntary mutual self-interest at the point of exchange. Imagine, if you will, the very point in time at which the dynamic equilibrium is reached where, mutually and voluntarily, two parties reach exchange as both parties perceive value.

If one introduces to the above mutual exchange an exogenous item known as politicos through the mechanism of government generating market distortion through tax, subsidy, regulation and/or the reduction or removal of the freedom to choose, the result is reduced/diminished utility [satisfaction]. That is, the dynamic equilibrium reached at the point of exchange becomes much less economically efficient.

Is too much attention paid to, and the considering thereof, the forces that result in reduced efficiency at the point of exchange, and too little attention paid to the politics of self-interest? Set aside the economic forces for a moment. Is the collective action proposed by the politico merely “self-interest in a self-interest”? -Or- for those with a political agenda: “greed in a greed”?

If one acknowledges the politically introduced forces causing economic inefficiency at the point of exchange, is one in essence viewing the individualistic idea of self-interest being superimposed upon another self-interest? Stated alternatively, we have collective action through the mechanism of government advertised as supposedly for the benefit of the many yet the collective action is initiated through the appeal to the self-interest of the individuals making up the recipient group of the collective action. That is, the action phase of the collective proposal is delivered via the appeal to the self-interest of the individuals supposedly benefiting from the collective action.

Viewing the concept outlined above from another angle, the collective action in effect, politically, creates another set of individualist self-interests. That is to say, collective action or collectivism, when sold by the politico, in the main, is depicted as action for the benefit of the many. However, in essence, the “action phase” in and of itself, that supposedly is collectivist in nature, is really politically sold as individualistic in nature, as the action phase is a self-interest in a self interest.

Hence we find that a collective action which finds its roots in the altruistic view of redistribution to the many, sold to the many by appealing to each individuals self-interest that make up the many. That each individuals self-interest within the many are sold on their having a self-interest in a self-interest.

Returning to voluntary mutual self-interest at the point of exchange, the two parties to the exchange are enjoined by a third party which is the politico who is the self appointed surrogate for the "many". The politico proposes that an exogenous group has a self-interest in the self-interest occurring at exchange between the two parties. The politico frames the exercise as the third party benefiting from a collective action yet appeals to each individuals self-interest within the many. That is, the politico puts forth the notion that the many that supposedly benefit from the collective action should benefit as the many have a self-interest in the self-interest  occurring at exchange between the two parties.

The odd item is that the self-interest occurring at exchange between the two parties is depicted as greed and/or generating excessive benefits to the two parties and/or an exchange that the many should benefit from not just the two parties. Yet greed, the participation by the many in supposed excess benefit is simultaneously sold by the politico to the greed of the individuals making up the many [recipient class]. That somehow, someway, the many have a self interest in a self interest or greed in a greed.

Therefore the billboard advertises self-interest as your noble interest as defined by the politico, whereas greed is that other guy's ignoble self-interest. Yet the action phase of the advertisement is not selling the supposed beneficial outcome of a collective action, the warm and fuzzy benefits to the collective if you will; the action phase is selling you on your supposed self-interest in a self interest or greed in a greed.
 

Observations on Political Self-Interest

Gordon Tullock and James M. Buchanan wrote The Calculus of Consent, Logical Foundations of Constitutional Democracy which is the book that, in the main, launched Public Choice Theory.

In another book by Tullock, Government Failure, he makes an interesting point that up until Hobbs and Machiavelli (circa 1500) the concept of "self-interest" did not exist in any formal way, that all social and private issues were discussed on moral and ethical grounds with self-interest not a player or formal concept.

“Until the days of Adam Smith (1723-90) most social discussion was essentially moral. Individuals - whether they were businessmen, civil servants, politicians, or hereditary monarchs - were told what was the morally correct thing to do and urged to do it.” (1)

With David Hume and Adam Smith in the 1700’s the concept of self-interest became mainstream but only in private endeavors whereas "government" issues were still discussed on moral and ethical grounds with self-interest not a player. That is to say, government and the politicos that make up government, the issues thereof, continued in the realm of moral/ethical until the late 1940's and mid 1950's when political science was doing a poor job of explaining the inner workings and resulting output of "democracy" which prompted the application of economics to the study of political science and the advent of Public Choice Theory - which clearly shows politicos do function in their own self-interest.

Tullock points out that politicos today still try to dupe the public per talking points such as public servant, working in the public interest and doing the people’s work as they desperately try to convince James and Jane Goodfellow that they, as politicos, are not at all self-interest oriented and are merely working in James and Jane Goodfellows best interests. That is, politicos continue to sell the 16th century in the 21st century.

Which then reminds one of Milton Friedman's famous quote which summed it all up very nicely: "Is it really true that political self-interest is somehow nobler than economic self-interest?"

Notes:

(1) Government Failure, Tullock, Seldon and Brady, 2002, CATO Institute, pages 3 - 4.

Upon Further Review: The ObamaCare Argument of Private Health Insurance Monopolies Rebuked

Please recall for a moment an argument used during the ObamaCare debate: There is a serious lack of competition among health insurers within the differing and several states. That is, the debate point implicitly and explicitly alluded to many [if not all] states having one insurer dominating the market. Examples such as Hawaii, Maine, Vermont, Alabama and Arkansas were mention where one insurer controls 70% or more of the market place . That more competition was needed and government provided health insurance would create a competitor.


Upon further review, the argument/debate point mentioned above made for a good story albeit fantasy. As the story goes, a monopoly exists [the villain] and the white knight on the stallion [politico through the mechanism of government] will charge in and vanquish the evil doer. Problem is, the statistics used to frame the monopoly position of particular private insurers, and the supposed lack of competition thereof, is incorrectly portrayed and merely so much political theater. How so? (1)


The Obama Administration and other advocates of government provided insurance used a single study made in 2008 by the American Medical Association (AMA) entitled Competition in Health Insurance to frame their argument of the existence of wide spread private insurance monopoly in the differing states. Problem is, the study based its statistical outcomes on less than one half of the health insurance market.  Ops! That is, the study did not include employer provided coverage that are self insured plans. 

Not included in the study were plans where the firm acts as the insurer through self-insurance and pays the bills from the firm’s resources. The self-insured plans hire an administrator (many times an insurer) to handle the every day administration of the plan such as claim payments, enrollment processing, etc. however the firm itself acts as the third party payer i.e. the insurer. Employer provided self insured plans make up over half, approximately 55%, of the health insurance provided in the United States. (2) (3)


Economist John R. Lott, Jr. crunched the numbers and found that the 70% (or even higher claim) of the market controlled by a single company in the differing states is really 36 percent when the entire insurance market is taken into consideration:


“We can look at the 43 states for which the AMA compiled data ranking them with market share held by the two larges insurance companies. That pattern is fairly similar. On average, over 53 percent of people with insurance in those states get their insurance from companies that self-insure. For Alabama, instead of the “[Obama] almost 90 percent is controlled by just one company,” as the president claims, the correct number is just 36 percent. And the second-largest company has 2.1 percent of the market.


Even with the “almost 90 percent” number, it is worth noting that the president rounded that up from the actual share in the full insurance market of 83 percent. The president just wasn’t happy to claim that the largest insurance company in Alabama had an 83 percent share when the right number was 36 percent, but he had to go further and raise it to “almost 90 percent”. On top of that, in his attacks on for-profit insurance companies, he couldn’t even acknowledge that Alabama’s largest insurer was a non-profit company [Blue Cross Blue Shield].” (4)

Notes:


(1) President Obama, weekly address, 08/22/2009,

http://www.whitehouse.gov/the-press-office/weekly-address-president-obama-debunks-phony-claims-about-health-reforem-emphasizes-

　

(2) American Medical Association, 2007, “Competition in Health Insurance”,


http://www. Ama-assn.org/ama1/pub/upload/mm/368/comp study_52006.PDF


(3) John L. Lott, Jr., Debacle, pages 141-145


(4) John R. Lott, Jr., Debacle, page 143.

　

　

“Social Darwinism”: The Political Spectrum’s Fungible Taking Point

“In remarks later Tuesday, President Barack Obama will slam the Republican budget plan put forward by Rep. Paul Ryan (R-Wis.) as "nothing but thinly veiled Social Darwinism."

"It's a Trojan Horse," Obama will say during remarks at an Associated Press Luncheon, according to excerpts released by the White House.

"Disguised as [a] deficit reduction plan, it's really an attempt to impose a radical vision on our country. It's nothing but thinly-veiled Social Darwinism. It's antithetical to our entire history as a land of opportunity and upward mobility for everyone who's willing to work for it -- a place where prosperity doesn't trickle down from the top, but grows outward from the heart of the middle class. And by gutting the very things we need to grow an economy that's built to last -- education and training; research and development -- it's a prescription for decline," the president will say.” (1)

　

One might ask oneself what does social Darwinism mean? That is, the phrase “social Darwinism” is not a common phrase. Matter-of-fact, the phrase is used so infrequently that it prompted a Washington Post article entitled What Obama meant by ‘social Darwinism’:

　

"Simply put, it means applying the ideas of Charles Darwin — that species adapt over time — to human society, arguing that competition over resources helps humanity evolve for the better as the weak are weeded out and the strong survive and thrive.

But social Darwinism is seen as more as an epithet than a useful description, because the idea is so malleable.

Social Darwinism gained some popularity early on among British landowners and American capitalists, who saw in it a justification for their own wealth.

Imperialism was
justified on Darwinist grounds as strength honed through warfare, with stronger races overtaking weaker ones. But peace was too, on the grounds that the fittest members of society should not be wasted in war. 

“The concentration of capital is a necessity for meeting the demands of our day, and as such should not be looked at askance, but be encouraged,” Carnegie wrote in his autobiography after reading social Darwinist theory. “There is nothing detrimental to human society in it, but much that is, or is bound soon to become, beneficial.”

Social Darwinism is also seen in eugenics, the idea that certain races and physical traits should be weeded out of the general population. It played a role in the American progressive movement and in Nazi Germany — both movements that went against laissez-faire capitalism, in very different ways. In this interpretation, the weak must be culled so that the society as a whole can evolve more quickly.

Thus “social Darwinism” can be used to attack all sorts of enemies.”

　

“While the term “social Darwinism” was used as early as 1877, it did not gain widespread popularity except in retrospect, and mostly as an insult.” (2)

　

　

Hence one finds oneself with a seldom used phrase, used as an epithet, a phrase that is highly malleable which can only mean one has arrived once again at the intersection of politics-and-talk otherwise known as political talking points. That is, Mr. Obama does not like Mr. Ryan’s’ plan. Rather than empirically disproving Mr. Ryan’s plan Mr. Obama merely relies on a political talking point that attempts to vilify by denying legitimacy to the plan and the plan’s sponsor through a malleable epithet. Moreover, if one is out to disparage without evidence, one might reconsider using a political talking point phrase that doesn’t prompt everyone to run to textbooks to find the meaning of the vilifying talking point.

Furthermore, the disparaging political talking point of social Darwinism, as a political short cut attempt to avoid evidence to empirically refute, and the subsequent attempt by others to explain what the heck the political taking point means, still leaves us with no insight regarding social Darwinism. That is to say, we still are left with: why is it a political talking point and why is it considered disparaging and why can all corners of the political spectrum use the talking point against one another?

For those seeking some grand insight into the political talking point “social Darwinism” one may find that Thomas C. Leonard offers such insight. Leonard’s 2007 essay Origins of the myth of social Darwinism: The ambiguous legacy of Richard Hofstadter’s Social Darwinism in American Thought appeared in the Journal of Economic Behavior & Organization.

One very, very odd point that Leonard uncovers is that the phrase “social Darwinism” was hardly ever used prior to Richard Hofstadter’s 1944 book Social Darwinism in American Thought. Moreover, Hofstadter basically declared “social Darwinism” as dead at the end of World War One. However, after Hofstadter’s 1944 book, the use of the phrase “social Darwinism” skyrocketed. Hence we have a very obscure concept, rarely referred to and when the rarely mentioned obscure concept is pronounced dead, it suddenly skyrockets in its use. Odd to say the least.

A link to Leonard’s essay appears below:

　

http://www.princeton.edu/~tleonard/papers/myth.pdf

　

Notes:

(1) Obama: Paul Ryan's Budget is 'Nothing But Thinly Veiled Social Darwinism', Huffington Post, 04/03/2012,
http://www.huffingtonpost.com/2012/04/03/obama-paul-ryan-budget-social-darwinism_n_1399080.html

　

　

(2) What Obama meant by ‘social Darwinism’, Washington Post, 04/04/2012,
http://www.washingtonpost.com/blogs/the-fix/post/what-obama-meant-by-social-darwinism/2012/04/04/gIQAKlZLvS_blog.html#comments

　

　

　

　

　

　

　

　

　

　

Student Loans: a burden or a purposeful politico transfer of cost?

On April 24, 2012 president Obama visited Chapel Hill, NC the home of the University of North Carolina to make his political pitch regarding student loan interest rates. Leaving aside many items that circulate around the topic and proposal, one might want to focus upon his talking point that student loans “become a burden”.

One might say the “burden” is due to too much loan value in relation to income earned after graduation. One might say the “burden” is the inability to finance other items in the near term such as a car or home until student loan balances are paid down/off. However, one might want to also consider that the burden is purposely placed upon the student. How so?

If one considers public universities one must consider that these institutions are public sector entities. That the same over staffed and over paid bureaucracy exists at universities that exists in many other public sector entities albeit the bureaucracy is entitled “administration” at a university.

At many, many universities a long-term trend stretching back to approximately 1979 is the ever increasing size of the administration at universities. Today the number of employees within university administrations is approaching , equaling or exceeding the number of professors at particular institutions. Therefore, like any other public sector entity a very well paid and benefit laden bureaucracy exists.

If one goes back to the explosion in college costs, one will see the escalation began in 1979 which coincides with the explosion in administration size.

Returning to the concept of “burden”, is the burden purposefully placed upon the student in that their loan amount reflects an exploding tuition cost associated with an exponential growth in public sector bureaucracy at universities? Is the “become a burden” political dupery as politicos through the mechanism of government have encourage the administrative increase as a dependent political constituency building exercise with the student “burdened” with the cost?

Stated alternatively, has the politico through dependent political constituency building regarding the increased sized of public sector university administration shifted such cost of the dependent political constituency building exercise onto the unknowing student and consequently the size of the students’ loans? Is the “burden” no more than the burden of the cost purposely transferred to the student by the politico and then “become a burden” is merely a politico dupery talking point to deflect the real source of the burden?


Update 04/29/2012: The Political Obsession with College Education Has Created an Unsustainable College Tuition Bubble, carpe diem blog, Dr. Mark Perry. Link appears below:

http://mjperry.blogspot.com/2012/04/political-obsession-with-college.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+blogspot%2FmmMP+%28CARPE+DIEM%29

“Free” contraceptive –or- Politico Dupery, Under Politico Nitwitery, and in Government Mysticism We Trust.

What if one is faced with the introduction or more succinctly the mandated introduction of the notion: “free” contraceptive. Why “free”, at what cost “free”, and does “free” mean transfer, and does “free” change outcomes?

Appearing in US Today 02/09/2012 was a story Birth control mandate stirs debate . The authors of the story refer to "free" contraceptives no less than three times in the essay and not once examine the fact that nothing is "free". Not once is there a reference that all economic propositions have an associated cost and an associated opportunity cost. Hence the authors proudly carry the politico dupery banner of "free". (1)

“What I tell you three times is true.” - The Hunting of the Snark.

“Free" contraceptives morphed today, in that, the religious employer e.g. catholic hospital can opt out of the coverage but the insurer must supply "free" contraceptives at the employee-insured’s request. Who is paying for the free lunch? In this case the cost of "free" is borne directly or indirectly by the employer and other premium payers. Hence nothing changed. Same exact song, different beat. (2)

Further, the concept mentioned above is being framed as, no, the employer doesn't pay directly or indirectly nor are other premium payers paying for the "free" contraceptive because (fasten your seat belt) the insurance company is paying for the “free” contraceptives. Hmmmmm.

Upon further review, Catholic hospital C opts out of the contraceptive provision, however insurer Y must offer the “free” item directly to the employee-insured. One knows for a fact that “free” cannot exist hence the cost associated with “free” contraceptive is passed onto all parties [the catholic hospital being one of those parties] by insurer Y.

Moreover, Catholic hospital worker E pays for the “free” contraceptive as C experiences a premium increase from Y associated with furnishing “free” and E’s potential total compensation is effected either by a reduction in compensation, an increase in employee health-care contributions, or lower benefits in the form of higher deductibles or co-insurance. Even if C attempts to pass on the cost to health-care consumer X then X’s health-care bills increase and insurer Y has to raise premiums to compensate for additional expense and keep reserve requirements healthy hence back to E we go with Y’s increase in cost.

“The state is the great fiction by which everybody seeks to live at the expense of everybody else.” - Frederic Bastiat, French economist, 1850

Assume for a moment that one agrees with the logic that "the insurance company" pays and hence the contraceptives are free. Then why stop at contraceptives? Shouldn't every last health-care item be furnished “free” as we merely have "the insurance company" furnish the items for free?

“The fact the compromise had not been proposed earlier angered the president, who felt let down by his staff, officials said. Obama waded into the details of the dispute himself this week and personally crafted the solution, according to a Democratic official who spoke on condition of anonymity to discuss a sensitive matter.” (2)

Ah, the political dupery was challenged and hence political nitwitery was introduced! Very nice.

“Under the new plan, administration officials believe insurers will comply for free because the coverage may not actually cost them anything. Evidence suggests that providing birth control coverage reduces overall costs for health plans because birth control is much cheaper than pregnancy, according to administration officials and some health industry analysts.” (3)

Hence “free” really does exist because politicos tell you so.

If one where to ponder the notional proposition that “…administration officials believe insurers will comply for free because the coverage may not actually cost them anything. Evidence suggests that providing birth control coverage reduces overall costs for health plans because birth control is much cheaper than pregnancy…” one would need to consider present circumstances and known-knowns, unknown-knowns, and unknown-unknowns:

       (1)    The cost of “free” is a known cost,

(2)    Contraceptives are widely available at modest cost yet unwanted pregnancies occur,

(3)    The assumption is that the cost of “free” substituted for the cost of widely available at modest cost, the transfer of cost thereof causes a different outcome,

(4)    The different outcome is an assumption that unwanted pregnancy is reduced although the same cost exists, the same population exists, the same wants and needs exist, yet a transfer of cost causes outcomes to change.

However, if offering “free” contraceptive causes free to be free via the proposition of “…administration officials believe insurers will comply for free because the coverage may not actually cost them anything. Evidence suggests that providing birth control coverage reduces overall costs for health plans because birth control is much cheaper than pregnancy…” then should not all health-care be free as the cost to produce X is offset by Y hence no cost exists and hence all is “free”. In other words why is anyone paying a premium of any sort as every last health-care item should be free as cost X is offset by the cost savings of outcome Y?

Therefore, a known cost is transferred and “transfer” is a magically, mystically procedure that creates outcomes of a much better variety which cancels out the cost. Hence we arrive at “free”.

We end as we began:  Politico Dupery, Under Politico Nitwitery, and in Government Mysticism We Trust.

Notes:

(1)    http://www.usatoday.com/NEWS/usaedition/2012-02-09-Contraceptive-debateRECOVERED-Wed-Feb--8-163722-2012-_ST_U.htm

       (2)    http://www.nashuatelegraph.com/newsworldnation/949794-227/obama-accommodates-  religious-groups-changes-birth-control.html


      (3) ibid.

“Spillover into the local community": Politico Mantra and Politico Reality

Spillover effect: a secondary effect that follows from a primary effect, and may be far removed in time or place from the event that caused the primary effect”. (1)

In the Foreground

 The politico and spillover effects

Spillover effects are positive or negative externalities [neighborhood effects] of a particular action e.g. burning coal for electricity has the positive externality of power-on-demand while soot is depicted as a negative externality. Other times political proponents of proposed private sector investment or proposed public sector spending co-op the concept of “spillover” to mean some positive external economic activity that arises from a primary economic activity e.g. a computer maker builds a new assembly plant which then attracts suppliers to situate nearby or a downtown revitalization plan based on X causes businesses associated with X to be attracted to the downtown area as well. The phenomena are many times termed/framed as "spillover into the local community".

Note: "spillover into the local community", in the main, is a politico proposition-phrase that frames only the positive aspect of spill-over effects and purposely leaves out any negative externalities of such spillover effects such as traffic congestion, the taxpayer cost of additional social overhead capital, tax relief for the attracted primary event and hence taxpayer cost for attraction by low or zero tax rates for a specified period, etc.

Failure to diversify an economy’s portfolio of primary effects

A potential as well as real life reoccurring long-term problem with the depicted spillover effect is the concentration of particular spillover activities associated with the primary event. That is to say, the first stage spillover effect as described/depicted is many times a concentrated single end result. For example, a natural gas find, a valuable coal seam, the opening of a large auto assembly plant, or the attracting of an entire sub-sector such as textiles becomes associated with a concentrated first stage spillover effect that lacks diversification within the economy at hand. For example, the primary effect described above is followed by a first stage item which is generally the primary event’s direct suppliers. The primary and the first stage secondary effect create a robust economy that causes no perceived need to diversify the economy further. That is, the robust economy is concentrated around the primary first stage and secondary events.

 Over time ancillary items pop-up regarding the primary and first stage secondary events such as additional housing, auto dealer, grocery stores, retail strip centers, etc. However these items are not additional primary events. Hence we have an economy based on one prime event and the prime events suppliers. Occasionally the economy seems so well situated that the need to diversify and find additional and alternate primary effect and associated spill over effect items are put aside in favor of additional duplicates of the initial primary and first stage secondary events e.g. Buffalo as a steel center, Detroit as an auto assembly center, greater North Carolina as a textile center.

Hence the primary driver and first stage secondary events create such a robust economy that the mind-set becomes “what goes up continues to go up”. Over time exogenous events such as aggregate regulation, taxes, technology, changes in demand preferences, etc. can cause a decline in the concentrated primary event which causes the reverse process of the primary first stage secondary events. The economy begins to deteriorate, deterioration increasing at an increasing rate e.g. Detroit.

In the Background

Spillover effects and politicos through the mechanism of government

From the discussion above it becomes obvious that diversification is very important within an economy’s portfolio of primary effects. However, regardless of the amount of diversification, the politico’s mantra of “spill over into the local community" comes with a lesser known phenomena that empowers the politico and simultaneously drives away the very primary effect, secondary primary suppliers, and ancillary items that the politico trumpets with the manta "spillover into the local community".

When politicos want to attract a primary effect and sing the praises of “spill over into the local community" caused by the primary effect, the politico also sees the entire exercise as potential tax revenue the politico can use for political constituency building purposes. That is, the politico rejects the concept that all capital and all human capital is mobile, and most capital and most human capital migrates to the lowest environment of tax and regulation. The politico substitutes mobility with “fixed”. That is, the politico sees the primary effect, primary suppliers, and ancillary items as tax revenue generators that can fund political constituency building exercises.

The politico, with the mind set of primary effect, primary suppliers, and ancillary items as tax revenue generators, begins a long march of raising taxes on the very concept of “spill over into the local community" and the revenue is used for political constituency building. The politico thinks they can raise taxes and further raise taxes, and raise tax even more as the taxed entities are perceived as “fixed”. That the “fixed” entity will not/cannot move and hence is a constant target of tax. The politico then takes increased tax revenue and builds politico monuments [public structures that supposedly benefit the greater public], increases redistribution to build a dependent constituency base, and increases size and scope of government to create yet another dependent constituency base of the public sector dependent on the politico to maintain funding.

The fallacy of “fixed” entities and escalating taxes on such entities ends by the entities merely following the economic phenomena that: all capital and all human capital is mobile, and most capital and most human capital migrates to the lowest environment of tax and regulation. Over time, most capital and human capital migrate away leaving the locale with no tax base yet the associated cost of maintaining prior build politico monuments, a redistribution system with politico build constituency dependent on continue redistribution of a tax dollar stream and a bloated public sector. That is, the economy begins to deteriorate, deterioration increasing at an increasing rate. A phenomena that can be in place of or in concert with the failure to diversify primary effects as discussed above.

That is, purposely, the politico creates a situation that causes the primary source to pass like the wind through the trees.

Notes:　

(1) http://www.businessdictionary.com/definition/spillover-effect.html

“Fair Share”: another name for politico constituency building through the use of other peoples‘ money.

“Fair share” or a version thereof has been used many times by politicos over the years. Two components exist: fair and share.

“Fair” has very little meaning other than what one wants it to mean in a particular context. Generally, given a context of political debate, where fair is very often used, fair is said to mean: what you are doing or advocating and what someone else is not doing or advocating. That is, “fair” is how one paints the world vs. other portraits available that conflict with one’s own painting of the world.

Examining the politico’s use of "share", within the phrase fair share, means something exists that needs divided. Now comes the introduction of an implicit underlying assumption of zero sum thinking. That is, the desire of the politico is to politically frame the talking point that one party is gaining at the expense of another party. Hence the real underlying manufactured argument is that  party B deserves additional gains from party A based upon "something" existing in the abstract that somehow was divided improperly.

Therefore, "fair" and "share", are combined into an argument ultimately of: "advocating deserve". The politico advocates deserve by selling zero sum thinking by framing the argument as one party can only gain from the loss of another party regarding some abstract something that was divided somehow improperly. Hence the loss requires restoration, additional gains, or “deserves”.

In point of fact, with a free people in a free market, exchange only occurs at mutual exchange. That is, two free parties do not exchange unless each party perceives a gain and hence we come to exchange at mutual self-interest. Party A does not cause an exchange trigger at the detriment of party B as no exchange would occur as B would not find his self-interest. B turns down the zero sum exchange and goes elsewhere to seek an exchange of mutual self-interest.

If an exchange between two parties is voluntary, it will not take place unless both believe they will benefit from it. Most economic fallacies derive from the neglect of this simple insight, from the tendency to assume that there is a fixed pie, that one party can only gain at the expense of another. - Milton Friedman

The politico argument is then exposed, as regardless of the manufactured abstract something that was somehow divided improperly, exchange is mutual self interest driven not zero sum driven. There is no need to restore, cause additional gains, or “deserve” as mutual self interest occurred at exchange, not zero sum.

Regardless of the economics of exchange, the politico presses on by further framing parties to exchange as now being classes to exchange (parties suddenly, notionally and purposely become classes). The politico frames exchange as not occurring between “parties” rather occurring between distinct “classes” with particular assigned attributes with attributes either trumpeted or vilified as the debate point unfolds. It remains the zero sum argument, side stepping mutual exchange reality, however goes one step further and frames parties as good vs. bad classes and classes butting heads resulting in zero sums.

The final stage of the political argument is to substitute “shirk” for “deserve”. The politico purposely puts forth the fallacy that one class is gaining at the expense of another class as being a stone cold fact, and in order for the losing class to made whole, a shirking partner needs introduced. The shirking partner is politicos through the mechanism of government who will redistribute the abstract something that was somehow divided improperly. The power to act as the shirking partner (a partner who takes part of the value and provides none of the effort) through the imposition of a cost [tax] then allows the politicos through the mechanism of government to build a dependent political constituency class through redistribution of the value extracted.

What is purposely left out of this debate is that "work" is irritating toil. Apparently the irritating toil is required of some, and the value produced by the irritating toil becomes a "claim" or "right" which  is deserved by others. Stated alternatively, the irritating toil of work producing value, comes complete with a shirking partner, a shirking partner who then takes part of the value and provides none of the effort, and uses such value as a political constituency building exercise. That the abstract something that was somehow divided improperly is then purposely captured by the politico as a value used directly for dependent political constituency building.

　

Manufacturing Jobs Peaked, On a World Wide Basis, Years Ago: Not a Singularly US Phenomena

Talking heads, pundits, and media types supporting current public policy [more accurately termed politico policy], are always in search of a statistical data point, holding forth statistics as fact, then making the leap that the data point constitutes complete evidence of an open and shut case…..have recently latched onto the data point of an increase in manufacturing jobs.

One must realize that the mantra of “manufacturing job” is a panacea. That is, implicit to the “manufacturing jobs” mantra of the politico and their intelligentsia following is that this particular job category, the rise and fall thereof, is the fix all. If manufacturing jobs are falling then this is the key to economic woes and the falling jobs number is due to some evil exogenous force. The rise in manufacturing jobs is a key to economic success and, of course, any rise thereof is directly due to politico policy.

Obviously the panacea and the political wrangling around this particular panacea is political dupery. However, the greater political nitwitery is that manufacturing jobs, the decline thereof, is a world wide phenomena and not singularly a US phenomena. Manufacturing jobs on a world wide basis peaked years ago yet overall output continues to increase. Technology and automation, as in the agricultural sector of the past, are supplanting the need for human workers. This technology and automation supplanting the need for human workers results in better more innovative product at a lower real cost.

Where the political dupery and political nitwitery merge is: if one is successful in attracting manufacturing jobs and builds upon the panacea, and if one looks forward considering that the current batch of dupes and nitwits being long gone twenty years hence, then one finds themselves in a 20 year future economy that has attracted an economic sector that’s worldwide employment opportunities have peaked years ago and which the unemployment is decreasing at an increasing rate while output increases at an increasing rate.

How does one frame the panacea at this 20 year future point? That is to say, how does one explain to the people alive 20 years hence that dupery and nitwitery purposely attracted an economic sector that was in decline in relation to human employment? How does one explain that nitwits attracted a sector akin to 1920’s and 30’s agriculture declining employment, and now its 1950 and agriculture is shedding jobs at a maximum rate while output skyrockets. And when manufacturing runs its course and becomes the agriculture of today, employing 3% of the employed work force yet producing mass abundance, how does one frame the panacea?

Class Warfare Politics: upon further review, poverty is the best policy

Each time class warfare politics raises its ugly head in regards to taxes, the rich are vilified and the vilification is used to argue for an increase tax on the so called “rich“. The argument put forth by politicos is the general and usual notional argument with concepts such as “fair”, “just”, “fair share” and so on. Purely political notional concepts that only have absolutely no meaning except in the context the politico presents e.g. fair is merely what you are doing and the other guy is not doing. That is to say, its an argument with no arguments. Vilification and notional concepts do not make for empirical underpinnings of any policy be it public or private.

Moreover, when the dust clouds of class warfare politics settle, everyone ends up paying more taxes. Stated alternatively, if one climbs on the magical bus of class warfare to tax the rich, at some point one has their very own class warfare bus ticket punched and ends up thrown under the bus of higher taxes. Odd huh?!?

Its not really that odd at all. You see, in a system of “some people” politicos want/need more money to spend. Why? The conduit of taxpayer dollars must increase at an increasing rate allowing the politico to use such funds for political constituency building exercises. Special interests and dependency constituencies [recipient class] are built with taxpayer money. The existing taxpayer-dollar-funded-constituencies, as well as any newly proposed constituency building targets, require vast amounts of taxpayer dollars flowing into the sphere of the politico. The flow must increase at an increasing rate in order for the politico to “grow their constituency”.


“Here it may suffice to observe that, on the theories of the social philosophers to whom I have referred, we should get a new maxim of judicious living: Poverty is the best policy. If you get wealth, you will have to support other people; if you do not get wealth, it will be the duty of other people to support you“. - W.G. Sumner (1)


Therefore, the politico promoted class warfare argument purposely plays James and Jane Goodfellow for saps. It sounds great as the politico weaves and frames the argument that you can have some other group of people pay for some crisis or problem. The politico is going to save you from the expense of solving a problem by merely making someone else pay for the problem.

The question one must ask oneself is: the centuries upon centuries of basically the exact same politico promoted class warfare argument has done exactly “what” to solve any and all problems? The politico wants you to judge them by their intentions and not their results. Exactly what results do we have presently? Do we have a tax problem or a spending problem? The politico wants the answer to be that we have a tax problem as they want more tax dollars to “grow their constituency”. The politico must direct the problem away from the spending side of the equation as decreases in spending means the collapse of existing political constituencies built and dependent on taxpayer dollars and disallows the acquisition of newly proposed constituency building targets.

“The good news is that, according to the Obama administration, the rich will pay for everything. The bad news is that, according to the Obama administration, you’re rich.” - P.J. O’Rourke

Notes:

(1) On a New Philosophy: That  Poverty is the Best Policy, William Graham Sumner, 1883

　

　

Politicos Purposely Frame Arguments

'President Barack Obama and the Democratic Party have led increasingly successful efforts to pit Americans against one another through the politics of hate and envy. Attacking CEO salaries, the president -- last year during his Midwest tour -- said, "I do think at a certain point you've made enough money."

Let's look at CEO salaries, but before doing so, let's look at other salary disparities between those at the bottom and those at the top. According to Forbes' Celebrity 100 list for 2010, Oprah Winfrey earned $290 million. Even if her makeup person or cameraman earned $100,000, she earned thousands of times more than that. Is that fair? Among other celebrities earning hundreds or thousands of times more than the people who work with them are Tyler Perry ($130 million), Jerry Bruckheimer ($113 million), Lady Gaga ($90 million) and Howard Stern ($76 million). According to Forbes, the top 10 celebrities, excluding athletes, earned an average salary of a little more than $100 million in 2010.

According to The Wall Street Journal Survey of CEO Compensation (November 2010), Gregory Maffei, CEO of Liberty Media, earned $87 million, Oracle's Lawrence Ellison ($68 million) and rounding out the top 10 CEOs was McKesson's John Hammergren, earning $24 million. It turns out that the top 10 CEOs have an average salary of $43 million, which pales in comparison with America's top 10 celebrities, who earn an average salary of $100 million.

When you recognize that celebrities earn salaries that are some multiples of CEO salaries, you have to ask: Why is it that rich CEOs are demonized and not celebrities? A clue might be found if you asked: Who's doing the demonizing? It turns out that the demonizing is led by politicians and leftists with the help of the news media, and like sheep, the public often goes along.' - Walter E. Williams

Link to the entire essay Pitting Us Against Each Other by Walter E.. Williams appears below:

http://townhall.com/columnists/walterewilliams/2011/10/19/pitting_us_against_each_other