Tuesday, June 21, 2011

The Missing Money

Thomas Sowell

One of my earliest memories of revulsion against war came from seeing a photograph from the First World War when I was a teenager. It was nothing gory. Just a picture of a military officer, in an impressive uniform, talking to a puzzled and forlorn-looking old peasant woman with a cloth wrapped around her head. He said simply: "Don't you understand, madam? The village is not there any more."

To many such people of that era, the village was the only world they knew. And to say that it had been destroyed in the carnage of war was to say that there was no way for them to go back home, that their whole world was gone.

Recently that image came back, in a wholly different context, while seeing pictures of American seniors carrying signs that read "Hands off my Social Security" and "Hands off my Medicare."

They want their Social Security and their Medicare to stay the way they are -- and their anger is directed against those who want to change the financial arrangements that pay for these benefits.

Their anger should be directed instead against those politicians who were irresponsible enough to set up these costly programs without putting aside enough money to pay for the promises that were made -- promises that now cannot be kept, regardless of which political party controls the government.

Someone needs to say to those who want Social Security and Medicare to continue on unchanged: "Don't you understand? The money is not there any more."

Many retired people remember the money that was taken out of their paychecks for years and feel that they are now entitled to receive Social Security benefits as a right. But the way Social Security was set up was so financially shaky that anyone who set up a similar retirement scheme in the private sector could be sent to federal prison for fraud.

But you can't send a whole Congress to prison, however much they may deserve it.

This is not some newly discovered problem. Innumerable economists and others pointed out decades ago that Social Security was unsustainable in the long run, including yours truly on "Meet the Press" in 1981.

But the long run doesn't count for most politicians, since elections are held in the short run. Politicians' election prospects are enhanced, the more goodies they can promise and the less taxes they collect to pay for them.

That is why welfare states in Europe as well as here are facing bitter public protests as the chickens come home to roost.

It has been said innumerable times that nobody already on Social Security will lose their benefits. But it needs to be spelled out emphatically, so that political demagogues will not be able to scare retired seniors that they are going to have the rug pulled out from under them.

Retired seniors have the least to fear from a reform of Social Security, since neither political party is about to take away what these retirees already have and are relying on.

Despite irresponsible political ads showing an old lady in a wheel chair being dumped over a cliff, the people who are really in danger of being dumped over a cliff are the younger generation, who are paying into Social Security but are unlikely to get back anything like what they are paying in.

The money that young workers are paying into Social Security today is not being put aside to pay for their retirement. It is being spent today, paying the pensions of the retired generation -- and it can't even cover that in the years ahead.

What needs to be done is to allow younger workers a choice of staying out of a system that is simply running out of money. Nor can the system be saved by simply jacking up taxes on "the rich."

Generations of experience have shown that high tax rates that "the rich" can easily avoid -- through tax shelters at home or by investing their money abroad -- do not bring in as much revenue as lower tax rates that keep the money here and the jobs here.

Since the law does not allow private pension plans to be set up in the financially irresponsible way Social Security is, that is where young people's money should be put, if they ever want to see that money again when they reach retirement age.



Here Come the Extremists!

It isn't quite panic yet, but the sounds emanating from Obamaland are certainly nervous. If you are David Axelrod, chief strategist for President Obama's re-election campaign, you are well aware of your idol's fall and doubtless less than thrilled to get this question from CNN's Candy Crowley:

"Something that the president said this week struck me ... he said it's not as cool to be an Obama supporter as it was in 2008... I think he's right. I think it's not as cool to be an Obama supporter now. How do you get cool back into this?"

Gee, how do you compare a campaign that was based entirely on vapid promises and vaporous sentiment with a referendum on actual job performance? Axelrod denied (unconvincingly) that the 2008 campaign had been a "cult of personality" and assured Crowley that once the campaign gets "fully engaged and the choices become clear, you are going to see a great deal of activity out there on his behalf." In a signal of just how feeble the case for Obama's re-election is, Axelrod fell back on the bogeyman:

"I think one of the things that's going to inform that campaign is whether that Republican candidate is going to yield to some of the forces within his own party or her own party that is driving their -- their party further to the right."

For the record, there has never been a time in the past 50 years that the Democrats have not claimed to detect a frightening rightward tilt in the GOP -- even as the party has nominated such wild-eyed radicals as George H.W. Bush, John McCain and George W. ("compassionate conservative") Bush.

Crowley pointed out that support for the president among independents has declined from 52 percent in the 2008 election to 42 percent today, and that even among staunch liberals, 89 percent of whom voted for Obama in 2008, support has dipped to 64 percent. How does the Obama team re-create a victory in light of these numbers?

She might have added so much more to that question. She might have asked how an incumbent requests re-election when the unemployment is at 9.1 percent. Even more worrisome, according to the Bureau of Labor Statistics, fully half of the jobless are now long-term unemployed, meaning they have been without jobs for 27 weeks or longer. That is the highest percentage of long-term unemployed since the Labor Department starting keeping such records in 1948.

She might have asked how an incumbent achieves a vote of confidence when commodity prices on food and fuel are rising and, relatedly, the value of the dollar is plunging; when the housing market has yet to recover from the crash despite (or, more likely, because of) the president's Home Affordable Modification Program, which has prevented markets from clearing; when a record one in seven Americans now receives Food Stamps; when one out of six Americans is on Medicaid; and when a whopping 62.5 percent of respondents say the nation is on the wrong track.

When the economy is strong, elections can turn on a variety of issues. But when the economy is poor, elections are seldom about anything else. The 1980 race was illustrative.

Though the Carter/Reagan race is remembered now as a landslide for Ronald Reagan, the contours of the victory were not apparent during the campaign. As late as October 29, Gallup had the race as a dead heat, with Reagan at 44 percent and President Carter at 43 (it was a three-man race). Other polling showed larger margins for Reagan but nothing like the 10-point margin of victory he achieved. At the time, the contest was perceived as close.

It was after the first and only debate, a week before Election Day, that voters definitively moved into Reagan's column. At the time, inflation was running at 13.5 percent, unemployment was 7 percent and interest rates were 21 percent. American hostages remained in Tehran. Carter's approval ratings hovered in the 30s during the final year of his tenure.

Why wasn't Carter perceived as hopelessly weak? Perhaps because as bad as things were, voters needed to be confident about the challenger's fitness. Carter had succeeded to some degree in frightening voters about Reagan's (you guessed it) right-wing extremism. Reagan's reassuring debate performance allayed those fears. And Reagan's summation drilled to the heart of voters' concerns. Ask yourself, Reagan advised, "Are you better off than you were four years ago?"

The economy today is in some respects worse than it was in 1980. Barring a catastrophe, little else will matter in 2012. Any credible Republican can defeat Obama -- which is why Axelrod is already smearing as "extremist" a person whose name he does not know.



A Big Win For Common Sense

The Unconscious Prejudice Industry -- the boo-hoo-we're-all-guilty-stop-us-before-we-discriminate-again lobby -- took it deservedly on the chin Monday from the U.S. Supreme Court.

Genial enough was the court's unanimous decision not to allow advancement of a sexual discrimination suit against Wal-Mart, inasmuch as the plaintiffs were using the wrong part of the right law. Better still was the conservative bloc's rejection of a claim to the effect that Wal-Mart managers might have been allowing stereotypes to influence their personnel decisions, thus engaging in "gender bias" against 200 actual claimants who wished judicial permission to speak for a million and a half female employees.

A University of Illinois-Chicago professor, William Bielby, had cooked up this fragrant theory by using something called "social framework analysis." The reference is to "scientific evidence about gender bias, stereotypes, and the structures and dynamics of gender inequality in organizations."

The inventors of the concept, also academicians, had already accused Bielby of neglecting to research Wal-Mart's actual performance, but it was left to the justices to pour this malodorous broth down the kitchen sink. Where was the proof of anything that Wal-Mart had done wrong? The 5-4 majority wished to know. There wasn't any, apart from a small collection of anecdotes. Everything else was inferential. It had to be so, because it had to be so, because ...

The Unconscious Prejudice Industry, which imputes bias to people on the basis of sex or race, has no notion of closing down and going away. For one thing, class action suits employ too many plaintiff's lawyers shopping for the next judicial bonanza. These folks get no discouragement from Justice Ruth Bader Ginsburg, who wrote in the Wal-Mart case that "Managers, like all humankind, may be prey to biases of which they are unaware."

Well, yes, as a matter of fact. You might even say the same of Supreme Court justices. Does this mean we should bar Justice Ginsburg from sitting on cases with plaintiffs or defendants against whom she might nurture some bias kept carefully on her person? For that matter, what about the rest of the courts? What about you? What about me?

Federal and state law make certain assumptions that they are well entitled to make when it comes to stated obvious bias; for instance, the job advertisements in 19th-century Massachusetts: "No Irish need apply." What happens, nevertheless, in a case the Wal-Mart allegations could have turned into? Wal-Mart officially prohibits personnel discrimination. It accords its local managers the latitude that alone keeps decision processes flexible. What that means, to the Unconscious Prejudice Industry, is that things work the opposite way. Yes, they say they don't discriminate. But, of course, they must and do. "Framework analysis" tell us so: one more sign of the general loopiness of modern life.

Evidence? What need has the liberal mind for evidence -- the mind in which the idea of unconscious prejudice was hatched to begin with? The burden of these cases on society grows cumbersome.

First to notice is the cost of litigation. Millions spent on lawyers isn't doing much besides strengthening the second-home industry. Then watch as we become a culture of bleaters into whose heads the alien thought couldn't possibly penetrate: Gee, maybe I just didn't do the job very well!

The whole matter of fairness in hiring and promotion suffers from any public perception that the government alone can save us from the hateful little minds of managers and personnel employees who don't even know how biased they are.

In the Wal-Mart case, the Supreme Court kept things from getting worse -- economically, intellectually, constitutionally than they are at present, but the problem persists and will re-emerge. It's just too easy, and maybe too profitable, to take for granted that mean old white male power brokers did somebody in due to unconscious white male biases (which deserve to cost them big time).

There's another factor. The court majority on "unconscious bias" was 5-4: too narrow for comfort, as the constitutional lawyer in the Oval Office has surely noticed.



Culture of death silences opposition in New York

The culture of death is relentless. And certain of its adherents—Planned Parenthood and NARAL Pro-Choice America, for example—are not only committed to the promotion, provision, and performance of abortions, but to removing every obstacle that might deter a woman from having one.

In this they prove that the argument isn’t really between pro-choice and anti-choice, as they wish to cast it, but between defenders of life and those consumed with the money-making opportunities which await doctors willing to kill hundreds of thousands of children each year at a rate of about one child every 95 seconds. (If we consider all abortion providers, rather than Planned Parenthood alone, there are about 1.2 million abortions each year at a rate of about one child every 27 seconds.)

Just consider the full frontal assault NARAL, Planned Parenthood, and others have been carrying out against pregnancy centers in places like New York City throughout this year. With the help of all-too willing accomplices like Mayor Michael Bloomberg and the city council, these profiteers of death have secured passage of a law which forces such pregnancy centers to post signs in English and Spanish telling women a long list of “disclosures” mandated by the city, including whether they perform abortions, whether a licensed medical provider is on staff (even though New York state law does not require medical providers at non-medical centers), and that the city health department encourages women to consult with one.

The law requires the signs to be posted in various locations throughout the pregnancy centers and replicated in any advertisements issued by the centers. Moreover, counselors working at the pregnancy centers must provide the same message “in person or over the phone when a client requests or inquires” about certain services.

Clearly, the purpose of the signs is to dissuade women from going to pregnancy centers instead of abortion mills. In effect, the signs are part of larger push to regulate pro-life help providers in order to deny choice to women who want to pursue solutions other than abortion when a need arises.



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The Big Lie of the late 20th century was that Nazism was Rightist. It was in fact typical of the Leftism of its day. It was only to the Right of Stalin's Communism. The very word "Nazi" is a German abbreviation for "National Socialist" (Nationalsozialist) and the full name of Hitler's political party (translated) was "The National Socialist German Workers' Party" (In German: Nationalsozialistische Deutsche Arbeiterpartei)


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