Monday, May 14, 2018

Would-be Hitler says Trump Must Be Impeached before He Becomes another Hitler

Leftist projection again.  Steyer and his Greenie companions want to control just about everything that people do.  They are the real heirs of the Nazis

Billionaire liberal Tom Steyer told the crowd at an Iowa town hall Thursday that President Trump communicates effectively like Hitler and must be impeached before he leads the country down a similarly dark path.

A lady from the crowd remarked to Steyer that Trump reminds her of Hitler, saying the president separates immigrant families just as the leader of Nazi Germany separated Jewish families and others.

“[Trump] really is an incredibly skillful and talented communicator. He really is, which Hitler was, too,” Steyer agreed.  He added, though, that there is still a “very big difference” between the two men:

    I think the reason people push back against the Hitler comparison, regardless of any similarities, is Hitler ended up killing millions and millions of people, and Mr. Trump has shown a disregard for our law, he breaks the law…and in many ways he has done things that we find, or I find abhorrent. But he hasn’t killed millions of people.

The crowd rumbled with raised voices, causing Steyer to entertain the comparison some more.

“I agree! Look, that’s why we want to impeach him!” Steyer said. “We’d like to end it here while it’s still OK….We haven’t gotten to that point. God bless us, let’s hope we never get anywhere near that point.”

Steyer, the heavyweight anti-Trump activist, has invested tens of millions of dollars trying to convince Democrats to impeach the president, to the chagrin of many party luminaries including House minority leader Nancy Pelosi, who has argued that the best way to oppose Trump is to gain control of Congress.

As part of his campaign against Trump and the GOP, Steyer’s political action committee, NextGen America, released an ad this week comparing Republicans to white nationalists.

“We’re just telling the truth to the American people, and it’s an important truth,” he said of impeaching the president. “And if you don’t think it’s politically convenient for you, that’s too bad.”



The Republican Advantage That’s Easy to See but Nobody Notices

In close elections, any slight advantage might be responsible for determining the outcome, and it might be that the red party has a slight advantage over the blue party... because it’s the red party.

An article reporting on studies by two psychologists suggests that color influences behavior and that red is a winning color. In one study from the 2004 Olympics, where competitors in combat sports like boxing and taekwondo were randomly assigned either red or blue kits, they found that those assigned the red kits were more likely to win than those assigned the blue.

One of the researchers said, “Simply wearing red doesn’t turn you into an excellent competitor, but it helps tip the balance between winning and losing when people are fairly evenly matched.” Might referring to one party as the red party and the other as the blue have the same effect in politics?

The article gives many other examples of the color red being associated with dominance. People feel more dominant when they wear red. Gamblers feel more confident and gamble more when they use red poker chips. Waitresses get higher tips when they wear red. Men and women are both rated as being more attractive when they are wearing red rather than other colors.

This suggests that the party associated with red will have an advantage over the party associated with blue.

Today, we are accustomed to thinking of the Republican Party as the red party and the Democratic Party as blue, but this color assignment was solidified only in the past few decades. This article explains that color-coding the parties as red and blue became popular with the advent of political reporting on color television, but initially, the colors were not consistently assigned. The election of 2000 was the point at which the current color identification was solidified, and the Republican Party became the red party.

If there really is an advantage to being the red party, how did the Republicans manage to get it? One conjecture is that the mainstream news media (which may slant toward the left) rightly associated red with communism, and didn’t want the Democrats being the red party. During the Cold War, being a red meant being a communist. So, the media assigned red to the Republican Party to avoid associating the Democratic Party with socialism.

If so, this may have been a lucky break for the Republicans. They managed to grab the color that dominates all others by default, giving them a slight advantage in elections. Surely, in politics more than in many aspects of life, symbolism exerts powerful effects.

This is a red party advantage that everyone can see, but nobody notices.



Free Traders Should Be More Careful When Defending Trade Deficits

 In a recent Wall Street Journal op-ed, Harvard economist Robert Barro understandably took aim at President Trump’s faulty mercantilist criticism of free international trade. In contrast to Trump’s view, Barro argued that imports are “things we want” whereas exports are “the price we have to pay” to obtain them. Although Barro’s statements are a useful way to get novices to think about trade, they can be misleading, and in this case actually did lead a WSJ editor to write something incorrect. All too often, in their zeal to defuse hysteria over America’s trade deficit, free-trade economists prove too much, using arguments that suggest countries with trade surpluses are somehow getting ripped off. In this post, I’ll spell out the WSJ mistake, and offer a clearer way to think about international trade.

To set the scene and to be fair to Barro, here is his argument in context:

The Trump theory of international trade seems straightforward: Selling stuff to foreigners is good, and buying stuff from foreigners is bad. It’s a form of mercantilism. Exports are attractive because they represent domestic production and American jobs. Imports are undesirable because that production and employment otherwise could have happened at home.

Simple economic reasoning, however, suggests that this logic is backward. Imports are things we want, whether consumer goods, raw materials or intermediate goods. Exports are the price we have to pay to get the imports. It would be great, in fact, if we could get more imports without having to pay for them through added exports. [Barro, bold added.]

To reiterate, there’s nothing explicitly false in the above excerpt; this is a standard approach to getting students to think about international trade. However, there’s actually a problem with this typical line of free-trade reasoning that I’ve noticed for some time now. And to prove I’m not just handwringing, look at the title and subtitle that a WSJ editor (presumably) gave to Barro’s piece:

Trump and China Share a Bad Idea on Trade

Imports are things we want, and we pay for them with exports. Isn’t getting more for less a good thing?

Contrary to this claim, the U.S. trade deficit does not mean that Americans are “getting more for less.” If it did mean that, then the flip side would hold as well: Countries running a trade surplus must be getting less for more, and so presumably a populist candidate could run for office in those countries and offer trade barriers as a way to stop the bleeding. Yet, of course, that’s not right either: so long as people around the world are engaging in voluntary transactions, the trades are all win-win and a “trade deficit” or “trade surplus” is a bit of statistical trivia.

The problem with the WSJ subtitle stems from the equivocation in the claim that “we pay for them [imports] with exports.” Although this statement is a useful first step in getting novices to think about trade, strictly speaking, it is not literally correct in any finite time frame. After all, if a country literally paid for its imports with its exports in any particular time period—say, during each calendar year—then every country’s measured trade deficit/surplus would always be $0.

It’s easy to unpack the confusion by considering an analogy with an individual. We can imagine an economics professor telling her students: “Contrary to popular belief, ‘consumption’ is the things you want, while ‘work’ is the price you have to pay to get them. Indeed, if you could get more consumption without having to work more, that would be great.”

There’s a certain sense in which this statement is correct, and it might help some students get their thinking straight when sorting out benefits vs. costs in the context of employment. However, suppose a particular student replied, “Ah, then I’m doing great! Last year I spent $52,400 on consumption, while I worked only enough to earn $18,700 in wages. I plan on keeping my consumption the same this year, while maybe working even less. I love getting more goods for fewer labor hours!”

It would be clear that such a student utterly misunderstood the professor’s statement. The student isn’t bartering labor-hours directly for consumption goods. Rather, the student is spending a full $52,400 on the “$52,400 worth” of consumption goods; that’s what it means to measure consumption in dollars. The difference between the consumption ($52,400) and wages ($18,700) is made up by the fact that the student is selling assets worth $33,700 in order to finance his “trade deficit,” by selling off pieces of property (such as an old car) and/or by issuing claims against his future income by (say) borrowing money from credit card companies.

There is similar confusion in the WSJ’s treatment of U.S. trade with China. According to Barro, “In 2017, the Chinese sold the U.S. $524 billion of goods and services and bought only $187 billion, for a bilateral trade deficit of $337 billion.” Even though it’s true that imports are things we want and exports are the price we pay to get them, it is not the case that Americans are somehow snookering the Chinese. No, we paid a full $524 billion for our $524 billion of imports; that’s what it means to measure imports in dollars. The fact that we only sold them $187 billion of goods and services means that we made up the difference by issuing a net $337 billion in asset sales, such as U.S. real estate, corporate stock, and Treasury debt.

There’s a sense in which a worker must pay for consumption by selling labor hours, but that is only a long-run condition; the timing of consumption and wage payments can be different, with the gaps accommodated through asset sales (including the credit markets). Furthermore, if we observe a worker who consumes more than his wages in a certain year, this isn’t evidence of shrewdness; it simply means the worker is selling assets and/or taking on future claims against himself. Maybe that’s a sign of wise investment (in the case of a student taking out loans to attend medical school) or maybe it’s a sign of profligacy (in the case of someone running up credit cards for gambling vacations), but either way we shouldn’t congratulate such a worker for “getting more for less.”

What is crystal clear in the case of an individual is, unfortunately, obscured in the case of a country, as even a WSJ editor got tripped up. The editor took Robert Barro’s correct claim that a nation pays for its imports with its exports, and then erroneously misconstrued trade deficits as evidence of a bargain. But it’s more accurate to say the United States in any given time period “pays for” its imports with exports and by selling claims on future U.S. dollars. Maybe that’s a sign of wise investment (in the case of foreigners investing in U.S. factories) or maybe it’s a sign of profligacy (in the case of foreigners lending money to Uncle Sam to fuel boondoggle programs), but either way we shouldn’t view our trade deficit as “getting more for less.”



Curing Diseases Is Sustainable, Government in Healthcare Is Not

 Goldman Sachs analysts recently asked the question, “Is curing patients a sustainable business model?”, in a report entitled The Genome Revolution. The report outlined profit strategies for biotechnology companies engaged in gene therapy, which attempts to replace defective genes to correct genetic disorders. CNBC has since obtained the report and released the answer:

The potential to deliver ‘one shot cures’ is one of the most attractive aspects of gene therapy, genetically-engineered cell therapy and gene editing. However, such treatments offer a very different outlook with regard to recurring revenue versus chronic therapies... While this proposition carries tremendous value for patients and society, it could represent a challenge for genome medicine developers looking for sustained cash flow.

Some have taken the report to be an “outright acknowledgment from the financial services industry that curing diseases with a single treatment is not profitable.” Others allege the report demonstrates “curing patients is bad for business” more broadly.

While Americans have every reason to be concerned about their healthcare, the belief that private medical companies will not develop and produce products that cure various conditions is unwarranted.

Recent medical history provides ample evidence that the medical industry has tremendous incentives to cure patients. For example, chicken pox, smallpox, rabies, SARS, measles, polio, and shingles, among many other diseases, were all cured and eradicated in our lifetime. Insulin, although not a cure for diabetes, has saved countless diabetics from certain death. Similarly, HIV and AIDS are now manageable when they were once fatal.

Further, most medical discoveries do not earn profits. This is especially true of pharmaceuticals where, according to a white paper published by the Biotechnology Innovation Organization, only 20 percent of the drugs that make it to market obtain enough revenue to cover their R&D and FDA drug approval costs. Although not all these drugs provide a cure, profits are clearly not the only motives for these companies.

However, there is a more fundamental misunderstanding about these claims. Are profits derived from curing diseases sustainable? No. However, in a market economy, no profits are sustainable! Entrepreneurs work tirelessly to improve their products and lower their prices to please their customers and to compete for the profits earned by others. When profits dwindle, entrepreneurs search for other opportunities to serve customers. In some cases, this means finding innovative ways to cut costs. In others, it can mean improving the product. Offering a cure for a condition, although difficult, is a clear way to beat out other treatment methods.

Consider the case of the biopharmaceutical company Gilead Sciences, whose entrepreneurial insight to purchase and develop an unproven compound became Sovaldi, the only cure for hepatitis C. In 2014, Solvaldi earned over $10 billion in sales. However, two years after making the cure, Solvadi sales fell over 50 percent. Far from suffering from its “unsustainable business model,” the company recently released data on a drug it is developing to help HIV infection.

While the evidence companies do not find curing diseases profitable is weak, concerns that the healthcare sector might act in ways against the patient’s interest are very real. But these concerns stem from the relationship between the state and the market, not from the market itself.

For example, the burdensome costs and time-intensive FDA drug approval process, which is supported by large pharmaceutical companies, prevents many smaller companies with less financial capital from getting their products approved. When the medical industry spends lobbying for government favors, and it spent $57 million last year, it uses resources to thwart competition to the detriment of consumers. Efforts like these are how the firms in the healthcare sector can earn sustainable profits without benefiting consumers.

Fundamentally, the alarm created by Goldman Sach’s report stems from a fear that the companies in the healthcare sector will not act in the patient’s interest and little can be done about it. I can think of no better way for these fears to become a reality than to have government involved in healthcare. Once we understand this diagnosis, we can work toward a cure.



For more blog postings from me, see  TONGUE-TIED, EDUCATION WATCH INTERNATIONAL, GREENIE WATCHPOLITICAL CORRECTNESS WATCH, AUSTRALIAN POLITICS, and Paralipomena (Occasionally updated),  a Coral reef compendium and an IQ compendium. (Both updated as news items come in).  GUN WATCH is now mainly put together by Dean Weingarten. I also put up occasional updates on my Personal blog and each day I gather together my most substantial current writings on THE PSYCHOLOGIST.

Email me  here (Hotmail address). My Home Pages are here (Academic) or  here (Pictorial) or  here  (Personal)


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