Friday, March 18, 2016

Voters Mad as Hell

Through this primary season a consistent theme on the Republican side is Republican voters are angry and frustrated and are letting their anger and frustration decide who to gets their vote.  Not to suggest this is a failing that only afflicts Republicans, people on the left are prone to the same tendency, but the angry lefties are more marginalized in the Democratic party at this point in time.

Some of this is just media blather but judging by the behavior of the candidates they perceive a large element of the Republican primary voters are motivated not by gathering data on how to solve problems, but by identifying enemies and bad guys who are the source of all the perceived problems.  Ironically apparently many of these angry Republicans are Evangelical Christians who seem oblivious to the admonition from Jesus that if you are angry you are in danger of hellfire (Mathew 5-21). 

Makes one wonder if these folks follow their emotions in all their important decisions in life.   

It also makes one wonder if these folks have any clue how easily they can be manipulated through their anger.  We see that playing out in the success of Donald Trump, the master marketer.  In the same way some business folks jump on whatever marketing strategy will make the most money, Donald seems to look at whatever marketing strategy will get him the most votes.  While other Republican wannabees look to pollsters and consultants to figure out what to say to get votes, the Donald knows instinctively.

Hitler's ability to stir up anger to gain power in Germany was the direct cause the most horrendous war in history.  I don't think the Donald is another Hitler - he seems to be a pretty happy guy.  But the worst atrocities in history generally can be traced back to political leaders who created enemies to blame for all problems and then stoked anger at those enemies.  

Politicians of all stripes are always going to be tempted to cultivate anger or disgust since that is the easy way to motivate voters.  It is up to we the voters to not reward that tactic.


Thursday, March 10, 2016

Reference Query - Do We Have A Growth Problem?

(Caution - this blog has lots of facts and figures - maybe have some caffeine before reading)

The world of economists revolves around GDP.  It is tempting sometimes to view economist as worrying about mathematical constructions that are not reality.  GDP growth is a measure of wealth not health or happiness.   Economists often seem to not even consider someone, or a society could be perfectly content at a given level of income per person.  Maybe they don't need more wealth to be either healthy or happy?

Further, GDP is not a direct measure of technological and scientific advances. Finding ways to do things better in our day to day lives is unquestionably a good thing.  But GDP measures many things totally unrelated to doing things more efficiently.

But that said, given all the talk about income inequality I decided to look into the whole concept of wealth to see what I would find - maybe there are some good reasons to be focused on GDP?

I begin with the proposition statistics about wealth are not precise but are probably educated estimates that provide some representation of reality.

I also begin with the proposition growth in itself is not the concern, the concern is growth allows more people to live comfortably.  Studies tell us that the average American worker is comfortable with an income of about $70,000 a year. That is the point where they feel no need to work at getting more wealth.  So if the whole world was generating an average yearly income of about $70,000 per person, we perhaps would not need more growth?

Where are we on growth?

I looked at wealth figures, even though GDP combines both wealth and income.  Although wealth is not the same as income, it is a relatively good proxy for income.  If you have a lot of wealth you probably have a decent income and if you have a lot of income you will probably will have a lot of wealth eventually.

Dividing the total wealth in the world (241 Trillion) by the total world population (7.4 billion) reveals that existing wealth amounts to $35,567.56 per person.   That would be a decent yearly income but as total wealth it is pretty low.  $35,000 invested to produce a 5% per year return would only be income of about $1,750 a year per person.  Clearly the world could use some growth.

On the other hand dividing the total wealth of the United States (118 trillion) by the population of the United States (319 Million) reveals that existing US wealth amounts to $369,905.95 per person.   A two person household with this theoretical wealth could generate an income of about $18,000 per year per person assuming a return of 5% on their wealth, which would be $36,000 for a two person household.  Skimpy but not starving.

However data indicates the top 1% of the US population currently owns about 37% of the wealth.  That means the top 1% (3.19 Million people) own $43 trillion of the countries wealth which equals $13,479,624 per person.  At 5% per year the top 1% control assets could produce income of $673,981 per year per person.    

Subtracting the top 1% share from the total national wealth (118 Trillion - 43 Trillion) leaves 75 Trillion for the other 99%. 

However, the next 19% own 1/2 of this remaining wealth which amounts to $37.5 Trillion.   19% of the population equals 60 million people.  Per person each of that 19% has assets of about $625,000.  At 5% that would generate $31,250 per person per year.

The remaining $37.5 Trillion are shared among the remaining population (80% = 255,200,000 persons)   The per person share is $146,944 which, if invested would produce $7347 per year per person.   

Conclusions

Economists can't be faulted for obsessing about growth, the world needs it.  However, the world would not need as much growth if economists could figure out policies that would spread wealth across populations more effectively.


Source of Data - Wikipedia articles on wealth, GDP and Income Inequality.






Monday, March 7, 2016

Trump - Random Thoughts

1.  Lloyd Kumley offered the following observation:


"I had a thought while listening to the harangue at a wrestling show..." (Lloyd isn't a wrestlemania kind of guy but was indulging a niece who likes the excitement of the shows) ".... Trump's campaign talks sound much like the outrageous stuff the wrestlers shout to whip the crowds up... It's a formula that works for wrestling....those choreographed "shouting matches" , which lead to what look like make believe battles between the good guys and bad guys. Are wrestling fans and their ilk much of the Trump supporters?'

2.  Some very rich and politically active CEO's are coming out saying Trump must be stopped.   Mitt Romney, Meg Whitman.  Hmmmm.  Perhaps they feel like the domination of Republican economic policy by big business interest is threatened?  Both Mitt and Meg say Trumps policies could cause a recession.  Gee whiz, no Republican has ever caused economic damage - oh wait, the Republicans were running the show for the decade leading up to the great Depression...and the Republicans were also running the show in the decade leading up to the great Recession. Those prior Republican efforts have set a pretty high bar in terms of economic disasters, I don't see how a mediocre  businessman (according to Mitt and Meg) like Trump could do as much damage.



Saturday, March 5, 2016

The FBI, Apple and Privacy

I don't get it.

On probable cause the government can get a warrant from a judge and search my house.  But they shouldn't' be able to search my phone?

Privacy is an abstract concept, what does it mean in the real world? 

What data could be on my phone that I would perceive as more important than accommodating to governments efforts to protect us from violent attacks?   

The techies argue this is a slippery slope, if they open the door to let the government into a terrorist suspects phone soon all manner of bad people (or the government) will then be able to troll through the data in all of our phones.  So?  Maybe I don't do my banking on my phone to protect financial data.  An inconvenience, but in my mind worth not providing safe havens for those seeking to engage in potentially murderous criminal activity.  

It would be helpful to understanding if the techie claims have merit if they could give a few concrete examples of what other data from my phone could present a threat.  Because I haven't been able to come up with much.

I can accept that some governments in this world would collect data to stifle dissent, maybe even arrest people on trumped up charges.   But as my mother used to say, two wrongs don't make right.  Hamstringing governments ability to investigate potential threats to public safety doesn't seem like the way to deal with bad government.  

I wonder if the tech industry isn't overly wrapped up in the idealistic notion that technology is going to save the world.  They don't want to face up to the problems their ambitions are creating.  I'm old enough to remember life when it didn't revolve around the phone in our pockets, I'm no happier now than I was then.  

Friday, February 26, 2016

The Underdog Democratic Senator from a Small State

Pushing the Democratic establishment candidate with idealistic aims to make revolutionary change that appeal to and motivate young people and attract celebrity endorsements.

No, not talking about Bernie.  Talking about George McGovern who startled the Democratic establishment and ended up pushing aside Edmund Muskie, the presumptive Democratic nominee in 1972.  

In 1972 the Democrats had controlled both houses of Congress for 17 years. But in the general election McGovern got clobbered 60.5% to 37.5% in the popular vote.  McGovern's idealistic liberal views, coupled with Nixon's southern strategy (backing away from active civil rights enforcement to swing southern whites, solidly democratic since the Civil War, over to supporting Republicans) laid the groundwork for a new Republican coalition that has dominated politics since.  By 1980 the Republicans grabbed the momentum and by 1996 Republicans took control of both houses of Congress and held it for 12 years, power that had eluded them for 66 years in the middle of the Twentieth Century (other that one session where they rode the coat-tails of Dwight D. Eisenhower when he was first elected). 

The times are different, the issues are different and Bernie Sanders is not George McGovern.  But the Bernie campaign reminds me in so many ways of George McGovern's idealistic campaign.  Bernie is idealistic and uncompromising in his progressive prescriptions for what ails us as a country.  I like Bernies vision of what this country should be better than what the decades of Republican  dominance have bequethed us.  But getting from where we are to where Bernie wants to be is a little like turning an aircraft carrier around in a bathtub.  Not surprisingly Bernie talks a lot about goals and ambitions and not so much about how to achieve them.

I feel like the Republicans are spent, out of ideas, burdened by the fact swing voters are aware of the Republican legacy of Iraq, the financial collapse and the last 5 years the most do-nothing Congress in modern history.  Their primary has been a spectacle of nonsense and name calling.  This is a significant opportunity to begin moving the country away from the Republican ideology that enriches the powerful and punishes the most vulnerable.  But leftish idealism has a poor history in this country as a formula for winning elections.  I don't want to see the country lose the opportunity because the Democrats can't resist overreaching.

Wednesday, February 24, 2016

Justice Scalia - Not a Tribute

He may have been a decent guy but he represented a most unfortunate tendency that has plagued the law profession down through history.  He saw words as reality, not as imperfect tools we use to communicate about reality.

You and I go through our lives relying on context to interpret the meaning of words.  Not just the context of the word within the larger body of words, but the context from which the words sprang, and the context within which the words are to have meaning.  Generally the more we know about context the better we understand.

Justice Scalia publicly disdained context.  He was not going to go outside the words to determine meaning.  He loftily argued that in this way he would not impose his views on the words.  In reality ignoring context outside the words is the ultimate indulgence.  As we see from politicians daily, ignore context and with clever words you can obscure factual reality.  You can make the words mean what you emotionally want them to mean - be that to accomplish a particular goal, or just to make your job easy.  All you have to do is cultivate the ability to manipulate words and you don't have to spend lots of time investigating and understanding the world that provides context.

Our country is the worse for it.  

In the Citizens United case he ignored the context to give us a law - that government can't regulate corporate political contributions - that is corroding the foundations of our democracy.  It is a decision that could only be justified by ignoring context.

Modern corporations did not exist when the founding fathers drafted the constitution.  They developed generations later as something akin to an agreement between government and investors.  Government wants investors to take risks so government allows people to create a corporation in which they put money they want to invest.  The corporation is subject to regulations as the government sees fit.  As long as the entity obeys the rules government establishes the investors are shielded from losing any more than what they invested.  

Allowing corporations the privilege of limited liability can impose tremendous costs on real people.  We recently spent billions in taxpayer money bailing out big corporations because their limited liability meant their stupid activities were sending waves of huge economic losses rippling through the world economy while the corporate officers and owners went home to their massive estates and fabulous fortunes, insulated from responsibility for their folly.  

Justice Scalia found in the founding fathers words the intent to preclude the government from regulating political contributions by these corporations that did not then exist.  As a result corporations still have limited liability but governments ability to regulate what is deemed inappropriate behavior is severely limited. 

Fixing the problems caused by Citizens United will be really difficult.   As a legal matter we could abolish corporations - state governments could repeal all the laws under which corporations operate.  But corporations are so embedded in our financial system we can't just abolish them.  The economic upheaval would be disastrous. 

Perhaps state governments could make consent to regulation of political contributions a condition of doing business within their state.  But that would take years, perhaps decades, and make economic life for all very complicated.  This really is a national issue and should be dealt with at the Federal level.

At some point (I hope) some future Supreme Court may find a way to lead us out of this mess.  But it will be a mess - for many years, thanks to an agile legal mind that celebrated words over reality.

Monday, February 22, 2016

Fact check - Democratic President v. Republican Congress

Republicans on the stump spend a lot of time talking about President Obama's executive orders - that he is exercising power he doesn't have.  On the other hand Democrats have alleged for the last few years that Republicans are more interested in obstructing Obama than in doing the peoples business and Obama says he is using Executive orders because problems need to be solved and the Republican Congress is doing nothing to solve them.  

As a voter the claims that the Executive Orders are unconstitutional is just background static I ignore.  Obama has his lawyers who say they are constitutional, Republican lawyers say they are not constitutional.  I may be many years from law school, but not so far as to have forgotten how fuzzy the Constitution is when applied to the relative powers of the President and Congress.  To me this issue will be determined by the ideological orientation of the Supreme Court that addresses the issue at some point in the future.   

But two of the three Republican front runners dissing Obama's executive orders most vehemently are currently members of the Senate.  How Congress has behaved during Obama's term in office compared to past Congresses seems to have some bearing on whether Republicans have been more interested in obstructing Obama than in doing the peoples business.  Objective measures of congressional activity can provide some evidence of whether Republicans have been willing to engage in good faith efforts to compromise with other viewpoints to move the country forward.  So I looked back at Congressional data back to 1973.

To me the objective facts support the theory the Republicans for the last 7 years have been more interested in undermining Obama than in doing the peoples business, but decide for yourself.  

Summary of the data:

The average number of laws enacted per year

From 1973 through 2008 - the pre-Obama period, regardless of the party of the President and who controlled Congress, Congress enacted an average of 298 laws per year.  The lowest average was 228 during GW Bushes first 6 years, the highest was 385 during the Carter years in the late 70's.

In Obama's first administration, even with a Democratic Congress the number of laws enacted per year dropped to 192.5, well below even the lows of the GW Bush years.  Since the Republicans regained control of Congress in 2011 the total of enacted bills has dropped to 140 per year, less than half what was typical from 1973 to 2010.  

Some might suggest that fewer bills passed by Congress is a good thing.  But no need to change or add laws would suggest that the status quo under Obama is pretty good.  But according to Republican primary candidates the country is in a disasterous decline.  One would therefore think Congress ought to be doing more, not less.  

Vetoes
The drop in enacted laws isn't because Obama is vetoing bills.  During the prior periods when a President of one party dealt with a Congress controlled by the other party the President averaged 8.6 vetoes per year.  In the five years since Republicans took control of Congress in 2011 Obama has vetoed an average of 1.4 bills per year.  This is lower than what Jimmy Carter vetoed per year when he was working with a Congress of his own party (1.7 per year).  I doubt that Republicans are afraid to send legislation to Obama.  It seems more likely to me this is evidence of their focus on marginalizing him by not dealing with him.

Number of Bills Congress actually casts a vote on per year.
Republicans might argue fewer bills have gone to Obama because they can't work with Democrats.  But since the party that controls Congress controls the ability to bring legislation to a vote (through their control of committees) how many bills Congress is allowed to vote on seems to reflect how interested the controlling party is in the negotiation that makes the democratic process work.  

In any given year thousands of bills are introduced in Congress.  A tiny fraction actually get to any kind of floor or committee vote.  Since 2011 fewer bills have been allowed by the Republican leadership to go to any kind of vote than any period in the last in the last 43 years.  From 1973 to 2010 an average of 303 bills per year went to a vote.  Looking specifically at years where Congress dealt with an administration representing the other party 321 bills per year got to a vote.  In the last five years the average number of bills that the Republican leadership allowed to go to a vote was 241.

Side note - Democrats are more democratic
The statistics on how many bills get a vote also reveal that prior to Obama when a Republican Congress is dealing with a Democratic President (Clinton - 1995 to 2000) Republicans allowed an average of 275 bills per year to go to a vote.  When a Democratic Congress has worked with a Republican President, in contrast, an average of 333 bills go to a vote.

Thus statistically Democrats are - well - more democratic.  They are not as inclined to use control of Congress to choke off votes as the Republicans.   

To me this all suggests the problem isn't that Democrats aren't willing to work with Republicans, it is that Republicans have always been inclined to use every lever available to exercise their power to do things their way and have been particularly prone to that approach during the last 5 years.

Source of the Data Summary
This compilation was compiled from data at 
https://www.govtrack.us/congress/bills/statistics
Numbers are average number of bills per year during the specified period. Administrations highlighted in red indicate Congress controlled by opposing party - presumably the most accurate comparable to Obama's last 5 years.

1973-76 - Richard Nixon/Gerald Ford administration
Republican President, Democratic Congress.  
292.75 went to a vote but did not pass
375.25 enacted
15.25 vetoed
1977-80 - Carter Administration 
Democratic President and Democratic Congress.
290 went to a vote but did not pass
385 enacted
7 vetoed
1981-86 - Reagan Administration
Republican President & Senate, Democratic House.
267.33 went to vote but did not pass
307.16 enacted
8.66 vetoed
1987-88 - Reagan Administration 
Republican President, Democratic Congress.
289 went to a vote but did not pass
380.5 enacted
8 vetoed
1989 to 1992 - Bush Administration
Republican President, Democratic Congress.
319.25 went to a vote but did not pass
318.75 enacted
10.75 vetoed
1993-94 - Clinton Administration
Democratic President, Democratic Congress
251 went to a vote but did not pass
236 enacted
0 vetoed
1995-2000 - Clinton Administration
Democratic President, Republican Congress 
275.16 went to a vote but did not pass
224.16 enacted
5.83 vetoed
2001 to 2006 - GW Bush Administration
Republican President, Republican Congress
313.83 went to a vote but did not pass
228.33 enacted
.2 vetoed (1 in 6 years)
2007-08 - GW Bush Administration
Republican President, Democratic Congress
430 went to a vote but did not pass
230 enacted
3.5 vetoed
2009-10 - Obama administration, Democratic President, Democratic Congress
300.5 went to a vote but did not pass
192.5 were enacted
1 vetoed
2011 to 2015 - Obama administration 
Democratic President, Republican Congress
241.8 went to a vote
140.8 enacted
1.4 vetoed