Let's Make Voting Harder

Good article in today's New York Times explains what's really going on with voting law in North Carolina and in other states.

I had an earlier post on the issue of one-stop (early voting) in North Carolina.

Make White Water!

When a US Navy destroyer goes from one place to another at high speed, it stirs the water up and leaves a big rooster tail and wake.

One day in 1964, I was at the conn of USS Higbee (DD-806) when the commodore decided to exercise the destroyer squadron at tactical maneuvers. At one point, we were in a circular formation centered on the flagship, when he ordered us to rotate the formation axis. I checked the maneuvering board solution and realized we could simply alter course a bit, slow to about ten knots, and slide into the new station. Smooth.

Commodore Healy had different ideas. He called us on the radio. "Higbee," he said, "this is ComDesRon Three. Make White Water!"

In other words, he wanted us to speed up, turn in a tight circle, stirring up the water, and hurry into the new station. I ordered left full rudder, all ahead full, and did as he wished.

I learned from that experience that sometimes visible action is more important than subtlety.

As I look at the state of the economy and assess the recent jobs information, I see that we aren't creating jobs fast enough to keep pace with our growing population. We need to kick up a rooster tail and make white water!

Is anyone in Washington listening?

Debt Problem?

Suppose you could borrow money for ten years at a real interest rate of less than one percent? Even better, suppose you could borrow money for five years at an interest rate of less than zero? In other words, someone will pay you for you to borrow their money?

You'd probably think about borrowing that money and investing it in measures to improve your future wealth.

Strange as it seems, the US Treasury's real interest rate paid on inflation-protected securities is less than one percent for ten years and less than zero percent for five years. So why not borrow more at those rates and use the funds to stimulate jobs and reinvigorate the economy?

Ask the Republicans.

Is this what they mean by running the government like a business?

What is Economics?

I've been following recent disputes among academic economists in the blogosphere. Very interesting.

I think macroeconomist Brad DeLong has put his finger on one of the essential differences in approach that feeds economic disputes, as well as political disputes.

Commenting on a presentation by Robert Lucas, Jr., a noted economist of the Chicago School, who cites taxes, unions, financial regulation and the expanding welfare state as causes of the persistent depression, DeLong has this to say:

"[A]s Gavyn Davies [another economist blogger] drily notes, Lucas "seems to have ruled...out [alternate explanations] by a priori conviction, rather than any detailed empirical work."... Lucas seems to be discarding the very idea that economics, like the natural sciences, should be based on the evidence. He appears to believe that the state of the world can be ascertained by deductive logic, without ever looking out the window. That's fine, I suppose, if you believe that economics is a branch of philosophy rather than a branch of science. But it does not seem to be an approach that is likely to enable many practical improvements in the lives of human beings."

Reminds me a bit of the Queen of Hearts in Alice in Wonderland: "Sentence first - verdict afterwards." And perhaps then a bit of evidence, if ever we get around to it.

But I'm afraid too many in Congress treat economics as a branch of philosophy rather than science.

Milk Jug Protests

Remember the local protests against President Obama's health care reform proposal at the Oriental post office last year? The protesters, mostly Republicans, said they didn't want any government interference in health care, though most of them were users of Medicare, VA and other US Government health care programs. Some seemed to fear that health care reform would take these away.

We now know that it is the Republicans who want to replace Medicare with a voucher system, thus turning it into something entirely different from the present system. But they get upset if anyone points out that Congressman Ryan's plan is a voucher system (which it is) and will end Medicare as it now exists (which it will).

Paul Krugman points out quite clearly in his blog why Medicare is sustainable in its present form, but is susceptible to improvement. If you are interested in his explanations, look here. For even more information, once on his blog, keep clicking on the "previous post" button. Eventually, you will come to an explanation of liquidity preference and an informative graph.

Personally, I think a better health reform would have been to adopt a system like VA. For various reasons, in any event, doctors are increasingly withdrawing from their own private practices and going on salary. This brings many benefits to them as well as to their patients. I, for one, would be more comfortable knowing that the physician isn't recommending a procedure because it improves his own personal income.

Jobs, Jobs, Jobs

Today's employment news isn't good.

Unemployment is up to 9.1%.

I hate to be a pessimist, but I'm not surprised. The stimulus plan (ARRA) wasn't big enough, and included too many tax reductions in lieu of direct government expenditures.

To understand why, you need to be familiar with three concepts:
A. Liquidity trap. That is when our national monetary authority reduced short term interest to zero, but banks aren't lending and companies aren't borrowing. We are in a liquidity trap. There are many reasons for this - companies, for example, aren't investing because they have no expectation that new customers will suddenly appear. Another reason is:
B. Liquidity preference. In uncertain economic times, companies prefer to hold liquid assets (that can be readily converted to money, like bonds) rather than illiquid assets, like real estate and other commodities;
C. Aggregate Demand. Classical economists have believed for nearly two centuries that there will never be an overall shortage of aggregate demand. Time and again they are proven wrong, but the belief persists. Our aggregate demand is way down because we have the lowest percentage of the population employed since the great depression.

The reason our recovery is stalled is that, in a liquidity trap only government expenditures have a realistic chance of overcoming liquidity preference, improving aggregate demand for goods and services, and therefore stimulating businesses to hire workers and invest in increasing productive capacity.

Businesses aren't refusing to invest because Democrats have hurt their feelings, as some seem to suggest.

Modern Anarchism

Government isn't the solution - government is the problem!

Did you ever hear that? If you really believe it, you are an anarchist.

Tea Party adherents say they believe it.

Until the pot holes on the way to work don't get fixed. Or they lose their job. Or their house catches fire.

Rich Man's War - Poor Man's Fight

I just finished reading an interesting book about the Civil War in Mississippi: The State of Jones.

I had long known that something happened during the war in Jones County, Mississippi. The county became a refuge for deserters and supporters of the Union. The central figure was Newton Knight, a yeoman farmer who opposed the planter class. He not only organized and led a force of Unionists who opposed the Confederacy, he established an interracial community in the county.

I don't know if it was these farmers who invented the phrase, "it's a rich man's war and a poor man's fight," but it might well have been.

Bitter as Newton Knight's fight was during the war, the struggle afterwards was even more challenging as the planter class reestablished control of the state after the war through a reign of terror. They even succeeded to a great extent in reestablishing white dominion over black laborers. How Knight survived the assassination attempts and the violence of the Klan to die in his old age is in itself a remarkable story.

I have also been reading the New York Times' Disunion series of articles. I'm learning a lot about the Civil War I never knew. A complicated tale.