Paul M. Jones

The writer suggested I begin: "it was once the most powerful company in the world…"

GM was indeed the most "profitable," or "biggest"--that I get. But powerful? Why do people think about business that way? GM has/had no armies with which it can invade other companies. It had no power for force anyone to work there. It couldn’t force anyone to buy GM cars.

Your average two-bit government bureaucrat has more "power." He can send people with guns to take your money (tax collection). He can lock you up, seize your property, tell you what you cannot do on your property, summon you to court, and so on. Government has the monopoly on power.

via "Powerful GM" - John Stossel's Take.

It's also time, Obama tells his viewers, to lose weight, and stop smoking, and pull up your socks. Later on he tells people that they are foolish to prefer brand name drugs to generic drugs, and to want multiple medical tests. "If you only need one test, why do you want five tests?" Stop clinging to your tests! You're worse than those people in Pennsylvania.

Who knew we were electing a national mother-in-law? And get a chance to endure increased taxes for the privilege. Obama's supposed to be rallying support from voters, not castigating them. Outside the S& M parlor, most people do not enjoy paying to be disciplined.

via Kausfiles : Obama as Health Care Salesman: He Sucks!.

In my opinion, the signs are now pointing more strongly toward deflation. Or in other words, to the next leg downward in the collapse of the housing bubble. The heroic efforts of government policymakers to deny reality and act as if they can forestall a necessary readjustment appear to be fizzling out. And the behavior of policymakers is an important clue to this situation. As usual, the focus falls on the mild personage of Fed Chairman Ben Bernanke.

...

I had an interesting argument with a friend yesterday who is involved in politics. She asked me if the operations to save the banking system worked. I said yes, certainly. The world’s largest banks are no longer in danger of a cascade of collapses, as was threatened by the failures of Bear Stearns and Lehman Brothers. A moment later, she referred to this as a good thing, and there I stopped her. It worked, yes, but was it good? Only if you believe that it’s good to have a large raft of all-but-nationalized financial institutions kept fat and happy by exceptionally high reserve levels, and with no economic incentive to actually do their job, which is to intermediate credit, not to lobby Congress for higher salaries and bonuses. What Bernanke did was necessary to prevent a systemic collapse, but the aftermath isn’t pretty.

Still, that’s only half of the story. While the financial system has been rescued, the real-world economy is still in a deep funk. And it’s going to stay there for a while, because we all have to work off the effects of the credit bubble. Here, the policy responses of the Fed, the Administration and Congress are being less successful. But they won’t stop what they’re doing, because politically that would take a lot more courage than Barack Obama has.

via Bernanke vs. History: Our Economic Outlook | The New Ledger.

Veterinary spending is rising just about in line with human medical spending. Kudoes to AEI for publishing a graph that seriously undercuts one of the major conservative arguments about health care: that the main problem is consumers who don't bear their own costs. Veterinary spending is subject to few of the perversities that either left or right suppose to be the main problems afflicting health care spending. Consumers pay full frieght most of the time. They are price sensitive, and will let the patient die if keeping him alive costs too much. There is no adverse selection. There is no free riding on mandatory care. Government regulation is minimal. Malpractice suits are minimal, and have low payouts. So why is vet spending rising along with human spending?

Two reasons, presumably: technological change and rising income. As we get wealthier, we spend more of our income on former luxuries, like keeping our pets healthy--nineteenth century veterinary care for sick cats consisted of a sack and some stones to weight it down with. And improvements in health care technology are giving us more things to spend that money on. With the help of my family, I bought my dog five extra years of life with an MRI that diagnosed his slipped disk; without it, we'd have had to put him to sleep when he was three. Worth it? I think so. But in 1950, I couldn't have afforded it, even if it had been available.

via The Price of Innovation - Megan McArdle.

The New Culture of “Pay Up, Mister–or Else!”

For Obama to pull this off, an entire sort of new vocabulary, rhetoric, and attitude is necessary. And the model is California: the carpenter and the bricklayer are laid off, and the state snoozes; while the assistant solid waste inspector of Green Acres is on television every night (his union can afford the advertising) to weep, and claim that if he and those like him (retire at 55 with $100,000 for life) are laid off, then Dantesque things follow.

Remember the logic: the poor Californian voter who works at Starbucks or Target is angry that the grandee social worker is unnecessary and grossly overpaid at $90,000 a year, with lush retirement and benefits, and so is told that if he does not raise taxes to over 10% income and 9% sales, then firemen, police, and water workers will quit/be laid off/furlow and so he will starve, be murdered, and have no sewage.

viaWorks and Days » The War Against the Producers.

The normal critique of socialized medicine is to point out that people have to wait a long time for these kinds of treatments in places like Britain. And that's certainly a valid critique. I'm sure my mom and daughter would still be waiting for their treatments, while my father and wife would probably be dead.

The key point, though, is that these treatments didn't just come out out of the blue. They were developed by drug companies and device makers who thought they had a good market for things that would make people feel better.

But under a national healthcare plan, the "market" will consist of whatever the bureaucrats are willing to buy. That means treatment for politically stylish diseases will get some money, but otherwise the main concern will be cost-control. More treatments, to bureaucrats, mean more costs.

via Glenn Reynolds on the hidden cost of national health care | OpEd Contributor | Washington Examiner.

WSJ: Few Economists Favor More Stimulus. I say cancel the unspent stimulus we’ve already got, replace with a payroll-tax holiday. That would really stimulate, instead of just lining politicians’ pockets.

via Instapundit. I completely agree.

And, even more unusual, with a Frenchman:

U.S. President Barack Obama (C) and France's President Nicolas ... - Yahoo! News Photos.

Watch a liberal Democrat and a conservative Republican redline the Bill of Rights together:

"You may have green shoots, whatever you want to call them, you may have temporary relief, but you are still in a world that's breaking," Taleb said ...

"We're in the middle of a crash," Taleb said. "So if I'm going to forecast something, it is that it's going to get worse, not better."

The government needs to deleverage debt and not try stimulus packages that will inflate assets, he said.

"What makes me very pessimistic in not seeing any leadership or awareness on parts of government on what has to be done, which is deleverage $40-to-$70 trillion," Taleb said.

"The monkey on our back is debt," he added.

via 'We're in the Middle of a Crash': Black Swan - Financials * Europe * News * Story - CNBC.com.

Another line from Taleb in this interview, paraphrased from memory: "The people making predictions about the economy, which of them saw the current situation coming? None of them. So why believe them now?"

I read Taleb's "Fooled By Randomness" and "Black Swan" a couple years ago, and found them insightful.