Tuesday, April 28, 2009

Poisonous Snake Bite? Run to the Hospital!

Medical-care blogger Paul Hsieh of FIRM has warned of the danger of Democrats trying to "fast track" a universal medical care legislation that would effectively socialize medical care.

Very little needs to be said as to why Universal Medical Care (to be exact, Universal Medical Insurance) is a bad thing. When politicians promise that something can be obtained at any amount at no cost, the demand skyrockets to the point that it overwhelms the amount of supplies available to satisfy that demand, and a shortage results. In this context, people start going to the doctor for things they otherwise would not, and the result is a long waiting line (sometimes up to several months) for all involved. But, to be clear, supplies do not decrease only because demand is taking them all up, but also because suppliers are less willing to continue supplying. When medical suppliers see profits decreasing or being eliminated, or when doctors find their work becoming less rewarding (whether their motivation be monetary or spiritual), they leave. (Which seems to be the case happening already.)

(For a more in dept, though still short, explanation, check out Leonard Peikoff's lecture transcript Health Care is Not a Right. For a more exhaustive analysis of the fallacies involved in Universal Medical Care, and how it has already been employed partially the United States and failed, check out Lin Zinser and Paul Hsieh's essay Moral Health Care vs. "Universal Health Care".)

This legislation is the greatest immediate threat to our health and freedom. If it passes, you can expect a lot more controls to follow as a result of desperate attempts to keep prices under control. At worst, it could come to the point where a politician decides whether you live or die (if your treatment is "too expensive", you do not get any). Please, send an e-mail to your representatives. You can find their contact information here.

Here is what I sent off to both of my senators:

Dear [representative],

It came to my attention yesterday that Democrats are currently trying to rush through Congress a piece of legislation that would put Universal Health Insurance into law. This is a dishonest attempt to force Universal Health Insurance onto an unwilling public. Dishonest because supporters of the legislation piece have explicitly stated that they are employing this particular methodology in order to avoid opposition and debate (referencing the article on Reuters titled "Democrats near deal to 'fast-track' health bill").

I am writing to ask you to oppose this.

Little needs to be said as to why universal health coverage is a bad thing: when politicians promise that anyone can obtain any amount of a certain thing at no cost, the demand for the product or service surpasses the amount of supplies available (doctors, medicine, diagnosis machines, etc.) to satisfy that demand and a shortage results, a shortage being fatal if one were to occur in the medical industry. If it becomes law that anyone can receive medical care at any time at no price, then people will start going to the doctor for things they otherwise would not, and a long wait results for all involved. Long waiting lines can be fatal for someone needing immediate medical attention.

Not only that, but further governmental controls would be an inevitable result of the government trying to keep prices under control. In other countries with socialized health care, there are special taxes on certain foods and beverages, further restricted speech (an egg commercial called "Go to Work on an Egg" was censored in the United Kingdom because it was considered as promoting an unhealthy lifestyle), and even outright denial of medical insurance, which means little to no medical care for that particular individual in a socialized system, if the government deems one to be too unhealthy and therefore too expensive to cover. It is ironic: an attempt to "free medical care from the rule of the dollar" inevitably leads to an even fiercer monetary rule.

I encourage you to read the essay titled “Moral Health Care vs. ‘Universal Health Care‘", authored by Lin Zinser and Paul Hsieh, which analyzes why Universal Health Care is immoral and impractical, and how it has already been partially implemented in the United States and has failed:




Of course, one not need to be as detailed as I have; only a sentence or two will suffice if one is clear. I give permission for one to use (and alter) my letter if it is the case that you *do not* live in Michigan.

Remember, it is your health.

Monday, April 27, 2009

No Phoenixes Here

Senator John Kerry is planning on holding Senate meetings on April 30th to consider possibly extending aid to the troubled newspaper industry.

To my friends I had been speaking as to why it would be atrociously silly to try and bail out the newspaper industry, using an analogy, but I never expected the politicians to seriously consider it! I will reserve the analogy for the end of this post.

John Kerry, of course, makes the same weak arguments in regards to extending aid:
"America's newspapers are struggling to survive and while there will be serious consequences in terms of the lives and financial security of the employees involved, including hundreds at the Globe, there will also be serious consequences for our democracy where diversity of opinion and strong debate are paramount," Kerry wrote in his letter, addressed to "the Boston Globe family".
His argument consists of two points: that 1) serious economic consequences and 2) public debate losing diversity in opinion will be the result of the newspaper industry being left to suffer or fail.

In both his points, he fails to realize that demand for news sources is not disappearing, but rather shifting. People are reading fewer newspapers, but more and more of other news sources (Internet and television). Information dissemination to the public is only changing form, not amount. Economically, while certain companies may be laying off their staff, other companies are hiring because of the increased demand of their particular product/service, so the economy will not be harmed unless there is governmental interference. Debate-wise, things will only become more efficient. The only group that would be harmed by the newspaper industry failing is those who refuse/are unable to resort to the television or Internet, and even then the harm would still be minimal considering many restaurants offer televisions (mostly on news or sports stations) and countless libraries offer free Internet access.

Another thing Mr. Kerry fails to realize is that extending aid to the newspaper industry would actually achieve what he asserts to be preventing. He would achieve economic harm by giving out capital because that would deprive another company of capital (remember we are speaking of tax dollars, and it does not matter whether it is directly taxed via taxes or indirectly taxed via printing money); he would achieve lack of diversity in debate by making newspapers less apt to criticize politics considering political leaders are their investors. (One piece of legislation actively seeks to infringe on freedom of speech by prohibiting political endorsements, which, of course, logically means political un-endorsement is prohibited as a corollary. To clarify, the reason why un-endorsement would be prohibited is because by asserting what one stands against clues others into what one stands for, a sort of process of elimination. Therefore, the alternatives of criticism and endorsement are both forbidden.)

Finally, let us not forget, bailing out the newspaper industries would be futile. The analogy I use to illustrate this is that of comparing this to the hypothetical bailing out of the now extinct cassette tape. It is obvious why cassette tapes would be doomed to extinction regardless of how large of a subsidy the companies received: people would simply not buy them. Compact Disks are what are in demand. The same applies to newspapers: no sense in bailing them out when the consumer base is demanding televised and Internet sources. What does Mr. Kerry expect? A Phoenix rising out of its (newspaper) ashes?

The truth of the matter is that we cannot afford to *keep* the newspaper industry. If we want economic progress and higher efficiency, we must let devalued and inefficient industries fail.

Thursday, April 23, 2009

Where is the Political Lexicon?

Thomas Sowell has come up with another excellent article about "universal health care".

What especially stuck out to me was this:
Those who think in terms of talking points, instead of trying to understand realities, make much of the fact that some countries with government-controlled medical care have longer life expectancies than that in the United States.

That is where the difference between health care and medical care comes in. Medical care is what doctors can do for you. Health care includes what you do for yourself — such as diet, exercise and lifestyle.

In many arguments against universal health care it has been absolutely essential to distinguish between having health insurance and actually receiving medical care. Having insurance does not automatically mean that one will receive what the insurance covers.

In truth, universal health insurance would actually greatly restrict access to medical care, contrary to what politicians assert, and reduce the quality of it as well. This is due to the economic principle known as supply and demand. When supplies (of a product or service) increase while demand decreases, prices decrease; when demand surpasses supply, prices increase. In both cases, prices help keep supplies aplenty by regulating demand: when things become unaffordable, people become more frugal; when it becomes cheaper, people buy more.

If politicians were to completely abolish prices from the medical system and promise the masses that anyone could get medical care at any time and be guaranteed to receive it, demand would greatly surpass the amount of supplies, and a shortage would result.

A shortage occurring in the medical industry is deadly. People who need treatment in the short-term, those that have a disease or injury, are delayed from getting it because they are in line behind people who have the sniffles or are being reckless in their hospital visits.

For an extensive analysis about the failings of universal health care and how it has already been partially implemented in the US, I recommend the essay "Moral Health Care vs. Universal Health Care" by Lin Zinser and Paul Hsieh, accessible in its entirety for free.

To close with another quote by Mr. Sowell, about politicians:

This is just one of the many ways in which self-righteous busybodies leave havoc in their wake, while going away feeling noble.

Monday, April 20, 2009

Jackie Chan's Absurdity

Actor Jackie Chan has recently given a statement that Chinese people need to be controlled, and is receiving a negative backlash.

I must admit, every time I hear such an argument for establishing/maintaining an all-powerful government I cannot help but shake my head at the absurdity. In such arguments it is asserted that individuals are innately irrational and cannot manage their own lives. Their solution: put individuals in charge of those individuals.

This is the fallacy of arbitrary exclusion, or, if a politician is making the claim, the fallacy of self-exclusion. The fallacy entails that one make an assertion that logically subsumes an entire category (e.g. all X's are A) but then arbitrarily and implicitly excludes particular instances. In the case of the politician, he is stating at the same time that he is rational and that all individuals are irrational. They fail to see that a group, a collective, is not a separate entity with a special nature, but rather a collection of individuals.

Sadly enough, the contradiction has gone over the heads of many societies, thereby allowing absolute government control to take place. But they are always star-crossed by reality from the beginning. The politicians not only succeed in destroying the people they control, but also at destroying themselves.

Friday, April 17, 2009

Tea and More Tea

I must apologize for my lack of posting this week. I am still struggling with what particular blogging methods and style I shall employ, and am still having especial difficulty trying to figure out what to blog about. All in good time.

Today I present a link to Titanic Deck Chairs for his post regarding analyses of the Tea Party protests that have been happening recently. The limited media coverage I have encountered has been disappointing.

Perhaps the media's attitude can be summarized in this video:

To summarize, a reporter at one of the Tea Parties questions a protester and immediately becomes hostile after the protester mentions Abraham Lincoln's stance on liberty, going so far as to cease interviewing him and argue. She cuts off the interview by stating such was not suitable for "family viewing" and that things should switch back to the anchorwoman (despite nothing offensive taking place). Even stranger, the anchorwoman states that this is a "prime example of what we're following across the country" when it was the reporter whom had made a spectacle of herself.

An excellent analysis of this can be found at The New Clarion.

Friday, April 10, 2009

Fire the Holdrenizer Smithers!

The blog Titanic Deck Chairs has a good piece about an absurd proposal to combat global warming by heavily polluting the atmosphere (thereby preventing sunlight from hitting the earth's surface).

While it be absurd, this proposal is extremely dangerous. What is rarely noted is that more heat is good (by the standard of man's life), not bad, for the environment as it promotes plant life, which promotes animal life, which increases food supply. By this standard (delimited to temperatures not hostile to life), global warming is actually desirable. Cold is hazardous to life.

If this proposal comes to see the light of day it may prevent a very ambiguous catastrophe, but it could have catastrophic consequences on human life as a whole.

Wednesday, April 8, 2009

"Atlas Shrugged and the Tea Party Revolts"

The Ayn Rand institute has come out with a new video advertising the best-selling book Atlas Shrugged.

I must confess that I find this video to be unsatisfactory, but it suffices for the time it runs. What is troublesome, as I have said in a previous post, is that the majority of the current focus on the book is on its plot-theme, that is, its political aspects. Atlas Shrugged is not a political novel, but rather a primarily ethical and epistemological work.

It is not about what happens to the economy when the government imposes controls; its about what happens to the world when men stop using their minds.

Monday, April 6, 2009

Adjustable Interest Rates and Economic Forcasting

A few days ago my local representative, Carl Levin, sent me an e-mail announcing that

[...] this week the Senate Banking, Housing, and Urban Affairs committee passed the Dodd-Levin Credit Card Accountability, Responsibility, and Disclosure Act of 2009 (CARD Act, S.414).

He states that this legislation

[...] seeks to put an end to unfair credit card practices that mire millions of American families in debt. [...] Under this legislation, for example, credit card companies would be prohibited from applying higher interest rates retroactively to existing credit card debt, hiking interest rates on customers who pay on time, and collecting interest on credit card debts that were repaid on time. In addition, this bill would crack down on unreasonable fees, including repeated late fees, over-the-limit fees, and fees to pay your bill, and would prohibit charging interest on those fees. It would also prohibit so-called “universal default” interest rate hikes in which a credit card company hikes a cardholder’s interest rate for reasons unrelated to the account held with that company. It would also make sure that cardholders get their bills 21 days before the bill is due and give them until 5:00 p.m. on the due date to make a payment.

(More information can be obtained from this press release.)

What needs to be realized is however "outrageous" (according to whom?) or "unfair" (according to whom?) some of the business practices are of credit card companies is irrelevant; a private business has the right to operate as it so pleases as long as its consumers mutually consent. If a consumer is ignorant enough to have signed a contract without reading that it gives the company the power to charge over thirty percent interest, he has screwed himself over and must responsibly face the consequences. Whether or not the terms are desirable is of no concern of anyone but the involved parties. This bill amounts to "but I don't wanna pay so much!"

This bill is a violation of the credit card companies' owners' rights, as it dictates how they must and must not run their business, and the price for such will be paid by yet more worsening of the economy. Let us focus on interest rates in particular.

While some companies may count on the ignorance of its consumers to be able to charge high interest rates, adjustable interest rates do serve a practical purpose in helping keep businesses afloat. Take, for instance, the economic phenomena known as inflation, where the money supply is artificially increased ("artificial" because the economic output does not warrant a monetary increase) and thereby decreases the value of each unit of money.

Any business that deals with lending money or credit must take inflation into consideration in its policies to be able to adjust when it happens, because if inflation hits during a time it has increased its loans or has not all of its loans paid back it must increase interest rates lest it lose money. A simple illustration:

Let us say, for example, that you loan $1000 to a friend who is hard on his luck and you both agree to have the debt repaid two years later in a lump sum payment. What if, during those two years, the Federal Reserve was to double the money supply? The value of each unit of money is cut in half, so by the time your friend pays you back, you are getting the same amount of money back in monetary terms, but only half the value; you lent out $1000 in value but received only $500 back. To clarify our thinking, we could appropriately and literally think of this as losing money.

Businessmen realize this, and so they raise interest rates when the economic forecast yields that the value of money will decrease during the repayment of a debt. To prohibit outright increasing interest rates or to set a price ceiling is to force businesses to take a loss and risk bankruptcy.

But this is not the only reason interest rates increase and need to be adjustable. What if a credit card company's consumers start defaulting on their debt in large numbers? They have to raise interest rates on those that are repaying their debt (assuming the contracts allow it). What if governmental or economic factors make it more expensive to operate the business? Again, interest rates will have to increase. But the CARD Act will prohibit such actions, or at the very least make them much harder to go through on short notice (which will be harmful if immediate action is required).

We need not wait to see the long-term or even short-term consequences of this legislation if it should happen to pass, for we already have our concrete example in the banking crisis. The Community Reinvestment Act changed the lending practices of some banks by forcing them to lend to non-creditworthy people. Lending to non-creditworthy people means the banks run a much great risk of losing money from people not repaying their debt. The banks could have survived such legislation if they were allowed to increase their interest rates so as to recoup the losses, but not only were they prohibited from doing so, the Federal Reserve set the interest rates for them.

We have seen the results.

Friday, April 3, 2009

Wesley Mouch with your Paycheck?

Another disturbing proposal is upon us. Legislators are actually entertaining the notion of dictating the pay of all employees of companies that have received government funding.
But now, in a little-noticed move, the House Financial Services Committee, led by chairman Barney Frank, has approved a measure that would, in some key ways, go beyond the most draconian features of the original AIG bill. The new legislation, the "Pay for Performance Act of 2009," would impose government controls on the pay of all employees -- not just top executives -- of companies that have received a capital investment from the U.S. government. It would, like the tax measure, be retroactive, changing the terms of compensation agreements already in place. And it would give Treasury Secretary Timothy Geithner extraordinary power to determine the pay of thousands of employees of American companies.

Of course, this is but only a logical development, as would be known by anyone familiar with the nature of government intervention and money in general. When we spend money, we want to know where it is going and, if we are smart, will not finance activities we do not approve of. When the government starts paying for the operation of a business or industry the politicians involved will sooner or later act as if it were their money that had been spent, and will be suggesting, or forcing, courses of action.

What is their standard of how people should be paid?
In addition, the bill gives Geithner the authority to decide what pay is "unreasonable" or "excessive." And it directs the Treasury Department to come up with a method to evaluate "the performance of the individual executive or employee to whom the payment relates."

And how will he decide what is "unreasonable" or "excessive"? And by what process will the Treasury Department come up with method to evaluation performance? Will it be based on sound economic principles of how employers keep their employees, or by the popular opinion of voters?

This will be particularly harmful to our economy, especially at a time like this, since the government does not work from the motivation of profit as a business does. I predict that, if Geithner is granted these powers, he will take a look at some sheets and decide that everyone is being overpaid. In a free economy, the proper amount of payment is according to the economic worth of the work or the abilities of the person; in the government, the arbitrary ideas of politicians as influenced by the smiles and approval of potential voters.

Worst yet, what is to stop this from expanding even further beyond businesses that received government funds? As I argued in The Sisyphean Judgment of Politicians, any attempt by politicians to run the economy is doomed to failure as Sisyphus is doomed to have the boulder roll down the mountain, so we have a vicious circle of government creating crises and trying to cure those crises with more government.

If this continues unabated by principled thinking or cultural change, Timothy Geithner may soon be cutting your own paycheck.

Thursday, April 2, 2009

90th Objectivist Round Up

The latest Objectivist Roundup has been posted over at Rational Jenn.

For those that do not know, this is what is known as a "Blog Carnival." The purpose of such is to gather links to the best blog posts or so of authors that share an interest or theme. In this case, the Roundups gather together posts from authors that are supporters of the philosophy known as Objectivism.

If you have enjoyed my posts then perhaps you might enjoy some of these articles.

Wednesday, April 1, 2009

Taser Controversy Unwarranted

My local news media has published a biased article about a death during a police confrontation that paints the police as evil for having used a taser.

It is a supposition that since tasers may cause the death of a suspect they should not be used, but this is utter nonsense. All police weapons, all *physical objects*, when used a certain way, can be fatal: nightsticks can induce comas or worse, pepper sprays may set off an allergy, guns obviously can stop vital functions, and so on. The only reason tasers are so often targeted is because they are so commonly used due to their effectiveness and ability to subdue anyone regardless of their strength or pain tolerance.

Henry Hazlitt stated that the majority of economic fallacies stems from the error of not using the imagination to think beyond the effects of a policy in the short-term or the effects on a certain group; let us exercise that needed imagination, for people are making errors by not thinking past their writing tablets.

Let us say, as in the presented article, that you are the one of the policemen that is facing the youth in the apartment. He is not complying and is taking a fighting stance against you. What should you do? First let us ask: does he have a knife or perhaps a....Well, it is too late now. In the time it took you to ask that question and make the necessary observations the suspect could have you killed by then. We will start over. Instead, this time, we will concern ourselves solely with action. Should we use a nightstick? Should we use...‘tis too late again!

The point should be clear now that police officers do not have the time to examine the exact nature of a suspect or to weigh all the pros and cons of a course of action as a newsreader, who is granted omniscience when he imagines the situation, does in his armchair. All decisions must be made as instantaneously as absolutely possible, for in the law enforcement line of work it merely takes a moment’s bad decision to be fatal to the officer. Obviously then the police officers must resort to the most effective method of subduing the suspect as soon as their “instincts” tell them to. This is why a police officer would pull a gun on you even if you were merely fooling around in the glove box during a traffic stop: you may know your intentions are innocent but the officer does not.

But why do we not take it upon ourselves to accept the premise that tasers should not be used due to their potential fatalness? What would be the fullest logical conclusion of such an action?

Immediately we would know that a policeman’s self-defense weapons are reduced to nightsticks, pepper sprays, and guns. Would these reduce the amount of deaths while at the same time maintaining the same amount of effectiveness as we have in enforcement today? No. The pepper spray could largely be considered by far the most ineffective weapon, as it is entirely dependent on pain, amounting to nothing if the suspect has his adrenaline pumping or has a high level of pain tolerance. The nightstick would increase the number of long-term injuries and fatalities, as it is a close-range weapon that could fail an officer if he were to come up against a criminal with a knife (or worse) and could cause a number of injuries to suspects including, but not limited to, concussion, brain injury, coma, or death. Even guns have a possibility of failure; for the bullets could miss the target or hit an inconsequential area of the body (pain tolerance applies here too).

The results are clear: without tasers law enforcement difficulties, injuries, and fatalities increase. Let us not forget that the worst of criminals would only be emboldened upon learning certain self-defense mechanisms are forbidden to the officers, further increasing the difficulties, injuries, and fatalities.

This whole taser controversy is nonsense once logic is applied to it. Why the police are sometimes targeted for biased news stories is beyond my understanding.