Archive for the ‘#commonsense’ Tag

Medical Insurance Is NOT Medical Care   1 comment

I know that flies right past the ears of many people, but take a pause and consider the implications of that statement.

Medical care is when you interact with medical providers and receive a diagnosis, surgery, therapy, a prescription and so on.

Medical insurance is how you pay for medical care.

Politicians use the terms interchangeably, but they are NOT the same thing. Whenever I hear someone use terms that mean different things as if they are the same thing, I become suspicious of their motives for conflating the two.

Of course, there are other types of insurance that we don’t do this with. Nobody confuses car insurance with vehicle maintenance, for example. I keep my own car clean and I pay out of pocket for repairs. If my car is damaged in an accident, my insurance covers the repairs, less the deductible, but I don’t call my insurance agent if I need an oil change or to replace my starter.

Homeowners insurance is similar. I don’t call my insurance company to finance painting the house. I call them when a tree falls on the roof.

Medical insurance ought to work the same way that car and home insurance do, but right now it doesn’t. Routine procedures, drug prescriptions for chronic disease, and a variety of other predictable and non-urgent procedures are all handled through insurance companies.

Now, take a pause and realize that one of the key differences between medical insurance and car or homeowners insurance is that medical insurance is a state-run and -regulated program with limited competition while care insurance has plenty of competition.

March is the month we renegotiate our car and home insurance and I received dozens of circulars in the mail offering me insurance plans that will meet my needs at a price I’m willing to pay. None of them offer to reimburse me for minor damage because they wouldn’t stay in business for long doing that.

Continuing this theme, repair shops, tire manufacturers, and other car-care providers all compete on price to get the largest possible share of the millions of car owners in the market for their products and services.

Meanwhile, the medical care market we currently know is provided by a mixture of public and private payers, and it funds a significant share of the vast majority of procedures. Providers don’t compete on price even for services that millions need on a regular basis.

When it comes to medical insurance, most people expect their coverage to give them more than they pay in. That makes no economic sense. If one person’s treatment costs $120,000 a year and they pay a monthly premium of $1,000, the company needs nine people to pay $1,000 a month, but those eight other people cannot consume any medical care services in order for the company to even break even.

The primary role of insurance should not be to pay bills. Insurance is customer peace of mind—a guarantee that a catastrophic event will not bankrupt us.

If medical insurance worked as it should, we would only use it for catastrophic medical needs. For more minor medical care services, we would be looking for the best-value care in the market because those costs would be coming out of our pockets. Yet the high levels of medical debt show that our current insurance system has strayed far from this model as the prices for minor procedures and treatments have gone through the roof.

Increased coverage sounds nice, but as our recent experiment in increased coverage shows, we’d still struggle with unaffordable copays and deductibles and staggering levels of medical debt. The first step toward obtaining an affordable medical insurance system that works for the maximum number of people is to let insurance be what it was meant to be: peace of mind against catastrophe.

Andrew Yang’s Math Doesn’t Add Up on Universal Basic Income | Jacob Dowell   Leave a comment

The UBI rests on the assumption that consumption spending grows the economy and drives production. Transferring money from savers to consumers, as Yang’s UBI hopes to do, does not grow the economy in the long run—it has the opposite effect.

Source: Andrew Yang’s Math Doesn’t Add Up on Universal Basic Income | Jacob Dowell

Andrew Yang, 2020 Democratic presidential candidate, has revived the debate on Universal Basic Income (UBI) with his proposed “Freedom Dividend.” His plan is to offer an alternative to the modern means-tested welfare state with one simple program to pay $1,000 per month, or $12,000 per year, to every American adult over the age of 18.

Yang has already received a thorough response from Gonzalo Schwarz. Though Schwarz’s response contributes important insights—such as the insignificance of technology replacing jobs, the self-worth that work brings, and the likelihood of a UBI supplementing rather than replacing welfare—I would like to contribute some further insights that more directly address the economic errors of Yang’s arguments.

First, let’s look at the funding. Yang says his 10 percent Value Added Tax (VAT) would raise $800 billion per year, save $600 billion per year from the costs of other welfare programs, save $200 billion per year from reducing the demand on health care services and incarceration, and eventually raise $600 billion extra per year from economic growth.

There is an even deeper flaw in the argument that the UBI would expand the economy.

Before the economic growth (which would not actually happen as I explain below), he has only $1.6 trillion of funds. Even after his expected economic growth, he will have only $2.2 trillion of funds per year, still far from the $2.8 trillionrequired excluding bureaucracy (234 million people 18+ at $12,000 per year). Yang never mentions debt as a means for payment, but his own math doesn’t add up.

Yang is also deceiving in his argument about the program’s impact on the economy. He cites a paper by the Roosevelt Institute that finds, at $12,000 per year, UBI would expand the economy by 12.56 percent over eight years. However, the 12.56 percent growth is under a scenario of a completely debt-financed program. The study admits that a completely tax-funded program would result in a 6.5 percent growth over eight years. Since Yang’s program is mostly tax-funded, it is highly deceiving to claim economic growth of 12.56 percent.

However, there is an even deeper flaw in the argument that the UBI would expand the economy. It rests on the assumption that consumption spending grows the economy and drives production.

The argument goes like this: By transferring money from those who save money to those who have a higher propensity to consume, there will be more spending on consumption goods such as food and clothing. This, in turn, will give an income to the shop owners who will spend their new profits on other consumption goods. And the circulating money creates more economic activity for the macroeconomy.

Transferring money from savers to consumers, as Yang’s UBI hopes to do, does not grow the economy in the long run—it has the opposite effect.

The “propensity to consume” as the cause of economic growth is a common Keynesian notion. But it’s dreadfully wrong. First, it is important to recognize that economic growth is not when everyone gets more money. Economic growth occurs when an economy produces more valuable goods. And what causes this? Capital goods.

Capital goods are the previously-produced goods that are used in the production process and that improve the productivity of workers and the general economy. The use of hammers and nails, for example, greatly improves a construction worker’s ability to build a house. Capital goods are created through savings and investment—the opposite of consumption. Without investment funded by savings, the production of capital goods will slow, causing economic growth to slow.

It may be argued that no one argues for 100 percent consumption spending and that since an individual business will be getting more money, they will be better able to afford more capital goods. But this argument still ignores how the capital goods were produced in the first place.

To create capital goods, someone in the past must have put aside resources to use for a line of production that would not create immediate value. To create a hammer, someone has to save and invest resources into mining iron ore, which then requires resources to smelt into steel. Someone must also have invested resources into tree-cutting for the wood to create the handle. Each of these projects, in turn, required resources for its production process.

In order to have economic growth, there must be a sacrifice of current consumption in order to fund the creation of capital goods.

All of these steps required the production of goods that did not serve any immediate consumption value. The steel and the wood are only a means of creating a hammer, which is itself a means of creating houses and other consumer goods.

The final consumption good, however, would not be possible without someone in the past saving resources to be used for a line of production that was not immediately serviceable but used for the production of capital goods.

In order to have economic growth—to expand production—there must be a sacrifice of current consumption in order to fund the creation of capital goods. Transferring money from savers to consumers, as Yang’s UBI hopes to do, does not grow the economy in the long run—it has the opposite effect.

A common argument against UBI is that it will incentivize people not to look for work. Yang answers this criticism, saying that $12,000 per year will still not be a good enough living for most people, so people will still be incentivized to get jobs and contribute to production.

However, there are still marginal effects at play that can add up to huge changes: 1) It decreases the incentive for workers to quickly find new employment once they’re out of a job, and 2) it decreases their sensitivity to income differences between jobs.

A UBI would skew choices towards enjoyable work rather than efficient or productive work.

The increased time between jobs means there will be lower employment at any given time and, therefore, less production. And the decreased sensitivity to higher incomes means people will be more likely to do less productive work for the sake of enjoyment. While it may be desirable for workers to balance their income needs and their work preferences, a UBI would skew choices towards enjoyable work rather than efficient or productive work. Yang even admits this: “UBI increases art production, nonprofit work and caring for loved ones.”

While these may be admirable activities, Yang is forgetting to consider the opportunity costs associated with them. While people will be more inclined to make art, write novels, and work less, the amount of needed goods in society will decline. This may be a worthwhile tradeoff to some, but when the main stated goal is to help those in poverty, producing less clothing and food is not going to achieve the desired ends.

Andrew Yang does bring up some admirable points about a UBI avoiding the welfare cliff and reducing bureaucracy. However, the overall greater expansion of the government, the even more massive resource transfer from savers to consumers, and the productivity-reducing effects on labor all toll to a huge loss for the economy in the long run.

Posted March 16, 2019 by aurorawatcherak in economics

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Oscar Wilde on Why Wanting to Be Left Alone Is Not Selfish | Jon Miltimore   5 comments

Individualism involves allowing people to flourish and think as they see fit, mainly by leaving them alone.

Source: Oscar Wilde on Why Wanting to Be Left Alone Is Not Selfish | Jon Miltimore

 

Confession: Oscar Wilde is one of my favorite writers. Though he was what Dostoevsky would have described as “a dedicated sensualist,” Wilde possessed a true creative genius perhaps unmatched among his literary contemporaries.

His essay “The Soul of Man under Socialism” is not, in my opinion, his best work. Written in 1891, it’s largely a stream of consciousness detailing what Wilde thought about art, capitalism, socialism, and—most importantly—Individualism.

Individualism is Wilde’s primary concern. What is it? Here’s what he had to say:

Art is Individualism, and Individualism is a disturbing and disintegrating force. Therein lies its immense value. For what it seeks to disturb is monotony of type, slavery of custom, tyranny of habit, and the reduction of man to the level of a machine.

Wilde’s ideas on government in the essay are a strange hodgepodge. He basically rejects both capitalism (too vulgar) and socialism (too authoritarian).

Still, the endgame of his philosophy soon becomes clear. Individualism involves allowing people to flourish and think as they see fit, mainly by leaving them alone.

Is wanting to be left alone selfish? Not at all, Wilde argues:

[U]nselfishness is letting other people’s lives alone, not interfering with them. Selfishness always aims at creating around it an absolute uniformity of type. Unselfishness recognises infinite variety of type as a delightful thing, accepts it, acquiesces in it, enjoys it. It is not selfish to think for oneself.

The tyrants, Wilde says, are those who demand of others to think as they do:

It is grossly selfish to require of ones neighbour that he should think in the same way, and hold the same opinions. Why should he? If he can think, he will probably think differently. If he cannot think, it is monstrous to require thought of any kind from him. A red rose is not selfish because it wants to be a red rose. It would be horribly selfish if it wanted all the other flowers in the garden to be both red and roses.

One could easily apply Wilde’s metaphor to the desires of many Americans today. Unfortunately, there seem to be legions of red roses demanding all flowers become red roses.

Another Good Reason to Distrust Government   Leave a comment

Posted March 14, 2019 by aurorawatcherak in Common sense

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Why Might I Wish to be Armed?   Leave a comment

There are Sundays when some of us at my church choose to conceal carry. It started after the Texas church was shot up and there’s a rotation, kind of like the nursery duty. We can’t afford security guards – who would be the first to die anyway – so some of us carry concealed. We have a large military presence in our church (retired and active-duty) so many folks were already carrying concealed. I had never carried in church before and the guys were surprised when three women who were not former soldiers showed up for the meeting ready to do our duty. And, so, now we do. Whether we’ll ever need it is unknown, but at least we’re prepared.

So a couple of Sundays ago, I was still concealed when I left the church to go to the gas station to get diesel for our day tank. It was a busy Sunday and I positioned my car such that I could be the next one at the pump. While I was waiting, these three big trucks pulled up, clearly with the desire to be together and worked to position themselves so that they could take all the pumps. Only I was in a good position, so I pulled up to one of the pumps first. I waited my turn, but I wasn’t intimidated by the attitude of those who got there after I did.

Until I got out of my car and got my ears laid back by the driver of the truck that was trying to get in there ahead of me. How dare I, this passenger car, cut in front of him, a big truck with a huge tank. Didn’t I know he had somewhere to be?

I tend not to be intimidated by men even when I’m not armed. I chose to ignore his tirade and doing what I needed to do. And he just kept getting angrier, and close enough I could smell the beer on his breath.

But I wasn’t afraid because my 45 was comfortably cozied into the small of my back under my winter coat, which I unzipped in case I needed to access my firearm on short notice. He never knew I was armed. Concealed means nobody can tell. And, I just pretended I was deaf as I filled my cans. One of the things I share with 90% of the concealed-carry people I know is a desire to never have to draw my gun, so I felt no need to escalate the matter. Eventually, the angry man stomped off to his truck and I did get a little nervous at that point. I made sure my car was between him and me, and I slipped my free hand back to my holster because, well, people are stupid when they drink beer and someone pisses them off. But he finally pulled up to the pump his friend vacated and the friend got out and came over to me, apologized for his friend, said I was brave.

Of course, I wasn’t really brave. I just wasn’t scared because I was prepared, and I wanted the guy to know what what he did was not only wrong and rude, but also dangerous, so I told his friend.

“He new up here?”

“About a year.”

“Well, he should know by now that Alaskans women are often armed and he might not like the outcome of his next scream fest. Might run into a less reasonable woman than me.”

“Yeah, that’s what I thought you might say,” he said, laughing, because the idea of going to the filling station armed is not a weird concept in Alaska.

Why might I wish to be armed?

  • Because someone someday might want to shoot up my church and I’d prefer to be able to end their life rather than hope I escape notice.
  • Because sometimes people get stupid at the gas station and think they can intimidate and/or hurt a small woman because they’re bigger and stronger.
  • Because sometimes bad people break into houses with bad intentions and I might want to live through the encounter.

Posted March 6, 2019 by aurorawatcherak in Gun control

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Recovering Stone-Chucker   8 comments

Feb 18, 2019

What was your best drop the mic moment?

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I guess it depends on how you define a “mic drop moment.”

Those who have followed my discussions on Facebook know that I don’t advocate for shutting down conversations, so quite often, when I could have a “mic drop”, I choose to let it go. I think mic drops are (mostly) arrogantly executed by people who believe they’re right and are unwilling to hear any evidence to the contrary. That’s not me (most of the time). I do believe I know some things a lot of people don’t know (and, I’ve tested that theory a bunch, so I have evidence to support my suspicion I’m right), but I like seeing a broad range of discussions and points of view. Sometimes they change my mind, mostly I’m hoping I can change their minds. If I do a mic drop, I’m shutting down that conversation and that rarely, if ever, changes anyone’s mind.

But I do have them occasionally. Often it’s not intentional. I’m a quippy person in my everyday life and I’ve gotten into some verbal sword-play and I’ve said something that caused the other person to go – “hmm, I can’t think of a comeback”. Since it’s not intentional, I don’t keep track. I don’t glory in it. I kind of think it was a failure because it stopped the discussion. A few times, though, I’ve had that person come back to me and say “You had a point and I changed my mind.” Good, but half the time, I can’t even remember what I said.

I had one to share with people on gun control (it really was a glory moment), but I changed my mind this morning after my pastor’s sermon mic-dropped a bunch of people in the congregation and I thought, yeah, there’s my topic.

The Bible is unequivocally clear that Christians aren’t supposed to participate in sin and I try to live my life accordingly. It’s been 27 years ago in December since I’ve drunk alcohol – not because I have a problem with alcohol. I’ve always been able to stop at one beer, wine, whatever and I’ve never really needed it to have a good time. But I take seriously that if I cause my brother (or husband) to stumble, I am as guilty of his sin as he is, and so, I chose to give it up and I don’t regret that. I don’t judge anyone for their ability to handle an adult beverage or two, it’s just that someone in my household can’t, so I judge myself accordingly. It certainly wasn’t a sin when Jesus turned water in REALLY GOOD wine, but it would be a sin for me to drink it because it stands a good chance of dragging my husband into what is truly a sin for him.

I also don’t cheat on my husband and that includes reading (or writing) books that have detailed sexual encounters in them because I take seriously Jesus’ admonition that if you commit a sin in your head, you’re as guilty as if you committed it with your body. I don’t judge you if you can read (or write) such books and feel fine in your marriage. It would be a sin for me. It might not be a sin for you. If you’re worried about it, consult your Maker, not me.

Lest you think I’m as pure as the fresh-driven snow, I’m not, and I don’t pretend to be. I slammed a lot of caffeine before writing this article, for example, and my heartrate informs me that is not treating the temple of God (my body) with the respect it deserves. I also still have some weight I’m trying to lose and that too is a desolation of God’s temple (my body). My lack of self-control assures me I am a sinner just like everyone else. My sins are just more socially acceptable than some people’s sins, but God isn’t a socialite, so I am without excuse.

Romans 2:1-11 is an interesting passage – I won’t post the whole thing here because it’s long, but it basically says (after talking about non-Christians in Chapter 1) – “Christians, you are sinners too, and you have no excuse for judging those who are non-Christians because God doesn’t see shades of grey when it comes to sin. And you will be judged if you treat non-Christians as if you are better than them because you’re not.”

My overindulgence in caffeine is not better than my husband’s past overindulgence in alcohol … just as an example. The teller of “white lies” is as much a sinner as the murderer. In God’s eyes, we’re the same, sinners one and all. The only thing that separates Christian sinners from non-Christian sinners is that Christians have accepted Jesus’ sacrifice on our behalf as salvation. He bought out our slave contract, in essence. WE didn’t do that. He did and He did it for the whole world, we’re just the ones who have accepted it. Anyone else wanting to join us is welcome … by me anways and certainly by Jesus … but more on that in subsequent paragraphs.

Now, understand, paired with other passages of the Bible, this passage is not saying Christians are supposed to join the non-Christians in their sin. No, we absolutely are called to be a counter-cultural movement within society. But we are absolutely wrong if we think that makes us better than those who compose the cultural tide we’re swimming against. We’re all wading through the same cesspool, it’s just Christians have heard that rescue is upstream, not down.

The mic drop here is that many many conservative Christians are judgmental stone-chuckers and I’m not really innocent of this charge. I’m a recovering stone-chucker. It’s taken me a long time to get to the point where I can look at people who commit sins, clearly know that they are committing sins, commit to not joining them, and just say “Yeah, your choice, I’ll pray for you.” This doesn’t mean I condone their sins by any stretch of the imagination. Just as I am still working on learning not to make excuses for my own failures, I am not going to white-wash the world around me. There is a lot of crap in my culture that I know makes God’s heart bleed for my fellow humans and so I (try to) refrain from those activities because I don’t want to embarrass my Heavenly Father, but there were a lot of people in the congregation this morning who walked out trying to justify their own stone-chucker behavior. I could see it in their eyes. They were a little pissed at the pastor, but in reality, they were more than a little pissed at the word of God, and that’s on them – that’s their sin and I’m called to not join my fellow Christians in their immorality either.

So, I didn’t do that. It was done to me and to the people sitting around me by a man (our pastor) with an incredibly tender heart and a son sitting in SuperMax lockup. Do I think my pastor might be a recovering stone-chucker? Oh, yeah! And, I know people in my congregation who are WAY bigger stone-chuckers than I am (some of them have recently written letters to the editor so that we know how judgmental they are) — but God doesn’t see it that way. In His eyes, my little tiny pebbles of judgment are the same as the meteors some of my fellow church-goers hail down on secular society. There is a fine line between recognizing that something is a sin that Christians shouldn’t participate in (and choosing not to participate even when there are big consequences for our refusal to comply) and using that knowledge as a bludgeon against an unbelieving world. I AM CALLED to NOT PARTICIPATE in the world’s folly, but I am NOT called to try to make the world conform to my morality. I’m supposed to be a spiritual salmon, swimming upriver, but not trying to change the river’s course. Let the river go where it will. I know my destination.

So, the mic got dropped on me this morning and I am without excuse. And, as with all mic drops, now that I’ve been rendered without defense, I get to decide what I’m going to do about it. Not “What am I going to do to other people about it”. Judgment of others is always the temptation, right? No, I must decide “What am I myself going to do with this knowledge?”

Posted February 18, 2019 by aurorawatcherak in Blog Hop

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She’s No Hamilton   Leave a comment

by Randal OToole 02/15/2019

http://www.newgeography.com/content/006224-she-s-no-alexander-hamilton

The Antiplanner might be behind the times, but has anyone else noticed that it is the Democrats who are playing the role of Alexander Hamilton — the conservative who wanted to centralize government and concentrate power in New York banks — while the Republicans are playing the role of Thomas Jefferson — the civil libertarian who wanted to keep economic and political power decentralized? I always wondered why Lin-Manuel Miranda picked such a conservative historical figure to be the hero of his left-leaning musical.

Now we know. Alexandria Ocasio-Cortez’s Green New Deal is going to cost tens of trillions of dollars, but she just blithely says we’ll pay for it “the same way we paid for World War II”: “The Federal Reserve can extend credit to power these projects and investments and new public banks can be created to extend credit.”

The complete article is available at the link above.

Posted February 15, 2019 by aurorawatcherak in cultural divide

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