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POLICY: Taking Out The Trash-Talk

I’m up at Spot-on talking about a particularly crappy study that snuck into a WSJ editorial. I made some snarky remarks about the math skills of economists at the Manhattan Institute in the process. Of course after the editing process a Spot-on it all got a little smoother, shall we say

I’m not too worried that a Republican will actually win the White House in 2008. But I am worried that efforts by what I confidently believe will be a Democratically controlled White House to reform the U.S. health care system will founder on the free-marketeers devotion to faulty statistics, unsound analysis and, well, lying.It’s not a new problem. But it’s one that’s increasingly difficult to combat.

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Peter
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Peter

“Focus your efforts on making sure the rules reflect true costs” Surely Eastern Europe has no capacity to make a success of any economic system as my view is most of that populace still live with a mindset based in the middle ages. But the rules you agree (I think) need to be in place are not set by capitalists but by government forced by its citizens to act against the entrenched political/corporate alliance. Capitalism doesn’t need to be reformed – government and its instituions need the reforming. In the case of healthcare that means universal single-pay with a just… Read more »

pcb
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pcb

Peter, Your beef seems to be with the externalities that are sometimes not realized until long after they’ve been incurred. I don’t know how that’s a failure of capitalism. It would be a failure in any economic system, we don’t worry about something until it becomes clear we should worry about it, then we change the rules to account for the newly recognized externalities. It was felt that pollution could be “handled” by the enviornment, so there wasn’t much concern intitially. Over time we realized it wasn’t being handled and it was a real cost of doing business that needed… Read more »

Peter
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Peter

pcb, I’m no economist but a full evaluation of market efficiency must include offset costs. A mine that produces the most amount of product for the least amount of input is not really efficient unless the pollution it creates or the worker injury/deaths it causes are also accounted for. This has been the problem with capitalism, its supporters fail to account for all costs which must be paid eventually. But those costs usually come from someone elses books while the profits are accumulated by owners and shareholders. If the total historical costs of slavery were accounted for then the true… Read more »

matt
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matt

What’s Really Propping Up The Economy?
Since 2001, the health-care industry has added 1.7 million jobs. The rest of the private sector? None
http://www.businessweek.com/magazine/content/06_39/b4002001.htm

pcb
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pcb

“Taxes can be a drag if they are spent on support of inefficient programs but they can be good for growth when they are spent on pushing the economy in a direction that creates efficiency” This is, imo, one of the fundamental forks in the road regarding conservative vs. liberal economic thought. Conservatives see the majority of modern government programs as economically inefficient and better handled by the marketplace. They then downplay inequalities that inevitably arise from more market solutions. Liberals, on the other hand, downplay the inefficiencies of govt programs, and any inefficiencies that are acknowledged are a small… Read more »

Peter
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Peter

“Our challenge is to do that in a way that distributes the tax burden fairly across the income spectrum and does as little economic harm as possible.” Take note: http://www.washingtonpost.com/wp-dyn/content/article/2007/06/27/AR2007062700097.html Barry, Warren Buffet also said, “If this is class warfare, my class is winning”. pcb, my understanding of WWII was that 1. it broke the depression from huge amounts of government spending (war) and 2. the U.S. economy after WWII was fueled by a destroyed Europe (markets) and the GI bill (tax stimulus). Taxes aren’t buried in the ground, they’re spent on goods and services which stimulate the economy. If… Read more »

Barry Carol
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Barry Carol

taxes are usually, almost by definition, a drain on economic growth that pervert the marketplace in some way or another and almost always lead to inefficiencies. I think the Laffer Curve applies here. For an economy to function reasonably well, we need both the rule of law and an educated workforce. Our government could not function with a zero tax rate and would not function with a 100% tax rate. Over the years, I’ve had the opportunity to directly ask members of the Council of Economic Advisors, CBO and OMB directors and even Secretaries of the Treasury from both political… Read more »

pcb
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pcb

Matthew’s comment that the growth of the US economy after WWII shows that taxes and their collection are not a drag (but actually a stimulus) on the economy is an interesting claim. My recollection of old econ classes (not a great recollection these days, I admit) was that taxes are usually, almost by definition, a drain on economic growth that pervert the marketplace in some way or another and almost always lead to inefficiencies. We can argue about the obvious need for taxes based on other concerns , (moral arguments for redistribution, the public good, etc.) , but we really… Read more »

BJS
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” .. health care system will founder on the free-marketeers devotion to faulty statistics, unsound analysis and, well, lying ..”
Why, of course. Only Republicans lie. And I.T. company owners who advertise never do.
Those who call others “liars” without legal proof are vile, disgusting, and absurd. Your advertisers ought to wash your brain out with lye-soap.

Barry Carol
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Barry Carol

Matthew, I attended the Manhattan Institute event in late September at which Ben Zycher discussed his paper about Medicare’s administrative costs and distributed copies of it. One valid point that he made is that the Medicare program has administrative costs that are not reflected in the CMS data. For example, when people first enroll in Medicare when they reach age 65, it is the Social Security Administration (SSA) personnel that handle the enrollment paperwork. The IRS collects Medicare taxes and audits tax returns. The Treasury raises capital when taxes are not sufficient to pay for government programs, which is most… Read more »