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Archive for July, 2009|Monthly archive page

A Plan, not the Plan

In Specific Facts on July 31, 2009 at 5:08 pm

After my histrionic post Wednesday about the importance of health care reform, I thought a more academic post was needed to balance the equation.  It is premature to discuss the plan coming out of Congress, because there are about fifteen of them, but I thought I could point some of the best ideas (many of which have no chance of happening).

1. Scrap the whole system and switch to a single payer model.

Yeah right.

2. Close the Health Benefits Tax Loophole.

For a variety of reasons – including Obama hammering McCain for this proposal during the elections –  but primarily because no one wants to raise taxes, this is very unlikely.  However, it is the only idea that would both fund universality and actually lower the cost of health care.  The reason health care keeps getting more expensive in this country is because people have incentives to use it improperly.  Employer insurance, because its the only part of compensation that isn’t taxed, keeps growing as a proportion of total compensation.  In other words, instead of getting a raise, people get a more expensive health-care plan.  Meanwhile, consumers don’t see how expensive health care really is and low co-pays don’t offer a sufficient deterrent against over-consumption.  If benefits were taxed then people would feel when prices went up and attempt to cut costs, plus businesses would stop pushing compensation into health care; not to mention that if you don’t have an employer subsidizing your health care, then you are indirectly subsidizing everyone else’s health care because your taxes fund a more expensive Medicare.  Selling this plan should point out that this loophole is in effect a tax, only it is collected by insurance companies.  Improperly selling this plan may cause you to lose elections.

3. The Public Option

The public option is a government sponsored insurance that people could opt into rather than choose a private insurance company.  Private insurance administrative costs are 25% of the price of health care in this country, while only 3% of Medicare costs are adminstrative. Thus, a well run public option would drive private insurance costs down by increasing (or in many places creating) competition.  Further, because most consumers do not have the ability to choose health care plans now (in that the only choice they have is their employer’s selection) this would actually create a free market, rather than hinder it.  Naturally this would cut into the profits of insurance companies.  This is the part of the bill that is the most strongly contested and the public option as currently proposed is toothless and wouldn’t even be available to most Americans.

4. MedPAC on Steroids

Under this plan, general Congressional incompetence would be mitigated by giving the recommendations of MedPAC the weight of law, unless blocked by the President or Congress.  This allows incremental progress without the furor that arises every time legislation is debated.  Instead, experts in the field – not morons and demagogues – would set policy, and then it would have to be blocked by said morons and demagogues.  This turns legislative incompitence against itself, since it is so difficult for Congress to do anything that it probably would struggle to block MedPAC recommendations.  This sort of advisory committee recently recommended an end to the fee for service system in Massachusetts, which is the ultimate way to cut costs.  This is the trojan horse in the bill that might actually result in transformative change.

There are a bunch of other things out there, its a 1000 page bill after all, but those are my favorites.

The Rich get Richer

In Specific Facts on July 30, 2009 at 1:43 pm

After Goldman Sachs announced its record setting profits (and bonuses), the reaction was mixed: some people thought Goldman was scum and others thought it was a “great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money.” Probably the truth lies in the middle: Goldman is a money vampire, but they are also pretty scummy about it.

The list of Goldman’s offenses is astounding: juicing IPO prices that cost average Amercans billons of dollars, selling garbage sub-prime-backed morgage securities while betting they would fail, heavily trading oil futures leading to over $4 a gallon gas and receiving billions of dollars from tax payers (at the behest of former Goldman employees like Hank Paulson) and then only paying 1% in taxes (a total of $14 million) by shifting all of their money abroad. Understand, these things aren’t in dispute.  Goldman settled out of court for millions of dollars for unfair IPO and subprime mortgage practices, though it did so without admitting wrongdoing and all of the other things are in the public record.  This is just how the bank works, they figure out a way to exploit the system and then they pay a token afterward to make any questions go away.

Now, the latest Goldman Sachs get richer quicker scheme is high frequency trading, or using super computers and complicated algorithms to respond to market changes in milliseconds.  Unfortunately, in practice this works out to front running the market, which is the only explanation Harry Markopolos could give for Bernie Madoffs success (other than the Ponzi scheme it was).  By examining billions of trades at once, and responding in milliseconds, high frequency traders are able to capture millions of dollars in value a day just by getting there first.  Thus a two tier system emerges, where ordinary day traders are paying a “Goldman Tax” on every trade by losing tiny amounts of value because they don’t have the resources to compete.

This isn’t to say that Goldman is the only one doing high frequency trading, but of course they are among those doing it.  Goldman is the biggest and best at what they do and they are unparalleled at figuring these things out.  Thousands of the smartest people in the country, the sort of people who could win Nobel Prizes or earn Ph.D.’s in astrophysics are instead working on Wall Street, coming up with these zany ways to make money.  All that human capital is doing work that at its best contributes nothing to humanity, and at its worst actually makes everyone’s life a little more expensive.

If “The Gathering of the Juggalos” is the funny side to free market capitalism, Goldman Sachs is the horrifying inevitability: making money for the sake of making money, contributing nothing but involved in everything, too big to fail and capable of writing off the penalties of their malfeasance as just part of the big score.  Then its on to the next scam.

UPDATE

Ezra Klein has a great post up about a financial transactions tax that would amount to a government capture of the value stolen by high frequency trading.  It would also raise 100 billion dollars and change the incentives for the better.  Sounds promising.

 

All Profits Go to the Devil Himself!

In General Principles on July 30, 2009 at 12:23 am

While watching this video for the Insane Clown Posse’s “Gathering of the Juggalos,” which is hilarious for a million reasons, it occurred to me how incongruous an infomercial for “the most controversial music festival in the world!” is.  This event, which is for people who are on the periphery of society, and probably pretty comfortably so, is a sort of bacchanalian festival of low-brow fun.  Now, far be it from me to judge other people’s hobbies – every so often I sit in Barnes & Noble and read an entire graphic novel or two, but the juxtaposition of the all of these stridently offensive activities with the most banal of huckster mediums is just ridiculous.

This is the fun side of free market capitalism, if there is some market gravy out there – no matter how absurd or distasteful – someone will be willing to sop it up.  Now, people have been doing dirty deeds since before capitalism was even dreamed up, but it only gets silly once people start to run it like a business.  Las Vegas used to be this great mix of class and seediness out in the desert.  Now you can probably get your hooker comped if your pit boss likes you.

Even this particular brand of merchandising evil isn’t new, Hot Topic was first to turn disenfranchisement into cold hard cash.  It always seemed weird to me that all the kids who don’t fit in had to shop at the same store, like the bizarro world Abercrombe & Fitch, but I guess when you let your freak flag fly you are really just trying to attract like minded individuals.  Still, this infomercial is particularly shameless in its pandering.  I wonder how a person can still think they are being subversive after seeing all that spectacle wrapped up in a poorly tied bow* (seriously, Sugar Slam is the worst actress ever, woot woot), but maybe I am underestimating the mental gymnastics people go through in order to feel a sense of community.  Comic-Con was this week, I’ve been to Bonnaroo, and I’ve even watched reality television just to have something to talk about around the water cooler.  So maybe it’s easy to mock, and man is it easy to mock, but its hard to begrudge the “family” making its way to the “Gathering of the Juggalos.”

* I must restate again, how unbelievably poorly made this video is.  At one point they list the other virtues of the festival and it includes: (presumably evil) hay rides, “dudes on stilts,” the human cannonball, and carnival rides.  The Dark Carnival, where everyone is a sideshow freak!

Health Care Reform, D.O.A.

In Specific Facts on July 29, 2009 at 11:55 am

Matt Taibbi isn’t one to mince words.  If you haven’t read his epic takedown of Goldman Sachs do so immediately, so when he gives his opinion on health care reform he takes no prisoners:

This whole business, it was a litmus test for whether or not we even have a functioning government. Here we had a political majority in congress and a popular president armed with oodles of political capital and backed by the overwhelming sentiment of perhaps 150 million Americans, and this government could not bring itself to offend ten thousand insurance men in order to pass a bill that addresses an urgent emergency. What’s left? Third-party politics?

It is hard to agree with that, because I am one of those 150 million Americans. I campaigned for Obama, I was swept up in the possibility of change, and it was and is exciting to have adults running things again.

My favorite domestic issue was health care, because it is so unbelievably poorly run in this country that the potential is enormous. A better system would save the government from the disaster of entitlements looming on the horizon, it would invigorate the economy by allowing people to more easily leave their jobs and employers to get out from under the crushing costs of providing health care, oh yeah, and it would stop ruining people’s lives when they got sick. Health care reform is that rare intersection of fiscal and moral imperatives, the sort of issue that defines a Presidency.

I like that it was Obama’s top priority too, but when I saw Tom Daschle go down in flames, I started to get a little nervous. It wasn’t until I saw Obama just allow Congress to work it out on the fly, like a ditz thinking aloud, that I really began to despair. Congress needs leadership, otherwise things get messy, and Obama is selling the plan to the American people when, to quote Taibbi, he should “take the recalcitrant legislators blocking [his] path into a back room at the Capitol, and beat them with rubber hoses until they changed their minds.”

The plan(s) circulating now are absurd, they don’t control costs or provide more access. If you want to improve health care there are about 20-30 working models out there in Europe and Canada, and contrary to what people afraid of socialism think, most of them actually have more choice that our “free market” system where you can’t choose your insurance company and you only have the illusion of choice over your doctor. This isn’t a system that needs a tweak here and there, it is bursting at the seams with problems and yet people like Max Baucus are looking for a “bipartisan” solution like you can split the difference between a plan and nothing.

This is the fight that Obama said was so important that he couldn’t stop kicking gay people out of the military because he couldn’t spare the political capital. This is the change we can believe in. So I don’t care about Congressmen wondering if they can get reelected back home, I don’t care about hurt feelings, Clintoncare, bipartisan solutions, or socialism.  Take the reigns and stop leading by committee, Obama, because Congress can’t do this for you.

Is Marriage a Good Economic Strategy?

In Specific Facts on July 27, 2009 at 11:55 pm


This idea entirely belongs to my Microeconomics professor, Dr. Siddiq Abdullah, but it’s so good I have to post it.

Elasticity is the responsiveness of one thing to another, with the most common example being the responsiveness of quantity of a good demanded to price.  From a consumer’s stand point, and that means you, elasticity is a good thing because it keeps prices low.  So in general, it pays to avoid getting in a situation where you have to keep buying a good, even if the price goes up (think of being a taxi driver when gas prices are high).

Which brings us to the subject of marriage. Marriage is expensive!  Imagine what you could get for signing this contract: exclusive use of your person, fifty-fifty revenue sharing of everything you make for the rest of your life, the certainty of new responsibilities as the contract evolves, and worst of all, the contract lasts until death with an extremely expensive opt-out clause.  This price is far too high for nearly any good, but marriage is the price for the least elastic good of all, love.  The most important factors for determining elasticity are the availability of substitute goods and the necessity of consumption and once you fall in love there is only one thing and you must have it.  So we pay.

But then once a person gets married, the incentives are all backwards.  Before the wedding, both people have to be on their best behavior to ensure that no one gets sticker shock, but after the wedding the contract last forever and there are prohibitive barriers to exit so that previously suppressed idiosyncrasies come to the fore.  In game theory, this is the sort of contest where everyone always loses because of the tragedy of the commons – namely, the costs of cheating (not that good kind of cheating that would make marriage less expensive) are borne collectively while the benefits of cheating are accrued personally.  People go through years of misery because, without needing a contract year push, their partners never remember to take out the trash, find the clothes hamper, or always have headaches when they are in the mood.

A better economic strategy would be short contracts of 3 or 5 years.  That would be time enough to ensure that no one would be rash about jumping into one, but not so long as to ruin anyone’s life.  This would ensure that everyone stays on their best behavior to guarantee that their contract gets renewed.

Now the obvious flaw in this scheme is having children.  It wouldn’t do to have children and then complete your contract and move along.  However, this is also the obvious flaw with marriage too: your original contract is expensive to get out of, but once you have kids a hidden rider activates and now you are really stuck.  If you decide anywhere in the 18-22 years of this new deal that you wish to leave, the cost is so extreme that many people will think you are immoral to even try.  Surely if, instead of marriages, we had shorter contracts, then a system would be worked out to accommodate children to our rational, self-interested lives.  In the meantime, try to avoid having any children during your first contract, perhaps you can agree to a longer term contract the second go-round once you have made sure you know what you are dealing with.  I mean, this is why universities have a tenure track, and there is no way that is more of a commitment then having a kid.

Or even better, never fall in love at all, because all the gain is in getting people to fall in love with you.

 

Yoo Just Don’t Get It

In Empires of the Mind on July 27, 2009 at 2:42 am


John Yoo recently wrote an op-ed for the Wall Street Journal, titled Why We Endorsed Warrantless Wiretapping, defending the decision to violate the Foreign Intelligence Surveillance Act (FISA) and allow the NSA to intercept the communications of U.S. citizens, regardless of whether there was probable cause.  He employs the same trusted rhetorical devices: doomsday scenarios, fear-mongering, straw-men arguments, selective disclosure of facts, an appeal to patriotism, and quotes from past patriots, like Alexander Hamilton and John Locke.  But something struck me as worthy of pointing out.  The editorial is not a denial of wrongdoing.  Instead, it is a tacit admission that he and others knowingly broke a law they deemed to be “outdated” or, more precisely, inconvenient and prohibitive.  Rather than working to adapt FISA to fit the current geopolitical landscape and the war they claimed it prevented them from waging, the Bush administration, with cover from Yoo, chose to circumvent the law and allow the NSA to illegally wiretap American citizens.  On top of it all, the Inspector Generals’ report purports that the program went to extraordinary lengths to yield little useful information in the war on terror.  There are enough fallacies in Yoo’s argument to fill a book, but I’ll do my best to take on as many as I can.

FISA was first created in 1978 in reaction to Nixon’s questionable intelligence-gathering practices, employed to spy on political opposition and activist groups.   It called for greater judicial and congressional oversight over domestic intelligence techniques, requiring notification if any of the parties involved were US persons.  Fast forward to 2001, in the wake of 9/11, when the ability of our federal security agencies to protect against terrorist attacks was obviously in question.  In his editorial, Yoo presents this unpleasant hypothetical and pitches the only logical course of action (in his mind):

Suppose an al Qaeda cell in New York, Chicago or Los Angeles was planning a second attack using small arms, conventional explosives or even biological, chemical or nuclear weapons. Our intelligence and law enforcement agencies faced a near impossible task locating them. Now suppose the National Security Agency (NSA), which collects signals intelligence, threw up a virtual net to intercept all electronic communications leaving and entering Osama bin Laden’s Afghanistan headquarters.

Here, Yoo conveniently fails to mention that we had actually had the ability to arrest several of the 9/11 hijackers, had greater communciations between our domestic and foreign intelligence agencies been present.  A lack of communication between the CIA and the FBI led to the exposure of a major blind-spot once a foreign surveillance target made his way into the U.S.  The NSA, which is responsible for intercepting, analyzing, and interpreting foreign communications, has no jurisdiction within the United States.  In other words, they can listen to calls coming into the U.S., but not the other way around.  The CIA is responsible for intelligence outside the United States.  The FBI, in contrast, has jurisdiction within the U.S., and can act on intelligence gathered by the NSA, but is limited to domestic operations.  In fact, in the case of the the 9/11 hijackers, two FBI agents were working with the CIA on its Bin Laden team prior to the attack and were aware of their presence in the U.S.  They were prevented by the CIA from disclosing this information to the FBI, which would’ve resulted in tracking and surveilling the subjects.  James Bamford, author of The Shadow Factory describes this dynamic:

The CIA had FBI operatives working within their bin Laden unit, but when the FBI operatives found out that one, and possibly two, of the terrorists had visas to the United States, were heading for the United States, the CIA wouldn’t let them tell their headquarters that they were coming. Only the FBI could have put out alerts to stop Khalid al-Mihdhar and Nawaf al-Hazmi if they tried to enter the United States….The CIA was forbidden from operating within the United States, and the FBI didn’t know they were here, so the only way to track the terrorists was if NSA continued to monitor the conversations as they called back to the house in Yemen.

The house in Yemen refers to Al Qaeda’s base of operations prior to 9/11.  This brings me to the straw man argument I alluded to in my introduction:

It is absurd to think that a law like FISA should restrict live military operations against potential attacks on the United States.  As the 9/11 Commission found, FISA’s wall between domestic law enforcement and foreign intelligence proved dysfunctional and contributed to our government’s failure to prevent the 9/11 attacks.

Actually, the wall to which Mr. Yoo refers was created by the agencies themselves.   Furthermore, the actual metaphorical wall created by FISA was designed to protect against the government’s illegally listening to the conversations of its citizens.  Other countries have employed similar tactics, but Yoo’s sense of American exceptionalism prevents such a comparison from being made.  Further, isn’t that why the Department of Homeland Security was created; so that there would be greater inter-organizational cooperation?  I freely admit that my security clearance (or lack thereof) limits my understanding the secrets of our national security apparatus, but, in the events leading up to 9/11, the NSA lived up to its nick-name of “Never Say Anything.”  It seems to me that, if we have two complementary security organizations, it makes more sense for them to work in tandem, sharing intelligence and allotting the necessary resources, rather than illegally expanding the jurisdiction of one to overlap and effectively compete with the others.

Regardless of whether or not violating FISA and the fourth amendment were necessary for protecting the country against terrorism, violated they were.  This leads to another question: what is the point of a constitution, or laws, if there is no incentive to uphold them?  Let’s for a minute assume that the only recourse the U.S. had after 9/11 to prevent another terrorist attack was warrantless wiretapping by the NSA.  If that is the case, the constitution is really not sacrosanct after all, and the founders only gave us a living document that evolves with the times (a point I happen to agree with, though Yoo and David Addington, who keeps a copy of the constitution on his person at all times, would argue the contrary).  More importantly, it means the president of the United States has the power to violate any law he chooses, providing it is in the interest of protecting the nation.  In fact, this is something Yoo fully endorses:

In FISA, President Bush and his advisers faced an obsolete law not written with live war with an international terrorist organization in mind. It was to meet such emergency circumstances that the Founders designed the presidency. As John Locke first observed, foreign threats “are much less capable to be directed by antecedent, standing, positive laws.” Legislatures are too slow and their members too numerous to respond effectively to unforeseen situations. Only the executive can act to protect the “security and interest of the public.”

Translation: as long as the case can be made that violating the law is in the interest of national security, it is fine to do so.  Fortunately for President Bush, the subject of your correspondents’ piece, Mr. Yoo, was in charge of making the case.  Yoo’s point seems to be this: it is fine to break the law, as long as we are protecting the country.  If so, he should say so.  Then, we should collectively decide whether that was really the intention of the founders, as Mr. Yoo contends, and accept it, or whether we believe that no one is above the law, and we are bound by law to investigate and potentially prosecute those who break it.  And keep this in mind:

While the Bush administration had defended its program of wiretapping without warrants as a vital tool that saved lives, a new government review released Friday said the program’s effectiveness in fighting terrorism was unclear.

This is not to say that  we should start prosecution of Bush Administration officials.  I understand that we were and are at war.  But I do believe it is important to be a nation of laws, and we need to begin a dialogue about what to do with those who violate those laws, no matter who they are and why they thought it was justified.

Is Cheesecake Factory Gross?

In Specific Facts on July 17, 2009 at 8:21 pm

Ezra Klein weighs in on why Cheesecake factory is so popular, ultimately concluding:

Foodies have an unfortunate tendency to alight on a Unified Field Theory of Corporate Food: It’s bad for the environment and bad for workers and bad for animals and bad for waistlines and, above all that, a fraud, because it also tastes bad. This would be convenient, if true. If people weren’t actually enjoying what they were eating, then getting them
to change their eating habits would be pretty easy. But it’s not true, of course. They keep going back to the Cheesecake Factory because, well, they like it.

While it is certainly true that people enjoy Cheesecake factory (and I remember their firecracker salmon appetizer being pretty solid) there are other reasons for its popularity than the food quality.

For example, the restaurant is incredibly kid friendly, not just in the high chairs and crayons department, but because its menu has approximately one thousand items on it. Little Johnny wants egg rolls, Sam wants pizza, and Betsy wants a burrito; no problem! Their menu is a 20 page, full color book, complete with advertisements.  If you can’t agree on what you want to eat, then the Cheesecake factory is perfect. I don’t know for sure, but it definitely always seemed like more of a family place than a happening singles scene or a date place when I’ve been.

It’s also safe. You won’t feel like a square there, the place looks like a palace of cheese with art deco plaster columns and service staff in all white hospital uniforms. You’ll get taken care of, it won’t break your budget, and it has what you like, no matter what you like.

Plus, as James Joyner pointed out in his response to Ezra:

If you serve a 275 pound man an amount of food that would be appropriate for a 125 pound woman, he’s going to still be hungry at the end of his meal and therefore a dissatisfied customer. Because the marginal cost of additional food (especially pasta, potatoes, and the like) is negligible, it’s just good business to pile it on.

Which is the other reason the cheesecake factory is so popular. You definitely feel like you get a good value when you go there. I personally hate it when portion size is prohibitive and I can’t enjoy three courses without washing it down with self-hatred, but I imagine I’m in the minority. My $15 meatloaf was at least 16 ounces (somewhere between four to eight times the daily recommended protein intake) with at least that much mashed potatoes plus an equally huge corn succotash that I had to ignore out of self-preservation. Calorielab.com estimates that my meatloaf lunch clocked in at 1838 calories, or 92% of my daily requirement. If you brought the family there, eating family style would require maybe two entrees for five people (and you’d have mashed potatoes to take home, believe me).

Still, I wonder about Joyner’s point, I am a six foot tall man with a robust appetite, and I left more food than I ate at the Cheesecake Factory. It seems unnecessary to ensure that no one could ever finish their food, no matter how cheap potatoes are. I am willing to bet that the rate of return on increasing portion size turns negative well before where the Cheesecake factory landed.

So is the Cheesecake Factory Gross? No, tacky definitely, but it only makes you feel gross. 

Hova Makes His Move

In Specific Facts on July 15, 2009 at 5:34 pm

When one of my favorite bloggers, Marc Lynch, talks one of my great loves, hip-hop, my ears naturally perk up. However, while he is characteristically insightful, I think he misses a few key nuances in his analysis of the hegemonic Jay-Z.

Hova is clearly the most powerful man in hip-hop today, but his power is wasting, like Pentagon assets unsuited for future battles. Even though he is the most famous, wealthy, and, as the former head of Def-Jam, powerful rapper, he has never been regarded as the best or most authentic rapper. Without soft power there is no longevity in the game, which is why Jay had to quickly come out of retirement. He was unable to create a legacy that would last when he was gone. Thus, his power play on Nas was an attempt to shore up his weakest front, his street cred. Unfortunately, Nas murdered him on “Ether,” and Jay’s eventual co-option of Nas into Def-Jam was using strength in one area to make up for weakness in another.

So Jay is a hegemon, but with weak soft power, who must rely on a super abundance of hard power. This analysis ignores that Jay’s success is itself a form of soft power, especially in an industry that constantly name checks girls, cars and chains. Every rapper wants to be in Jay’s position, even if many of them think they are better rappers. Similarly, even when America’s global influence reached a low point with Bush’s disregard for the international community causing a backlash, the proof of its material dominance was attractive enough that its economic model was still spreading.

It is important to note that rap beef is not zero sum; many battles are never decided decisively and both rappers benefit. In some way a good feud is akin to international competition, because, unless one party scorches the earth (see 50 Cent versus Ja-Rule), both parties benefit from the increased publicity. However, if the relationship is too asymmetric then it becomes parasitic rather than mutualistic. The Game is like North Korea: contained and blustering, but the consequences of an attack are unknown and catatrophic. Just as North Korea is being treated like a nuisance rather than a real threat, Jay-Z has nothing to gain from a direct attack. Ezra Klein explores the possibility of a proxy attack on the Game, but why poke the bee’s nest? Jay could just as easily reach out to the Game and have him recanting everything by next week, while seemingly staying above the fray.

I tend to agree with Spencer Ackerman that the attack on Auto-tune is the real Hova power move. However, I think he misses the delicate balance struck here. The biggest conflict in rap today is between the “Hip-hop is dead” faction, based mostly in New York and featuring rappers who peaked in the mid-90s (no offense meant to luminaries like Nas and Ghostface, but Wu-Tang and Illmatic are over fifteen years old), and those who feel slighted because this overlooks the dynamic Southern hip-hop scene. Even though Jay is a New York rapper, he is too big to alienate a whole swath of potential record buyers, and so he finds a middle path. Auto-tune is ubiquitous, so even if it is associated with (marginally*) southern rapper T-Pain, attacking it won’t spark a regional backlash. Further, by associating auto-tune with ringtone rappers, the soft power equivalent of Haiti, Hova positions auto-tune as a method of selling-out. Since Jay-Z has everything except for soft power, this attack on auto-tune should be viewed as an attempt to reassert his own authenticity in a world of sell-out auto-tune rappers.

Even better, by having auto-tune loving Kayne produce the album, including the song “Death of Auto-Tune,” Jigga insulates himself from backlash. Clearly if you want to be less authentic than the Hove, be his guest (Kayne is probably too far gone for street cred at this point), but he made himself clear. This is akin to Obama’s tough stance on Israeli settlements, another grab at credibility, while having Hillary and Rahm around to ensure that his tough love to Israel isn’t misconstrued by Jewish-Americans.

*T-Pain is from Florida, which is inarguably the asshole of the rap world.  All rap that comes out of Florida is a turd. 

The War on Drugs: Graft-Versus-Host Disease

In Specific Facts on July 15, 2009 at 3:51 am

Since it has been mentioned in the last two posts, a full post on prison and drug reform seems warranted.  Eventually, I’d like to discuss the social/economic impact of the current criminalization of drugs, but first I’d like to consider the moral and ethical questions surrounding the issue.

First, why is it illegal to consume certain substances?

It’s not.  Its illegal to possess drugs, but from what I understand consumption is not punished (at least not by itself: if you are on parole, applying for a job, or driving a car you can be punished for consumption).  Of course, it is impossible to consume without possessing, so this seems like a moot point.  Philosophically, however, this means that drugs are illegal apart from the question of whether adults should be allowed to do with their bodies as they see fit.*  Similarly, distribution is subject to greater punishment than mere possession, because that is the act of inciting illegality.  The real crime of drug possession is disobeying the express will of the paternal state.

So on what basis does the state declare drugs illegal?

While the actual history of how and why drugs were criminalized is frequently absurd and racist, there are several rational arguments for drug prohibition.

For example, it could be argued that drugs are a public health issue, akin to extreme seat-belt laws.  As drugs are controlled by the Food and Drug Administration, whose role is to ensure the health benefits of consumable products, this seems to be the government’s position on the subject.  That drugs are illegal because their consumption is a public health concern is unconvincing because many of the least healthy drugs are legal.  If criminalization was to ensure that the public was insulated from damaging substances then legal drugs would have more nutritional merit.

That drugs inspire criminality is tougher to dispute, but such a claim is complicated by the fact that drug use itself constitutes criminal behavior.  Plus, many other things inspire criminality, including sporting victories and election to local political office. Surely it is best to just punish people for their criminal behavior, rather than create new, once-removed criminal behaviors to punish them for.

Perhaps the best reason for the illegality of drugs is the violence that accompanies the drug trade: from drive by shootings to Mexican assassinations to cocaine and poppy financed FARC guerillas and Taliban fighters.  It is undeniable that if you purchase illegal drugs (well, marijuana, opiates, or cocaine anyway, who knows where the trail of the stuff sold at Phish concerts leads) then you are a participant in a violent and oppressive chain.  But the question has to be asked: does the criminal control of the drug trade have anything to do with the fact that drugs are illegal?  We have one example of what happens after a drug is legalized in alcohol prohibition.  During prohibition criminal gangs controlled the sale of alcohol, but after alcohol legalization, traditional industries undercut the high-prices bootleggers charged, and soon the criminals were pushed out of the market (fortunately, drugs would soon be criminalized, so they wouldn’t be without work for long).

Would drug decriminalization serve as a panacea to the problem of crime?  Clearly not.  However, illegal drugs are a huge industry (estimates vary from $300-400 billion dollars a year globally) and all of the profits go to criminals, by definition.  Decriminalization would cut deeply into these revenues, provide a modest, but not negligible, source of tax revenue and end the need for the incredibly expensive drug war.

Perhaps the best argument against drug criminalization is the state should not be the business of locking people up for most of their lives for non-violent drug offenses.  Prison populations have swollen to the point that America has the largest prison population in the world, a fact that should cause every American great shame.  That the state, which was created for the protection of individual citizens, would now imprison millions of them for non-violent crime seems like the equivalent of Tobias Funke’s graft-versus-host disease: the implant is attacking the body.  We should be able to do better.

*I do not understand how a person could be pro-choice on abortion and in favor of drug criminalization.  It is the exact same argument: personal choice and the control of one’s body.  Plus, you get to sanctimoniously say “I wouldn’t do it personally, but I can’t decide for other people” in both cases.

The Trouble With Representative Democracy

In General Principles on July 13, 2009 at 1:36 pm

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The criticism that politicians lack the testicular fortitude to back unpopular or broadly-impacting reforms because they must maintain relations with a local constituency is misdirected. Representative democracy is ill-equipped to deal with long-term issues – like climate change, healthcare, and social security – or acute problems that require a fundamental overhaul, like our financial regulatory system. But the reality of creating a majority coalition among 435 congressmen and 100 senators in a two-party system crippled by partisanship (see stimulus package) is that issues prone to negative-spin, like prison and drug reform, are consciously ignored.

Take prison reform.  The United States penal system, by design or not, is fraught with flaws: overcrowding, racial disparities, draconian penalties for non-violent drug crimes, etc. To suggest that reducing penalties for certain drug crimes, or that treatment, rather than incarceration, might be a part of the solution, is to risk being labeled “soft on crime,” an undesirable epithet for a politician in a close race. Even if a politician were able to successfully provide treatment, rather than prison time, with great success to non-violent drug offenders, he or she can rest assured that, like Michael Dukakis, everyone will know the name of the first one to commit a violent crime. So what to do? Nothing, don’t bother. It’s not worth it. The risks of failure far outweigh the benefits of success. The affected population is already marginalized, largely isolated, and of no value to anyone but the individuals, their families, and their communities. Hell, even if you help them they probably aren’t allowed to vote in your state. Standing up for logical reforms could jeopardize the success of (slightly) more palatable changes to other issues, like education. Your opponents will tear you apart, you risk alienating your core constituencies, and your political career will be short and undistinguished. Best to stick to more popular reforms, like the old John McCain pork-barrel special, that will endear yourself to your constituency, keep your job for a few more years, and allow you to gain influence through tenure, like Teddy the Lion or Smokin’ Joe Biden.

For the reasons described above, the legislative bodies of representative democracies are a quagmire by design. One way to break the gridlock is to drive reforms through from above through a strong unitary executive and a general “fuck you” attitude. But, as history tells us, this approach has its limitations (see George W. Bush). Another alternative is to look at other forms of government. Say what you will about human rights violations perpetrated by the Chinese government, they know how to get that double-digit GDP growth, and have managed to implement, by most accounts, a fairly successful stimulus package.  I am not advocating either of these alternatives – Winston Churchill says the democracy is the best form of government except for all the rest – but these two approaches know how to take care of a stalemate in the legislative body.

That said, Obama managed to send an $800 billion stimulus package and a $3 trillion budget through congress, and is in the process of moving climate change and healthcare reforms through the house and senate before the summer is done. Maybe there is a third way to break the legislative stalemate: wait for the other guys to massively fuck up, and then ram it through like a freight train. Kudos to Karl Rove.