Monday, August 31, 2015

The facade of free trade with a military super power

There has been a lot of discussion about free trade in the news including TPP, TTIP, TISA and about 40 other agreements waiting in the wings. Now that Trade Promotion Authority has been set for President Obama, Congress will have a chance to vote on them up or down once they are presented. All of those agreements are being presented as "free trade" agreements.

CNN has a nice little chart showing the world's largest economies, with the US at $18 trillion and China at a distant second with $11 trillion. According to Wikipedia, there are 14 current free trade agreements in effect with the US. Clearly, there are many benefits to free trade. But is it really free trade?

The assumption we are asked to believe is that the US has built up the world's largest economy with free trade, but nothing could be further from the truth. For example, in my previous post, "The facade of the free market in global labor", I detailed the false assumption that when we trade with other countries, we are competing on a level playing field in the world labor market. There is no way American workers can compete with foreign labor where the government of our trading partner steps in to keep wages low for businesses. Yet, when we buy clothes, we are being asked to assume that the workers that created the clothes negotiated their wages in a free market.

There is another aspect I'd like to bring to the debate on free trade: the implied use of military force. The United States has been involved in one war after another for 214 years of its 239 years. To put this in perspective, 90% of the existence of the US has been supported by war.

The US has a current military budget of $600 billion, roughly 3 times greater than the next big spender, China and more than the next 7 countries combined, including China. The US has been the biggest spender on military force and preparedness for much of its modern life.

So when the US approaches another country for a trade agreement, is there a balance of power? Most definitely not. Consider the prospect of a third world country with a valuable resource like oil or uranium. Deal or no deal? No deal? Say hello to our jets, ships, tanks and boots. Deal? Please do your best to suppress wages so that our strong dollar can support your regime. Get the picture?

The current balance of power suggests that there is no way for any country to negotiate a mutually beneficial agreement with the United States. There are several sticking points with the agreements currently in negotiations that put our negotiating power perspective. Pharmaceutical companies are seeking to leverage US military power to ensure that their patent monopolies are protected. Seed companies like Monsanto, DuPont and Bayer are seeking to use American military force to protect their patent monopolies, by inserting provisions that allow GMO foods to be sold without labeling. Big Content, including companies like NBC/Universal, 20th Century Fox and Viacom, are seeking to protect their copyright monopolies through trade agreements by leveraging the implied use of military force.

Note the use of the language in the previous paragraph. In every example I included "military force". But when we read the news about free trade agreements, the use of force is never expressed or implied. Major media would prefer that most of us assume that the agreements were negotiated with a balance of power when they were not.

To be fair, the chances of war with any of the G20 countries is slim to remote. But the chance of indirect war say, with a third world trading partner of any of the G20 countries, is real. Everyone knows that the threat is real. Whether or not the threat can be carried out without worldwide political repercussions depends on who we're dealing with.

With such an overwhelming imbalance of power, it is impossible to say that any trade agreement with the United States was negotiated fairly and freely. Clearly, the US is relying more on military force than American innovation to compete with the world, and that is unsustainable.

Saturday, August 29, 2015

How Bernie might prove that the system is rigged

I want to share with you all a few memes that I found floating on the internet. First there is this one:

This meme reminded me of Elizabeth Warren, quoted as follows:
"Let's just be real clear - the game is rigged and it's rigged in favor of those who have money and who have power," Warren said in an interview on "CNN Tonight."
"Watch what happens in Wall Street. If you can hire an army of lobbyists and an army of lawyers then you get what you need out of Washington - Washington will make sure that the rules work for you," she said.
In response to Bernie Sanders, I see that the opposition is marshalling their forces. In the press, we see that none of his grand events are being televised live. The Washington Post has done some very interesting analysis of media coverage and found that Trump is surging because the media prefers to cover him:
Donald Trump’s surge to the front of the GOP presidential polls has occasioned not a little media attention and endless speculation as to why. You can disregard most of that speculation. The answer is simple: Trump is surging in the polls because the news media has consistently focused on him since he announced his candidacy on June 16.
There is a chart embedded in that article showing the share of attention given to Trump at the expense of the other candidates, including Bernie Sanders. This not a conspiracy theory in the context of media ownership. Remember, 6 parent companies own 90% of the major media. Captured in this meme is one result of that ownership:

I did a search to fact-check this one and didn't see that it was covered live, but saw that local affiliates for ABC and NBC did cover the story. From what I could find in my searching, I didn't see that it was covered live. To be fair, I'm not sure that anyone else is getting priority over other programming that generates revenue. You know, like CSI.

Then I see that the Democratic National Committee has abruptly changed their rules on debates. The DNC claims that:
While a six sanctioned debate schedule is consistent with the precedent set by the DNC during the 2004 and 2008 cycles, this year the DNC will further manage the process by implementing an exclusivity requirement. "Any candidate or debate sponsor wishing to participate in DNC debates, must agree to participate exclusively in the DNC-sanctioned process. Any violation would result in forfeiture of the ability to participate in the remainder of the debate process.
In previous years there were more than 20 debates on Democrat candidates and there is now a petition in circulation to get more debates on the schedule. Many are questioning the motives behind this schedule change and the timing is rather suspect.

All of this could probably be dismissed as just a coincidence. But I do find it interesting that even though Trump has admitted that he is willing to raise taxes on himself, that no other GOP candidates admit the same. Trump has also admitting giving more money to Democrats than to Republicans. He seems to have a rather murky history in terms of his sincerity to the GOP. Yet he's still getting the lion's share of press coverage of all the candidates for president.

And then there is the Super Delegate problem for Bernie. In the Democrat nomination process, there is a rather large fraction of delegates that can vote their conscience rather than vote for who is elected through the primary process. It's not the most democratic way to select the nominee, but I guess someone had to put the brakes on any populism that might happen to break out within the party.

Sanders is filling stadiums left and right. Often, he has to move to bigger venues due to their consistent underestimation of the crowds attending. He's not getting much major media press, but the Internet loves him. Sanders could be the first president elected without any major media attention leading up to the primaries and the convention, just with internet support.

But if he's not nominated, the system is going to get a lot more scrutiny, if not ring a few alarm bells.

Thursday, August 27, 2015

Review: i-Rocks KR-6402 USB Keyboard

As a writer, I like to have a good keyboard. I look back on the many keyboards that I've had and have taken stock in the evolution of the keyboard. I learned to type on a typewriter and when I got my first computer, I began to make the transition from typing on paper to typing on screen. That transition didn't take very long.

In all the keyboards I've had in the past, the one that I used the most is this Dell keyboard. I enjoyed it because it's simple, minimalist and easy to type on. Have a look at the venerable SK-8115:

This keyboard has served me well many years on many Dell computers. I liked the compact form factor and elegant design. I was doing fine with that keyboard until someone turned me on to one of these:

Hands down, that keyboard from HP, the Elite v2 is by far the best keyboard I've ever had. My fingers just fly on it and I've enjoyed typing on them immensely. But there is a problem with them: they're wireless. I've gone through three of these in a few years. The successor, the K3500, is noisy, and probably has the same Bluetooth hardware. That hardware probably works great on Windows, but it doesn't last on Linux and I'm not sure why.

So I'd rather have a wired keyboard if wireless is going to be a problem. And away I went, looking at all kinds of keyboards to find something to replace my beloved Elite v2. Note that I still have one at work that works. But that computer is running on Windows and for obvious reasons, more effort goes into making these things work on Windows than on Linux.

After many hours of searching, I put together a short list. This keyboard wasn't on top of the shortlist and only beat out another from SIIG on price. But I like the nice aluminum finish, the short, short keystroke length, and the bounce back I get from the keys. Mind you, I've only had it for about 12 hours, but I believe that KR-6402 from i-Rocks is the next great thing, at least for me:

This new keyboard is raised a bit compared to the HP to make room for two USB ports on the side. Need to do some quick file transfers? The ports are right where you need them, one under the Escape key and the other under the email key (the top corners, left and right).

I can tell you now that aside from a slightly smaller footprint, this keyboard easily matches the response and feel from the HP Elite v2. Like anything new, it takes some getting used to, particularly the angle of the keyboard, a slight departure, but other than that, I'm happy with it so far.

This keyboard will remove any urge I have had in the past to plead with HP to make a wired version of their Elite v2. No longer will I tweet or email to HP to get the wired keyboard I wanted. I have it now.

Goodbye, HP. See you the next time I need another printer - that would be about 10 years from now.

Wednesday, August 26, 2015

Shocker! Fiber to the home adds value to the home!

Community Broadband Networks is the first place I go for news about broadband. The reason is simple, community or municipal broadband networks are the wave of the future. I like to call it "muniband" for short, but I don't know if that will ever catch on.

Anywho, Community Broadband Networks has found yet another study that shows that fiber to the home adds value to the home. In aggregate, the study found that fiber to the home has added 1.1% to the GDP of the cities with fiber, with a total value of more than $1 billion. That number may seem small in a $16 trillion economy, but fiber to the home is still relatively rare compared to copper.

For people who see home value as an indicator of economic activity, this is welcome news. For cities looking to attract jobs and businesses, this is one more brick to put into your foundation to support your argument in favor of municipal broadband with fiber to the home.

Going toe to toe, municipal broadband is cheaper and more reliable than commercial broadband. Even if private providers like Comcast or Verizon run fiber, they are still going to be more expensive than a municipal broadband service for one simple reason: community interest.

Comcast and Verizon have both shown a lack of interest in the communities they serve. The city of New York is just now waking up to the fact that Verizon is not living up to their end of the bargain when they promised fiber buildouts in exchange for preferential treatment received from that fair city. Comcast is legendary for their customer service failures and selective buildouts (I know, I still don't have Comcast here).

On the other hand, community broadband serves the community by offering service to everyone in the community. The most famous example is the Electric Power Board in Chattanooga, TN where fiber is rolled out to every address and can serve everyone in that city with a gig for $70 a month. That's a gig up and down, while legacy incumbents almost always offer asymmetrical service where the download speed is far greater than the upload speed.

Comcast has announced plans to roll out gigabit service to all subscribers by 20126. But even that will still be on copper. That means they are still a legacy incumbent service provider, unwilling to make that shift to fiber. Fiber is far more reliable than copper and is essentially future proof. It just doesn't get any faster than light.

What is interesting to note here is how hard the incumbents have been fighting higher speeds and better prices for more than a decade. They didn't really start to budge until Google Fiber made national news, but now, legacy incumbent carriers are trying to buy time with announcements of higher speeds. It's a tactic used by Microsoft called "vaporware". Promises, promises.

Not only are legacy incumbent carriers reluctant to upgrade their networks, or build out beyond their most profitable service areas, they are fighting communities that want to build their own fiber networks. Incumbents are fighting to prevent communities from adding a fiber connection to their homes with community broadband, a connection that adds value to their homes.

When legacy incumbent carriers fight municipal broadband, they are fighting the people they serve. They are working hard to prevent local self-reliance, to stunt local economies and to retard the growth of fiber to the home which can increase home values. If you own a home and love your community but would like faster, more reliable internet access, you know what I'm talking about.

If you live in a community that has community broadband, and you're connected, thank your lucky stars. If you're not connected to community broadband and you're stuck with a legacy incumbent carrier for an "ISP", then you might consider agitating for community broadband in your town. That's what I'm doing and I won't stop until I get fiber to my home from Utopia, Utah's municipal broadband carrier.

When legacy incumbent carriers fight municipal broadband while refusing to expand or improve their service, they are violating the public trust. It is up to us to revoke that trust in the legacy incumbent carriers and restore it to a carrier that serves the community rather than belittles it.

By creating community broadband services in our cities and towns, we are creating an organization that serves the community. Community broadband services are not owned by an absentee corporation. They are owned by their respective communities and as a part of that community, share a common interest to serve and to prosper.

Monday, August 24, 2015

We learn by repetition, so let us learn together with compassion

I learn by repetition. I admit this freely to new acquaintances at work and in social situations. "By the way, I'm hard of hearing and I learn by repetition, so I hope you don't mind my asking your name again." Most people are very gracious when I tell them this and they don't mind when I ask their name again.

To me, the mere act of letting people know that I learn by repetition allows me the relaxation I need to learn their names. All I did was ask for help, and that in turn leads to relaxation for learning.

I bring this up because I have noticed that my children do the same things over and over again. The tread the same paths, they like to listen to the same songs, watch the same videos, say the same words or sequences of words, do the same tasks, etc, over and over again. They learn by repetition. They repeat what they do until they learn and/or become bored and find something else to do.

When I survey my own experience, I find that I get into a comfortable groove with habits and learn the processes or tasks of daily living by repetition. I make mistakes until I learn what works. I'm reminded of a friend who once told me this about standup comedy: We learn more when we bomb than when we get the laughs. I happen to agree.

So when I see people making a mistake, I let them learn from it. When ATT had all that trouble years ago with porting numbers from another carrier to their own service, I let them learn from it and remained their customer for many months afterwards. I apply this willingness to forgive to many vendors that I do business with. When they make a mistake in an ongoing business relationship, I let them learn from it. I don't terminate the business relationship for an infraction.

I do this with people, too. I've been quite forgiving of my friends throughout the years. This isn't to say that I've picked bad friends. This is to say that I want to treat people the way I want to be treated. I don't criticize my friends or loved ones for their mistakes. I give them the space to let them learn from it. I do this because I want the people most important to me to have the space they need to try again, to do better next time, to learn from their mistakes so that they learn what works. Most of all, I want those same people to give me the space I need to learn what works, too.

I turn now to love. I have a rather loose definition of love: Love is allowing others to grow to the greatest extent possible while doing no harm.

That seems so simple, but as so often in life, that simple principle is so hard to follow. We see someone do something we don't like and we feel uncomfortable with the feelings we have. So we try to change them, but that doesn't work because we can't change other people. I know, I've tried.

Now, as a father and a husband, I've had time to learn to live with others and learn to let the feelings pass - then I can take action if need be. Most of the time, I try to just let other people do what they need to do to learn. As long as they're not hurting someone else or themselves, I can just watch and ask if they need help.

There is a temptation among humans to distract ourselves or protect ourselves from our mistakes. Some people take up one form of addiction or another to lessen the pain of their mistakes. It's an easy trap to fall into because our culture encourages such activity so much.

The problem with trying to avoid the pain of our mistakes was revealed to me long ago by the following passage I once read, but cannot attribute: The lesson will be repeated until it is learned.

I found in life that I had a choice in response to mistakes. I could either avoid the situation where I noticed the mistake before or, take comfort in knowing that it's not the end of the world. I will more than likely get another chance to learn from my mistakes if I'm persistent and introspective enough to keep trying until I learn what works.

Live and let live. Let the feelings pass and then take action. Let my friends and loved ones make their mistakes and let them learn from them without criticism. They don't need any help from me to feel badly for their mistakes for, like me, they would do better if they could.

I live this way because I can't think of a better way to live.

Saturday, August 22, 2015

Drug testing for government benefits in all the wrong places

Drug testing for welfare recipients has been a perennial charmer for conservatives in elective office. I've been hearing conservative demands for drug testing for the poor, poor beneficiaries of welfare for 3 decades now. In the last decade, they finally got their wish at the state level and it hasn't worked out quite like they planned.

USA Today ran an op-ed in 2012 on that very issue. Arizona tested more than 87,000 welfare recipients and found just one drug user, saving the state at least some money:
Arizona was the first state to impose a testing program. In 2009, it began testing new welfare recipients when there was a "reasonable cause" to suspect illicit drug use. So how many of the 87,000 people subjected to the program have tested positive since then?
Just one.
One? The program disburses more than $200 million in aid. How much was saved by drug testing? $560.

Florida went through a similar adventure until the federal courts stopped them. Florida also charged welfare recipients $30-40 for the test upfront, money that would be refunded if the test was passed. 2.7% failed the test.

There are more examples we could peruse, but that is not the point of this article. The point is this: at the bottom of the housing bubble collapse were the biggest banks in America, getting emergency assistance to "save the economy" - more like "please save my sorry ass from bankruptcy!" assistance.

The bailouts consisted of approximately $16 trillion in emergency assistance, some might call this "liquidity", so that the biggest banks in America would not have to declare bankruptcy. $16 trillion? Isn't that about the size of the entire American economy for a year, you know, GDP?

Bernie Sanders was one of the men and women in Congress seeking an audit of the Fed. The purpose was to find out who got all that assistance that was so badly needed. What did we learn from that audit? We learned that many of the biggest banks got huge bailouts, despite their mistakes. Yet, no one, as far as I know, was ever tested for drugs before getting the money.

A search for drug addiction on Wall Street can yield a plethora of results like this one from The Fix website:
While popular culture teems with images of the coke-snorting Wall Street hot shot, the reality these days is as grim as a Florida pill mill. Like millions in society’s addicted class, hedgies are hooked on prescription pain killers.
If drug use on Wall Street is so pervasive, why were there no drug tests of the beneficiaries of all that largesse in 2008? If there were drug testing for bailout bank executives, there would be howls of protests from conservatives pundits and legislators alike. But at least we'd know the state of mind of the people who were running the biggest banks when they failed.

Remember, these Wall Street guys are "running the economy". They manage trillions in other people's money and they share the revolving door from the street to the Fed and the Treasury.

Somehow, I think testing for drugs at the welfare office is the wrong place to start. I think we should start at the Fed's emergency loan programs and the Discount Window. Welfare recipients don't tank the economy. High finance executives do.

Friday, August 21, 2015

The hypocrisy of executive pay

Listen to any CEO and they'll tell you that if you keep CEO pay high, you'll attract top talent and get better performance. Unfortunately the same CEO will also tell you that "good help is hard to find", yet they will never tell you that employees perform better with less pay.

This 2009 study from the Wall Street Journal shows a very clear negative relationship between CEO pay and performance. Here is the abstract of that report:
We find evidence that industry and size adjusted CEO pay is negatively related to future
shareholder wealth changes for periods up to five years after sorting on pay. For example, firms that pay their CEOs in the top ten percent of pay earn negative abnormal returns over the next five years of approximately -13%. The effect is stronger for CEOs who receive higher incentive pay relative to their peers. Our results are consistent with high-pay induced CEO overconfidence and investor overreaction towards firms with high paid CEOs. 
So the top 10% saw a negative return of company performance of 13%? That doesn't correlate with the line that top CEO pay attracts top CEO talent.

The report goes on to say that investors often are not privy to all of the terms of the contract and therefore cannot see all of the effects of the contract. In sum, there is almost zero expectation of transparency in CEO compensation packages, preventing shareholders from determining the fair value of the contract with the CEO. The lack of transparency also allows the CEO to extracts rents from the shareholders, a fancy way of saying they steal from the shareholders.

So top tier CEO compensation doesn't correspond with performance. How about employees? Do employees perform better with a raise? There is anecdotal evidence and some studies to suggest they do, but it's more than just pay. The question seems to turn on attitudes. Does management see employees as costs or drivers of growth?

If you work at Costco, you're a driver of growth and you contribute to the bottom line. Management invests in your value as an employee with education, training, and other benefits. If you work at WalMart, well, not so much. At WalMart, you're just a liability with costs externalized to the state. Who makes a better profit? The company with happier employees empowered to do their jobs.

CEOs will often complain that good help is hard to find. They say that there is a skills gap. That there are not enough qualified people to do the job they are seeking to fill. Noted economist Dean Baker had this to say in 2012:
[I]f there is a shortage of qualified workers then we should expect to see rapidly rising wages. The point here is straight-forward. If an employer wants to hire qualified workers and can’t get them by offering the current wage, then she offers a higher wage in the hope of luring qualified workers away from competitors. This is a simple example of “supply and demand.” If demand exceeds supply in typical free markets, then the price of the item should rise. In this case, an insufficient supply should mean that the wages of manufacturing workers is rising rapidly.
That was back in 2012 4 years after the bottom of the recession. Wages are still flat now as they were then. What this means is that if there is a skills gap, it has almost nothing to do with the lack of skills. Anyone familiar with the travails of the STEM crowd know that having a post-graduate degree in science, technology, engineering or mathematics, will not guarantee a good paying job. What that means is that when employers complain of a skills gap, it means that they are not willing to pay enough money to fill the job.

To put it bluntly, management often would rather support the bloated pay of the C-class with lower employee pay than to pay more money for employees that can fill the jobs and perform well. As companies like Costco and Trader Joe's have shown us, companies that pay more have happier employees and contribute to the bottom line.

Baker also offers the following point in his report:
[W]e should not be blaming the workers [for the skills gap]. It is always good for people to have more skills so that they can be more productive wherever they work, but the data do not suggest that the reason so many people are out of work is because they lack skills. Instead, the real reason that they are out of work is that our policy makers have not done what’s needed to create enough jobs.
The lack of demand for labor is a feature not a bug. The lack of demand for labor is a result of public policy that is written by the 1% for the 1%. The primary purpose of public policy has been, for at least the last 40 years, engineering the economy so that it will support bloated CEO pay rather than higher wages for the working class.

What can we do about this condition? First, we can vote and vote progressive. Studies have shown that a lack of voter participation can lead to inequality. Second, we can support progressive candidates for office like Bernie Sanders and Elizabeth Warren. There is hope, but to hope without taking any action is futile.

Action is the magic word, for when we change our behavior, our political and economic adversaries will have no other option but to change their behavior.

Thursday, August 20, 2015

internal vs external sources of motivation

Many years ago, I used to watch "In the Actors Studio". I was fascinated by the interviews of the famous actors I knew and loved then. They would all talk about that moment when they caught the bug. They were in an improv class, or they took an acting class in college, it was always some pivotal moment that they knew they could not do anything else for a living. I remember one actor who said that when he discovered acting, he had a firehose and he couldn't turn it off.

In reviewing the fields of study and performance, in almost every case, where we see excellence, we see people who are internally motivated. The greatest scientific minds were internally motivated. From Einstein to Darwin to Salk, the greatest scientists of history were all motivated by their own desire to know, to excel, to discover, to share.

In a similar vein, all of the greatest athletes were and are internally motivated. They practice, they compete, they study their craft. And with actors, they study, they compete (in the auditions), and they act. It is hard to find an example of excellence that is not internally motivated.

A simple cautionary sentence comes to mind. "If you're doing it for the money, you're doing it for the wrong reasons". I was a sheet metal worker for ten years. I did it for the money and I just could not keep doing it. My mind would not let me. So I got into IT. Then I got into writing and found my passion. I love IT, so don't get me wrong. I'm very good at it, but that work takes real effort. Writing is a talent. IT is a skill. Some people have a talent for IT. I'm not one of them. I have a skill for IT, but it's not my talent.

Skills and talents both require practice, but both come from internal motivation to perform. There is a song called "I Hate Mondays". It's about work and as a part of our culture, shows us how many people hate their jobs. I don't wake up on Monday and say that I hate that day. I wake up for work, even IT work and I never say that I hate my job. I enjoy my job because I find something to enjoy about it. I like to get to work early so that I'm prepared for the day. I enjoy solving technical problems. I enjoy helping other people. I enjoy the satisfaction of work well done.

There is another phrase that comes to mind: "You can't change people". This is the clincher. I have beat my head on this one many times to no avail. I've got enough bumps now and can move on. Now I just pray because the reality is, that's about all I can do now that I know that motivation to change must come from the inside.

When I see people suffer, or adapt to people that cause suffering in my life, I remind myself that I can't change them. I simply cannot provide motivation for others to change. I can only change myself and redirect my motivation somewhere else. But I can pray for them. Take note here, I'm not religious. I don't subscribe to any religion. But I have noticed the power of prayer and have faith in the existence of a power greater than myself, like the sun or the Universe. My tiny little brain is simply no match for the universe, so I pray to get along with it.

When I interact with children, particularly my own, I have no illusion that I can motivate them to do anything. I simply don't the power to be their motivation to do anything or all things. Whatever children want to do, that comes from inside, not from me. If it turns out that they're intelligent, charming, or nice, that's all them, not me. I just provide the environment for them to be that way. I can't change them.

When dealing with misbehavior, I remind myself that my goal is to find the problem they're trying to solve with their behavior and help them to solve it. Kids act out when they cannot find the skills they need to respond to the demands of their environment. It is up to us to teach them the skills they need to respond. No amount of punishment or threat of punishment can change them. That can repress the behavior, but punishment doesn't solve the underlying problem which is the lack of skills to respond to the demands of the environment.

I assume that kids would do better if they could, if they had the skills to respond to their environment, they would. I assume that the motivation is there inside to do better. Now because of my own upbringing, I may forget that from time to time, but the vast majority of the time, I'm on track. I want my kids to find their own motivation in life.

The reason for this is simple. I can't be there for them all the time, 24x7. So I do my best to live the example. I do my best to be the person I would like them to be. I use my own motivation to do that, and to let them use their own motivation to do what they do.

I have since learned to apply this to adults. Adults would do better if they would. I learned this rather late in life having taken some rather deep detours as a result of my upbringing. Everyone is pretty much the same. When people do not have the skills to respond to the demands of their environment they act out. People commit crimes because they lack the skills to adapt or respond to their surroundings. If they had the skills to respond, they would.

Living in peace is a skill. This is all that I want to teach. We can learn this skill together.

Tuesday, August 18, 2015

How Citizens United might benefit the liberal cause - with a caveat

I love replies to my blog posts. When I get a reply (which isn't very often *sob!*) I find interesting and compelling new information that helps me to check my facts, that provides informative insight that I had not considered before and that, at the very least, provides some proof that people are actually reading my blog. I really do enjoy the replies, so please feel free to respond to any and all.

Today, I'd like to share with you an article sent to me by Eric C. Jacobson, Public Interest Lawyer. He responded to my post, Let Trump feed the GOP these words, "money is speech", with a very interesting and very well informed perspective on Citizens United. Further, he says that there are liberal billionaires out there who are willing to support liberal causes with their money and that Citizens United frees their hand where it was not free before. He provides several very good examples of such people, billionaires who are sympathetic to the liberal cause and that are willing to throw their money into the race.

Mr. Jacobson does a masterful job of laying out the history that is the backdrop of this presidential campaign. In his article he has brought forth the reserved vitriol I would expect from an attorney, and does so with a certain poetic flair. His article is quite informative and provides a unique perspective on how the 1% amassed their power and how they have taken their toll on the middle class. He also provides an ominous warning that only the well-funded candidates win the presidency.

I found his article most instructive with the following passage:
A lost footnote to history (a highly important one) is the established FACT that “campaign finance reform” laws were first proposed during the Nixon administration in 1969 as a CONSERVATIVE response to Eugene McCarthy’s electoral insurgency. The proponents were Congressional incumbents who wanted to make it harder for challengers to acquire the funds realistically needed to get their alternative messages out to the voters. 
Here, Mr. Jacobson sets up his main point that Citizens United has freed the hands of all billionaires to contribute to their campaigns of favor, especially the liberal billionaires by neutering certain campaign finance laws. Mr. Jacobson has even set up a SuperPAC dedicated to the sole purpose of giving the Bernie Sanders for President campaign a serious lift.

While I applaud Mr. Jacobson's efforts to promote Bernie Sanders, I must admit having somewhat mixed feelings about his efforts with the SuperPAC he created. I'm not here to denigrate him or his SuperPAC for I want Bernie to win, too. It may well be that we need this SuperPAC to provide the outlet that liberal billionaires need to put their money where it will best support Bernie.

But I have several concerns that should ultimately be addressed sooner or later, but they must be addressed. I offer the following with the utmost respect for Mr. Jacobson. First off is the fact that Bernie is not just running a campaign for election to the highest office in the land. He is the head of a social movement to address the injustices of institutionalized inequality in all areas of life, not just economic policy. That movement is a movement of ideas, not money.

Second, as I've noted in my blog previously, billionaires make their money from businesses, often large private monopolies that provide products or services with few if any alternatives. When profits from those businesses are used as political contributions, the customers of those businesses become unlikely and perhaps unwitting supporters of politics they would never support. This why I promote and support candidates like Bernie Sanders and the SuperPAC to end all SuperPACs,

There is one last point I want to make. The reason we have such deep corruption in our government, at nearly every level is this pervasive sense of entitlement that the wealthy have. When the wealthy make a political contribution, they have a reasonable expectation of getting something in return. This sense of entitlement that I speak of is in direct conflict with every ideal of democracy.

There is no question that we must fight fire with fire. But fire is a dangerous servant and a terrible master. I believe that our democracy, like others before it, must decide what is more important, money or ideas. If we go with the money our democracy is almost surely lost. The only way to save our democracy is for our elected representatives to be dependent on the people alone. All of them.

Monday, August 17, 2015

The facade of the free market in global labor

When asked, our leaders will proudly tell us how we must compete globally. They will tell us how we must demonstrate the virtues of the free market here and abroad. They tell us that we must innovate and invent to compete in the world market.

Here's what they don't tell you: labor markets in other parts of the world are not free. I found a very interesting example of that here, at the Films for Action website. It's a nice short film documenting the labor struggle in Cambodia. When workers in garment factories ask for a decent wage, they are denied. When they protest, the government intervenes on behalf of the businesses that employ the workers. 

Sounds familiar, right? We had something similar here, though not as extreme, when Ronald Reagan fired all of the air traffic controllers in 1981 when they went on strike. Since then, we've witnessed an unrelenting war on organized labor in the United States. The result? In the 1970s, unions represented 34% of labor. Now it's about 9%. Much of this shift is due to government support of businesses, not labor.

The use of government force against organized labor is not a new phenomenon. It's been going on for centuries. We're just seeing it again, in Cambodia as we do here. Lately, we've been seeing more labor protests in this country as more and more people begin to notice that the playing field is tilted in favor of business, by design. We have been fortunate that labor protests have been peaceful to the extent that they have been.

That short film was produced by Labour Behind the Label an organization dedicated to improving workplace conditions for workers worldwide. They work to improve wages, working conditions and respect for the rights of workers, all over the world. They also work to expose the exploitation of workers worldwide. They show us that while absentee corporations in foreign companies pay fantastic salaries to executives living in wealthy countries like the US and the UK, they are not paying a living wage to their sources of labor. Remember, the US and the UK are the two biggest promoters of "free trade agreements".

Which companies are participating in the exploitation of garment workers around the world? Here is their list of companies that benefit the most from wage suppression in Cambodia. It is interesting to note that Versace and Armani are at the top of the bad-boy list. These firms sell very expensive clothes yet pay a pittance for their labor. I note also that Adidas, New Balance, Puma and Levi-Strauss are on the list.

I happen to like New Balance shoes. They're great shoes, and I enjoy wearing them. Unfortunately, when I paid for the shoes, I also paid for their politics. Worldwide.

The Clean Clothes Campaign is a network of 250 organizations worldwide, seeking a living wage for garment makers. Their website says it all. Workers all over the world are seeking a living wage, just as we are here, too. But I notice a common denominator in every country: where there is a struggle for a living wage, there is a government standing firmly on the side of business. Big business.

Yet we are told that capitalism is the foundation for a free market. Well, if a free market is what you want, then you must accept these protests, unions and negotiations as a part of that free market. Unions are a natural response to suppressed wages in a supposedly free market. Unions are a part of the free market, so get over it and deal, because that's never going to change. If businesses can organize, consolidate and coordinate their efforts with interlocking directorates, then labor can organize, too. What's fair is fair, right?

So the next time you're out buying clothes, remember that the price of the clothes includes the cost of struggle of the people who make those clothes. That cost includes government intervention in the market to suppress wages, unions and media coverage of that struggle.

That cost is the facade of the free market in global labor.

Sunday, August 16, 2015

Low voter turnout predicts inequality

For decades we've been hearing the mantra, "Get out the vote", and for decades, we've been seeing the numbers showing a slow, steady decline in voter participation. In the last mid-term election we saw the lowest voter participation rate since World War II. That long, slow decline extends over 70 years and is more pronounced starting in the 70s. Voter participation trends right along with inequality over the last 40 years.

Add to that a variety of efforts to stifle or suppress voter participation and you have a recipe for banana-republic-strength inequality. For the proponents of voter suppression laws, I have to wonder, at what point will voter participation be low enough?

This relationship between voter participation and income inequality has been proven in at least one natural experiment in Argentina after compulsory voting was abolished. As voter turnout decreased over the years, income inequality increased.

In the United States (the other natural experiment), voting is voluntary, not mandatory. Given our experience, if we do not vote, we are essentially giving our money and our power to someone else. That someone else is usually someone with more money and power, someone with the willingness to make the time to vote. Then that someone else will write the laws, get the benefits, and send our kids to war.

If there was ever a reason to vote, inequality is the most important reason. Forget everything you know about civic duty and remember that politicians listen to the money first. They're going to blow $5 billion on a presidential election to get someone in the White House in 2016. Someone is expecting a return on their investment. We might as well have a say in this election, right?

No matter how much money they spend, the people in power have to justify the outcome with votes. The powerful cannot just manufacture consent, though they love to try. People are watching, and consent is hard to get if there is suspicion or even evidence of fraud at the polls.

Yes, it is true that many people think that their vote doesn't count, but it does. Every vote counts. Just ask B-1 Bob Dornan. Elected officials need to show that there are votes and that they are being counted honestly. They need to show that the winners were elected, fair and square. For if they do not, there will be unrest, protests and perhaps a change of government.

If we truly believe that inequality is the bane of democracy, then the antidote is the vote. When we are all heard, we can reverse the trend of inequality and bring about an economy that works for all of us.

Friday, August 14, 2015

4 hours of TV a day does not a democracy make

According to the Bureau of Labor Statistics, Americans spent an average of 2.8 hours a day watching TV in 2014:
Watching TV was the leisure activity that occupied the most time (2.8 hours per day), accounting for more than half of leisure time, on average, for those age 15 and over. Socializing, such as visiting with friends or attending or hosting social events, was the next most common leisure activity, accounting for 43 minutes per day. 
Norman Herr, Ph.D, professor of Science Education at California State University, Northridge, has compiled a number of interesting statistics on American life, including this one:
According to the A.C. Nielsen Co., the average American watches more than 4 hours of TV each day (or 28 hours/week, or 2 months of nonstop TV-watching per year). In a 65-year life, that person will have spent 9 years glued to the tube.
Perhaps Nielsen has an optimistic bias in favor of TV, but if they are right, 9 years is a long time to spend watching TV. Between the two of those sources, we're looking at 2.8-4 hours a day of just sitting and watching TV. That just boggles my mind. For the purpose of this blog post, let's assume that Nielsen is right since their sole purpose is to capture data on how we use TV and other devices as a business model.

4 hours a day is 28 hours a week. That's almost a part time job, just watching TV, keeping up with current events and tracking plots of the shows that people want to watch. For men, most of that is probably sports, given the way ESPN likes to get it's lineup tacked onto the basic cable package.

Watching TV, despite what we might think, takes a lot of effort. To watch TV, the viewer has to sit still long enough to get enjoyment from the programming. They have to time their potty breaks if they are not time-shifting. Time-shifting is recording programs for later viewing and it's a common practice. Then what happens on TV is committed to memory for discussion later with friends and family.

4 hours of TV a day would explain why some people who run for president are preparing to spend one billion and more on their campaigns for 2016. Air time is expensive. From production to the air, it all costs money. If we can reasonably expect most people to watch 4 hours a day, then we can expect that someone is going to see a commercial for a leading candidate for president.

The sad part is, many people make decisions based on what they see on TV. For example, it is plausible that many people make a decision to buy toilet paper based on the opinions expressed by two animated bears. Um, what exactly do they do in the woods again? If TV can sell toilet paper, it can sell a presidency.

That 4 hours of television time is time that could be spent pursuing a trade or formal education, raising a family, running a business or, God forbid...participating in civic life. If people would rather stay home and watch TV than to get off their but and vote, we have a problem.

Maybe that's the point of TV.

We now have the ability to educate and inform ourselves with the internet. We can watch just about anything we want to watch on YouTube, Netflix, Vimeo and a plethora of other online video services. We can research every candidate for their funding, their statements and their votes. We can check to see if they are philosophically and ideologically consistent. We might even be able to determine if they work for us or not.

So even if we see it on TV, we can still fact-check our candidates. We can determine if their actions are consistent with our desires of how a government should be run. As more and more people cut the cord, we can have a reasonable expectation that Americans will become more literate, more capable of discerning the issues from the candidates, and whether or not the candidates are representing our interests. As Americans cut the cord, they will have to learn how to use the internet to get the information they want.

That might mean having to spend less time watching TV and more time learning to live in a connected society. That might mean we spend more time learning how to use other sources than major media to form our opinions about who should sit in the White House.

Wednesday, August 12, 2015

The first act of the next Congress should be The Citizen Equality Act of 2017

More on Larry Lessig today. As I noted yesterday, Lessig is (and has been for many years) making a very significant contribution to the question of our elections and how they are run. He has a new video (2.5 min) and webpage which describe The Citizen Equality Act of 2017, an act to make it easier for everyone to vote and to reduce or eliminate the influence of big money on politicians.

The ideas proposed by Lessig spring from a concept from Federalist Paper #52. That concept is that there should be a branch of government that is dependent upon the people alone. This is what the Framers of the Constitution had in mind. They did not want a legislature that was dependent upon the money from a privileged few, they wanted the legislature to be dependent upon all of us, The People.

That means 3 really big things:

  • Equal right to vote. That means that every citizens has a guaranteed right to vote. That also means automatic registration and moving election day to a public holiday so everyone has a chance to vote.
  • Equal representation. That means an end to gerrymandering so that there are no more safe seats in Congress or our statehouses.
  • Citizen funded elections. Every voter gets a voucher to use for campaign contributions or matching funds for small contributions. There would be an anti-corruption act to remove the connection between money and time in prison lying in wait for those who persist with the old way. Then we can also make sure the revolving door would be shut.

Lessig is also considering a run for president, but this late in the game, I'm not so sure that he's a viable candidate. I think he'd be great as commissioner of the Federal Election Commision in Bernie Sanders' cabinet. His ideas are sound and they build off of ideas proposed by seasoned politicians who know our elections have gone off the rails.

It's worth noting that Sanders has just introduced a bill to make Election Day a holiday. Now we get to see who would be against that idea. In the same vein, Lessig makes an interesting point. As he stated in his video, "We're putting together a package that together would create a meaningful political equality for all American citizens. That commitment to equality should not be controversial in American. But if it is, then let's have that fight on these terms. Let us defend the idea of equal citizens and let those who oppose it explain why they're against it."

Tuesday, August 11, 2015

There can be no other reforms before this one

So there I was trolling for something to write about this morning and I saw this:

That is Lawrence "Larry Lessig". I follow him on Facebook and it seems that he's released a new video with a very powerful message:
There can be no reform of government of any kind until the money and corruption in government are removed from government. 
Lessig is one of the greatest men in politics, but most of us have never heard of him. I've been following him in politics for years. You can find his Google+ profile here. He's a law professor and activist. In the context of politics, there is no other person I admire more as he is one of the few who have found an issue central to all others: there is no place for corruption in government, and until big money is removed from elections, there can be no other reform. It's that simple.

He is the only person in politics I see across the spectrum that is making corruption and money in government a central issue in his campaigns. He has pointed out that none of the major candidates have taken up this cause as central to their campaigns.

Until we can have a national anti-corruption act that has real teeth and can add meaning to the idea that all citizens are equal, no other reform is possible. It doesn't matter if you're conservative, liberal or just a moderate. Zero reform is possible until all votes count equally. Zero reform is possible until all citizens reclaim the right of nomination. Zero reform is possible until we can be sure that laws are passed based on their merits rather than the money behind the bills.

I love what all of what Bernie Sanders is doing and promoting. I see that he is working with Black Lives Matters and I see that Black Lives Matters wants to see reform. Bernie has added new planks to his platform to address their concerns. But even for BLM, as powerful as their message is, it won't mean squat to the men and women who will use their billions to block the reforms needed to make Black Lives Matter to the police.

The same is true for all the other reform ideas that Bernie is promoting. The ideas are just ideas until we can root out corruption in government and restore democracy. Bernie is well aware of this, so it would be nice to see him make corruption a central issue to his campaign. I already see that he wants to make election day a national holiday. That's a great start, but we are just spitting against the wind until we remove big money from elections. Nevertheless, I see Bernie as our best hope for restoring our democracy so far.

I love what Elizabeth Warren is doing with her campaigns against the big banks. I'm not happy about the bailouts, too. She has great ideas for reform and I especially like the idea of of a nice strong wall between commercial banks and regular banks. In other words, let the wealthy gamble without government insurance. That would be real reform. But again, that idea doesn't mean squat to the men and women who want to rule this country with money rather than respect, diligence and courage.

I was a big Obama fan in 2008 (I still like him, but I'm tempered by experience). I saw him as an agent of change and hope. Then I saw how big money turned him around. I see how he is campaigning for trade agreements that are simply too noxious for Americans to bear the burden of, the TTIP and the TPP, to name a few. Perhaps Obama knows all too well, that until big money in politics is removed, until we have fundamental reform of campaign finance, NO OTHER REFORM IS EVEN POSSIBLE.

Lessig understands and communicates well that simple concept. He quotes Jefferson's wisdom that all men and women are created equal. But he reminds us that Orwell noted a corollary: that some are more equal than others, even in a seemingly capitalist country.

I urge you to consider Lessig's work in the context of the 2016 presidential election. Review to learn the facts about money in politics so that you can understand the government reforms so dear to your heart in the context of the corruption that would prevent those reforms from ever becoming law.

Our Constitution promises citizen equality. It’s time to make that equality a reality. The only way to make all votes equal is to change the way campaigns for elective office are funded.

Monday, August 10, 2015

We live in a new age of limits and that has nothing to do with Jimmy Carter

I remember the Age of Limits under President Jimmy Carter. I remember how unhappy I was that he was giving away the Panama Canal. But I also remember the debates between Carter and that retired actor, Ronald Reagan. I remember how Reagan sold us the prospect of unlimited optimism if he were elected president.

So I decided to have a look at the debates again to see if I was right. There is a great video from the Ronald Reagan Library with the full length debate on hand on YouTube. This is just one of the great things about YouTube. YouTube has become a worldwide repository of culture. It's incredible that we have such a service at all a service that is free.

Reagan and Carter both seemed to agree that Carter's presidency was an age of limits. Carter was intent on promoting conservation and self-reliance. Reagan? Well, I'm not so sure. He seemed more sure of his economics fixing the problem rather than having specific solutions to the problems that Carter was trying to solve.

In 1980, our country was in the midst of very high inflation relative to the low inflation that we seem to enjoy now. Inflation was running about 14%, mostly due to the increases in oil prices in 1974 and 1979. These increases were due to events beyond Carter's control, but Reagan did his best to make Carter look the fool. Nevermind that Carter was at the time promoting drilling and coal mining to help alleviate the pain at the pump.

In the same debate, Reagan pumped his tax cuts as a way out. Reagan also responded to Carter's criticism of the tax cut plans as inflationary. Reagan said, "Why is it inflationary to let the people keep more of their money and spend it the way they'd like, and it isn't inflationary to let him (Carter) take that money and spend it the way he wants?"

34 years later, we're back in a new age of limits. Reagan got elected, enacted his tax cut plan and the rest is history. We live in an age of limits, but that's just for ordinary people. For the wealthy, there are, apparently, no limits to the aggregation of wealth into the hands of the few, the privileged, the anointed. When Reagan used the term "people", he probably wasn't thinking of the 99%.

Wages have stagnated for about 34 years. In fact, last quarter, wages rose at the lowest rate in about 34 years, 0.2%. That would take us back in the recession of 1983. We have a belligerent majority in Congress intent on cutting government spending despite the fact that only people who have any extra money to spend are hoarding it rather than spending it. This is the age of limits I'm talking about.

Inflation is what you get when too many dollars are chasing too few services. The low inflation we've seen in the last 8 years is a result of too few dollars chasing too much supply. Oh. I guess that's what Reagan meant by supply side economics. So where did all that money go? Well, there's about $2 trillion parked offshore by the richest, largest corporations. In the last 5 years, 95% of all the new growth in the economy went to the top 1%. Where did that money go? It's parked in assets like stocks, bonds and property. That money is not circulating. That would explain the low inflation we have now.

This siphon on our economy has been going on for a long, long time and only accelerated to the point of near collapse in 2008 and it continues today. Without the bailouts, the economy would have corrected itself. With the bailouts, the wealthiest people get the bailouts and everyone else pays the taxes to cover for them. Life is great if you have a really good tax attorney.

It's time to rephrase and reframe the question that Reagan posed. The question that Reagan asked in the debates in 1980 should be rephrased and reframed as follows:
Why is it inflationary for the people to keep more of their money and spend it as they would like, and it isn't inflationary for the wealthiest corporations and people to keep it and spend it the way they'd like?
Because that money isn't circulating when it's parked in assets. This is the reason why our economy is still weak today. This is also the reason why wages are stagnating. The only way we can support the enormous grow in executive compensation is by suppressing wage growth. how is that done?

Through public policy. Who writes public policy? The 1%.

Saturday, August 08, 2015

How legacy incumbent ISPs fight the economic benefits of community broadband

I'm a big fan of community broadband. Community broadband is, simply stated, a network built by the community for internet access to serve the local community and public interest. There are numerous examples in America of community broadband. In fact more than 450 communities have built their own networks.

The most famous is Chattanooga, TN, a city that built a fiber to the premises (residential and business) network so that everyone in that city could have fast, reliable access to the internet. Their network arose out of a sincere desire by the Electric Power Board to serve the community. When Comcast became aware of EPB, they began a campaign to stop EPBs plans. They launched lawsuits and political campaigns designed to malign a government owned network as unfair. But the locals didn't believe Comcast:
Comcast claimed that a publicly owned fiber optic network was unnecessary because the company could “meet the telecom needs of Chattanooga.” In Comcast’s vision, Chattanooga’s telecom needs did not include building the first citywide 1Gbps network in the U.S., even though that network ultimately drew national media attention and attracted new businesses and entrepreneurs to Chattanooga.
I live in a city that could have built fiber to the premise for every address. Utopia, the Utah Open Infrastructure Agency was the agency to build that network, but the local and incumbent ISPs, Vivint, Centurylink and Comcast, have waged a very successful war against Utopia to prevent further adoption of community broadband in this city. Their lawsuits, foot-dragging and political machinations have stalled Utopia by at least a decade. Here in West Valley City, instead of providing everyone with fiber to the premises, Utopia only serves about 16% of the addresses.

When we hear the legacy incumbent ISPs talking about "what is fair", their talking point is that it is not fair when government provides a service that directly competes against a private provider of the same service. What private providers don't say is that they are not willing to provide the service that the city rolls out instead for the community it serves.

In a 2012 report by the Institute for Local Self-Reliance, the economic benefits of community broadband are described in detail. The report describes in detail, the plight of three communities seeking better broadband from absentee corporations that are only focused on the bottom line rather than the interests of the communities they serve, if at all. Community Broadband Networks (a part of ILSR) has compiled many examples of the economic benefits of community owned networks here.

As EPB competition prevailed in Chattanooga, ATT and Comcast both dropped their rates and increased speeds in their offerings. This is an indirect benefit as lower rates for everyone means that they have more money to spend locally. The EPB network provides gigabit access to the internet and that has attracted entrepreneurs and jobs to the region, just like Kansas City, Missouri, a town where Google Fiber has sprouted.

The ILSR report also describes the ferocious opposition of legacy incumbent service providers to community broadband. The lawsuits, the politics and attacks in the press were all designed to prevent, malign or prohibit community broadband just to ensure that incumbents could take their own sweet time about providing a better service. All in the name of "fairness".

Fairness, in the words of the legacy incumbent service providers, doesn't include raising rates when there is little to no competition. Fairness doesn't include unreliable or slow service. Fairness doesn't include using political contributions from corporate treasuries to defeat community interests.

So when you hear about a legacy incumbent ISP fighting to keep government out of the internet access business, remember that they are fighting against fairness. They are fighting against economic development. They are betraying the public trust.

Friday, August 07, 2015

A free trade agreement prescription for doctors and their crocodile tears

Everyone sees the doctor once in awhile. They wear nice white smocks with suits and ties. They work in clean offices with secretaries, nurses and expensive equipment. They enjoy their work with patients, watching them improve or maintain their health over time. At least that was what they signed up for. Not so much anymore.

In March, Geneia released a career satisfaction survey with the following results:
Today, Geneia released the results of our nationwide career satisfaction survey of practicing physicians. The findings are alarming. For starters: 84% of physicians believe quality patient time may be a thing of the past, and 67% of those surveyed know a physician who is likely to stop practicing medicine in the next five years as the result of burnout.
Uh-oh. These findings are indeed alarming. They're getting burned out. They're working too hard. They're not having very much fun. How did this happen? From the same report:
In our survey, we asked physicians to describe in their own words the obstacles that detract from their “joy” in practicing medicine. We received comments from 416 physicians, and while 14 of them told us that they’re still experiencing joy in medicine, the rest—402 physicians—told us, in very clear terms, that they are not. Most often cited as the top complaint? The corporatization of medicine, and the resulting recordkeeping and patient quotas demanded.
That is not a pretty picture. Only 3% report joy in their jobs? This is what we're walking into when we see a primary care physician? Can physicians give us the best possible care when they're not happy with their jobs?

Geneia is asking one of the right questions: how did we get here? They point to a long term trend of doctors selling their practice to get out of the business side so that they could enjoy the patient side. Seems like a reasonable thing to do. They've outsourced much of the administration of their work so that they could focus on the patient. They've stopped minding their own business and now the corporations that run their business are seeking to externalize their costs onto those same doctors.

This is reflected in the complaints of some doctors as seeing more paperwork and fewer patients. Doctors are doing more menial tasks rather than seeing more patients. They are also seeing a reduction in compensation. Well, that might be expected when they stop minding their own business.

This is yet another example of public policy written by the 1%. A report released in 2014 by the American Association of Medical Colleges lays the blame squarely on Congress. Their report debunks some of the myths surrounding the doctor shortage we're seeing in America. It's not exactly a scathing indictment, but it does point out that Congress needs to increase the number of people that can get residency positions so that they can graduate and practice medicine, to wit:
MYTH: Simply increasing the number of medical school graduates will fix the physician shortage.
FACT: Increasing the number of medical students is a necessary first step to addressing the doctor shortage, but a doctor cannot practice independently without residency training (GME). Unless Congress increases Medicare support for GME, the number of physicians per capita will actually decrease.
On a national level, it's really up to Congress to increase the number of practicing physicians by increasing Medicare support. Unfortunately, we have a Congress with a majority of men and women dead set on reducing or eliminating the Medicare program. They sincerely believe that the free market can prevail once it is freed form the burdens of the government.

Who has been setting public policy for at least the last 20 years? The 1%. Who makes up a significant fraction of the 1%? Medical specialists earning at least $323,000 a year (that's where the 1% start).

Crocodile tears I say. The doctors made their own bed, let them sleep in it.

There is an interesting solution beyond just increasing Medicare residency. We have a shortage of doctors worldwide, especially in developing countries. Why not globalize health care? If Obama wants a trade deal to sign before he leaves office, I found a great idea that could do the trick.

The idea comes from economist Dean Baker director of the Center for Economic Policy Research. Here's the idea: create a worldwide standard for the practice of medicine. Then we bring medical students from abroad to train and study here. Then when they are licensed, they work here as doctors for a much smaller fraction of what domestic doctors earn, thereby driving down prices and meeting the demands for service.

Foreign residents would then pay a tax on their earnings which would be sent back home to finance the training of more doctors so that there is not a complete brain drain from the originating country. Foreign doctors living here and practicing medicine would be happy to work for say, $80,000 a year since their education is financed by the government anyway.

The last leg of this proposal would be to let the government finance medical tourism:
For example, heart surgery in a US hospital can easily cost more than $200,000. Hospitals in India and Thailand can offer comparable quality care for $25,000. This cost difference can easily cover the travel expenses of the patient and immediate family and still allow for enormous savings. 
That would be a trade deal worth working for, Mr. Obama. Forget TPP and TTIP. Let's globalize health care so that doctors can get back to the joys of practicing medicine again.

Thursday, August 06, 2015

A natural experiment between doctors and dentists

When most people think of health insurance, they automatically assume that dental care is excluded. In fact, most people don't really think of dental insurance much at all, at least until the next visit. Relative to health insurance, dental insurance has a tiny premium deducted from the paycheck of most people. But when people go to the dentist, though most routine procedures are covered, anything beyond that packs a wallop for the customer.

As Paul Krugman notes, this "skin in the game" should provide adequate cost containment for dentists, but that's not what is happening. In fact, dental care is one of the components of health care that has been rising much faster than inflation. I think a clear sign of this is what I see at my local dentists office.

My local dentist office is very nice, with all new construction, built to custom specification for this dental group. They just moved there a few months ago and the office is a jaw dropper. Big screen TVs are in every room. There is state of the art equipment and facilities. The reception area is beautiful with open ceilings, nice furniture and a nice view of the mountains to the west.

They are also running a contest, with a range of prizes including free dental care for life for one very lucky individual. Perhaps that prize is a tacit acknowledgement that dental care is a very high out of pocket expense. With all that is happening at my dentists office, the move, the new digs and all the new gadgets and technology, they must be rolling in the dough.

Research suggests that because of the lack of involvement by insurance companies and government insurance, dentists have the freedom to raise prices faster than inflation. For most of us, dental insurance covers just the basics and anything beyond that? We're lucky if we get half covered by the insurance we do have. It should be noted that Medicare doesn't cover dental costs, which more than a bit ironic since we tend to lose more teeth with age.

An article at the Huffington Post notes some very interesting, if a bit dated statistics on how much money dentists earn:
According to the American Dental Association, the average net income in 2009 for general dentists in private practice was $192,680. The average for specialists, including orthodontists and dental surgeons, was $305,820. By comparison, the average income for pediatricians and family practice physicians in 2012, according to WebMD's Medscape, which tracks physician compensation, was $173,000 and $175,000, respectively. To be sure, many dentists make significantly less than the average, and their prices reflect that. And dentists who don't own their own practices or who work in public health settings typically make less than general dentists in private practice, and considerably less than specialists.
$300k for a dental specialist? That's close to what a heart transplant specialist makes. According to Medscape, in 2014, cardiologists earned an average income of $351,000, slightly down from the previous year. Cardiologists have seen their income decline slightly between 2013 and 2014. Judging by my local dentist's office, that's the opposite of what has been happening for his profession.

BenefitsPro, a website dedicated to tracking employee benefits has noted that dentists are working hard to stay out of public health care to ensure they can charge "market prices" for their services. Dentists have also largely escaped the new regulations under Obamacare. What really makes this interesting is that economists and the Congressional Budget Office have noticed a major slowdown of health care spending as a result of Obamacare. Not so much with dental care.

So the conservatives have got it wrong. When people have more skin in the game, the dentists have shown us that costs rise because there is less insurance or government oversight to contain costs. Expert knowledge of an industry is what is required to contain costs. Fortunately for dentists, most people are not experts on dental care costs.

Perhaps it's time for an Obamacare just for dental care.

Wednesday, August 05, 2015

The thinking behind the LIBOR scandal

In recent years, we have been treated to many scandals, but what is surprising is that the mother of all financial scandals came and went with hardly a mention in US politics: The LIBOR Scandal. As I read the articles on that scandal, I still find myself asking the same question: When you're making 2 or 3 million a year, how is it that you need to cheat to gain even more money? This is the question I would ask of a man named Tom Hayes, the ringleader of a massive collusion between banks and their traders.

What was the LIBOR scandal about? Here is a quick synopsis from Wikipedia:
The Libor scandal was a series of fraudulent actions connected to the Libor (London Interbank Offered Rate) and also the resulting investigation and reaction. The Libor is an average interest rate calculated through submissions of interest rates by major banks in London. The scandal arose when it was discovered that banks were falsely inflating or deflating their rates so as to profit from trades, or to give the impression that they were more creditworthy than they were. Libor underpins approximately $350 trillion in derivatives. It is currently administered by NYSE Euronext, which took over running the Libor in January 2014.
The details of this series of crimes are easy to find and have been well documented. The banks involved included UBS, Royal Bank of Scotland and Barclays, to name a few. Internationally, 20 big banks in all were involved.

But what I find interesting in this whole affairs is that a group of men decided, upon their own volition, to collude together to manipulate an interest rate that is used to benchmark around $800 trillion in loans. These are men who still wanted more even though they were making millions every year.

These same men like to talk about free markets, too. Oh, sure, they will wax on and on about how important it is for the market to decide how to allocate resources, openly and transparently. But now we see that if they had their way, their idea of work would be tweaking the market for an hour or two a day at their computers, and then go home thinking that a good job had been done.

The Independent of the UK reports that Tom Hayes earned 1.8 million GBP at UBS to 3.5 million GBP at Citigroup. Yet the man still felt compelled to cheat the system that the rest of us depend on for financing, costing the rest of us billions. He still wanted more, more, more. From what I can see so far, it's all about the numbers with nary a scent of compassion for the people he was hurting with his scheme. Given his talents and incentives, it should be no surprise that Goldman Sachs wanted to hire him, too.

It is also interesting to note how open and casual traders had been about the practice of rate rigging, a practice that has been documented as early as 2005. It is very likely that the rigged rates made a significant contribution to the collapse of the banks in 2008.

So when Bernie Sanders and Elizabeth Warren talk of a rigged system, this is just a part of what they're talking about. Privileged men more concerned about driving up the numbers of their personal net worth than about being of service to others. If wealthy people want to use "socialist" as a pejorative in America, those same people need to look at high finance a bit more closely to see what socialism is intended to fight.

This is what progressive taxation is about. It's not about punishing people for earning more with their talents and skills. It's about curbing greed and preventing people from amassing so much money that they're "untouchable". Hayes made more money in day that most people make in a year, yet wanted more and was willing to cheat to get it. Many of his peers were the same way. They don't see the use of their power to fleece other people as a problem. It's just business.

Tuesday, August 04, 2015

Police brutality is a public policy written by the 1%

Just about every day now, I see some article talking about the miniscule numbers of people killed by police in other industrialized countries. For example, a study done on police in Norway found that Norwegian police have not killed anyone in a decade. Last year, they drew their guns twice and fired without fatality.

In April, 4 Swedish policemen were on vacation while traveling on a subway to see Les Miserables. While on the train, the driver called for help to deal with two homeless men who were fighting near the drivers cabin. The Swedes went to assist by breaking up the fight and restraining the aggressor without the use of deadly force. Even when they are here, Swedish police are not packing heat and prefer to use restraint rather than force to calm things down.

In the UK, The Guardian has compiled an amazing set of data on police shootings called The Counted, In this study, The Counted compares the US to the rest of the industrialized world, giving us a picture in clear relief of American police with the rest of the world as a backdrop. The pictures are not pretty and here is one of them:

That is a staggering comparison, but the numbers don't lie. American police tend to be more than a bit trigger happy. If there needs to be better gun control, it needs to be exercised upon and by the police.

But there is more to the story here than just killings. This is a result of public policy that has been in place for decades. What is also interesting to note is that as birth rates decline and our population ages, we'd expect the crime rate to go down. And it has, as documented by FBI statistics. Yet the rate of police shootings has failed to decline with it. This means, in so many ways, that public policy is not working when it comes to the safety of Americans at the hands of police.

Who writes public policy? In nearly every study conducted on the subject of the responsiveness of American leadership to the people they serve, the answer is plain to see: The 1%. They are the people writing the policy. They are the people driving the policy. Everyone else? They are powerless to do anything but watch, if they want to work within the system.

Howard Zinn once noted that “Protest beyond the law is not a departure from democracy; it is absolutely essential to it.” If the courts, the legislature and the various administrations at state and federal levels are unresponsive to the needs of the people, then we can expect to see protests en masse. This is what we have seen in Ferguson, Missouri where voter turnout is so low, that the police are composed of a white majority in a town that is mostly black.

The horrendous number of police shootings in America is supported by public policy, not public opinion. To turn this around, we need to increase voter turnout, or the trend will continue and very likely get worse. It might be easy to blame the problem on the 1%, but we're fooling ourselves if we blame the 1% without getting out of the house to vote. In order for democracy to work for all of us, all of us must participate in government.

If we just vote, we decide who will cut the checks and write the laws. We must do more. Every legislature publishes their proceedings online. We can show up or follow their work. Every city council has meetings and we can show up or follow their work online, too. For Congress, there is C-SPAN and

Every agency writes regulations that implement the laws. We can participate in the rule making process to change how the laws are implemented. We participate by following the agencies and writing comments when new rules are proposed to implement the law. We participate in and/or follow administrative proceedings when we can.

In the courts, I learned long ago that if more than 1% were to fight their traffic tickets, the system would grind to a halt. We must be willing to follow the courts and fight in the courts if the need arises.

The numbers clearly show that the 1% is not capable of or willing to writing laws that benefit everyone. It's up to us to the rest of us to make the changes we want. We must be the change we want to see.

Monday, August 03, 2015

Why build a stadium when you could roll out fiber for a fraction of the cost?

In recent months, I've seen news about new proposals for sports stadiums. Governor Scott Walker in Wisconsin recently signed a bill to finance a sports stadium by cutting education funding. Seems consistent with the fact that in most states, the highest paid public official is the football coach.

In the previous decade, most states could skate by on $300-400 million for a new stadium. Not so anymore as noted by Athletic Business News:
The three newest pro football stadiums have cost $720 million (Lucas Oil Stadium, 2008), $1.15 billion (Cowboys Stadium, 2009) and $1.6 billion (MetLife Stadium, 2010). Major League Baseball hasn't seen quite that level of inflation, but it has produced the three most expensive ballparks in history in 2008 (Nationals Park, $611 million) and 2009 (Citi Field, $900 million; Yankee Stadium, $1.5 billion). Perhaps it's worth noting that MLB's newest venue, four-month-old Marlins Park - the league's sixth to feature a retractable roof, and its smallest in total seating capacity - cost a mere $515 million. On the other hand, the stadium's complicated financing plan (currently being investigated by the Securities and Exchange Commission), will lead to a final public cost to repay debt incurred by the stadium's construction of $2.4 billion over the next 40 years.
An article in USA a couple years ago provides some interesting analysis on the subject of sports stadium funding:
In 2010, 121 professional sports facilities in use for all five major sports leagues required $43 billion in investments in new construction or major renovations. About half of that investment came from the public, according to research by Harvard urban planning professor Judith Grant Long.
But over the life of these stadiums, taxpayers will have to pay an additional $10 billion of what Long calls "obscured costs" that were not initially factored into the public's share, Long said. That means instead of taking on about half the cost of stadium construction and improvements, the public is now taking on about 75% of the cost, she said.
The public ends up paying 75% of the costs for a new sports stadium? Do they even get a return on their investment? The article goes on to say, not really, or at least, not a widespread return on the investment. I find it especially telling that much of the long term costs are "obscured" from the public. Besides, not everyone attends sporting events.

To make matters worse, a team from Stanford University has done a study to show that sports stadiums do not generate any significant economic growth. As public scrutiny grows, resistance to financing what are essentially private ventures is growing. The public is getting a clue to how they're being screwed by professional sports stadiums.

If the cost of a sports stadium can run into the billions, and is largely financed by the taxpayer and doesn't generate the revenue or economic growth that was advertised, perhaps we might consider an alternative use for that money: community broadband., a part of the Institute for Local Self-Reliance, has compiled the data on community broadband. The benefits are numerous. With community broadband, you get a better faster connection at lower cost than the private ISPs are willing to provide. The money stays in the community. Everyone gets a connection and that's good because more people are going to use broadband than will use a sports stadium.

Community broadband adds value to the home and increases the sales price on average by about 2-3%. Community broadband attracts jobs like no other facility does. And finally, community broadband gives businesses a fast, stable connection to the internet so that they can stop worrying about their connection and serve customers.

For a fraction of the cost of a stadium everyone in a city, and I mean everyone, could be hooked up with a fast and reliable broadband connection. For example, here in Utah, local governments are looking at financing a fiber buildout for 6 cities with 111,000 addresses for about $232 million (you can find the number on page 34 of that report in the link).

In Chattanooga, TN, they built a fiber network through their local electric power cooperative, the Electric Power Board (EPB). They spent $330 million to build the network and charge $70 a month for a gigabit connection to the internet. That monthly fee is actually down from $300 a month they used to charge for a gig. has documented numerous examples of how municipal fiber adds value to the communities that deploy fiber. From job creation to property values, there is a lot to like about community broadband.

If community broadband is so great, why aren't more cities and states considering fiber instead of stadiums? It's possible that state governments are not fully aware of the benefits of municipal fiber and they just need greater awareness. On the other hand, it's possible that they are aware and their leaders would prefer not to spread the wealth around. It's hard to say for sure.

But we can be sure that municipal broadband is a much better deal than a stadium.