The Power and the Money

National health care, updated

  Megan McArdle, whom I respect, linked to a piece by Glenn Reynolds that basically says that his wife and father would be dead while his daughter and mother would have a much-impaired quality of life under socialized medicine.

But I have a question.  Two, actually.

(1)  The treatments for Reynolds' mother (hip replacement) and father (radioactive prostate cancer implants) were developed for a patient pool that is mostly subject to Medicare.  Which is socialized medicine by most definitions.  Why doesn't that fact show that the argument is fallacious?

(2)  If other countries generally force healthy young women to die or live impaired lives, why doesn't that show up in any of the comparative quality-of-life studies?

A third, fourth, and fifth might be:  Does Ms. McArdle really believe this argument?  If so, why?  And what does it have to do with any of the actual health care reforms that are on the table?

Meanwhile, Matt Yglesias points out why I have trouble staying friends with doctrinnaire libertarians.  This one's for you, Guy.

UPDATE:  Matt Miller has an interesting column in today's Financial Times.  He points out that save for the public option, the current reform plan essentially extends coverage using a basic template designed by Mitt Romney in Massachusetts.  In addition, one of the financing plans on the table (not my preferred one, I must admit, nor the President's) was basically proposed by John McCain.  Finally, the eye-popping cost is propaganda, caused by people's emotional reaction to the t-word; the right way to think about the cost is that it is 0.5% of GDP or 3% of total healthcare spending.  In short, the way to a compromise that should attract lots of Republican votes is obvious.

But I will add that since we aren't going to get any Republican votes, I will be very annoyed at my party and President should we get a bill that does not include a public option and that is not financed by a surtax on high earners like, uh ... really? ... my wife and me.

Demography matters, and a music video

  There is an interesting (if rarely updated) blog called “Demography Matters.” It's hit a few interesting topics lately.  Randy McDonald is the driving force behind it.  For those of you who don't know him, he wrote the defining takedown of the whole “Eurabia” nonsense, aka the idea that immigration and differential birthrates will eventually give Europe a Muslim majority.  But the blog is a lot more than that.

Here is a discussion of Greenland.  Short version:  considering the country's dependence on Danish expats for skilled labor, even a non-independence independence of the sort negotiated by other microstates could lead to disaster.  The population is shrinking despite high birthrates.  Maybe they'll get lucky and find oil.  More likely they will remain a dependency of Denmark forever, most likely de jure but definitely de facto.

The blog also recently discussed Iran.  Short version:  looks like Europe!  Crashing birthrates could fuel an economic boom if only the place could get the policies right.  In comments there is an interesting discussion of the fact that American birthrates have stayed above replacement ... and that much of that difference is because urban birthrates in the U.S. aren't appreciably different from their suburban or rural equivalents.  The really weird fact?  Canadian birthrates are crazy lower than U.S. ones, even in such similar places as Washington and British Columbia. 

Finally, it presents a scary version of Cuba's future, in which the country enters a demographic death spiral.  All it lacks is a projection of the worst case scenario: what would Cuba's population and age pyramid look like in 2050 if it goes the way of Ukraine and stays there?

Below the fold is a music video.  It is for Randy, for reasons he understands.  Essentially, while not my cup of tea, it shows what can be accomplished in his preferred genre in both aural and visual terms when attempted by two rather accomplished artists.  Enjoy.

More Doug in Senegal, and why you shouldn’t worry about the deficit

  It seems as though I start a lot of posts with the words “it seems.”  I will try to rectify this in the future. 

Ditto, “so,” a verbal tic I blame on my unbridled admiration for Doug Muir, who has, by the way, written a little more about Senegal.  He tells us about the Mourides, a powerful Muslim sect of which I am embarrassed to say I knew nothing.  He bemoans the crappy state of Dakar’s airport, and receives in turn a useful warning from Bernard.  Finally, he wraps his trip with a discussion of W, railroads, France, birds, the CFA franc (e.g., France yet again, although he doesn’t say so), the weather, the expats, and the clothes.  I am pretending not to be annoyed at not getting a shout-out on the France tip, which means that pique is not the reason why I am not explaining the story of the Senegalese railroads under French colonial rule. 

Which brings us to the U.S. federal deficit.  You hear a lot of worring about how interest rates are going to rise from all this wild borrowing.  Where will the money come from?  We are doomed, doomed!!  No links, because I actually like and respect many of the people doing the worrying.  But they need not.

I just had a colleague in my office with the latest BEA numbers, worrying about just that.   Where will the money come from?  So I pulled out a spreadsheet and showed him.  In the first quarter of 2009, annualized personal savings came to $620 billion, or 5.7% of personal income.  Total savings (again, annualized) came to $1,273 billion, or 9.1% of GDP. 

Personal savings is only going up.  If we assume that nominal GDP growth is flat in 2010 (meaning, most likely, that real GDP keeps falling), a rise in the personal savings rate to 10% will produce $468 billion of additional savings.  Retained earning are also likely to rise, say from 4.6% to 5.0% of GDP.  That’s another $47 billion.  Total of $515 billion in new savings ... just as the federal deficit is projected to fall by $393 billion.  Plenty of wiggle room should private investment rise (one can hope) or the current account deficit fall (which seems likely).  A rise in real interest rates does not seem like something we need to worry about.

Rather, what we need to worry about is a continuing shortfall in demand.  What if Americans don’t substitute domestic consumption for imports?  Final demand will fall.  What if domestic investment doesn’t quickly rebound?  (It was $2 trillion in 2008, a full 25% higher than in the beginning of 2009.)  Final demand will fall.  In that situation, we might be wishing for another round of stimulus, rather than worrying about the deficit. 

UPDATE:  The May numbers just came out from the BEA.  Looks like the personal savings rate hit 6.9% that month.  We are on track to exceed 10 percent in 2009, and in my opinion the country will permanently return to 1970s savings levels.  That said, past performance does not always predict future results.  Any counterarguments?

Doug in Senegal part 5

  Doug is now in Goree, a small island off the Senegalese coast.  I don't have much to add at the moment, unfortunately.  (Or not.)

Doug in Senegal parts 3 and 4

  My friend Doug Muir is in Senegal.  He is visiting a city that I am deeply ashamed to admit that I had never heard of.  His reports from Kaolack are here and here.

Read the posts.  They pose an interesting question, about infrastructure, trade, and prosperity.  How much would an improvement to Kaolack's port reduce transport costs?  How much would a reduction in transport costs increase peanut production?  (In other terms, are there increasing returns in peanut production?)  These are unanswered questions; it isn't a sure thing that fixing Kaolack will promote growth.  After all, a declining peanut economy could provoked the city's decline, rather than the other way around. 

Which isn't to say that Doug is wrong; he probably isn't.  Just that any and all development quick-fixes deserve careful stress-testing before they are implemented. 

Hopefully we'll hear more from him soon.

Domingo flojo, and Doug in Senegal parts 1 and 2

  ¡Domingo flojo!  Despierta tarde en el mediodía, llama al tren, pa’ver q pasaría ... Narnia?  No no no no no. 

So I line up a trip to the deep-pit copper mine.  Chido!  At which it point it starts to hail around here, and the company cancels.  (Liability issues.  Chile is not Mexico, it seems.)  So I figure, hey, Chile has restarted passenger train service, why not chill in Chillán?  Metro to the train station, thin attractive woman a little older than me and wearing this cute little neo-hippy snoopy hat sells me a ticket with just the right amount small talk to remind me why I like this country so much.  Only ... she realizes that the return trips are all sold out.  I debate taking the bus back, decide no, and now regret it.  WTF am I going to do in Santiago on a rainy lazy Sunday?  Work in my hotel room?  Too depressing! 

I'll figure something out.  Meanwhile, Doug Muir is in Senegal, with details here and here.  I, of course, am fascinated by the French influence.  As always, don't expect pictures from Mr. Muir, but do expect lots of information, historical detail, and very good analysis about what it all means. 

You can also go here and here on this blog, where we discuss another part of the French not-empire in West Africa, or here, where you find out how Burundi got a handle on infectious disease.

I'll be back with more about regional inequality, copper, and the effect of the Panama Canal on Chile, but right now I'm going to go brave the rain and wander aimlessly around Santiago for a while.  I will, however, take requests for any Chile-related topics you might want to know more about.  (Randy has one pending on regional inequality.)  Hasta pronto, mis cuates desconocidos. 

A different perspective

  I haven't been to Mérida, Venezuela, in decades.  (I haven't been to the one in Yucatán for about as long, either.)  I used to have an aunt who lived nearby.  She's long gone, and last I heard both her grown children (and their families) lived in Houston and Miami.  

Anyway, Gringa Diary is by an Australian socialist fervently working to further the triumph of the Bolivarian Revolution and turn back to the forces of imperialism.  I believe her name is Tamara Pearson.  It's a fascinating look into the Revolution, up-close-and-personal. 

Of course, her perspectives on the value of Mr. Chávez or the long-term impact of his policies on the poor of Venezuela are quite different from my own.  But she's so earnest about it.  Which is sort of touching, in a way.  More importantly, the true-believer tone infuses the blog with this sense of reading something for a parallel universe.  You read her stories, and more often than not find yourself scratching your head at her emotional reaction or logical analysis, so different from your own. 

But you can't get angry; she's so enthusiastic about it all.  Recommended. 

Ross Douthat

  Who reads my blog?  Nobody reads my blog.  Do I avoid certain topics anyway?  Of course I do; I don't have tenure.  But I do believe that my liberal progressive credentials are fairly secure.  So I would like to ask Brad Delong, on the off chance that he is reading this, to go here.  These arguments exactly reflect my thinking when I first read Brad's posts on the Douthat appointment.  I think that Douthat will be a fine columnist, albeit one that I will usually disagree with and often be infuriated by.

Let me add that as someone who between 1988 and 2000 managed to go from a bizarre Reagan Democrat phase into dumb-ass radical libertarianism before becoming a sort of Democratic-voting Rockefeller Republican in the 1990s ... only after 2001 did I drift further left under the weight of, well, facts ... I am seriously glad that there was no internet to preserve my more adolescent opinions.  You gotta forgive people their past opinions.  Even George Wallace reformed.  So I can't hold Ross Douthat's sillier college columns against him. 

People usually change their opinions when the fact available to them change.  Albeit not always. 

P.S.  If I haven't said so already, Ganchoblog is worth putting on your regular blogroll, for all news Mexican and quite a bit else besides.

My return, I hope, plus some apparent nonsense

  I've been busy, what with the election and then finishing Work-in-Progress number 1.  It isn't quite done, but Carlos and I went through a frenzy of productivity (and three steak lunches, with wine) in New York last week, and the end is very near.

So I will try to get back to posting, although I can't promise anything.  Anyway, I began today with a brief discussion of the Typealyzer.  It purports to be able to analyze the personality type of a blog-writer using some sort of unspecified text analysis algorithm.  I heard about it on Kevin Drum, and then again on Language Log. 

Now, I usually like this sort of thing.  What British political party should I belong to?  The Liberal Democrats!  Of course!  What kind of movie is my life most like?  An action flick!  Obviously!  What South American country would I be?  Venezuela!  Uh ... well, yes, that does make more sense than any of the others, when I think about it.

But the result from the Typealyzer, well, it was just odd:

Doug in Burundi, part 8

Here Doug discusses what cheap labor really means on the ground.  And he means cheap labor.  According to the U.S. State Department, workers in Burundi received on average 1,500 francs per day, or $1.40.  Since a 12-hour day wouldn't surprise me, Doug's estimate of 20 cents per hour might even be high.

You don't need to go to Western Europe to see just how poor that is.  To give an example with which Americans are familiar, production workers in Mexican maquiladoras cost US$2.64 per hour in 2006.  Production workers in all Mexican manufacturing cost US$2.75.  Total hourly direct pay for all employees (including benefits but not taxes and other social charges) averaged US$3.32 per hour.  (That'd be 5,752 pesos per month.)  Even farmworkers in the country's northern states make about US$1.50 an hour.  In short, Burundi is impoverished compared to Mexico.

Anyone who spends time in Latin America can see some of the effects of cheap labor, but nothing on the scale of what Doug describes.

Doug in Burundi, part 5

More about Burundi, starting with the presence of the African Union, moving on to the rebels, and ending with a discussion of the country's really really bad transport problems.  It appears to still be raining in Bujumbura.

One point that I'll repeat on Doug's comment page:  narrow gauge isn't a problem.  Narrow gauge railroads can be upgraded to carry similar loads and operate at close-to similar speeds as standard gauge.  They simply lose most of their initial cost advantage.

Doug in Burundi, parts 3 and 4

Looks like it's rainy in Bujumbura.  It's been weirdly tropical in Massachusetts this summer:  black downpours so heavy that you can't see across the street followed by bright actinic sunshine.  Thankfully, that seems to have ended here; let's hope it ends soon in Burundi.

Over here, Doug explains why there's a Greek deli in the middle of Bujunbura.  It seems as though there was a small community that came down the Nile from Alexandria with the British; some kept going and wound up in Burundi, where they helped administer the place and played a role in commerce.  The messiness of independence, though, drove most of them back to Europe (I assume), leaving a big consulate and what seems to be a very nice deli.

Doug in Burundi, part 2

Catch it here.  Although I dunno why it's on AFOE instead of HDTD.

Doug in Burundi, part 1

Available here.

Doug across Africa, but first Brussels

This post goes out to my friend Doug Muir, over at HDTD.  Doug is going to Burundi.  Burundi, unlike neighboring Rwanda, is still at risk of relapsing into violence, although I wouldn't want to exaggerate it.  Doug writes, “I don't know if Burundi is the sort of place that stimulates blogging,” which I don't understand, and “nor whether the work will allow much time for it,” which I most certainly do.  Anyway, here's a vote for some reportage on what the situation looks like on the ground. 

Before that, he is going to Brussels.  Brussels is interesting.  The two main train stations are strangely chaotic, a throwback to the 1980s in New York.  The smaller one smells of vomit and has a population of rather hostile-looking teenage runaways.  But the architecture is pleasant. 

The larger one, Midi, closely resembles Penn Station in New York, save that it's rare to have to break up a screaming match between a dude in a leather jacket and a tall slender woman in Penn Station these days.  The strange thing, to an American, was the lack of reaction.  I ran towards the guy yelling, "Llame seguridad!" but an Algerian and a British dude (both of whom seemed to work in the bar) got there first and grabbed him, telling him ... something.  Meanwhile, all these other people stood around and watched.  Ignore it completely, that I understand, jump in, that I understand, but gawk?  A little odd.

I don't suppose that this will be obvious to people who don't know me, but I like the above kind of thing.  At least now that my city of birth no longer has it.  Brussels is a real city, and I very much like the place.  Quite a bit. 

Outside Midi is an immigrant neighborhood well worth visiting.  More below the fold.

What's in a name?

Once we figure out the easiest way to port over my existing posts, I'll be leaving HDTD for another space on the internet, turning this place back over to its rightful owners.  I'm sure my new spot will soon become the hot go-to spot for Caribbean politics, early-nineties hip-hop, and random photographs.  Plus, pirates! 

Of course, it needs a name.  "Pure Product of America" is taken by an excellent blog that y'all should go over and start reading regularly.  (Go!  Now!)  Which leaves me at a loss, because while I'm sure that my posts have a pattern, I'm too close to see it, let alone come up with a pithily descriptive phrase.  "Orgulloso de ser argentino" would work, except I'm not.  (Argentino.)  "Shwingalokate" is one of the best tracks ever, but seems a bit too random.   I'd love to do "Radio Free Brooklyn," only I'm, like, not in Brooklyn any more, and "Radio Free Boston" just sounds wrong.   Which leaves me with "Notes from the Gabacho," or perhaps "Notes from teh Gabacho."  The problems with that one are obvious.

"The Power and the Money"?  Too serious.  "A Wee Bit Down the Charles"?  Derivative.  "Econ Dub Style"?  "Mexican Pie"?  "Yeah, We Did Start the F@#&in' Fire"?  "Rico Suave"? 

Quality Control ... Debout là d'dans ! ... Con Todo Respeto ... Lo Que Sea?

Anyway, suggestions are very appreciated.