Wishful Thinking

The theme for today seems to be wishful thinking. My first exhibit is this editorial from the Dallas Morning News on what to do in reaction to the murders of the Americans living in Mexico:

So how can the U.S. help Mexican authorities stem the rising tide of violence and terror?

First, it’s clear that President López Obrador’s campaign promise of using “hugs not guns” to address the break down of Mexico’s social fabric and the rule of law was considered a sign of weakness by the cartels. Last month’s decision by the Mexican government to release Ovidio Guzmán López, the son of drug kingpin Joaquin “El Chapo” Guzman, to prevent further bloodshed after eight people were killed in a botched raid in Culiacán has also emboldened the cartels.

But do the high-profile arrests and extradition to the U.S. of kingpins like El Chapo actually weaken the cartels? Jake Dizard, a fellow with the Mexico Security Initiative at The University of Texas at Austin, is skeptical. “The U.S. should continue to provide intelligence on criminal groups to Mexico,” he us, but “U.S. law enforcement should recognize the counterproductive nature of playing whack-a-mole with cartel leaders and help Mexico develop a more comprehensive, civilian-led security strategy.”

What would such a strategy look like? All the experts we spoke with agree that a joint effort to crack down on illegal U.S. gun sales to Mexico should be a high priority. Patrick McNamara, a history professor at the University of Minnesota and an expert witness on more than 100 asylum cases, says the U.S. should also “stop obsessing about Central American refugees and allow Mexico’s new National Guard to be deployed to protect Mexican civilians in northern Mexico” instead of stopping peaceful migrants from heading north.

This is nonsense. If we can’t “crack down” on cross-border illegal drugs or human trafficking, how in the heck will we do so on the illegal gun trade. We can’t even crack down on illegal guns in Chicago. Nearly all Chicago’s homicides are perpetrated using illegal guns.

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Why Do Blacks Support Biden?

In his Wall Street Journal column Jason Riley attempts to explain something I have been trying to explicate for some time:

Your typical black Democratic primary voter is likely to be middle-aged and female, and right now Joe Biden is her guy. But who’s her second choice?

There is general agreement that black voters, while a small percentage of all voters, could again play an outsize role in determining the Democratic presidential nominee and the outcome of next year’s election. Blacks are concentrated in important primary states, such as South Carolina, as well as in the cities of key battleground states like Michigan and Wisconsin.

Perhaps taking them for granted, Hillary Clinton failed to mobilize enough black voters in 2016, when black voter turnout fell in a presidential election for the first time in 20 years. Mr. Biden believes he can succeed where she failed, and perhaps he can. His popularity among blacks obviously stems from his eight-year stint as Barack Obama’s vice president. He is quick to invoke Mr. Obama’s name in front of black audiences and to defend their administration’s policy victories, such as ObamaCare. Mr. Biden is also more politically moderate than most of his rivals, which sits well with older blacks who are more likely to vote.

Blacks are more conservative than Democrats, generally, they are more religious than Democrats, generally, their rate of military service is higher than Democrats, generally, and their median level of educational attainment is lower than Democrats, generally.

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Why Is Centralization Good?

The editors of the Washington Post go off on “Medicare For All”:

SINGLE-PAYER HEALTH care can work. Government-run systems operate in other industrialized countries and often achieve comparable or better overall results, for less money, than the health-care patchwork in the United States. So why aren’t Sen. Bernie Sanders (I-Vt.) and Sen. Elizabeth Warren (D-Mass.) proposing something that resembles those systems?

The two presidential candidates promise far more generous benefits than other countries offer. They pretend that the United States wouldn’t have to make any of the trade-offs other nations have had to make. They promise fantastically generous benefits, no premiums, co-payments or other cost-sharing, and a miraculously low price tag. It’s fiction.

concluding:

All Americans should have decent health-care coverage. They should also have good schools, good roads and world-class universities. Nations with single-payer plans have had to make real-world compromises among these various needs. If the Warren and Sanders plans sound too good to be true, it’s for a reason.

Let me make some scattered observations. We can’t reduce the cost of our health care system without reducing somebody’s income. Some of those somebodies will be in the insurance sector but most of them will be in the health care sector.

What’s the fixation with centralization? Here are the populations of some of the countries with which people routinely compare the United States:

Country Population (millions)
France 66.99
Germany 82.79
UK 66.44
Canada 37.59

and here are the populations of some U. S. states:

State Population
New York 19.54
California 39.56
Florida 21.30
Texas 28.57
Illinois 12.74

The total U. S. population is something like 330 million. Get the point? Those countries are more like states than they are like the U. S. as a whole. We are also much larger physically and enormously more diverse than any European country. We are very nearly as large and diverse as all European countries put together.

If we’re seriously considering a single payer system, why not a system more like that of Canada, a country which we resemble culturally much more than we do France or Germany. Canada’s system is run by the provinces.

Administration of Canada’s system costs about half as much as ours. We simply are not going to realize savings in administrative costs beyond Canada’s. I would be astonished if the savings in administration from going to a single-payer system here would even match that and the financing assumptions of practically every body’s plan makes that assumption. Everything our government does costs more than anywhere else. Why should health care be an exception?

There are actually good reasons why a single payer system is not a good fit for the United States and I usually summarize them by saying that we don’t have enough social cohesion. That covers a lot of territory including a greater emphasis on individualism, diversity, and a long-standing culture of political incompetence. We don’t trust our government for good reason.

I’m actually more concerned that every American should have access to decent health care than I am that they should have access to decent health care coverage. Framing it that way conditions the discussion.

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What Next?

If you are unaware of the story of the day, here’s a synopsis from the editors of the Wall Street Journal:

The slaughter Monday of three Mormon women and six children, all American citizens who were longtime residents of Mexico, brings home a cruel reality of America’s neighbor to the south. Drug gangs control huge swathes of the country, and the government in Mexico City is too often overwhelmed by the criminal firepower and money.

The women and children were attacked by gunmen as they traveled in SUVs in the northern state of Sonora in broad daylight. Mexican officials said Tuesday that it could have been a case of mistaken identity. But according to survivors who hid in a nearby woods, one of the women was shot outside her vehicle with her hands up. It seems more likely that the murders were a warning from drug cartels to everyone in the region, and especially to Mexican officials, that the gangs are in charge.

and here’s their recommendation:

But if Mexico can’t control its territory, the U.S. will have to do more to protect Americans in both countries from the cartels. The Drug Enforcement Administration should be able to find out the identities and locations of those who ordered or carried out Monday’s murders, and ensuring their demise would be a signal that U.S. justice has a long reach. A U.S. military operation can’t be ruled out.

What do you think should be done in response to these murders?

  1. Nothing
  2. Warn Americans living or travelling in Mexico that it’s a dangerous place and they’re on their own. Otherwise nothing.
  3. Keep doing what we’re doing now—provide the Mexican government with intelligence, cooperation, and support as requested. Otherwise nothing
  4. Warn the Mexican government that, unless they apprehend those responsible, we will suspend intelligence, cooperation, etc. Otherwise nothing.
  5. Arrest or eliminate those responsible via covert action
  6. Deploy the U. S. military to create a cordon sanitaire from the U. S. border to 150 miles to its south.
  7. Put the entirety of Mexico under U. S. military occupation
  8. Other (specify)
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OK Boomer

I think there’s connecting thread among the recent remarks of Larry Summers (in the op-ed to which I linked), Joe Biden’s defending himself against charges of just not being Democratic enough darn it, Barack Obama’s critique of “cancel culture”, and Rahm Emanuel’s observations about candidate missteps. To coin a cliché, there’s a battle being waged for the soul of the Democratic Party between the Democratic establishment and the progressive wing of the party.

All of the individuals I mentioned above are party apparatchiks at one level or another. Not only that, they represent those who actually hold the reins of power in the party. Do Bernie Sanders and Elizabeth Warren actually represent the future of the party? Or do they represent a comparatively small number of progressives who want to be the future of the party?

All of the worthies in the list above have actually wielded power. Bernie Sanders and Elizabeth Warren have been elected to office in two of the oldest, best educated, least religious, and whitest states in the Union. Do they represent the future or a future that cannot be?

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Not What You Think

At Roll Call election analyst Nathan L. Gonzales points out the lessons of the 2019 elections may be different than most think. Here are his hypotheses:

  • Kentucky was not an upset.
  • Trump was an asset, not a liability.
  • Impeachment isn’t the silver bullet for Republicans.
  • Bevin clearly had a unique problem.
  • Transformation of Virginia is complete.
  • Suburbs continue to be a problem for Republicans.
  • Mississippi is a red state.

Read the whole thing.

My own view is that people tend to over-interpret elections. Just because a candidate with a certain profile wins a particular election in a particular state, county, city, etc. doesn’t mean that another candidate with a similar profile is a shoe-in in another state, county, city, etc. Politics remains stubbornly local whatever analysts may think.

Update

Also, check out the author’s four potential scenarios for the way the 2020 elections might play out. I have lost any predictive ability I ever had in the Era of Trump. All I can say is that I wish that Democrats were taking a lower risk “eyes on the prize” strategy rather than a “high risk/high reward” strategy. And don’t underestimate Trump.

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Lawrence Summers Enters the Lists

Dr. Lawrence Summers, the economic voice of the Democratic establishment, has an op-ed in the Washington Post sharply criticizing Elizabeth Warren’s “Medicare For All” plan. His criticisms are, first, that it’s the most ambitious plan in the world:

However, no other country offers as broad coverage as Medicare-for-all would or claims to provide universal health insurance without taxing its middle class. With respect to the admirably detailed plan the Massachusetts senator laid out, there will, I suspect, be serious questions about the accuracy of her arithmetic, the impact on labor markets, the feasibility of applying Warren’s full set of proposed taxes to the rich, and the financial and economic impacts of the plan.

It won’t generate as much revenue as she thinks it will:

Whatever the merits of these arguments, it is hard to see a defense for assuming — as the Warren proposal does — that wealth taxes can be doubled with no impact on avoidance, or that annual capital gains taxes can be levied without reducing the wealth tax base. The estimates are also infected by erroneous transcription of the CBO’s 10-year growth estimates and by a general failure to take account of interactions between the different tax measures proposed.

Its effects on the labor market will be extremely disruptive:

Second, there will be large labor market effects: Warren’s plan will discourage hiring, particularly of low-skilled workers, by firms that currently provide generous benefits. These firms will face the most burdensome taxes when they increase hiring and will gain the greatest cost savings by laying off workers. In addition, workers’ incentives to take jobs will be dulled because they will no longer be compensated with health benefits (which will become available regardless of what they do). There are further potential economic perversities as well: To cut costs, firms will be incentivized to get below the 50-employee threshold and scale back on current health benefits. And all the efforts that employers have engaged in to contain costs and to encourage prevention will become pointless.

To that I would add that companies that self-insure may well end up spending a lot more, something that will certainly be resisted. 40% of all employer-sponsored plans are self-insurance.

The plan will have an extreme effect on taxes:

The sum of all the new taxes on the wealthy proposed by Warren is of comparable magnitude: adding together around $310 billion a year in new wealth taxes; $330 billion a year in corporate taxes from her new proposals and her previous real corporate profits taxes; $240 billion a year from her new capital gains and finance tax proposals; at least $90 billion from her across-the-board 14.8 percent taxes of labor and investment income; and $190 billion in increased compliance. This totals nearly $1.2 trillion — more than millionaires’ total after-tax income.

There will be run-on economic and financial effects:

Recognizing that some of these taxes fall on salary income or non-corporate business, it is reasonable to estimate that investors will pay an extra $500 billion to $600 billion in taxes related to corporate profits. Then, Medicare-for-all proponents cite a severe hit to health industry profits, currently on track to be over $200 billion this year. Then, there will be the broader impacts of overhauling regulation, often to serve vital social interests, in initiatives such as banning fracking and reforming the energy industry, stepping up financial regulation, a major increase in antitrust enforcement and the regulation of technology companies, and filling corporate board seats with labor representatives. It is hard to see an argument that investors’ claim on profits would fall less than a third. The figure could be considerably greater.

Because of abnormally high valuations, along with increased uncertainty and volatility, loss of business confidence and selling pressure from those in distress, the market would likely fall more than proportionally to earnings. Accurate market predictions are impossible and will in any event depend not on what is proposed but on what the market expects will actually take place. There is, however, the real risk of economic contraction following a sharp market decline, especially given that the current very low level of interest rates puts the Fed in a weak position to pursue counter-cyclical policy.

A summary of his observations is that as campaign rhetoric Sen. Warren’s plan is fine. As serious policy it would be catastrophic.

Those are somewhat different from the criticisms I have lodged but they’re interesting.

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McGurn on Operation Varsity Blues

In the Broadway musical Destry, based on the 1939 movie Destry Rides Again, as Gyp Watson prepares to be hanged, there’s a song, “Are You Ready, Gyp Watson?”, a showstopper. One of the passages in the song (sung as a sort of descant) is

Oh he may have been willful
Yes, he may have been wild
But one look will convince you
He’s as innocent as a newborn child
He’s just friendly and playful
What a lovable lad
And his friends will all tell you
He ain’t got the brains to be bad

My wife and I are convinced that’s the rationale for Lori Laughlin and her husband’s “Not Guilty” plea in the widely published college admissions cheating scandal for which they are standing trial. We call it the “Gyp Watson Defense”. Based on what has happened so far they may well be able to convince a jury that they “ain’t got the brains to be bad”.

In his Wall Street Journal column William McGurn is oddly sympathetic with Ms. Loughlin:

If convicted of all the charges federal prosecutors have piled up against them, Ms. Loughlin and her husband could be sentenced to as much as 45 years in prison.

This is nuts.

The same operation that caught Ms. Loughlin also snared dozens of other high-powered people, including CEOs, lawyers and venture capitalists. They too are accused of paying fixer William “Rick” Singer either to cheat on their kids’ college entrance exams, to present them fraudulently for college admission as athletes, or both. But Ms. Loughlin’s celebrity status has ensured that she and fellow actress Felicity Huffman remain the face of the scandal for most Americans.

With this difference: While Ms. Huffman pleaded guilty, apologized profusely and served out her sentence (14 days, but released after 12 because it was a weekend) at the Federal Correctional Institution in Dublin, Calif., Ms. Loughlin and Mr. Giannulli are insisting, perhaps unwisely, on taking their case to a jury. Meanwhile, in the same way the sans-culottes jeered Marie Antoinette on her way to the guillotine, today’s equivalent— Twitter mobs and gossip sheets—are thirsting to see this icon of Tinseltown wealth and privilege cut down to size by a stint in federal prison.

Now, it may well be standard procedure for prosecutors to add new charges when their targets refuse to plead. But does anyone else think it a stretch to argue that two California residents bribing their children’s way into a private California university are committing a crime against the federal government? Or that the statutes she’s accused of violating, such as bribery or money laundering in connection with a program that receives federal funding, were really intended to go after people such as Ms. Loughlin?

He does bring up a good point: why are they, literally, making a federal case of this? I genuinely don’t know. Is it because the prosecutors just stumbled across this and smell blood? That’s largely what’s been said.

Or does it strike a chord with people who are highly committed to the idea of a college degree-based technocracy? If that college degree doesn’t mean what they claim it means, where does that leave them?

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Copper Fox Single Malt

The other day during my daily shopping at my beloved Happy Foods I picked up a bottle of Copper Fox Peachwood American Whisky. I had never heard of it but here’s the squib from the distillery’s web site:

Our continuing quest for whisky flavor perfection has led us to the delicate complexities of peachwood, contributing a symphony of fruity, floral notes both in the smoking medium of the kiln drying process and as a maturing catalyst in our barrels.

and here’s a quote from a representative review:

Creativity is something not lacking at Copper Fox Distillery in Sperryville, Virginia. As an early East Coast pioneer of American single malt, its founder, Rick Wasmund, took lessons from Scottish tradition (they’re the first distillery in North America to install a malt floor and kiln) and combined them with completely original techniques like the use of different fruitwood smoke in their malt. The latest addition to their line-up, Peachwood American Single Malt, is perhaps their most unique endeavor to date, relying on peachwood as both a smoking medium during kiln drying and as a maturing catalyst inside the barrels. Surprisingly, much of the process behind the single malt is spelled out on the label, from the type of still used to the barrel entry proof to the ppm (parts per million) of Virginia peachwood smoke used in the malting. It’s clearly something different, but how does it taste?

On the nose, Peachwood American Single Malt is like a candied campfire. It’s sweet with a blend of toasted grain, ripe peach, and mesquite aromas. On the palate, the whisky showcases a great balance of sweet and savory with vanilla, clove, and citrus complemented by toasted oak, a briny smokiness, and gentle heat. The peachwood is less of a factor on the palate than on the nose, which is probably for the best, but it seems to have created some welcome, honeyed citrus notes not found in the distillery’s standard single malt offering. The finish is slightly drying, but still manages to carry those complex initial flavors for a decent length until they erode into smoke and caramel sweetness. It’s a well-made and extremely interesting single malt — and it’s just what the craft whiskey world could use a little more of.

This is a fine sipping whisky and “unique” is an excellent way to describe it. I plan to check out their rye whiskey as well.

I have no idea how it managed to make its way to Happy Foods’s liquor shelf but I plan to ask.

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Relevance?

In an op-ed in the Washington Post John Kerry and Chuck Hagel are outraged over President Trump’s announcement that the U. S. was withdrawing from the Paris Agreement:

Climate change is already affecting every sector and region of the United States, as hundreds of top scientists from 13 federal agencies made clear in a report the White House itself released last year. The past five years were the warmest ever recorded. Without steep pollution reductions, climate change will risk tens of thousands of U.S. lives every year by the end of the century. Rising seas, increased storm surge and tidal flooding threaten $1 trillion in public infrastructure and private property now along U.S. coastlines. The United States has experienced at least $400 billion in weather and climate disaster costs since 2014. The recent hurricanes that slammed America’s southern coasts, as well as historic wildfires in California, resulted in more American victims of severe weather juiced by climate change than ever before.

The problem I have with that is that they’re drawing a straightline connection where none exists. There is no demonstrable connection between the Paris Agreement and CO2 emissions. India and China have sharply increased their emissions. The U. S. has reduced its emissions. Not only has Germany increased its emissions, its approach to doing so is disastrous—replacing the electricity produced by its nuclear plants with wood for home heating, for example, has resulted in the harvesting of old forests to feed German stoves.

It’s at about this point that someone will point out that the U. S. per capita outputs of carbon dioxide are much higher than those of Germany, China, or India. That, too, is irrelevant. To whatever degree atmospheric carbon dioxide contributes to climate change, it is absolute amounts that matter not per capita amounts. Yes, we can decrease our carbon emissions more. Why not continue our success by reducing cement production?

In conflating the Paris Agreement with carbon outputs I’m not sure what Mssrs. Kerry and Hagel are complaining about. Is it that their labor are coming to naught?

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