There’s an interesting post here on the repercussions of Seattle’s $15 an hour minimum wage. The idea of a $15 minimum wage is catching on in Chicago, too:

Supporters of a $15-an-hour minimum wage in Chicago said today that the time is right to introduce their plan to the City Council, despite moves from Mayor Rahm Emanuel and at the state level to go more slowly and possibly adopt smaller increases.

Speaking at a City Hall news conference prior to a council meeting, fast food worker Tanika Smith said she can’t make ends meet on her pay of $8.75 per hour. “My car note is $500 a month, my rent is about $500, food is going up, lights are going up,” she said.

The state minimum wage is currently $8.25 an hour.

Ald. Proco “Joe” Moreno, 1st, scoffed at the argument that a higher minimum wage would hurt business, saying the whole city would be better off if residents had more money to spend. “It’s not going to hurt business. It never has,” Moreno said. “It’s only raised those at the lower end.”

Clearly, it’s time to start hurling rocks through bakery shop windows. Think of all the jobs that will create for glaziers! If only they could figure out how to legislate a $7.75 an hour marginal product of labor, they’d really be on to something.

IMO if you favor a higher minimum wage, you should favor a higher national minimum wage, particularly if you live in a place like Chicago, whose metropolitan area borders two states, each of which has a lower minimum wage than Illinois’s current state minimum wage and a lot lower than $15 an hour. Otherwise we may be in for a future in which large areas of Chicago are not merely “food deserts” in the sense of no grocery stores that offer fresh fruits or vegetables but real food deserts in which there are neither grocery stores nor even fast food.

Michael Weiss re-imagines the president’s speech at West Point. You might find it amusing. Here’s a sample:

To these critics, I would only pose a few simple questions. Can any nation on earth amass a hashtag campaign on Twitter faster than the United States of America? Has any nation in the history of the world held so many international conferences in Switzerland in so short a period of time? Does any one constitutional republic have a former leader so easy to mock and blame for all the problems that have ensued well after he has gone?

The answer, of course, is no.

Then again you might not.

This week I begin my third week at the new gig. I’ve already accomplished quite a bit there and expect to accomplish more.

I’m the oldest person in the office there, decades older than most of the workers, older than the top managers. Many of the kids have no idea of how much difference experience makes.

The nine to five grind is physically taxing. I’m exhausted at the end of the day. It would be less exhausting if it were more interesting, something I’m hoping will happen. I’m also hoping that over time they’ll put less emphasis on physical presence and let me work more from home, a possibility that was extended to me when I started but not one that I solicited.

I’ve had it up to here with comparisons of the United States, all but unfailingly disparaging, with one European country or another. We don’t sample laws or policies from a combination plate or buffet, picking what we like most from the vast array of alternatives before us. Historical, legal, and social context matters.

It matters that until very recently the Swedes were 90% ethnic Swedes and Lutherans. It matters that the Swiss are preponderantly Catholic, continue to be very religious, and that any Swiss law of any consequence is subject to a direct popular vote. It matters that the French have actively suppressed their ethnic minorities for centuries and continue to do so.

It matters that soldiers of the king in Spain, Portugal, France, Germany, Poland, and Russia slaughtered Jews in organized campaigns, something that never happened in the United States.

It matters that U. S. labor law requires antagonistic positions from management and labor, something not the case under European law.

It matters that there’s a racial/ethnic divide between management and labor in some countries while not in others.

It matters that we have a common law system in the United States while most European countries have a civil code system.

We should adopt reforms that make sense in the American context not because they work so well in Norway.

Context matters.

The kerfuffle of the day is over the release of U. S. soldier Bowe Bergdahl from his five year captivity in exchange for the release of five Taliban leaders from Guantanamo, negotiated by the Obama Administration. My immediate reaction to the news is that it highlights how glad I am that I don’t have to make decisions about matters like this. Do you choose the most prudent course of action or the most merciful? Which is the higher priority, security or not leaving a soldier behind in the hands of the enemy?

Additionally difficult are separating what’s important from what isn’t important in the decision. Does it matter whether Sgt. Bergdahl were a deserter? Does it matter that the Obama Administration negotiated with terrorists for the release? Does it matter whether the Taliban released were the worst of the worst? Does what the Israelis do or don’t do about their own soldier held captive by their enemies?

I don’t have formed opinions about any of those questions and I’m glad I don’t need to have them.

I found this article by James Pethokoukis on why economic growth has slowed interesting but ultimately frustrating. Like so many other such articles it’s much better at stating the problem than producing much in the way of answers. I agree with this:

In 1900, the high school graduation rate was only 6%; now it’s between 75% and 80%. The college graduation rate back then was maybe 2% or less; it’s now around a third. However, again, we are seeing a real fall off in continued growth in human capital, at least as measured by years of schooling. Part of that is math, there’s simply so many years that you can stay out of the work force to improve your job skills. Perhaps we are running up against that. We are running up against the number of people qualified to take on post-secondary education. In primary and secondary education, there are fewer people graduating high school today than there were in the early 1970s and test scores haven’t improved at all.

However, he elides over the facts that the unemployment rate for new college graduates is 8.5%, higher than the general rate of unemployment and that H-1B visa holders are frequently paid less than native-born workers for the same jobs. If we do, indeed, need more workers with more education, wouldn’t you think that the wages should be rising for them and the unemployment rate lower?

Or this:

The key to more robust innovations is more robust entrepreneurship. Big, established firms innovate all the time, but they tend to innovate at the margins. They don’t tend to come up with big industry upending innovations for precisely the reasons that doing so would mess up their current profit centers.

We typically see new industries being created by new firms, new technologies coming to the surface with new firms. New firm formation is really the key to the creative destruction that makes modern economies dynamic and innovative. We have seen a secular falloff in the rate of new business formation and the percentage of people working in new businesses.

I think the solution to that problem is to lower the barriers to new business formation, to stop subsidizing large companies, and reduce the power and effectiveness of the tools, e.g. intellectual property law, that large companies exploit to beat down smaller upstarts. Unfortunately, I can’t see any enthusiasm for doing any of those things because all of them have powerful support constituencies.

Additionally, there used to be a dictum that big companies like to do business with big companies. I think that’s still true but I think it can be extended: big government likes to do business with big companies which prefer to do business with other big companies. In other words the larger and more powerful government becomes the more policy will tend to be oriented to favor large companies and the lower our rate of new business formation will become.

Rather than articles devoted to defining and exploring the problems in minute detail I’d like some articles completely dedicated to solutions.

The Economist provides some sobering statistics on healthcare fraud:

Health care is a tempting target for thieves. Medicaid doles out $415 billion a year; Medicare (a federal scheme for the elderly), nearly $600 billion. Total health spending in America is a massive $2.7 trillion, or 17% of GDP. No one knows for sure how much of that is embezzled, but in 2012 Donald Berwick, a former head of the Centres for Medicare and Medicaid Services (CMS), and Andrew Hackbarth of the RAND Corporation, estimated that fraud (and the extra rules and inspections required to fight it) added as much as $98 billion, or roughly 10%, to annual Medicare and Medicaid spending—and up to $272 billion across the entire health system.

Federal prosecutors had over 2,000 health-fraud probes open at the end of 2013. A Medicare “strike force”, which was formed in 2007, boasts of seven nationwide “takedowns”. In the latest, on May 13th, 90 people, including 16 doctors, were rounded up in six cities—more than half of them in Miami, the capital city of medical fraud. One doctor is alleged to have fraudulently charged for $24m of kit, including 1,000 power wheelchairs.

Distressing as that may be I think that it understates the problem if anything. IMO Medicare and Medicaid fraud are widespread, endemic, and structural. Medicare does not cover chronic care. In the interest of their patients (and to get paid for their efforts) some physicians bill chronic care as acute care because there’s no other way they can get paid for what they think of as doing their duty.

The stories of all of the patients in a care facility being fitted with hearing aids regardless of need are widespread. And how do you characterize bundling overhead costs into the charges for small things to the point of absurdity, e.g. the $25 aspirin or the $100 diapers?

Additionally, patients, particularly elderly patients, are strongly inclined to believe that when their doctors tell them that this or that test or this or that procedure is necessary that it is. Especially when they’re not paying for it.

Note that I’m not trying to make a case for the abolition of Medicare or Medicaid on grounds of widespread fraud. I’m just observing that the structure of our system lends itself to fraud.

You might want to take a look at Walter Russell Mead’s assessment of Hillary Clinton’s tenure as Secretary of State over at the Washington Post. I found it quite fair and even-handed. Here’s a sample:

How did Clinton understand the interplay of America’s power, its interests, its resources and its values? Was she able to translate that vision into policies that won enough support throughout the government to be carried out? Was she able to gain or keep the president’s confidence, and was the State Department under her leadership able to hold its own in the bureaucratic battles of the day? To the extent that her policy ideas were adopted, how effective were they? How well did she manage on the inevitable occasions when things went horribly wrong?

The quick synopsis of Dr. Mead’s assessment is that Sec. Clinton is an optimistic realist (Hamiltonian) with a strong global meliorist streak, unlike many foreign policy realists. What that means stripped of jargon is that she believes in pursuing American interests through “sea power, commercial expansion and a focus on strategic theaters in world politics” and that she believes that we have an obligation to use our power and influence to make the world a better place. Since I incline towards being a pessimistic idealist with a strong non-interventionist streak, you can hardly be farther from my views than she.

As to how well she held the office, Dr. Mead thinks she was a middling Secretary of State—better than some, not a titan of the office:

Historians will probably consider Clinton significantly more successful than run-of-the-mill secretaries of state such as James G. Blaine or the long-serving Cordell Hull, but don’t expect to see her on a pedestal with Dean Acheson or John Quincy Adams anytime soon.

The first words of Article II, Section 1 of the U. S. Constitution, the section that describes the role of the president are:

The executive power shall be vested in a President of the United States of America.

That means that the first job the president, before his role as commander in chief or preacher from the “bully pulpit” is the direction and management of the apparatus of the federal government. There is a connecting link among the poor management of the development of the Healthcare.gov web site, the IRS scandal, and the emerging VA scandal. It’s that the president wasn’t particularly interested in any of them. I don’t think he caused any of them but it’s patently obvious that he allowed them.

Peggy Noonan articulates the problem more pointedly:

Barack Obama is killing the reputation of government. He is killing the thing he loves through insufficient oversight. He doesn’t do the plodding, unshowy, unromantic work of making government work. In the old political formulation, he’s a show horse, not a workhorse.

The president’s inattention to management—his laxity, his failure to understand that government isn’t magic, that it must be forced into working, clubbed each day into achieving adequacy, and watched like a hawk—is undercutting what he stands for, the progressive project that says the federal government is the primary answer to the nation’s ills.

He is allowing the federal government to become what any large institution will become unless you stop it: a slobocracy.

We only have one president and managing the operations of the executive branch is the primary job of the president. There’s only one person who can do that job.