December 18, 2012

The real reason it’s so hard to cut military spending

Filed under: Bureaucracy, Government, Military, USA — Tags: , , , — Nicholas @ 11:00

From the January issue of Reason, Veronique de Rugy explains how the system is set up to protect military spending from even the most determined spending cuts:

The Department of Defense, with its 2.3 million workers, is the single largest employer in the United States. The defense industry, which is the main private-sector recipient of defense dollars, directly or indirectly employs another 3 million people. This, in a nutshell, is why it’s so hard to cut government spending in general and military spending in particular.

The scope and reach of the government are far bigger than we think, explains John J. Dilulio of the National Academy of Public Administration in the Spring 2012 issue of National Affairs. It’s more than just the money Washington spends or the people it employs. It’s also the people in the private sector who live off that spending. It’s the nonprofit organizations paid to help administer government programs. It’s the contractors who run the programs, the contractors’ sub-contractors, and so on.

[. . .]

Even when military contractors’ profits have reached an all-time high, Congress seems committed to sheltering the companies from any budget cuts. Industry lobbying probably plays a role here. According to the Center for Responsive Politics, the U.S. defense and aerospace lobby doled out $24 million to political campaigns and committees during the 2008 campaign cycle and spent nearly $60 million on lobbying in 2011. Lockheed Martin alone spent $15 million in 2011 on its lobbying efforts, plus $2 million in political contributions. Boeing spent $16 million on lobbying the same year.

In his seminal 1971 article “The Theory of Economic Regulation,” the Nobel-winning economist George Stigler noted that agencies eventually become captive of the very interest groups they were ostensibly designed to police. Writing regulation or even spending legislation requires in-depth industry knowledge, so federal agencies and lawmakers tend to hire directly from the very companies they must oversee or spend money on.

The reverse is true too. In order to gain better access to their regulators and government funds, companies hire lobbyists who used to work for Congress or government agencies. Of the 408 lobbyists employed by the military industry to apply pressure on Congress, 70 percent used to work on Capitol Hill.

Don’t expand the Canada Pension Plan: reform it

Filed under: Cancon, Economics, Government — Tags: , , , — Nicholas @ 10:52

Andrew Coyne briefly praises the CPP before advancing a plan to (eventually) supplant it entirely:

By most measures, Canada’s retirement income support system is an outstanding success. The poverty rate for Canadian seniors, with just 4.4% living below half the median income, is among the lowest in the world. The Canada Pension Plan, once careening towards insolvency, is now on a sounder footing. Millions of Canadians contribute to their Registered Retirement Savings Plans every year, with a view to replacing more of their income than the 25% covered by the CPP; Tax-Free Savings Accounts are a fast-growing alternative. For most people, then, the pension system works well. There is no evidence of a generalized pension “crisis.”

[. . .]

Suppose an additional levy were tacked onto CPP premiums. Only instead of going into the regular CPP pot, the funds would accumulate in the contributor’s own personal fund — like an RRSP, only compulsory. To avoid wasting money on management fees, funds would be invested strictly passively (ie buying the indexes), with the particular asset mix varying as the investor aged: more stocks when younger, more bonds when older.

Any increase in benefits would thus have to be fully funded; at the same time, since legal title to the funds would rest with the contributor, there would be no way politicians could raid the kitty. Moreover, with such a direct link between contributions and the size of their nest egg, contributors would be less likely to see the rise in premiums as a tax increase, and more as savings, mitigating labour market effects, at least on the supply side.

On its own, this would be vastly preferable to CPP expansion. If we liked the results, we might even think of going further. Over time, one could imagine migrating more and more of the regular CPP over to these mandatory personal accounts, allowing the CPP fund to be slowly wound down. Rather than simply expanding the CPP, the challenge of population aging presents an opportunity to reform it.

QotD: Time to look at repeal

Filed under: Gaming, Law, Liberty, Media, Quotations, USA — Tags: , , , , — Nicholas @ 10:32

Is America ready to repeal the first Amendment and regulate Hollywood and the video game industry? Free speech absolutists point to their peaceful enjoyment of action-packed Blockbuster movies where protagonists of those films are often portrayed slaying hundreds of people in simulated scenes of violence.

Yet, journalists are broadcasting America’s call for an end to the tragedies through the regulation of this so-called freedom that has already killed too many. “The debate is long overdue. The mass-killing perpetrated by America’s free-speech culture is our hottest story today,” said one network reporter. “Adam or Ryan Whats-His-Name was just another face. The real problem that must be addressed is America’s sick love affair with unsanctioned ideas and unfettered access to violent imagery.”

The founding fathers could not have imagined high-capacity mass-communications networks when they wrote the Constitution. Thomas Paine was a pamphleteer, not a mass merchant of kill porn on iTunes. Indeed, in the age of quills and parchment, Thomas Jefferson could not have imagined tweeting, or using the cable news industry to launch into the superstardum of American’s celebrity culture overnight.

“I’m a free speech moderate,” said one New York Times reporter reflecting upon the recent tragedy, “I’m in the news business because of free-speech. But, I’m also here to make a difference. If, because of this overdue regulation, it becomes more difficult to speculate wildly about the identity of the shooter based on an intern’s cursory scan of social media, so be it.”

Stephen Taylor, “Time to look at repeal”, Stephen Taylor, 2012-12-17

The real barrier to self-improvement is always you

Filed under: Education, Humour, Randomness — Tags: , , — Nicholas @ 10:08

Just when did we take the portal to this alternate universe where Cracked is good? For example, this article:

If you want to know why society seems to shun you, or why you seem to get no respect, it’s because society is full of people who need things. They need houses built, they need food to eat, they need entertainment, they need fulfilling sexual relationships. You arrived at the scene of that emergency, holding your pocket knife, by virtue of your birth — the moment you came into the world, you became part of a system designed purely to see to people’s needs.

Either you will go about the task of seeing to those needs by learning a unique set of skills, or the world will reject you, no matter how kind, giving and polite you are. You will be poor, you will be alone, you will be left out in the cold.

Does that seem mean, or crass, or materialistic? What about love and kindness — don’t those things matter? Of course. As long as they result in you doing things for people that they can’t get elsewhere.

[. . .]

The human mind is a miracle, and you will never see it spring more beautifully into action than when it is fighting against evidence that it needs to change. Your psyche is equipped with layer after layer of defense mechanisms designed to shoot down anything that might keep things from staying exactly where they are — ask any addict.

So even now, some of you reading this are feeling your brain bombard you with knee-jerk reasons to reject it.

H/T to ESR for the link.

P.J. O’Rourke on marijuana and same-sex marriage

Filed under: Humour, Law, Liberty, Religion — Tags: , , — Nicholas @ 09:37

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