January 11, 2012
An unlikely source of healthcare innovation: Singapore
In a post from a few years ago, Bryan Caplan sings the praises of the very different approach to public healthcare practiced in Singapore:
In The Undercover Economist, Tim Harford highly praised the health care policies of Singapore. But it wasn’t until I read the section on health care in Ghesquiere’s Singapore’s Success that I realized how amazing the official numbers are. If the following is true, all the comparisons showing that the U.S. greatly outspends Europe without getting better health are beside the point, because Singapore makes Europe look like the U.S.:
The Singapore government spent only 1.3 percent of GDP on healthcare in 2002, whereas the combined public and private expenditure on healthcare amounted to a low 4.3 percent of GDP. By contrast, the United States spent 14.6 percent of its GDP on healthcare that year, up from 7 percent in 1970… Yet, indicators such as infant mortality rates or years of average healthy life expectancy are slightly more favorable in Singapore than in the United States… It is true that such indicators are also related to the overall living environment and not only to healthcare spending. Nonetheless, international experts rank Singapore’s healthcare system among the most successful in the world in terms of cost-effectiveness and community health results.
How does Singapore do it? Singapore is no libertarian health care paradise, but it does self-consciously try to maintain good incentives by narrowly tailoring its departures from laissez-faire:
The price mechanism and keen attention to incentives facing individuals are relied upon to discourage excessive consumption and to keep waste and costs in check by requiring co-payment by users.
[…]
The state recovers 20-100 percent of its public healthcare outlay through user fees. A patient in a government hospital who chooses the open ward is subsidized by the government at 80 percent. Better-off patients choose more comfortable wards with lower or no government subsidy, in a self-administered means test.
I’ve heard a lot of smart people warn that co-payments are penny-wise but pound-foolish, because people cut back on high-benefit preventive care. Unless someone is willing to dispute Singapore’s budgetary and health data, it looks like we’ve got strong counter-evidence to this view: Either Singaporeans don’t skimp on preventive care when you raise the price, or preventive care isn’t all it’s cracked up to be.
January 10, 2012
What a difference a decade makes
Megan McArdle reports from her business school’s ten-year reunion on the fates of her fellow MBA students:
It was my 10-year reunion at the University of Chicago Booth School of Business. Obviously I wanted to see if people had gotten fatter, balder, and wrinklier. (Surprisingly, not really.) But I also wanted to know what had become of us, and our careers.
Ten years ago, we graduated into a country where the Twin Towers were still standing, Webvan was a going concern, and the unemployment rate was 4.5 percent. Many of us headed to New York or other cities to become what Tom Wolfe, in The Bonfire of the Vanities, called “the Masters of the Universe” — the financiers who can earn lottery-size sums on a single deal. Others went to Silicon Valley start-ups, or became the consultants who worked with them. I couldn’t find anyone at the reunion who admitted to trading dodgy residential mortgage-backed securities, but we participated in all the other madness of two decades of financial froth—and got smashed in two crashes.
We weren’t the people who inflated the bubbles; we were the ones hired, and then fired, by those people. We were the ones who happened to be standing next to the guy who was pushing the buttons when everything went to hell.
[. . .]
I have a theory about what happened to us, and our nation: when too much money is piled together in one place, it starts to decay, and as it does, it emits some sort of unidentified chemical that short-circuits the parts of your brain controlling common sense. When my class matriculated in 1999, ads for a firm called Discover Brokerage featured a tow-truck driver whose passenger notices in the cab a picture of the home — an island — that the driver has purchased with his fabulous online-trading profits. The passenger looks taken aback while the driver muses, “Technically, it’s a country.”
What’s even more amazing than the fact that this ad was ever made is that this sort of triple-distilled balderdash could intoxicate a large group of very smart people at one of the nation’s top finance schools.
Oh, don’t get me wrong: none of us was simpleminded enough to take those ads literally. Oh, ho-ho, no, not us! No, we made only the most erudite and sophisticated sorts of mistakes, like gang-rushing banking internships, and telling ourselves we were “consumption smoothing” as we used student loans to finance vacations. Believe it or not, many of us talked frequently about the echoes of 1929 — but we still didn’t necessarily act on that insight, as the markets cratered in the early 2000s.
For my summer 2000 internship at Merrill Lynch, I chose the technology-banking group despite having watched the March 2000 NASDAQ crash from the lobby of Merrill’s auditorium, where we were supposed to be undergoing orientation. Ignoring the helpless, angry flapping of the HR staff, a bunch of us spent the afternoon telling nervous jokes and watching the eerie flicker that billions of dollars give off when they evaporate on live TV.
When “everyone agrees” about excessive executive pay, something else is being sold
Tim Black on the amazing unanimity of thought that the most pressing problem in the world right now is big pay packets for corporate CEOs:
Occupy London, the Labour Party, the Lib-Con coalition, the Archbishop of York… It doesn’t matter to what or to whom you look, you’ll find the same simple-minded sentiment: the root cause of our economic and social problems is greed. The greed, that is, of bankers, of overpaid CEOs, of those at the top of society who simply have and want too much.
[. . .]
If there was ever a striking indication of the deadening political conformism, the dearth of social imagination, that so characterises our contemporary impasse, it is there in the sheer ubiquity of the Greed-is-Bad argument.
So what is driving this pervy, across-the-board obsession with the pay packets of super execs? It’s certainly not impelled by a desire to get to grips with the economic crisis that holds most of the developed world in its grip. No doubt there are some simple-minded souls in a state of Occupation who believe that blaming and bashing company CEOs or bankers is somehow to understand the economic crisis. But just as the remuneration packages of a few bankers and bosses did not bring about the current crisis, so seeking to limit their wages, to impose a maximum national wage, will not solve the crisis. And while £3million or £4milllion for a CEO’s annual salary does seem huge, such figures amount to very little in the grand economic scheme of things. As the Investor’s Chronicle points out: ‘The average FTSE 100 CEO is paid £3.9million year. But this is only one four-thousandth (0.025 per cent) of the average market capitalisation of a FTSE 100 company.’
The current fashion for attacking large pay packages, then, is economic neither in impulse nor intent. Rather it is driven, in the first instance, by a narrow moralism. For its numerous proponents, either in party offices or in spartan tents, it represents an easy posture, a cheap critical pose. One Guardian columnist virtually gave the game away: ‘Like phone hacking or MPs’ fiddled expenses, this is an issue that only needs to be described to seem reprehensible.’ That is, to the right-thinking types on liberal broadsheets, criticising large salaries is just too good an opportunity to miss. Indeed, like attacking tabloids and MPs, it is a mark of one’s membership of the right-thinking to have a pop at the really, really rich.
But there’s a deeper, darker impulse driving this cheap attack on exorbitant pay packages than just preening self-righteousness. And that’s the belief that the large pay packets pursued by the undeservedly wealthy are a symbol of a society-wide pathology. The cheap attack on top earners is also an attack on the material aspirations of the rest of us. We are, in short, just too greedy now to be left to our own unregulated, uncontrolled devices. A report from the High Pay Commission — a grandiosely monikered body established by centre-left think tank Compass, a few trade unionists and business secretary Vince Cable — makes this clear by drawing the highly questionable link between this putative celebration of ‘greed’ — or ‘an elevation of the concept of the rational self-interested man to unprecedented heights’ — and the August riots. ‘It should not perhaps surprise us’, the report states, ‘that the rioters took the trappings of wealth that they could not afford — the TVs and designer trainers. It reflects a sense of entitlement that pervades society from the very top to the bottom.’
January 9, 2012
January 8, 2012
George F. Will on big government
Even fans of bigger government should recognize the accuracy of this short summary:
Liberals have a rendezvous with regret. Their largest achievement is today’s redistributionist government. But such government is inherently regressive: It tends to distribute power and money to the strong, including itself.
Government becomes big by having big ambitions for supplanting markets as society’s primary allocator of wealth and opportunity. Therefore it becomes a magnet for factions muscular enough, in money or numbers or both, to bend government to their advantage.
The left’s centuries-old mission is to increase social harmony by decreasing antagonisms arising from disparities of wealth — to decrease inequality by increasing government’s redistributive activities. Such government constantly expands under the unending, indeed intensifying, pressures to correct what it disapproves of — the distribution of wealth produced by consensual market activities. But as government presumes to dictate the correct distribution of social rewards, the maelstrom of contemporary politics demonstrates that social strife, not solidarity, is generated by government transfer payments to preferred groups.
[. . .]
The tax code, government’s favorite instrument for distributing wealth to favored factions, has been tweaked about 4,500 times in 10 years. Generally, the beneficiaries of these changes are interests sufficiently strong and sophisticated to practice rent-seeking.
Not only does redistributionist government direct wealth upward; in asserting a right to do so it siphons power into itself. A puzzling aspect of our politically contentious era is how little contention there is about the ethics of coercive redistribution by progressive taxation and other government “corrections” of social outcomes it considers unethical or unaesthetic.
The Joyce Estate provides useful ammunition to those opposed to longer copyright terms
The works of James Joyce have finally (re-)entered the public domain:
On the last day of 2011, the 70th anniversary year of his death, James Joyce’s work finally passed out of copyright. It was the dawn of a new age for Joyce scholars, publishers and biographers who are now free to quote or publish him without the permission of the ferociously prohibitive Joyce estate.
Over the past 20 years the right to quote from or publish Joyce’s work has been a matter of increasingly heated debate. The estate’s most vocal trustee, Stephen Joyce, the author’s grandson, earned himself the reputation as the most intractable defender of any copyright in modern times. His truculence (often verbal and colourful) towards those wishing to quote or publish his grandfather’s words dated from the mid-1970s, when biographer Richard Ellmann published some of Joyce’s “pornographic” letters to his wife Nora and some suggestive ones to a clandestine lover in Zurich. On becoming a trustee, Stephen was determined to prevent any further such revelations.
He outraged a meeting of Joyce scholars in Venice in 1988 by announcing that he had destroyed around a thousand letters to Joyce from his troubled daughter Lucia, as well as some to her from Samuel Beckett, the love of her young life. The following year he forced Brenda Maddox to delete a postscript concerning Lucia from her biography Nora: The Real Life of Molly Bloom. However, in 1991, the 50th anniversary of his death, Joyce’s copyright lapsed and for a time he could be quoted freely without permission. But in 1995 copyright in Europe was extended to 70 years, so the rights reverted to the estate.
[. . .]
The intention of the literary guardian is often not just to protect the reputation and prestige of an individual or family but also to safeguard the integrity of a work against experimentation, revision or trivialisation. Samuel Beckett, for example, refused to allow women to take the leading roles in Waiting for Godot, an indignant Orwell stopped his publisher publicising Nineteen Eighty-Four as a romantic thriller and the Joyce estate refused Kate Bush permission to include the final, seductive words of Molly Bloom from Ulysses in a song.
But there is also a certain power and prestige in being the literary executor of a famous writer. People pay heed to one’s words, come cap-in-hand to one’s door with requests, and the trustee of manuscripts is free to grant or deny favours with a lordly nod or dismissive gesture. It is a power jealously guarded and sometimes remorselessly implemented.
January 7, 2012
Conrad Black: Current events vindicate Margaret Thatcher
The current situation in Europe proves that British prime minister Margaret Thatcher was right all along:
Though it is probably happening too late to be overly gratifying to her, events are piling on to vindicate Margaret Thatcher completely in her reservations about British integration in Europe. Her response to the proposal to reduce Britain to a local government in a federal Europe was, memorably: “No, no, no, and never.” And her reward for her refusal to get on board what was then the thundering bandwagon of Eurofederalism, was to be sent packing by her own ungrateful party, though she was the only British political leader who had won three consecutive, full-term election majorities since before the First Reform Act expanded the electorate in 1832.
She was immensely popular with millions of Britons as a patriotic and courageous leader who took Britain off financial life support, saved it from strangulation by over-mighty, almost anarchistic unions, built a prosperous, home-owning democracy, threw the Argentinians out of the little corner of the British Empire they had wrongfully seized (the Falkland Islands), and played a starring role in winning the Cold War.
[. . .]
And as she liberalized the economy; imposed a free, secret ballot for labour strikes; lowered all taxes; privatized industry, housing, airports, almost everything except the National Health Service and the BBC; jolting economic growth resulted. Unfortunately, its most conspicuous exemplars included many successful entrepreneurs and financier types who offended British sensibilities by their garish and spivvy ostentation. The basis of Margaret Thatcher’s support was the Daily Telegraph-reading, gin and tonic-drinking, cricket-loving middle class, the backbone of the nation. But her enemies identified her with an infelicitous combination of Colonel Blimp fuddy-duddies and sticky-fingered, vulgar parvenus.
She had a somewhat hectoring manner in debates, and was notoriously impatient with what she considered pusillanimity from senior colleagues, sometimes calling cabinet members “blanc-manges,” or “suet puddings,” or even “spineless, boneless, men” (not necessarily inaccurately). Naturally less known was her exquisite courtesy and unaffected and egalitarian kindness to subordinates and strangers. It annoyed feminists that she was such a traditionalist, and weak men that she was a strong woman. But she triumphed by perseverance and courage; to the end, though a stirring speaker, she was nervous before a speech. She was a strong woman, but not at all a mannish one.
January 6, 2012
Ten years later: Ron Paul’s 2002 predictions
January 5, 2012
The MPAA over-cooks their numbers to support SOPA
Techdirt reports on the work done by Julian Sanchez at the Cato Institute to actually scrutinize the “loss” numbers used by the MPAA:
One of the things we’ve noticed in the debate over SOPA and PIPA is just how the other side is really lying with statistics. We’ve done a thorough debunking of the stats used by the US Chamber of Commerce to support both bills, as well as highlighted the misleading-to-bogus stats used by Lamar Smith in his support of the bill.
But every day, more bogus stats are rolled out. Julian Sanchez, over at the Cato Institute, has decided to dig into one specific bogus number, the supposed claim of $58 billion in “losses,” and to show how the numbers don’t hold up to any scrutiny. In fact, using the details of where the numbers came from, Sanchez makes the case that SOPA won’t save a single net job for the US economy. Read on to find out how.
First off, the $58 billion comes from an absolutely laughable report for the Institute for Policy Innovation, done every year by Stephen Siwek at a firm called Economists Incorporated. We’ve challenged this ridiculous number in the past, but not to the level of detail that Sanchez has here. He starts out by bringing up (as we have many times), Tim Lee’s excellent debunking of the ridiculous “ripple effects” that Siwek/IPI always use, despite them being a trick to double, triple, quadruple, etc count the same dollars [. . .]
January 4, 2012
Santorum is the “Spock with a beard” universe version of Ron Paul
Michael Tanner enumerates the Santorum attributes his evangelical conservative fans seem to find most attractive:
There is no doubt that Santorum is deeply conservative on social issues. He is ardently anti-abortion, even in cases of rape and incest, and no one takes a stronger stand against gay rights. In fact, with his comparison of gay sex to “man on dog” relationships, Santorum seldom even makes a pretense of tolerance. While that sort of rhetoric may play well in Iowa pulpits, it will be far less well received elsewhere in the nation.
[. . .]
Santorum’s voting record shows that he embraced George Bush–style “big-government conservatism.” For example, he supported the Medicare prescription-drug benefit and No Child Left Behind.
He never met an earmark that he didn’t like. In fact, it wasn’t just earmarks for his own state that he favored, which might be forgiven as pure electoral pragmatism, but earmarks for everyone, including the notorious “Bridge to Nowhere.” The quintessential Washington insider, he worked closely with Tom DeLay to set up the “K Street Project,” linking lobbyists with the GOP leadership.
He voted against NAFTA and has long opposed free trade. He backed higher tariffs on everything from steel to honey. He still supports an industrial policy with the government tilting the playing field toward manufacturing industries and picking winners and losers.
In fact, Santorum might be viewed as the mirror image of Ron Paul. If Ron Paul’s campaign has been based on the concept of simply having government leave us alone, Santorum rejects that entire concept. True liberty, he writes, is not “the freedom to be left alone,” but “the freedom to attend to one’s duties to God, to family, and to neighbors.” And he seems fully prepared to use the power of government to support his interpretation of those duties.
