Quotulatiousness

March 14, 2022

“Mister, we could use a man like Herbert Hoover Warren Harding again …”

Filed under: Economics, Government, History, USA — Tags: , , , , , , — Nicholas @ 03:00

Kind words for the oft-maligned 29th president of the United States? Daniel J. Mitchell is all over it:

Warren G. Harding, 14 June 1920.
Library of Congress control number 2016828156

Today, we’re going to celebrate the fiscal achievements of Warren Harding.

Most notably, as illustrated by this chart based on OMB data, he presided over a period of remarkable spending discipline.

Harding also launched very big — and very effective — reductions in tax rates.

And his agenda of less government and lower tax rates helped bring about a quick end to a massive economic downturn (unlike the big-government policies of Hoover and Roosevelt, which deepened and lengthened the Great Depression).

In an article for National Review last year, Kyle Smith praised President Harding’s economic stewardship.

    In a moment of national crisis, Warren G. Harding restored the economic health of the United States … America in 1921 was in a state of crisis, reeling from the worst recession in half a century, the most severe deflationary spiral on record … Unemployment, it is now estimated, stood somewhere between 8.7 and 11.7 percent as returning soldiers inflated the size of the working-age population.

    Between 1919 and August of 1921 the Dow Jones average plummeted 47 percent. Harding’s response to this emergency was largely to let the cycle play out … The recession ended in mid-year, and boom times followed. Harding and Congress cut federal spending nearly in half, from 6.5 percent of GDP to 3.5 percent. The top tax rate came down from 73 percent to 25, and the tax base broadened. Unemployment came down to an estimated 2 to 4 percent … Harding was a smashing success in a historically important role as the anti-Wilson: He restored a classically liberal, rights-focused, limited government, and deserves immense credit for the economic boom that kicked off in his first year and continued throughout the rest of the 1920s.

Smith’s article also praises Harding for reversing some of Woodrow Wilson’s most odious policies, such as racial discrimination and imprisoning political opponents (Wilson also had a terrible record on economic issues).

Of course, Harding’s term is much more often remembered for the scandals, and as most modern historians are far more interested in Woodrow Wilson’s bold progressivism they almost always decry Harding and then Coolidge for dismantling a lot of Wilson’s more enthusiastic progressive projects. Even H.L. Mencken — very much not a Wilson fan — found Harding to be not to his taste in turn:

On the question of the logical content of Dr. Harding’s harangue of last Friday, I do not presume to have views … But when it comes to the style of the great man’s discourse, I can speak with … somewhat more competence, for I have earned most of my livelihood for twenty years past by translating the bad English of a multitude of authors into measurably better English. Thus qualified professionally, I rise to pay my small tribute to Dr. Harding. Setting aside a college professor or two and half a dozen dipsomaniacal newspaper reporters, he takes the first place in my Valhalla of literati. That is, he writes the worst English that I have ever encountered. It reminds me of a string of wet sponges; it reminds me of tattered washing on the line; it reminds me of stale bean soup, of college yells, of dogs barking idiotically through endless nights. It is so bad that a sort of grandeur creeps into it. It drags itself out of the dark abysm … of pish, and crawls insanely up to the topmost pinnacle of posh. It is rumble and bumble. It is flap and doodle. It is balder and dash.

March 17, 2021

Rebuilding the Royal Canadian Navy

Filed under: Cancon, Military — Tags: , , , , , — Nicholas @ 05:00

I somehow missed this article by Sir Humphrey when he posted it a few weeks back. He’s looking at the Australian and Canadian governments’ respective decisions to use the British Type 26 design to replace their current anti-submarine fleets and considering some of the economic and military concerns that led to the decision.

In both cases there have been media articles in the last week over the programmes and concerns. In Canada, the challenge has been that the cost has grown to a total of $77bn for 15 escorts. There has been cost growth from an originally scheduled $14bn many years ago, and the first of class will not now be delivered until 2031. This has led to suggestions in some media quarters that Canada could do things faster and more cheaply if it simply bought an off the shelf foreign design now and got on with things.

An artist’s rendition of BAE’s Type 26 Global Combat Ship, which was selected as the Canadian Surface Combatant design in 2019, the most recent “largest single expenditure in Canadian government history” (as all major weapon systems purchases tend to be).
(BAE Systems, via Flickr)

[…]

The issue now is that Canada will need to establish, almost from scratch, a frigate construction programme and workforce for a finite period of time without a clear plan of what follows on when the last hull is completed. At the same time it will need to run on ships that are becoming increasingly elderly – it is likely that most of the Halifax class will see more than 40 years of service, and some may approach their 50th birthdays before being replaced – something that will pose an increasing maintenance and resource challenge.

Could things be done more cheaply or quickly? Almost certainly yes, but only if you are willing to make massive compromises. It could be possible, for example, to look to licence build an existing design that is already in service. There are plenty of designs out there that could be licence built and brought into service in the next few years — probably at less cost than the T26 programme.

But while this may sound easy, its also a recipe for disaster. It’s easy to look at country X and say “they’re buying this ship for that much” and assume that Canada is getting a bad deal. But Country X is likely to have a very different set of requirements, and their design will reflect it.

For example, Canada needs a ship able to operate with NATO and 5 EYES as a fully integrated player – this adds cost to fit specific systems and equipment that is compatible. Canada will also want to fit bespoke systems to meet national needs – again this will require design changes, that come at a price. Bolting on all manner of different requirements that Canada needs to meet the unique operational circumstances adds price and complexity to the design.

While you probably could take an off the shelf design and build it now, it would be just that, an off the shelf design. It wouldn’t be optimised for local needs, and it wouldn’t have the right equipment, comms, meet local design standards, or be certified for use with national equipment.

You are then faced with two choices – either bring a cheap ship into service that is entirely unsuitable and not designed for your needs, but is a lot cheaper, or spend an enormous amount of money shifting the design to better reflect your needs. If you choose the latter, then suddenly you are adding cost and time in, and the 2031 date will slip even further.

If you choose the former, then you have to accept that the design is “as it comes” and will have minimal Canadian input – so limited industrial offsets, very little economic benefit, and the long-term support solutions will firmly be tied into the country of origin and not Canada. In other words, Canadian taxpayer dollars will be spent to support a foreign economy.

That last point is really the key. Canadian governments, in my lifetime at least, never look at the military requirement as the top priority and sometimes not even the second or third priority. The economic spin-offs, especially in those cases where the benefits can be allocated to marginal parliamentary constituencies, will be the top priority. As is always a talking point in the case of any major military hardware acquisition, this is going to be the “single largest expenditure in Canadian government history”. Just as the replacement of the RCAF’s aged CF-18 fighters will be the largest expenditure in its turn.

March 2, 2021

Warship purchasing is not for the faint-of-heart

Filed under: Bureaucracy, Cancon, Economics, Government, Military — Tags: , , , , , — Nicholas @ 03:00

Ted Campbell talks about the way the Royal Canadian Navy plans for warship purchases … and how the best-laid plans can be derailed by ignorant political advisors:

An artist’s rendition of BAE’s Type 26 Global Combat Ship, which was selected as the Canadian Surface Combatant design in 2019, the most recent “largest single expenditure in Canadian government history” (until the RCAF gets their replacement for the CF-18 Hornet).
(BAE Systems, via Flickr)

Once upon time,* about 25 to 30 years ago, in the mid 1990s, when I was the director of a small, very specialized team in National Defence Headquarters (NDHQ) in Ottawa, something like this happened: One of my colleague, who had a title like Director of Maritime Requirements or something similar said to one of his principle subordinates, “Look, now that the 280s (Canada had four Tribal Class destroyers with pennant numbers starting at 280, they were often just called ‘280s’) are finished their mid-life refit and now that the new frigates are entering service it is time to put a ‘placeholder’ in the DSP for their eventual replacements.” The DSP was (still is?) the Defence Services Programme, it is the internal document which sets out the long range spending plans (maybe hopes is a better word) for the Canadian Armed Forces.

Anyway, the Navy commander (the officer assigned to write the document, not the Commander of the Royal Canadian Navy who is nicknamed the Kraken (CRCN)) sat at his desk and consulted the most recently approved planning document which, as far as I can remember, called for a surface fleet of 25 combat vessels and four large support ships plus numerous minor war vessels (like minesweepers) and training vessels. The officer then prepared a memorandum for the joint planning staff which said that the Navy would need 25 new combat ships, to be procured between about 2015 and 2035, in five “batches” of five ships each** at a total cost of about $100 Billion, in 2025 dollars. He didn’t say much beyond that, actually, he was just intending to “reserve” some money a generation or so in the future. His memorandum sailed, smoothly, past his boss and the commodore but questions came from a very senior Air Force general: Where he asked, did the $100 Billion come from? That was an outrageous number, he said.

A meeting ensure where the Navy engineering people came and said, “$100 Billion is a very reasonable guesstimate. Our brand new frigate are costing $1 Billion each when they come down the slipway. They will each have cost the taxpayers two to three times that by the time we send them to be broken up thirty or forty years from now. Adding in the inevitable costs of new technology and inflation, which we know is higher for things like military ships and aircraft than it is for consumer goods, then a life-cycle cost of $4 Billion for each ship is very conservative. The admirals and generals huffed and puffed but they didn’t argue ~ they knew that the engineering branch insisted on using life cycle costing, even though no-one but them understood it, and they also knew that arguing with engineers is like mud-wrestling with pigs: everyone gets dirty but the pigs love it.

A decade later, when a new government was planning the National Shipbuilding Procurement Strategy, which was all about making the Canadian shipbuilding industry competitive and had very little to do with ships ~ except they would be the “product” for which the Government of Canada would pay top-dollar, the Navy was told it could have fewer ships, in two classes, and someone ~ NOT the military’s engineering branch ~ assigned a cost figure to the project which was, to be charitable, pulled out of some political/public relations staffer’s arse.

[…]

* The story is true, in general, but I was not directly involved in any of it. I learned about what happened from three main sources: 1. routine briefings that my bosses (directors-general and branch chiefs) gave, regularly, to we directors, dealing with what was going on in the HQ and in the big wide world; 2. periodic chats with my colleagues, after work on Friday afternoons, in the bar of the Officers’ Mess ~ many of us regarded 2. as a more reliable source of information than 1.; and 3. in the case of the story about the Navy engineers and the Air Force general, by a friend and colleague who was in the room.

** The idea, long before the National Shipbuilding Strategy, was to keep shipyards moderately busy on a continuous basis. The 25 ships would all be similar: the first “batch” of five would be identical, one to the other; the second “batch” would be very similar but with some improvements; the five ships of batch 3 would be similar to the ships from the second batch and those from batch 4 would be rather like their batch 3 sisters. Finally, the batch 5 ships would be product improved versions of batch 4 ~ they would still be “sisters” of the batch 1 ships, but not, in any way, twins. The idea was that about the time that the batch 5 ships were being delivered the first of the batch 1 ships would be getting ready for a mid-life refit (after 15 to 20 years of service) which would result in it being much more like the batch 5 ships … and so on.

July 1, 2020

Toronto Police won’t be facing a 10% budget cut after city council votes down proposal

Filed under: Cancon, Government, Law — Tags: , , — Nicholas @ 03:00

Chris Selley on the vote by Toronto city councillors to retain the existing budget for the city’s police force at $1.22 billion:

On Monday, Toronto City Council debated and passed a variety of proposed police reforms, the newsiest of which had been asking the department to table a 10-per-cent budget cut for 2021. That idea was voted down 16-8. Further proposed changes included asking the Toronto Police Service for a line-item budget, and subjecting police to the municipal auditor-general’s oversight — utterly revolutionary concepts, you will agree. (Both passed.)

The budget cut might at least have been a useful exercise: It would be interesting to know what the police would and wouldn’t do with $1.1 billion instead of $1.22 billion. If I had been a consensus-seeking councillor on the virtual floor, I might have moved a motion asking the police to table line-item budgets for both — and maybe push for 20 or 30 per cent, too. But the question of the budget sucked up too much oxygen.

That’s certainly understandable. The “defund the police” movement in all its permutations is having a moment. There are North American police departments and police unions that might as well be begging to be disbanded, as much with their banal and petulant misbehaviour as with their needless use of lethal force. A few might even get their wish.

Canadian departments haven’t been begging quite as hard, however, and too many Canadians take false solace in that. When it comes to police-involved fatalities, we fare quite poorly against Western nations other than the one next door. Our accountability mechanisms are, generally speaking, a sick joke; indeed, it seems considerably easier to fire flamboyantly terrible cops in the United States than it does here.

James Forcillo, the Toronto officer who was caught on tape fatally unloading nine shots at 18-year-old Sammy Yatim for no good reason, was on the payroll for two-and-a-half years until his criminal conviction. He was at least suspended. Simon Seguin, the Alberta RCMP officer caught on camera in March rugby-tackling, punching and choking Athabasca Chipewyan First Nation Chief Allan Adam in a dispute over an expired vehicle registration, was at the time awaiting trial for assault!

June 27, 2020

QotD: The cost of military equipment

Filed under: Business, Economics, Government, Military, Quotations — Tags: , , , , , — Nicholas @ 01:00

Major military hardware is produced in only limited quantities and involves a massive amount of research, development, and engineering before the first unit goes into service. Because of this, the companies that build it are rarely willing to take the risk of paying for the development themselves and recovering the cost from the units that they sell. What if the customer suddenly decides to cut their buy in half? To avoid this problem, development is paid for by the customer separately from procurement of each item. Well, more or less. The actual answer varies with each particular system, accounting method, and time of the month. But in general, costs break down that way.

So why does this cause so much confusion? Well, it all has to do with what gets reported. Someone who is trying to make the case that some program is outrageously expensive and should be cancelled is going to lump together development and procurement, divide by the number of systems involved, and then publish the resulting number. But, particularly when we’re discussing the cost of a system about to enter production, that’s very different from the actual numbers. To give a well-known example, the B-2 is generally reputed to have cost about $2 billion/plane in the 90s. However, this is the total program cost divided by the 21 airframes. If we’d decided to buy 22 B-2s instead of the 21 we did buy, the extra plane would have cost only $700 million or so. Admittedly, the B-2 is a rather extreme case, and usually the share of R&D cost is less than the procurement (flyaway) cost, but it’s illustrative of the power of this kind of framing.

“bean”, “Military Procurement – Pricing”, Naval Gazing, 2018-03-09.

January 7, 2020

“HS2 will make the country worse off and should be stopped as soon as possible”

Filed under: Britain, Economics, Railways — Tags: , , — Nicholas @ 05:00

The British government recently reviewed the ever-escalating sums for the proposed HS2 high speed passenger rail connection that began at some £30 billion, then climbed to £50 billion, then £80 billion, and the latest estimate is up to £110 billion. Even by other countries’ high speed rail boondoggles, that is a breathtaking cost escalation. If, as it should, the government cancels the HS2 project, what happens to the money that was budgeted for the fiasco?

The figures used to justify HS2 were “fiddled” and that the project is most unlikely to deliver value for money — that’s the verdict of Lord Berkeley, the deputy chairman of the recent review into the project. He’s right of course and not solely because he’s repeating what I argued more than a year ago.

HS2 will make the country worse off and should be stopped as soon as possible. The government can mourn the money wasted and go off and do something else. Some suggest the HS2 money should be taken and spent on northern railways. Or as Lord Berkeley himself would prefer, on commuter lines in the Midlands.

But those offering these suggestions are making a very fundamental mistake: the real question is not which project most deserves this slab of funding, but whether the state should be spending this money at all.

This is not to say government should not be involved in funding any big infrastructure — everyone except the most hardcore anarchists accepts that state involvement in the economy is sometimes appropriate. But when it does intervene, it ought to be because there is an ironcast case for the betterment of the general population. That’s equally true whether we are talking about taxing to spend money now, or borrowing on the assumption that future benefits will pay back the debt incurred.

So, where does this leave the HS2 money? At some point it was decided that spending £30 billion, £50 billion, £80 billion or now as much as £110 billion on some nice choo-choos was an idea that justified taxing the public. Now it’s clear and obvious that it isn’t. Deciding afterwards that the government must spend all those billions on something else transport-related is missing the point entirely.

December 14, 2019

History of Space Travel – Guided by Starlight – Extra History – #6

Filed under: Bureaucracy, Government, History, Space, USA — Tags: , , , , — Nicholas @ 04:00

Extra Credits
Published 12 Dec 2019

What happened after we touched down on the moon? And where are we going in the future? While we may have lost the glitz and glamor of the Space Race, we have continued to make incredible progress in reaching the stars. We’ve come together to build space stations while in space, create the international space station, and started developing new technologies that could take us to Mars and beyond.

Start your Warframe journey now and prepare to face your personal nemesis, the Kuva Lich — an enemy that only grows stronger with every defeat. Take down this deadly foe, then get ready to take flight in Empyrean! Coming soon! http://bit.ly/EHWarframe

October 13, 2019

QotD: The modern British army is custom-tailored to resist reform of any meaningful type

Filed under: Britain, Military, Politics, Quotations — Tags: , , , — Nicholas @ 01:00

This then leaves the army in a bit of a quandary. It has focused on delivery of a global division as its benchmark at a time when the politicians simply do not want to do this. It has focused on keeping 82,000 troops when it can’t afford to keep them all equipped, and to meet the political priority of protecting certain regimental capbadges, it has been forced to sacrifice its far more valuable logistics, communications and other enablers that keep it as a genuinely effective force.

Talking to friends in the army, there is a real sense of anger and frustration among many mid-level officers. The veterans of [Operation] HERRICK feel that the army hasn’t learned lessons and remains bound by tradition and an inability to really learn. Candidly, many feel that the UK “lost” in Afghanistan and hasn’t yet accepted this fact. They feel the army is overly top heavy and rigid and unable to really adapt to 21st century warfare. Suggestions that much of the army exists as a structure to support rapid expansion in the future is met with a hollow snort of derision – we could never do a WW1-style rapid expansion again for the legacy reserve stocks of weapons and equipment have long since been disposed of as part of the move to RAB accounting in the early 2000s.

The operations that the army is likely to be involved in are either low level defence engagement, or as part of NATO reassurance in Eastern Europe. The chances of needing BAOR established again are slim – if we get to the stage where the UK is trading shots with the Russians, then things will be quickly escalating beyond the point where conventional weapons are of value. Home defence remains an issue, although the days of Exercise “Brave Defender” will never be repeated — the threat is completely different. There is simply no credible home threat that needs the army to deploy against invasion or insurrection. It is telling that there has been a move to get back into the Aid to the Civil Power role again, if only because having troops able to do flood relief helps generate positive headlines.

Whenever brave efforts are made to try and look again at how things can be done differently to free up funding (such as closing RHQs or making sense of the archaic HQ and regimental structure) leaks to the press ensure a media and Parliamentary furore that prevents real change being put into play. This stops the army from being able to genuinely restructure itself because the moment it tries to do so, some tired old headline such as “we don’t have an army anymore, only a militia” (an utter fallacy) appears and men of a certain generation with angry moustaches and blazers with badges and purchased medals write to their MPs. In a Parliament without a majority, it only takes a minor backbench rebellion to threaten chaos, meaning no minister will risk reform if it angers the backbenches.

The army today faces a structural and existential crisis. Too large to be properly funded, and politically barred from restructuring itself (although the recent 2017 manifesto pledge is merely to preserve the headline strength of the forces, not the individual services, so there is still hope). Denied a credible enemy that it can prepare to fight against, it has no clear rationale for why it needs to operate at a large scale when the political decision makers are increasingly set against boots on the ground for long term commitment.

Sir Humphrey, “How Do You Solve a Problem Like a Deployable Division?”, Thin Pinstriped Line, 2017-08-06.

July 24, 2019

“[T]he debt ‘ceiling’ is about as sturdy and solid as those featured on those DIY home reno disaster shows”

Filed under: Economics, Government, Politics, USA — Tags: , , — Nicholas @ 03:00

Mark Steyn notes that yesterday’s the “big victory” over the debt ceiling (in President Trump’s words) could be almost the same as the “big victory” he wrote about eight years earlier:

The western front of the United States Capitol. The Neoclassical style building is located in Washington, D.C., on top of Capitol Hill at the east end of the National Mall. The Capitol was designated a National Historic Landmark in 1960.
Photo via Wikimedia Commons.

That thoughtful observer of the passing parade, Nancy Pelosi, weighed in on the “debt ceiling” negotiations the other day: “What we’re trying to do is save the world from the Republican budget. We’re trying to save life on this planet as we know it today.”

It’s always good to have things explained in terms we simpletons can understand. After a while, all the stuff about debt-to-GDP ratio and CBO alternative baseline scenarios starts to give you a bit of a headache, so we should be grateful to the House Minority Leader for putting it in layman’s terms: What’s at stake is “life on this planet as we know it today.” So, if right now you’re living anywhere in the general vicinity of this planet, it’s good to know Nancy’s in there pitching for you.

What about life on this planet tomorrow? How’s that look if Nancy gets her way? The Democrat model of governance is to spend four trillion dollars while only collecting two trillion, borrowing the rest from tomorrow. Instead of “printing money,” we’re printing credit cards and preapproving our unborn grandchildren. To facilitate this proposition, Washington created its own form of fantasy accounting: “baseline budgeting,” under which growth-in-government is factored in to federal bookkeeping as a permanent feature of life. As Arthur Herman of the American Enterprise Institute pointed out this week, under present rules, if the government were to announce a spending freeze – that’s to say, no increases, no cuts, everything just stays exactly the same – the Congressional Budget Office would score it as a $9 trillion savings. In real-world terms, there are no “savings,” and there’s certainly no $9 trillion. In fact, there isn’t one thin dime. But nevertheless that’s how it would be measured at the CBO.

Around the world, most folks have to work harder than that to save $9 trillion. That’s roughly the combined GDPs of Japan and Germany. But in America it’s an accounting device. This is something to bear in mind when you’re listening to the amount of “savings” touted by whatever triumphant bipartisan deal is announced at the eleventh hour in Washington.

So I find myself less interested in “life on this planet as we know it today” than in life on this planet as we’re likely to know it tomorrow if Nancy Pelosi and her chums decline to reacquaint themselves with reality. If you kinda dig life on this planet as you know it, ask yourself this: What’s holding the joint up? As the old gag goes, if you owe the bank a thousand dollars, you have a problem; if you owe the bank a million dollars, the bank has a problem. If you owe the banks 15,000,000,000,000 dollars, the planet has a problem. Whatever comparisons one might make with Europe’s soi-disant “PIIGS” re debt per capita or deficit-to-GDP ratio, the sheer hard numbers involved represent a threat to the planet that Portugal or Ireland does not. It also represents a threat to Americans. Three years ago, the first developed nation to hit the skids was Iceland. But, unless you’re Icelandic, who cares? And, if you are Icelandic, you hunker down, readjust to straitened circumstances, and a few years down the line Iceland will still be Iceland and, if that’s your bag, relatively pleasant.

That’s not an option for the U.S. We are chugging a highly toxic cocktail: 21st-century spendaholic government with mid-20th-century assumptions about American power. After the Battle of Saratoga, Adam Smith replied to a pal despondent that the revolting colonials were going to be the ruin of Britain: “There is a great deal of ruin in a nation,” said a sanguine Smith.

March 21, 2019

“It’s back to normal, basically. The emperor is naked. Votes are for sale. Caveat emptor“

Filed under: Cancon, Economics, Government, Politics — Tags: , , , , — Nicholas @ 03:00

Chris Selley somehow seems, I dunno, a bit … cynical about Prime Minister Trudeau and Finance Minister Morneau’s 2019 federal (election) budget:

Ahoy there, relatively young and middle-class Canadian! Did you vote Liberal in 2015? And are you, shall we say, somewhat less enthused about that prospect four years later, for various reasons we needn’t go into here?

Now, what if Justin Trudeau were to offer you a down payment on a shiny new condominium?

Well, that’s just the kind of guy he is. Starting this year, so long as your household income is below $120,000, the Canada Mortgage and Housing Corporation will pitch in 5 per cent of the price of your first home — 10 per cent if it’s a new home, the construction of which the government hopes to incentivize.

That’s Item One in the 460-page federal budget tabled Tuesday in Ottawa.

On a new $400,000 condo, you could put down your own $20,000; CMHC would chip in another $40,000; and your monthly mortgage payment, on a 25-year term at 3.25 per cent, would drop by a not inconsiderable 12 per cent. You would reimburse CMHC, interest-free, if and when you sell. Cost to the taxpayer: $121 million over six years.

If you’re worried giving home-seekers free money might just push the price of a $400,000 condominium nearer to $440,000, Finance Minister Bill Morneau would first of all like you to stop. (“You’re wrong,” he admonished a reporter who dared suggest it during a press conference in the budget lockup Tuesday.) But if all else fails and you’re forced to rent, the feds also found $10 billion extra over nine years to throw at the Rental Construction Financing Initiative, a CMHC program that offers low-interest loans to qualified builders. The goal is 42,500 new rental units in a decade.

Can’t even think of home ownership until you pay off your student loans? Again, the government is here to help: From now on you’ll pay the Bank of Canada’s prime interest rate, instead of prime plus 2.5 points. And for the first six months after you graduate, you’ll pay nothing. The budget document introduces us to Angela, a recent psychology grad carrying $13,500 in student debt who landed a job at “a medium-sized consumer goods company.” (It doesn’t matter where she works. The writers just wanted to add some colour.) Angela will save something like $2,000 in interest over 10 years.

There’s also the new Canada Training Benefit, which the government intends to help Canadians with “the evolving nature of work.” (Maybe your parents were right, Angela. Maybe that psych degree wasn’t the best idea, Angela.) Starting in 2020, the feds will chip in $250 a year, and you can use the accumulated credit to pay up to half the cost of courses or training. And you can draw on up to four weeks of EI to complete it.

February 22, 2019

Germany’s armed forces – from world class to laughing stock

Filed under: Germany, Government, Military — Tags: , , , , , — Nicholas @ 05:00

Germany’s military has fallen on very hard times, and there’s so much wrong that it will be very difficult to fix even with all the goodwill in the world:

The German Navy training ship Gorch Fock (launched in 1958) under full sail (less the spanker topsail) in Kiel Fjord near the Laboe Naval Memorial in July 2006.
Photo by Felix Koenig via Wikimedia Commons.

Most Germans’ eyes glaze over at the mention of the Bundeswehr’s perpetual troubles, but an affair surrounding the Gorch Fock, the navy’s three-masted naval training ship, has caught their attention.

Launched in 1958 to school a new generation of West German naval recruits, the imposing 81-meter ship, which takes its name from a popular seafaring German author’s pseudonym, is more than just a training vessel; to many, the Gorch Fock — whose likeness was etched onto some Deutsche Mark bills — is a symbol of Germany’s postwar revival.

The ship’s iconic status is one reason why few objected when the Bundeswehr announced in 2015 that it needed a major overhaul. Until, that is, the price tag exploded from an initial projection of €10 million to €135 million, according to the latest estimate.

Bundeswehr officials claimed the depth of the ship’s troubles only became clear when it was in dry dock, but few are buying such explanations. “When the repairs cost more than a new ship, something is obviously amiss,” Bartels, the Bundeswehr’s parliamentary overseer, said in an interview.

The Gorch Fock “is a symptom of the Bundeswehr’s broader problems,” Bartels said. “Everything takes too long and costs too much money. It’s as if time and money were endless resources, and in the end no one takes responsibility.”

Almost overnight, the ship has gone from pride and joy to running gag. Last week, German weekly Der Spiegel pictured the Gorch Fock on its cover under the headline, “Ship of Fools.”

It’s an apt metaphor for Germany’s body politic as well. Given Germany’s size and economic might, Berlin’s attention to security is surprisingly shallow; citizens and politicians alike often seem oblivious to the challenges the country faces. Though Germany faces growing security threats from both Russia and China, one wouldn’t know it hanging around the German capital.

Much of the media now portrays the U.S. as a security threat on par with Russia. Public attitudes have moved in a similar direction. Security discussions are driven by a handful of like-minded think tank analysts who seem to spend most their time on Twitter, fretting about whether Trump will pull the plug on NATO.

More Germans believe China is a better partner for their country than the U.S., according to a survey published last week by Atlantik Brücke, a Berlin-based transatlantic lobbying group. About 80 percent of those surveyed consider U.S.-German relations to be “negative” or “very negative.”

H/T to Instapundit for the link.

January 5, 2019

We may already have passed the peak of High Speed Railways

Filed under: Economics, Japan, Railways, USA — Tags: , , , , — Nicholas @ 03:00

Hans Bader looks at the mass transit mess, including a brief glance at the state of high speed passenger rail:

So-called bullet trains generally turn out to be white elephants. South Korea is abolishing its celebrated high-speed rail line from its capital, Seoul, to a nearby major city because it can’t cover even the marginal costs of keeping the trains running. Most people who ride trains don’t need maximum possible speed, and most of those who do will still take the plane to reach distant destinations.

Despite Japan’s much-vaunted bullet trains, most Japanese don’t take the bullet train either; they take buses because the bullet train is too expensive. Bullet trains do interfere with freight lines, so Japanese freight lines carry much less cargo than in the United States, where railroads—rather than trucks—carry most freight, thereby reducing pollution and greenhouse gas emissions.

California’s so-called bullet train is vastly behind schedule and over budget, and will likely never come close to covering its operating costs once it is built. As Reason magazine noted, transportation officials have warned that California’s misnamed “bullet train” is a disaster in the making. California is drastically understating the costs of its high-speed rail project. Just the first leg of this $77 billion project will cost billions more than budgeted. And the project is already at least 11 years behind schedule.

December 30, 2018

The US federal government “shutdown”

Filed under: Bureaucracy, Government, Politics, USA — Tags: , — Nicholas @ 03:00

One of the things you quickly notice when there’s a public service cutback is that the cutbacks are always directed to the parts of that organization that interact with the public. The idea being that if the public are seriously inconvenienced by lack of service — I mean more than they ordinarily are, anyway — they’ll raise an outcry and the politicians will be forced to rollback the cuts. This is standard practice because, as a rule, it works fairly well. The current US federal government “shutdown” is a bit of an outlier here, because very few members of the public interact with federal employees between Christmas and New Year, and the ones that they do encounter are (mostly) still on the job. Even those who are not on the job due to the shutdown will eventually be paid for the time they didn’t work, so there are few monetary savings happening: probably the reverse, as the government will be racking up charges for services they’ve contracted for but won’t use during the disruption, and there may well be penalty clauses written into the contracts.

Colby Cosh discusses the oddity of American government shutdown kabuki theatre:

As occasionally happens, the U.S. government is now “shut down” as a consequence of a conflict over budget appropriations between the president and the Congress. Except, of course, it isn’t anything of the sort. Otherwise we Canadians would be meeting with other functioning states to decide what pieces of the United States to break off for ourselves, the way European powers used to do with Poland from time to time. (Newspaper ethics forbid me from publishing a web address for my $29.95 “Make Maine Canada Again” hats.)

The “essential” parts of the U.S. federal government, including the bits that guarantee the territorial integrity of the country, always keep on trucking through these “shutdowns.” (The National Guard is sometimes affected, but on this occasion the Guard has been taken care of by a spending bill that passed in October.) Social Security and Medicare roll on unimpeded. The functions of government that get held up are the ones whose delay or abandonment cause inconvenience — albeit serious, economically harmful inconvenience — rather than anarchy.

If you grow curious about these American “shutdowns,” perhaps because they did not happen before 1981 and do not really happen anywhere else, you discover that this kabuki-like feature is not really a coincidence. As much as Congress and the president may fight very earnestly over things like border walls, they have a common interest in the overall health of the state.

The U.S. Constitution says that “No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law.” This is a shared element of America’s legal DNA and the British Empire’s: U.S. government shutdowns are, in a weird way, a distant echo of early-modern money struggles betwixt King and Parliament. Westminster-style governments, however, have evolved so as to minimize the possibility of ugly standoffs between the executive and the legislature. The U.S., not so much.

November 23, 2018

“These are deficits of choice, not necessity”

Filed under: Cancon, Economics, Government — Tags: , , — Nicholas @ 03:00

The federal government released its fall economic statement the other day. The contents would not really have been a surprise to anyone who’s been paying attention since the last election, as Andrew Coyne explains:

The 2018 fall economic statement begins with a puzzle. Economic growth, it trumpets, is strong — the strongest in the G7 in, er, 2017. Unemployment is at a 40-year low; capacity utilization is back to pre-recession levels; profits are up; wages are growing faster than they have in eight years.

All this good news has produced a bumper crop of revenues to the federal treasury: an average of roughly $5.5-billion more annually over the next couple of years than was projected in the spring budget. Yet deficits are now projected to be … higher than expected — at $19.6 billion and $18.1 billion, respectively, about 10 per cent over forecast.

What explains this surprising result? Simple: as it has done throughout its tenure, the Trudeau government took the revenue windfall, and spent it — every last dollar and then some.

This is what the government calls “carefully managing deficits over the medium term.” It used to talk about reducing or even eliminating deficits. Now it seems devoted to doing whatever it takes to keep them in the $20 billion range, in perpetuity.

To be sure, the current set of projections, like its predecessors, shows deficits declining majestically in later years. But somehow in the here and now they never do. Once upon a time, this was supposed to be owing to a shortfall in revenues, the fruit of the Harper government’s supposed obsession with austerity.

By now this is not even pretended. The last Harper budget projected revenues for the current fiscal year at $326.9 billion, enough for a small surplus. The latest estimate has them at $328.9 billion — yet the deficit stands at $18.1 billion. Even allowing for a couple of billion dollars in accounting adjustments, it’s clear what is going on. These are deficits of choice, not necessity.

November 22, 2018

The apparently unexpected backlash over cancelling a French-language university in Ontario

Filed under: Cancon, Education, Politics — Tags: , , , , — Nicholas @ 03:00

I suspect a lot of the uproar is actually just target-of-opportunity stuff to justify criticism of Ontario premier Doug Ford. Chris Selley points out that until the announcement, there wasn’t actually a lot of support for the new university among French-speaking Ontarians:

You would never know it since Thursday, when the Ontario government cancelled plans to open a new French-language university in Toronto, but those plans were not universally beloved. A lot of people hated the location. In an op-ed in Le Droit, University of Ottawa political scientist François Charbonneau complained it was being built to serve future francophone immigrants, not proper Franco-Ontarians in a community where they’ve been established for generations.

He called it “a historic mistake that perfectly illustrates what it means to be a minority: to have no power over one’s own destiny and to be dependent on ideological rantings with no democratic legitimacy.”

Higher-education consultant Alex Usher was among many who dismissed enrollment projections for the university as “fantasy.” Writing on the Higher Education Strategies blog, Usher called a recent survey of francophone Ontario high school students the “worst piece of social science I have ever seen.” It found lots of interest in attending the new university, but didn’t bother asking about their interest in existing bilingual alternatives like Laurentian University and the U of O.

To language hawks, bilingualism is the enemy: French always loses out in a budget crunch, and it does nothing to advance the right to live one’s life solely in French. Trouble is, very few students at French-language Ontario high schools are remotely interested in living their lives solely in French.

These are all things Premier Doug Ford and his ministers might have mentioned if they hoped to leave an impression other than that Ontario francophones just aren’t worth the money. They might wisely have chosen not to axe the French Language Commissioner in the same fiscal update, transferring its complaint-resolution powers to the ombudsman but orphaning its advocacy mandate. Finance minister Vic Fedeli hasn’t even said how much of its $1.2 million budget he hopes to recoup.

But they did what they did, all at once, and they said it was all about saving money. I suspect the whirlwind they reaped came as a surprise.

Good heavens, though, what wind.

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