Thursday, February 26, 2009

Overkill... 2

A bit more on military spending...

1) Apparently the contract for new Presidential helicopters has gone over budget. The previous budget, was $6.1 billion. For reference, the budget for Iran's ENTIRE MILITARY is $6.3 billion. The current estimate on the project is $11.2 billion, which would put us at #20 on the world list, below Spain and above Taiwan. If the Pentagon bought nothing else and paid no one else, all year.

2) The military did not invent Tang or velcro. If wikipedia is accurate (and when is it not), both were private sector inventions (Tang in the US, velcro in Europe), and both were popularized by NASA. Those who credit military R&D for things in private use usually point to GPS, the internet, Hummers, things like that. Then again, the military didn't invent most of the things we use daily. Imagine what the private sector could do with $500 billion a year. I guess we can find out - that's what the rest of the world will be working on while we're buying more and bigger guns.

Wednesday, February 25, 2009


Get it? Overkill? Nothing new, but bears repeating. Image credit

Annual Military Spending

Sunday, February 22, 2009

A Bad Analogy

So, consider for a moment, the New England Patriots. The Patriots are lead on the field by a gentleman named Brady. Mr. Brady is well paid, and Mr. Brady's team is highly successful. They've won a bunch of Superbowls, they've gone 16-0, they've set a bunch of records. Then one January, some crazy shit goes down. Some dude catches a pass off the back of his head (yeah, it happened), a crazy drive, the unthinkable. The Patriots, the undefeated team, loses the Superbowl. Fans panic and cancel their season ticket orders. No one wants to watch the team on TV anymore, so ad revenue plummets. The ownership is in trouble. They have to pay rent on a giant stadium, they have to pay players, coaches, staff and facility personnel, they have all the travel expenses of a season. Kraft finally throws his hands up and gets ready to shut the doors on the team.

But wait! Boston won't sit idly by and watch their Patriots fold. Of course, they won't go out and buy tickets to see a team that's no good either. So they do the next best thing. The city council gets together and decides to offer a schload of taxpayer money to the Patriots in order to keep them together. There are some caveats though: the team must now pay its starting quarterback the league minimum, and they aren't allowed to bring in free agents or first round draft picks. Anyone that they hire must be a native of New England.

Kraft, for want of a better option, accepts the proposal. Brady quits and gets a job working for the Jets. The Jets are okay financially, and haven't accepted any rules on compensation, which means that Brady can earn 10 to 20 times as much as the league minimum. The Patriots need a couple of players to replace injuries and retirees, and they fill those slots with the best graduates that Harvard and Boston College have to offer. The Jets meanwhile sign Brett Favre out of retirement and pick up some star players and Heisman candidates from USC and Miami.

New England struggles during the season. Their quarterback has never even played in a bowl game much less the NFL, and their new hires on offensive line are routinely attempting to block players who are 50-100 pounds heavier than they are. The Patriots set a new single season record for sacks allowed, and finish the season 1-15.

The Jets, meanwhile, capitalize on New England's weakness and take the division for the first time in a long time. Favre finds success throwing to the greatest young receivers that the nation produced in the last year, and New York finally gets to beat down on the northern rivals that had been winning more than their fair share during the Brady years.

All the Giants fans are quietly purchasing Jets season tickets and buying season packages from DirecTV. Ownership is thrilled, and announces that they'll finally be able to afford to move their stadium out of @$%!#% New Jersey. Meanwhile, the Patriots are 1-15 and even the die-hard fans who'd been watching this year are canceling tickets and subscriptions. Some Jets jerseys have been spotted in and around Boston. The die-hard fans have been grumbling about it, but not too loudly anymore. Kraft still has to pay for that big old stadium, and the transportation, and the staff, and the coaches, and the facility personnel. So he goes back to the city council...

So I'm sure there's a great reason why capping executive pay and limiting use of H1-B visas is different from capping Brady's pay (and the NFL *already* has a per-team spending cap) and limiting free agency. What is it?

At first blush, it seems like the US government is investing heavily in previously dominant but presently downtrodden firms. As a requirement for that investment, they're severely limiting the ability of those firms to keep and attract top talent. Why would you hamstring a company that you're investing in? Aren't you almost guaranteeing that the bad times will get worse? And if they get worse, what are you going to do? Spend more? You'll have to spend more, since you can't let them fail. If you were going to let them fail, you'd have done that in the first place, right? Right?

Monday, February 16, 2009

More on Nuke Alternatives

Well, this guy seems to know what he's talking about. I recall however, that energy savings in cars have been spent mostly on increased power and increased size, and only marginally on increased MPG. I wonder if a world using his stuff would use less energy, or just do more. Not sure, but that's the kind of problem that I'm sure we'd all love to have.

Until next time, remember that the all-time score remains Technology: eleventy billion, Malthusians: 0 (i.e., "we're not dead yet.").

Monday, February 9, 2009


Lots of stimulus in the news, if you know what I mean. Assuming it passes, let's look at possible outcomes:
  • Quick recovery: good thing we passed the bill - otherwise it would've been longer.
  • Not quick recovery: good thing we passed the bill - otherwise it would've been longer.
The Great Depression was 10 years. How long do we figure that it would've run if not for the New Deal? Who knows?

I've said this before, but it's a good thing we bailed out Bear, Freddie and Fannie, since we otherwise might have lost Lehman, or needed to bail out AIG. And it's a good thing that we bailed out AIG since we might otherwise have needed 700 billion in TARP spending. And it's a good thing that we spend 700 billion on TARP, since otherwise the auto industry might have flopped and we might be considering 800 billion in Keynesian demand-side stimulus. And here's hoping that the 800 billion passes, because if it doesn't, then we might have to.... uh... what goes in the blank? Start teaching HS students the ins and outs of subsistance farming?



Well, good thing that the folks handling big time athletes have come around on the McGuire strategy. A-Rod's coming-out was way less... clumsy. Still, it sucks that the one guy who could've knocked Bonds off has an asterisk too. Sucks even more that Bonds still hasn't been man enough to admit it.

I know that I for one am ready for everyone to shut the f**k up and play from frickin' baseball. Either that or I'm just boycotting it all in favor of rugby, where the performance enhancing substance is beer. Lots of beer.

Single Payer (ugh)

Single-payer is a tough one for me. For the doctrinaire liberals and libertarians, it's an easy call: ideology allows a side-step of the trickiness. Anyhow, I'm far from edumacated on the matter, but I was reminded of the matter just recently, and Obama's promised action, so might as start working those public policy muscles... Anyway, stream-of-consciousness style:

  • A huge selling point of single-payer is the Wal-Mart effect. When a buyer is a sufficiently high portion of a vendor's business, that buyer can drive prices very low. Although liberals tend to be mixed in their views on Wal-Mart, the things that bug them are labor laws and romanticized boutiques. I don't see liberals worrying about doctors or pharmacies in the same ways.
  • Markets clear best when transaction costs are low and things aren't "sticky." Employer-mediated healthcare makes job transitions trickier, tends to penalize workers who would rather work part-time, etc. For libertarians, anything that can reduce the transaction costs for hiring/firing is, cetrius paribus, a good thing. Liberals probably wouldn't be convinced by this line of reasoning.
  • Health care is a lot of things. It's insurance, in the case that any of us can come down with a strange unknown disease or break a leg in a freak accident. Mostly, though, a health "insurance" plan is more similar to a buyer's club where consumers combine for greater bargaining power. Preventative care comes to mind here. It might be that the insurance and group discount components of health care can or should be separated.
  • One explanation for rising health care costs might be that the job is getting harder. When the life expectancy is 40, you can go a long way just by handling infections and infectious diseases properly. Once you get past 70, you move from accute, narrowly treatable ailments into direct consequences of aging. Beating Alzheimer's, MS, cancer, Parkinson's, and many of the other degenerative diseases will really require a fundamental hack of the body's cellular biology. The research that goes into studies, tests, treatments and drugs will be expensive. Kicking all of those will just open up even hairier problems, possibly leading to an (undoubtedly pricey) assault upon mortality itself.
  • One component of health care costs is labor. Doctors in particular. The opportunity cost of being a doctor is huge: roughly a decade of schooling and tens of thousands in debt. Doctor's salaries remain decent, but the combination of a decade of tuition and a decade of lost earnings is hard to overcome. Obama's plan to make federal tax rates slightly more progressive will have an impact here, on the margin. The rhetoric will point at executives, but it will be professionals (doctors, lawyers, etc) that bear a large part of the burden (SS minimums, for example). Anecdotally, the lost decade, the debt, and taxes were all factors in my decision to not pursue med school.
  • Our military spending is single-payer and I'm suspicious that we might still be overpaying. Will we create a new corporatist healthcare-industrial complex? Or, perhaps more accurately, further stimulate the one that we already have?
  • The stand-by libertarian argument: what happened to the efficient market hypothesis? What makes health care special here? Is it that consumers are making stupid decisions, with negative externalities? If so, what guarantee do we have that the government won't make equally stupid decisions, with equally negative externalities? Why pay billions for e.g., the SEC and FDA when I or some other private actor could have ignored Madoff and salmonella for a tenth of that?
  • There will be economies of scale (aka Wal-Mart effect), and possibly other policies taken to address the supply side, but ultimately, if we're aiming to provide helathcare to more people than currently consume it, and more healthcare to those already consuming it, we're going to end up spending more money. From whence do we draw that money? Taxes? Deficit? Spending cuts elsewhere (hey, it could happen, right? Right?)?
Anyhowz, that's a start. Perhaps more to come. Perhaps not. We'll just have to wait and see.

Friday, February 6, 2009

Nucular Energee

So, anybody want to convince me why nuclear energy is a bad idea? You know, relative to the alternatives? As I see it, coal, oil and gas have various pollution issues (including, perhaps, carbon) as well as limited availability. Wind and solar are useful in some places but tend to be too decentralized and expensive to utilize in the places where they're needed the most (a power transport problem). How are the issues with nuke power (security, disposal) worse than all of that? And don't nukes have the advantage of zero emissions, sufficient supply, and enormous capacity?

I guess we could just wait for fusion, but I'm imagining that India and China would, given the choice, prefer to industrialize now rather than later, no?