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Clunk . . . Crash?

The federal government has enlisted employees of the Federal Aviation Administration's air-traffic control unit and various federal contractors to help clear the backlog of "cash-for-clunker" rebates owed to auto dealers, according to this report.

An FAA memo obtained by The Washington Times reads in part:

"We have been asked to provide volunteers to assist with this high-visibility program … employees may work during regular business hours (providing mission allows) and/or overtime.

"The [Air Traffic Organization] has been asked to provide a list of 100 employees to assist. They will be asked to attend a two-hour training course this afternoon. The task is expected to take 5 to 10 days."

But Ms. Zuckman said that only support personnel, such as in finance and operations, were asked to work on the clunkers program.

"Nobody is being ordered to do anything; we weren't asking air traffic controllers to leave their posts. We're using budget and accounting people primarily," she said.

"It was made clear that no core mission activities of the FAA are to be affected by this effort, especially as they could relate to air traffic operations."

When the program was created, the federal government promised to repay dealers within seven days, yet as of last week only 7 percent of all claims had been paid. Moreover, some dealers are finding their claims rejected without explanation, according to this report (to which I linked last week).

Laura Sodano, a sales manager at Curry Chevrolet in Scarsdale, N.Y., said dealers were not told why their applications had not been approved and were having to review the entire form to determine what went wrong.

"I don't know one dealership that's gotten paid yet," Ms. Sodano said. "If they run out, we're in trouble. It's bringing us a lot of traffic, but it's not a very good program."

Among consumers, the program has created far more interest than experts had predicted. It was initially given $1 billion of funding, enough for about 250,000 sales, and an end date of Nov. 1. That money was used up in a little more than a week, and Congress quickly approved $2 billion more to extend it.

Transportation officials say they believe reimbursement requests of about $400 million on completed sales have yet to be filed, leaving about $600 million in credits still available for the final weekend, after removing $100 million for administrative costs.

If the funding is exhausted before all reimbursements are made, some dealers — and possibly G.M. — could end up having to write off the unpaid credits. The administration does not plan to seek a third installment of funding.

More from AllahPundit.

Mike& (mail) (www):
I feel quite comfortable giving the government control over healthcare. What could go wrong?
8.23.2009 1:49pm
Soronel Haetir (mail):
They sure seem to be using some strange accounting principals here. If dealers haven't been paid yet, but the money is gone, where has it been shuffled to? I could understand if the applications were approved but not paid, but that too doesn't seem to be the case.
8.23.2009 2:02pm
Malvolio:
I feel quite comfortable giving the government control over healthcare.
Well, that's not really fair. Cash-for-clunkers is complicated, anything could happen and people are very emotional about their cars. Health care is a well-understood field and most people are well-informed and reasonable about it.
8.23.2009 2:23pm
pete (mail) (www):
$100 million in administrative costs!? For a 2 month program with a budget of only thirty times that where most of what they are doing is shuffling paperwork and writing checks.

And for all that they can not even get the checks out to dealers. With every story I have read not even 10% of the the claims have been paid yet.
8.23.2009 2:24pm
Fub:
Malvolio wrote at 8.23.2009 2:23pm:
Health care is a well-understood field and most people are well-informed and reasonable about it.
And if they don't get the medical treatment they apply for, they eventually become very quiet instead of joining the shouting mobs in those annoying demonstrations we read so much about lately.
8.23.2009 2:42pm
mga (mail):
A strong advertisement for the government running the financial system, and the car companies, and the energy sector as well.
8.23.2009 3:03pm
Jody (mail):
they eventually become very quiet instead of joining the shouting mobs in those annoying demonstrations we read so much about lately.

Except for the zombies. Which is why we must act preemptively to remove the possibility of zombie protestors by injecting the bodies of the terminally ill with sodium silicate and forcing them to run until they seize up.
8.23.2009 3:06pm
Mark Buehner (mail):

$100 million in administrative costs!? For a 2 month program with a budget of only thirty times that where most of what they are doing is shuffling paperwork and writing checks.

They should have used Medicare as the model. Of course fraud would then account for 30% of the budget, but hey, you can't have everything I guess. Its easy to have low administrative costs if you don't care about waste and fraud, much less having a bottom line.
8.23.2009 3:08pm
one of many:
Fraud? By whom, the government's employees? For serious frauds of government programs they have to exist for long enough so people can figure out how to effectively defraud and obtain what they need for the fraud. This program has only 1 quick way for fraud - lie about destroying the engines and sell the cars as scrap and nothing I've seen shows any serious attempt to police that possible fraud. Anything else will be tripped up by VIN numbers, which if the program existed for some time could be bypassed but for a short term program is not a problem.
8.23.2009 3:42pm
David M. Nieporent (www):
They should have used Medicare as the model. Of course fraud would then account for 30% of the budget, but hey, you can't have everything I guess. Its easy to have low administrative costs if you don't care about waste and fraud, much less having a bottom line.
Worse, when you use ideological accounting, every fraudulent payment actually makes the system superficially appear more efficient, as administrative costs are calculated as a percentage of total payouts.
8.23.2009 3:44pm
GV:
Mike, would you feel comfortable giving the Government control over the military? Building roads? Providing medical treatment to veterans? Would you feel more comfortable if Ken Lay or Bernie Madoff ran your insurance company?

The Government is not perfect. Businesses are not perfect. Pointing to specific incidents where one fails or is inefficient is hardly a damning indictment of either. What's annoying about this health care debate is how often people will make these silly little points. Most trot out their silly little one liners, when the debate is more complicated than that.

It's stunning to me that this country ever manages to do anything right. People feel no sham in this country in their display of ignorance. (Maybe this is true of every country. I hope not.) Even politicians who are not ignorant know they can say ridiculous things in public because there's no consequences to saying ridiculous things. Every debate must be had the political-slogan level, rather than looking at any nuance.
8.23.2009 4:20pm
A. Zarkov (mail):
GV:

"... would you feel comfortable giving the Government control over the military? Building roads?"


Well actually no, but we have no choice when it comes to the military because this is something that we can't depend on markets to do. Moreover the US Constitution charges the federal government with this function.

As for roads, the interstate ones were created for the Post Office. The old Boston Post Road (Route 9 in New York) was one of the early ones. Then we built the Interstate system as a military project. Looking back I'm not sure the Interstate system was a good idea as realized.

One of the problem with having the federal government do things way beyond its constitutional mandate is politics. I once talked to a DARPA (Defense Advanced Research Projects Administration) contact monitor. He told me he has to fund some projects regardless of merit because he must give every state of piece of the action. Here's another example, although it might be out of date. The paperwork for a computer system for air traffic control is so onerous, that years ago there was talk of privatizing it just to get around the regs.
8.23.2009 5:11pm
Mike& (mail) (www):
Mike, would you feel comfortable giving the Government control over the military?

No. See, e.g., Iraq; Vietnam; Korea.

Now, one might say: What choice is there? The federal government already has central control over the military. Path dependence means we cannot just take it away. So we are stuck with it. We are stuck with the War in Iraq.

We are NOT stuck with government control over health care. I'd like to keep it that way?

Or do you think the Iraq War was handled properly? How about Vietnam?

Building roads?

Interstates and highways, sure. Some inefficiency is fine. Some corruption is enviable. I see how well the government does filling pot holes, though.

Providing medical treatment to veterans?

The government does a bad job of it, actually. If you live in the Fourth Circuit, you can take on VA Appeals pro bono. The people I know who've done those appeals have never viewed the VA the same way.

Would you feel more comfortable if Ken Lay or Bernie Madoff ran your insurance company?

Funny that you should mention Bernie Madoff. Do you know why he was able to rip people off? It was because the SEC - a government agency, last I checked - is incompetent. So the Madoff example is either a non-sequitur or is supportive of my distrust of government.

The Ken Lay case is much more complicated than you'd give it credit for. (How many original case filings did you read? How many dozens of hours did you spend review the downfall of Enron, and Lay's - alleged - role in it? If the answer is less than 5, then we can't have a nuanced discussion.)
8.23.2009 5:14pm
/:
GV, I can easily discontinue custom with any insurance company. I can not do so with the government, and be able to maintain all of my property.
8.23.2009 5:16pm
Brian K (mail):
The government does a bad job of it, actually. If you live in the Fourth Circuit, you can take on VA Appeals pro bono. The people I know who've done those appeals have never viewed the VA the same way.

i take it you don't do a lot of malpractice cases...private insurance companies are horrible too. i've worked in a VA hospital...anecdotally, patients there seemed to find it better than patients at the private hospitals i've worked at. students, like myself, had the opposite opinion mainly because it is hard learning the breadth of medicine when 90% of your patients are old men.


Funny that you should mention Bernie Madoff. Do you know why he was able to rip people off? It was because the SEC - a government agency, last I checked - is incompetent. So the Madoff example is either a non-sequitur or is supportive of my distrust of government.

so bernie madoff, a private non government person, rips off a bunch of highly sophisticated private non government people and some government people and it's the governments fault? that doesn't make any sense. the SEC could have caught onto the scheme faster but, like all of the private actors who likewise didn't, they got snookered...but no one claims the SEC has to be perfect. without the SEC and the regulations that they enforce it may have been even longer before he was caught.
8.23.2009 6:21pm
Recovering Law Grad:
Zarkov -

You argue that we can't rely on markets to provide a military, but nor can we rely on markets to provide a minimum level of health services to all Americans. They have failed to do so thus far and, even if we were to move to a utopian, regulation-free free market, the market would still fail because health care services are simply too expensive for them to be available to everyone.

If you believe that people shouldn't die or suffer debilitating conditions because they simply can't pay for the relevant treatments (as I do), then you have to permit for some government action to provide services.
8.23.2009 6:32pm
/:
and it's the governments fault?

I hold the government responsible for fixing a road vandalized with a jackhammer because it demands the authority to do so. I hold the government responsible for national defense because it demands the authority to do so. I hold the government responsible for ignoring the Constitution because it demands the authority to do so.
8.23.2009 6:39pm
Glen Alexander (mail):

You argue that we can't rely on markets to provide a military, but nor can we rely on markets to provide a minimum level of health services to all Americans. They have failed to do so thus far and, even if we were to move to a utopian, regulation-free free market, the market would still fail because health care services are simply too expensive for them to be available to everyone.
Talk about facts not in evidence!
8.23.2009 6:49pm
Relic:
They have failed to do so thus far and, even if we were to move to a utopian, regulation-free free market, the market would still fail because health care services are simply too expensive for them to be available to everyone.

Which "health care services" are you saying are being denied and would be provided if the government took over?

If you believe that people shouldn't die or suffer debilitating conditions because they simply can't pay for the relevant treatments (as I do), then you have to permit for some government action to provide services.

Because it's much better to suffer debilitating conditions because an unelected government bureaucrat said they aren't valuable enough. Furthermore, the money to pay for the treatments, for they aren't free, even in government-run systems, must come from somewhere, because those doctors need to eat, those hospitals need to maintain themselves, and those treatments cost money. That money must come from the same place it comes from now: the general population. Only, where the market, when it's not being manhandled, as the current health industry is, has incentives to keep costs accessible to as many people as possible.
8.23.2009 6:56pm
Relic:
Sorry, the last sentence should read "whereas the market... as many people as possible, the government has no such incentives."
8.23.2009 6:58pm
Mike& (mail) (www):
If you believe that people shouldn't die or suffer debilitating conditions because they simply can't pay for the relevant treatments (as I do), then you have to permit for some government action to provide services.

Why do you and others who want government-supported healthcare start a charity? Donate your excess income to this charity. I'm sure you're drinking a lot of lattes and otherwise indulging in material excess.

Maybe I'm an SOB who doesn't care if people die or suffer. I won't actually kill or torture people. But if a stranger to me dies, maybe I don't care.

Heck, Peter Singer would argue (quite cogently) that if we're sipping lattes and dining out, then we indeed do not care about the poor. There really is no refuting this.

Why don't you and others who say you care so much about the poor actually put your money where your mouth is. I'd gladly support a government-sponsored program that would payroll deduct 10% from each of your paychecks.

Pay for your own moral crusades.
8.23.2009 7:00pm
Brian K (mail):
Pay for your own moral crusades.

I'd find this argument much more convincing if it was applied to all government expenditure.

for example, i'd like to not pay for the FCC (and their imposition of conservative morality), the military (as long as they are fighting wars i disagree with), any faith based programs, other people's donations to religious charities, legal defense for what bush's cronies did, subsidized water/electricity/phone to rural people, enforcement of obscenity laws, abstinence only education, etc...

but when you see a sentiment such as this one expressed it's usually in the form of "i don't want to pay for your morality, but you had better pay for mine".
8.23.2009 7:12pm
Mike& (mail) (www):
but when you see a sentiment such as this one expressed it's usually in the form of "i don't want to pay for your morality, but you had better pay for mine".

So you know me personally? You know my views on these things? Or you're simply accusing a complete stranger of hypocrisy. LMAO.
8.23.2009 7:22pm
GV:
Mike, is your position that we shouldn't have a Government at all? If the Government should do something, then that sort of defeats the simplistic argument that we shouldn't have the Government more involved in health care simply because the Government is, at times, inefficient, unfair, etc. But if you think the Government should be involved in nothing, at least that's a position that would justify the political-slogan argument you led with. I doubt, however, you believe we shouldn't have a Government.

Regarding Bernie Madoff, your position is that he was only able to rip people off because the SEC didn't do a good enough job regulating him? Why didn't the free market take care of him? Why do we need the SEC?

You write that the case of Madoff "is supportive of my distrust of government." I generally don't trust the Government, and I'm generally a believer that we should presumptively believe in the free market. There's lots of situations, however, that I think relying on the Government is the best option, in our second-best world. I suspect many libertarians believe in the same principle, and our argument is about when the presumption of relying on the free market is overcome. (For example, I believe that there is a strong moral argument that everyone is entitled to a basic standard of living, which includes health care.) But that means arguments like the Government should not be involved in activity X because sometimes the Government is not good at doing other things is silly and nothing more than a political slogan, devoid of substantive content.

The Ken Lay case is much more complicated than you'd give it credit for. (How many original case filings did you read? How many dozens of hours did you spend review the downfall of Enron, and Lay's - alleged - role in it? If the answer is less than 5, then we can't have a nuanced discussion.)

I'm not sure, with my reference to Ken Lay, you can know how complicated I think his case is. I don't see what the numbers of hours I've put in with respect to Ken Lay (or Enron's downfall) has to do with anything. I have, however, represented a client involved with Enron's downfall, have spent countless hours reading about Enron, and have what I believe to be a fairly sophisticated view of its fall. That being said, none of it is relevant to my point. Regardless of what view you might have of Enron and whether you think there should have been criminal prosecutions, it's pretty clear that Ken Lay was not a particularly good or effective leader. I would not want him in charge of a health insurance company.
8.23.2009 7:24pm
/:
i'd like to not pay for the FCC (and their imposition of conservative morality)

If you think that's their charter or that they're effective at doing that, you haven't watched any broadcast TV lately.
8.23.2009 7:25pm
Mac (mail):

Would you feel more comfortable if Ken Lay or Bernie Madoff ran your insurance company?



Would I be any worse off than the bozos who are handling my retirement i.e. Social Security? I, and everyone else who works, have paid 15% of my salary into SS. I am told it is going broke. Ditto Medicare, which I and everyone else have paid in to for years.

How is the US Congress any different from Madoff other than we know they are ripping us off with the biggest pyramid scheme ever invented and they won't go to jail?

We could also talk about how Congress is devaluing our savings, which is theft, by printing money like it is confetti.
8.23.2009 7:42pm
Prof. S. (mail):
The military and road building examples are just silly. Those are items with huge, uncontrollable positive externalities that would be collected by freeriders. If you have your private military, then a lot of other people are going to be protected by that as well. Roads are a little different, as you can permit for toll roads; however, the fact that roads only work as a network means that it's a natural monopoly that is still best handled by government intervention (like regulated utilities).

Healthcare isn't anywhere close to that. I don't feel better if you go to the doctor. Sure, there are some positive externalities (such as people not spreading disease), but not enough to encourage freeriding.

And where you have military/security and road systems small enough to control the externalities, they are all privitized. Companies and VIPs have private security details. Gated communities pay for their own roads. Nobody is saying that only the public can/should build or provide those things, nor do people think that the private companies that do this are worse than the government.

If you're going to use examples to make a point, at least make them comparable items. Trying to relate health care and the military or roads without thinking about the underlying economics of how those things work is plainly absurd.
8.23.2009 7:52pm
Sammy Finkelman (mail):
I read in the American (English language) Yated Ne'eman that originally $4 billion was proposed for the cash for clunkers deal but it was cut back to $1 billion.

This was a ridiculous compromose of course. If only $1 billion would hjave been spent then it wouldn't have done very much - there wouldn't have been much stimulus and it wouldn't tend to do much to raise the average fuel econom of all cars in the United States. And if it was going to do that then a lot more than $1 billion was neeeded.

It's not just growing pains - the whole thing was a ridiculous compromise - the program would only run smoothly if it didn't do much good by anybody's measure. Perhaps this is typical of the way Congressmen negotiate a bill.

The people who wanteds something done still got their press releases, while maybe hoping there would a lot of deamdn for it, and the people opposed to it, got a firm limitation on costs for budget purposes, letting $1 billio get spent to no particular end.
8.23.2009 7:54pm
Prof. S. (mail):
How is the US Congress any different from Madoff other than we know they are ripping us off with the biggest pyramid scheme ever invented and they won't go to jail?
Because at least Madoff's investors received some of their investments back, and some of them who bailed in time did quite well. I'm stuck in Social Security, will only get a fraction of the market value of my (yet alone my employer's) contributions, and this is scheduled to be broke the year before I turn 62.

But come on, Social Security isn't a Ponzi scheme... or at least that's what they say.
8.23.2009 7:58pm
Sammy Finkelman (mail):
To Soronel Haetir who wrote:

SH> If dealers haven't been paid yet, but the money is SH> gone, where has it been shuffled to?

The checks haven't been written - or the amounts even calculated - but the money is gone because the government is legally obliged to spend it. The Obama Administration is very concerned about possibly going over the legal maximum and they are evidentally using some spreadsheets to try to calculate where they are.

The computer processing is so behind they have to guess where they are. If it turns out there is still some money they may open it up again for a while, although that will be hard if they are too close to the limit.

Congress may also act to get this restarted, although that will be a little hard since they'll have to take the money away from other spending they are committed to.
8.23.2009 8:01pm
Nik B.:
[...] nor can we rely on markets to provide a minimum level of health services to all Americans. They have failed to do so thus far [...]


[I'm ignoring the unsubstantiate nonsense in the rest of the paragraph since it's already been addressed]

Not all Americans want the minimum level of health services you feel is appropriate to impose on them. Not all Americans want to have the health insurance you want to sign them up for under the shadow of the government's proverbial gun.


If you believe that people shouldn't die or suffer debilitating conditions because they simply can't pay for the relevant treatments (as I do), then you have to permit for some government action to provide services.


If you believe that then feel free to pay for those people to get the relevant treatments. Nobody will stop you if you choose to do so out of your own pocket.

Just don't expect me to stay silent when you try to pay for your beliefs by reaching into my pocket.
8.23.2009 8:04pm
Mac (mail):

But come on, Social Security isn't a Ponzi scheme... or at least that's what they say.



I read the link and you are right. SS is much worse than a Ponzi scheme. Those investers got back 37 cents on the dollar which is much, much better than what SS recipients will get back.
8.23.2009 8:17pm
Mike& (mail) (www):
Mike, is your position that we shouldn't have a Government at all?

No.

Regarding Bernie Madoff, your position is that he was only able to rip people off because the SEC didn't do a good enough job regulating him? Why didn't the free market take care of him? Why do we need the SEC?

Many Madoff victims trusted Madoff, thinking, "Hey, if the SEC looked into it, he must be legit." If there had been no SEC, then there'd likely be a private-sector auditing firm. Or at least more distrust. Instead, when the federal government creates an agency that is supposed to investigate securities fraud and investment firms, people (not me, of course) tend to actually trust that agency.

Of course, you might say that people who trust the SEC are suckers. Which, again, just supports what I stated earlier.

Oh, and the SEC has been an epic failure. Which yet again bolsters my original point re: government incompetence.

Look, man, I'm not some anarchist who wants to live among Nobel Savages wearing a fig leaf. But I keep an eye on the federal government. I have seen failure after failure after failure.

The Bail Outs. Hundreds-of-billions in direct aid to Wall Street. Trillions in government guarantees of Wall Street debt.

Fannie Mae. Freddie Mac. The SEC.

The Iraq War. Vietnam. Social Security (you do realize that we're going to run deficits, soon, right?).

So I don't just come up with a prior arguments against government intervention. Instead, I've spend years observing reality and study the federal government. I don't like what I see.

Now, my question for you: Why do you think the federal government will be able to competently manage healthcare? Please answer in light of the many government failures I've identified.
8.23.2009 8:18pm
Mike& (mail) (www):
But come on, Social Security isn't a Ponzi scheme... or at least that's what they say.

This is a great point. G.V., do you think that Social Security is a Ponzi Scheme? If not, why not? Here is the textbook definition of Ponzi Scheme: "Ponzi scheme is a fraudulent investment operation that pays returns to separate investors from their own money or money paid by subsequent investors, rather than from any actual profit earned."

If, today, everyone stopped paying Social Security taxes, where would the money to pay Social Security benefits come from? Would Social Security be self-sustaining if everyone stopped paying Social Security taxes?

If the answer is no (and the answer more certainly is no), then why is Social Security not a Ponzi Scheme?
8.23.2009 8:23pm
Mac (mail):

Many Madoff victims trusted Madoff, thinking, "Hey, if the SEC looked into it, he must be legit.





Mike&,

You got it and you win the thread with that comment.

We moved here 8 years ago and built a new home. Little did I and my neighbors know that there were major builder's defects that any city building inspector should have been able to catch. We and others have suffered thousands of dollars in repairs. Thank God for the builder's insurance as most of us don't have a spare 45 or 85 grand in our pockets which is what the damages have run.

We, as many other people in other subdivisions, have discovered to all of our dismay, the so-called city inspectors are utterly and totally worthless. We, and others in our predicament, would have been so much better off knowing that the city was worthless. Then, we could have hired our own inspectors (for not a lot more than we paid the city) and gotten the job done right.

As you said, Mike&, we thought the city inspectors were keeping the builder "legit' and making sure he was doing a good job. If Government is not going to do the job, then get the hell out of the business and let the consumer take care of it themselves using the "buyer beware" caveat.
8.23.2009 8:37pm
/:
If the answer is no (and the answer more certainly is no), then why is Social Security not a Ponzi Scheme?

No. By the definition you stated:
"Ponzi scheme is a fraudulent investment operation that pays returns to separate investors from their own money or money paid by subsequent investors, rather than from any actual profit earned."


1. Anyone who researches the program can find out how it works (unfunded), therefore it's not fraudulent.

2. Being unfunded, it isn't an investment operation.

QED!
8.23.2009 8:57pm
Mike& (mail) (www):
QED!

A little logic without a lot of facts is a dangerous thing.

Read up on the Social Security Trust Fund. Start at Wikipedia. ("Paid-in contributions that exceed the amount required to fully fund current payments to beneficiaries are invested in securities issued by the federal government.")

The Trust Fund has investments: http://www.ssa.gov/OACT/ProgData/investheld.html

Etc.
8.23.2009 10:30pm
Mac (mail):

The Trust Fund has investments: http://www.ssa.gov/OACT/ProgData/investheld.html



Mike&.

Are these not otherwise known as IOU's? Would any business get away with that? Creditors of the State of California were none too happy to be getting IOU's. If there is no money to back them up, what good are they?
8.23.2009 10:37pm
Brian K (mail):
So you know me personally? You know my views on these things? Or you're simply accusing a complete stranger of hypocrisy. LMAO.

i was actually talking in more general terms of how i usually see the argument used. hence the addition of the qualifier "usually".
8.23.2009 11:09pm
/:
Yeah, that's not pay-as-you-go at all.
8.23.2009 11:17pm
Mike& (mail) (www):
Are these not otherwise known as IOU's? Would any business get away with that? Creditors of the State of California were none too happy to be getting IOU's. If there is no money to back them up, what good are they?

Imagine I wrote myself a check to myself, from myself. I deposited that check into my account. I then took a cash withdrawal from my account. That would be check kiting, which is a federal crime.

When the Federal Government writes an IOU to itself, that is called a trust fund.

Nevertheless, people like G.V. want to give the same government that is kiting checks, and giving trillions to Wall Street, and screwing up Cash 4 Clunkers, complete control over healthcare.

I am not a believer myself, but there is wisdom in the Parable of the Talents.
8.23.2009 11:21pm
GV:
Mike, I'm not attacking your skepticism of Government. As I said, I share it. I am saying, however, that your original post in this thread is silly and raises a bogus argument I see over and over again: i.e., the Government sucked at thing X, so therefore it should not be involved in thing y. Unless you believe the Government should do nothing, which you do not believe, that argument is intellectually shallow and dishonest. You're obviously free to oppose universal health care and you can defend that decision in whatever way you want. Moral, legal, whatever. But you can't oppose it and be intellectual honest by throwing out an argument like the one you did in the opening post, as long as you believe the Government should be doing something.

I assume the Government will not be much different than insurance companies in fairly dealing with health care. There will be fraud, as there is with the current system. There will be individual cases of injustice, as there is with the current system. I don't believe the Government should guarantee a minimum level of health care because I think the Government will manage the health care market in a more efficient manner (although it might). I believe that we as a society owe all of the members of our society a basic standard of living, which includes basic health care. Thus, even though I don't trust the Government, I think everyone's right to that standard of living outweighs the inefficiency that will result from the Government's involvement in health care.

(Regarding the rest of your points, I would not do them justice in my short responses, so I'll let you get the last word on them.)
8.24.2009 12:09am
/:
i.e., the Government sucked at thing X, so therefore it should not be involved in thing y. Unless you believe the Government should do nothing, which you do not believe, that argument is intellectually shallow and dishonest.

Unless X and Y are related, which we've been over partly but which you've ignored in this recap.

In short: socialized medicine lite is unsustainable, and whatever surplus happened to be left over from the pyramid dollar shuffling was raided mercilessly. Why would socialized medicine in full be an improvement? All talk of the synergy of central planning conveniently ignores dead weight losses and increased opportunities for rent seeking.
8.24.2009 12:21am
Mike& (mail) (www):
your original post in this thread is silly and raises a bogus argument I see over and over again: i.e., the Government sucked at thing X, so therefore it should not be involved in thing y.

Your comment is truly amazing. It would not be applied in any other context.

If any other agent screwed up over and over, you'd find a new agent. If you couldn't find a new agent (just as we can't disabuse the Federal Government of an area once its entered it), you'd certainly not give the agent more responsibilities.

Here's an idea: The government should competently manage what it currently has under its control. Once the government has established credibility, then it can take on other responsibilities.

Or do you ordinarily argue that people who continually f-up should be put in charge of trillion-dollar industries?
8.24.2009 12:31am
Mac (mail):

When the Federal Government writes an IOU to itself, that is called a trust fund.



Ahhh! Now, I get it! Thanks for explaining that to me Mike&. And to think I thought I was getting ripped off. I feel so much better now. I am sure GV does too, since he believes that because the government runs some things poorly, we should never complain when it wants to run all things.
8.24.2009 2:29am
Franklin Drackman:
OK, maybe I'm prejudiced cause my Grandmothers 1985 Pontiac didn't qualify. It gets 19 MPG and the cut off is 18 MPG... Of course it hasn't gotten 19MPG since Reagan still remembered who "Bonzo" was, it leaks enough oil to put ANWR to shame, and polutes more than an East German 2-stroke Trabant... Surprised you don't have to show your birth certificate too...
8.24.2009 9:10am
The River Temoc (mail):
Are these not otherwise known as IOU's? Would any business get away with that?

Without wading into the merits of this whole flamew^H^H^H^H discussion, I must ask: have you ever heard of "trade credits"? Accounts payable?

It would be nice if all the ideological commentators who said "no business would ever do it that way" actually had some knowledge of business.
8.24.2009 12:35pm
Prof. S. (mail):
The River Temoc - the big difference is that in accounts payable, trade credits and other examples, you are booking receivables owed from other parties. In this case, you are effectively booking future and expected revenue as present assets.

It reminds me of what Enron was supposedly doing (at least according to The Smartest Guys in the Room documentary). You book future not-yet-earned profit as a current asset to jack up your value. Of course, when those profits never materialize, you're in big trouble.

Now, I don't agree with Mike&, as companies may use internal shifts of budgeting to figure out its operations. But you wouldn't count those internal budget shifts as overall company assets or profits. So, you both are right, but you both are also wrong.
8.24.2009 1:19pm
David Schwartz (mail):
The argument over whether Social Security is a Ponzi scheme is like the argument over whether the fetus is a parasite. Yes, in many ways Social Security is like a Ponzi scheme, and a developing fetus is like a parasite in many ways. Since we know exactly what Social Security is and we know exactly what the fetus is, what does it add to argue whether it technically qualifies as a Ponzi scheme or a parasite?

And the technical answer in both cases is no. Social Security is not a Ponzi scheme because it does claim that future payment to each individual will be fully covered by investments of each individual's past inputs. And a fetus is not a parasite because a parasite must be a different species from its host.

But this changes nothing. It is important to understand that Social Security has most of the problems of a Ponzi scheme. And a fetus acts like a parasite.

The words don't change the facts. There's no point in arguing over them.
8.24.2009 3:15pm
Gonzer Maven (mail):
Instead of arguing about how badly CFC is being administered, shouldn't we reflect on the fact that it is inherently counterproductive even if it works, because

First, it makes the car industry eat its seed corn. Those purchases made today to get the $4500, won't take place tomorrow.

Second, the program is destroying a fleet of cars that would have made good transportation for the young and the poor in the years to come. What will they drive now? Answer: Even older, klunkier, more polluting cars for a longer period of time, and keep them running like they do it in Cuba.

Third, most of the cars being traded in are American, while most of the cars being bought to get the $45000 subsidy are foreign. So this crazy program is de facto susidizing foregn car manufacturers in the economic war they are waging against American car manufacturers. Way to go Washington!
8.24.2009 3:48pm
A. Zarkov (mail):
Social Security as a Ponzi Scheme

Unfair accusation? I think not. In the 1980s the Public Interest Magazine had an article by Nathan Keyfitz where he called SS just that. Keyfiz is (was?) a mathematical demographer and a consultant to the Social Security Administration in addition to being a professor at Harvard. He is a really big name in demography. He correctly predicted that SS would run short of money in the early 1980s and it did. There are basic problems that make it Ponzi.

1. In order to pay benefits to 1937 retirees and help re-elect FDR, SS got established as a pay-as-you and not a funded system. This would work fine of we had a population stable age distribution, but we don't.

2. Congress has raised the benefit levels several times.

3. SS not only indexes for inflation, but tries to maintain wage parity. In other words is the average wages increases faster than inflation, SS retirees get an extra boost.

4. Congress expanded SS into a disability program.

5. Over the last 30 years immigration from the Third World has flooded the country with low-skilled, low-income workers. The system is also front loaded so the rate of return on low wage contributions is higher than the other income categories. This throws off the original actuarial calculations.

In short SS has become a honey pot for politicians to dispense other peoples money to help get them reelected.
8.24.2009 5:09pm
A. Zarkov (mail):
David Schwartz:

I think it's more than semantics. A Ponzi scheme has no outside source of revenue generation. Charles Ponzi claimed that he was making money with an arbitrage scheme involving Italian stamps. His scheme produced very little revenue. Most of the money dispensed came from new investors. Similarly SS does not make investments that could generate the revenue to pay benefits. Of course SS is not isomorphic to a Ponzi scheme, but it's close.
8.24.2009 5:16pm
A. Zarkov (mail):
GV:

"I think everyone's right to that standard of living outweighs the inefficiency that will result from the Government's involvement in health care."


Where does such a right come from, and what limits it? You bring out a basic problem with civilization: freeloading. How do we cope with such a thing? Traditionally we shamed or even punished people who freeloaded, now we seem to ignore it.
8.24.2009 5:24pm
Mac (mail):

Traditionally we shamed or even punished people who freeloaded, now we seem to ignore it.


A. Zarkov,

Ignore it? I beg to differ. Now every MSM outlet strives to find every irresponsible human being they can so they can emote over them especially if it is a Republican who is President. Anyone heard about the homeless since Obama took office? Nope.

Then, the Democrats seek to find anyone and everyone they can possibly convince to become a dependent class so they will vote Democratic and get more goodies. The last thing the Dem's care about is taking care of the people who work hard and pay the damn bills for this country, not to mention those who fight and die for this nation.

On FOX on Sunday there was a liberal reporter bemoaning the fact that the media were not seeking out those who had been denied a treatment by their ins. company and how the media really, really needed to be telling their story so Obama Care would get passed.

So the 85% of Americans who are quite happy with their health care should lose it so a few people can be happy. We must be fair, after all. What is fair about that, I do not know. Let's screw it up for everyone and put the country into an even deeper black hole of debt, so she and her ilk can feel good about themselves. They never notice all the harm they do.

Remember the Democrats sob ad for expanding S-Chip? Their poster family, it turned out, lived in a 300,000 or 400,000 dollar home. For God's sake, if you can make a friggin payment on that you can buy your kids some health insurance. But no, the poor, poor people need the taxpayers to provide their kids with health insurance.

Before anyone mentions it, we should get rid of all corporate welfare as well and reduce the corporate tax rate. Of course, then, the politicians would not have both a hammer (tax increases) and a carrot (special tax exclusions) to hold over their heads when they want contributions.
8.24.2009 5:58pm
A. Zarkov (mail):
Mac:

I agree completely. In my zeal to avoid being inflammatory on this matter I went too far by using the word "ignore." As you point out, we now seem to extol freeloading. Advocacy groups such as La Raza have a active campaign encouraging Hispanics to freeload off America as much as they can.
8.26.2009 7:40am

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