Tuesday, March 24, 2015

Fixing Federalism Sidestepped in Opposing E.P.A. Coal Regulations

In his letter to every state governor in March 2015, Mitch McConnell, the majority leader in the U.S. Senate, urged the state officials to ignore the E.P.A.’s regulations that when implemented would reduce carbon pollution from coal-fired power plants. In his letter, the senator complained that President Obama was “allowing the E.P.A. to wrest control of a state’s energy policy.”[1] Were McConnell the chair of the E.U.’ s European Council rather than the U.S.’s Senate, he would doubtlessly have pointed to the worsening “democracy deficit,” wherein regulators in the European Commission take power away from state legislatures. Yet, surprisingly (or many not), the majority leader did not frame the issue in terms of federalism.

Instead, McConnell depicted the political problem as being one between the Congress and the executive branch, including the White House. “The E.P.A. is bypassing Congress and the American people by unilaterally proposing these crippling regulations that would wreak havoc on our economy and are clearly unprecedented,” he said.[2] In other words, President Obama is going too far, usurping Congress’s constitutional power. Not a word edgewise about the states having to comply. “I have used and will continue to use all of the tools available to protect families and jobs,” he continued, “whether that be in Congress, or outside of the legislative process.”[3] What about protecting the state governments from further federal encroachment? Not a word.

I contend that the senator had a vested governmental and political interest in swerving off from the issue being federal encroachment, for the U.S. Senate is a federal institution and the senator gets his power from it. He was not about to urge the governors to resist federal power, not to mention wrestle some of it back to the states. Yet in protecting himself, his institution, and the government of which it is a part, the majority leader sidestepped an opportunity to attend to the viability of the American federal system. The senator’s short-term horizon could also be seen in that his stand on the regulations translates into greater climate change. The silver lining of this rather gray cloud is perhaps that if we heat the planet’s atmosphere enough, the question of the long-term viability of the American federal system will be moot.

[1] Coral Davenport, “McConnell Urges States to Help Thwart Obama’s ‘War on Coal,’” The New York Times, March 20, 2015.
[2] Ibid.
[3] Ibid.

Sunday, March 22, 2015

Conflicts of Interest in Europe’s Greek-Austerity Impasse

At the conclusion of the European Council session in March 2015, all 19 of the state governors in attendance still wanted the state of Greece to remain with the euro. As for whether Greece should continue its austerity program and reform its economy as per the ongoing agreement on continued bailout funds, the tally was 18 to 1. Although both federal and state officials in the E.U. overwhelming believed that the austerity program had been behind the growth in the Greek economy in 2014, the Greek finance minister and most Keynesian economists disagreed, pointing to the fact that the state had lost a quarter of its GDP under the austerity. Besides this honest difference of opinion on the effectiveness of the strategy, conflicts-of-interest compromise the “club of 18” and thus its position.

The full essay is at "Essays on the E.U. Political Economy," available at Amazon.

Thursday, March 19, 2015

California’s Elongated Drought: Warming to a Changing Status-Quo

With the winter of 2014-2015 failing to deliver much of a snowpack to California, Californians entered a fourth year of drought. The measurement on March 3rd of the snowpack was the water equivalent of five inches, or 19% of the average for that date.[1] The drought’s extension ran counter to the conventional wisdom that droughts last three years in California. Such “wisdom” is problematic not only for its specific content in this case, but also because of the underlying presumption of epistemological infallibility. Ok, I’ll unpack this bit of creative verbosity. Without being aware of it, we tend to assume that we can’t be wrong about things we have not studied. In fact, we even dismiss the knowledge of those who are learned in a given subject in favor of our own belief that we can’t be wrong about what we suppose we know. This tendency of the human brain gets our species in a lot of trouble, yet we as a species are nearly blind to underlying drought.
Felicia Marcus, chair of the State Water Resources Control Board, said at the time, “Last year people thought we were in a regular three-year drought cycle and it would rain next year.”[2] Even though people were aware of global warming, they presumed that what they thought they knew of the drought cycle was still applicable. Underlying this assumption is the more basic one that tomorrow will be like today and yesterday.

Problematically, the three-year drought-cycle presumption may have made California’s water-situation even worse. With the rain in December 2014, Californians generally may have taken longer showers and left their bathroom facets on while brushing their teeth under the mistaken assumption that drought must be ending. The following month was dry, so people watered normally dormant landscapes.

Even in trying to explain the elongated drought, people were getting it wrong in concluding that the cause was changing precipitation patterns. Global warming, evinced in California’s record average temperature in the winter of 2014-2014 of 45.6 degrees (F), is the actual cause. “The normal cyclical conditions in California are different now from what they used to be, and that’s not because the long-term annual precipitation changed,” Noah Diffenbaugh at Stanford’s Woods Institute for the Environment explains. “What is really different is there has been a long-term warming in California . . . (a)nd we know from looking at the historical record that low precipitation years are much more likely to result in drought conditions if they occur with high temperatures.”[3]  Yet in spite of such evidence and that of the Earth’s atmosphere as warming above and beyond normal cycles, enough people cling to their antiquated knowledge as if they cannot be wrong that I suspect that a human tendency is involved.

“It’s a three year drought,” someone in Sacramento says. The sheer declarative tone has the ring of hubris because the person has not read anything on the drought. The assumption of knowing nonetheless is precisely where the problem lies, if I am correct in my theory here. The human mind may put too much stock in its own machinery and its output. Another Californian says in San Diego, “Southern California is suffering from a shift in the precipitation pattern.” Let’s say he has not read this; it is his conclusion, or one of his friends has told him. Even without reading anything on the science of climate change even in a newspaper like The New York Times, the San Diegan may dismiss Diffenbaugh’s statement out of hand. It is the sheer dismissiveness that strikes me as arrogant, even strange. The Californian may even say (as I have heard before), “I don’t need to read the science; I know it is in dispute.” Well, actually it is not, but such a person—such a mind—would not know it because it is closed off—a closed system—and yet it is utterly unaware of what it itself has done to itself. Like the light from the most distant star, the news of the deed has not reached the doer yet—the doer who presumes to know beyond what any actual learning can bestow legitimacy.

Abstractly, I hypothesize (i.e., propose) that the human brain contains a vulnerability in bringing to experience—structuring it rather than from it (i.e., a priori rather than a posteriori)—the presumption of knowing more than is actually known and furthermore not being capable of being wrong even about such “knowledge.” It is as if a person were to go to some neighboring houses and without entering any of them proceeding nonetheless to speak in a tone of definitiveness to the occupants about what they should clean up inside. The mere tone would ooze out arrogance and presumption, and yet the speaker could be oblivious to what he is projecting from his or her own mind onto experience and thus the world—structuring it as he perceives it.

Philosophers may recall Kant’s claim that the mind provides its own structure on space and time themselves—and not from experience. Such synthetic, a priori ideas as we bring to our perception of space and time are like the epistemological assumptions that we carry around with us all the time. In both cases, we have no clue that we are bringing these ideas to the dance because we have them constantly with us. Noticing them would be like fish noticing the water in which they spend their entire lives. That which is a constant for us can easily be invisible rather than transparent to us, and thus escape our notice. Yet as Kant points out, we can notice, through reasoning.

Probing a person on knowledge we know lies beyond his or her reach, we can see the problematic assumptions in the absurdity to which he or she will go to defend the purported knowledge. Like arrogance on stilts during an increasingly common flood from a storm surge in Miami, the presumption should be under water rather than held above as if it were Moses incarnate coming down the mountain with a new tablet. Unfortunately, the mind’s internal defense-mechanisms can block the reception of even such obvious feedback, so it is probably pretty rare for the mind to “see” the “water” in which it has always resided. If I am correct, the mind itself—hence not out of experience—structures knowledge in terms of presumptuousness. That is to say, the problematic assumptions are not in the knowledge; rather, they come from the human mind and are projected onto the purported knowledge such that learning or becoming informed are assumed to be optional rather than requisite. The mind itself presumes itself so entitled even though the assumption is untenable. The fallacious thinking should be under water (naturally oblivious to it) rather than looking down from stilts as if not only legitimate at water-level, but also an authority above.

[1] Adam Nagourney, “Alarm Rises For a State Withered By Drought,” The New York Times, March 18, 2015.
[2] Ibid.
[3] Ibid.

Tuesday, March 17, 2015

Does the Affordable Care Act: Healthcare as a Human Right?

Did the Americans who were in favor of passage of the Affordable Care Act in 2010 believe that access to healthcare is a human right? Did the Americans who opposed “Obamacare” reject that assumption and thus favor treating health insurance as a commodity? We can look at political and economic indications to reach an answer.

According to a report by the U.S. Department of Health and Human Services, based in turn on Gallup survey data from early March 2015, 16.4 million people had gained health-insurance coverage since the Affordable Care Act went into effect. The figure includes people who signed up for Medicaid under the law. “When it comes to the key metrics of affordability, access and quality, the evidence shows that the Affordable Care Act is working, and families, businesses and taxpayers are better off as a result,” said Sylvia Mathews, the Health and Human Services Secretary at the time of the report.[1]  That the uninsured rate had fallen to 13% from 20% at the beginning of open-enrollment in October 2013 supports the secretary’s conclusion. 

The strongest gains were from the states whose governments expanded Medicaid. “Those states had an average baseline uninsured rate of 18% in early March, compared with 23% for those that didn’t.”[2] This suggests that an upturn in the economy did not account for all of the change. The overall increase is large enough that the upswing in the economy is not likely to be the sole cause, according to Rachel Garfield, a researcher at the Kaiser Family Foundation.[3]

Furthermore, the difference between the two zones of states (to borrow a catchy term from Europe) points to an ideological condition wherein Americans as a whole were not convinced that access to medical care is a human right, and thus a responsibility of government. Modern federalism, wherein the member-states and federal institutions both have a share of governmental sovereignty, accommodates “being on the fence” concerning whether a benefit is properly a commodity or human right.  To the extent that the benefit is available regardless of state, that extent of being insured from the federal government can be treated as a human right, whereas the amount of benefit left up to the states indicates the extent to which Americans do not consider health-care to be a human right.

Admittedly, a federal base-level combined with various amounts of contribution from member-states does not necessarily mean that “We the People” are on the fence on whether a benefit is a human right. A person could be in favor of more state authority because of an excess at the federal level, for instance, while firmly believing that the benefit at hand is a human right. Clearly, other measures are needed in the assessment.

Another indication of the extent to which Americans as a whole consider health-care to be a human right is how close the percentage of uninsured is to zero. The uninsured rate of 13% for adult Americans and illegal immigrants in March 2015 tells us that health-care was not viewed as a full or established human right. Were access to medical care definitively regarded by “We the People” as a human right and the elected representatives representative of their constituents as a whole, the Federal Government would see to it that every American or even every resident of the U.S. has access to healthcare. This does not necessarily imply a single-payer system, though reliance on private insurance companies without subsidies for every poor person would be insufficient.

[1] Stephanie Armour, “Rate of Uninsured Falls Sharply Under Health Law, Report Says,” The Wall Street Journal, March 17, 2015.
[2] Ibid.
[3] Ibid.

Sunday, March 15, 2015

The German Government Refuses to Pay Down Its Debt: How Un-German!

How should a government spend a budget surplus? In California, the Californian government put some of its surplus in a “rainy-day fund” in 2014. The following year, the German government made plans to use any surplus in 2016 “to increase investment instead of repaying debt.”[1] This means the government “could spend more to support the German economy and that of its neighbors.”[2] Undoubtedly, the E.U. economy would benefit, especially if the U.S. dollar were to continue to appreciate against the euro. However, the decision not to use even a portion of the anticipated surplus to pay down some of the government debt is problematic.

The German government balanced its 2014 budget—the first since 1969.[3] Achieving a surplus must therefore be quite a feat, rather than easily achieved. Considering the E.U.’s limit on state debt to GDP (3%), not paying down some of the debt in a time of surplus risks breaching the federally-imposed limit when the next recession rolls around.

Looking out to the horizon, paying down debt during years of surplus then switching to a rainy-day fund when the debt has been eliminated could conceivably mean that the government would not have to issue debt during a recession. In fact, building up an “endowment” and opening part of its revenue up to fund the government could conceivably make taxes obsolete! That is to say, were a democracy to be capable of such self-discipline concerning taxation and spending that enough money could be put in a risk-balanced investment portfolio, then more and more of the government’s spending could be funded out of the investment revenue rather than taxes. That a part of that revenue would be reinvested (plus the continued annual contributions to the fund out of surpluses) means that at some point the revenue or even just a portion of which could fund the entire budget such that taxes could be ended. I take this to be the fiscal telos of government.

1. Andrea Thomas, “Berlin Moves to Spend Now, Save Later,” The Wall Street Journal, March 14-15, 2015.
2. Ibid.
3. Ibid.

Thursday, March 12, 2015

Right to Work or Destroying Unions: A False Dichotomy

On March 9, 2015, Wisconsin became a “right to work” State. That is to say, labor unions cannot force every worker of a unionized company to pay union dues and fees. At the time, 24 other States had the law on their books. I submit that both the “right to work” slogan and the unions’ charge that the law unfairly goes after unions are misleading.

In signing the bill, Wisconsin’s Governor Scott Walker said that the law “will give workers the freedom to choose whether or not they want to join a union.”[1] Workers had that freedom, strictly speaking, though it could be argued that in having to pay dues whether or not they joined the union at their company, they did not really have the freedom to be completely out.  Put another way, the option they lacked was to not join the union at their company and not have that union get anything out of their paychecks. A worker not wanting to join the union would still have to pay union dues (although not the portion devoted to political lobbying). The unfairness of the requirement weakens the unions’ claim that the law is designed to depress wages and destroy unions. A non-union employee living paycheck to paycheck may want to see a union destroyed that takes money out anyway.

To be partisan in politics is to obfuscate the whole and distend and distort a part. In this case, both sides exceed their mark in embellishing their own causes. The non-unionized worker who was forced to pay union dues is somehow left out from the two poles even though arguably the focus of the law is precisely on his or her condition. That is to say, the law’s legitimacy stems from removing that particular unfairness rather than giving workers the freedom not to join a union, or destroying unions.

1. Monica Davey, “Unions Suffer Latest Defeat In the Midwest,” The New York Times, March 10, 2015.