Smaller Government I Can Believe In

There's another good article in the NY Times about efforts to downsize the number of generals and admirals in the military.  This leads me to a few thoughts.

First the government needs to do this throughout the bureaucracy.  Top heavy bureaucracy has been a problem for years and trimming needs to be done not just in the armed forces but in the federal, state, and likely (though this I'm less sure of) municipal levels.  We have too many high ranking people relative to lower level people.  This is not a natural distribution for an organization.

Second, we need to do this in a way that keeps career opportunities open.  There are problems with up or out systems that are present in some areas of the federal bureaucracy.  You don't want to get rid of someone with good skills just because there's no place, and you don't want to promote someone with specialized skills just because to keep them you need to move them up.  There should be ways to compensate people for needed skills without necessarily having a bureaucracy full of senior staff.

Last, we need better ways to reward people without having to promote them.  Paying people's salary isn't really that big a part of government expenses.  I have no problems with good pay, people doing hard work should get rewarded.  The problems are the high benefits down the line as well as not creating good career paths and new leadership lower down in the ranks which is made more difficult by top heavy organizations.  The focus should be on rank inflation, not on people's salary.

Can the State Create Effective Housing Policy When There is No Rational State Interest in Housing?

Economix pointed me to a good report on Fannie Mae and Freddie Mac.  I think the data is fairly clear.  Fannie and Freddie weren't causal, they didn't help matters, and the idea that the government should be encouraging home ownership is basically hare-brained.

More specifically, both organizations performed very poorly in their core business, not just when they got creative and went into exotica.  They lost money on pretty much everything.  As for the argument that Fannie and Freddy were behind the housing bubble, their market share declined from 80% in 2001 to a low of 46% in 2006.  While I'm sure someone that knows more than me about mortgages will probably be able to make a convoluted argument as to why this doesn't prove anything, I think it's pretty strong evidence that there were other problems that were more important.

There's lots of good stuff in the report and it's easy reading.  Lots of charts and bullet points.  I'd encourage you to take a look.  And let me know if you think government guarantees of mortgage is still a good idea after reading it.

Personally, I see no state interest in encouraging home ownership in the first place.  I understand that it's popular, but I can't get from any of the arguments to a convincing argument that there's a state role there.  I think this is important.  A very simple model of determining what the state should, and should not be, involved in is simply asking how does this intervention increase the prosperity of the state as a whole?  If you can't answer that, the state shouldn't be involved.  The reason simply being that if this question can't be answered there is no consistent guiding policy for the intervention between administrations and policy that lacks direction will simply waste resources.  The more a state's policies conform with an idea of what a state's interests are the more likely there will be coherent policy, leading to a more prosperous state and indirectly to more prosperous citizens.  Ignore this, and simply say a policy is for the good of the citizens, and resources are simply wasted.  This is an area it's unlikely that the state can effectively create consistent policy for.  Leave the market to do that.

A Positive Interfaith Message On a Subject That Has So Far Inspired Little but Acrimony

I'm sick of the topic of the mosque too.  Still, there's been so much negativity surrounding the issue that I was glad to see a positive message on the topic that makes no mention of the negativity.  I thought I'd share with those that haven't come across it independently.

Message from the New York State Council of Churches:

The New York State Council of Churches, which represents Protestant denominations with more than 6,000 congregations in New York State, released a statement today supporting the planned Community Center at 51 Park Place in Manhattan. The Council also voiced support of Imam Feisal Abdul Rauf, whom they characterize as “a religious leader allied with the best of both our traditions,” who has “repeatedly denounced Islamist terrorism and has admonished members of his congregation to be, both good Americans and good Muslims.”


The Council pointed to the planned Park51 Community Center as an opportunity for America to demonstrate to the world that it stands up for its principles of religious freedom.

Pointing out that those “seeking to build The Community Center at Park51 in lower Manhattan lost family members in the September 11th tragedy also,” the Council praised the project as “a tribute to the American way of life,” in that “those whose faith is often blamed for the sins of extremists that happen to claim the same religious label, wish to turn this place into one that is life-giving for the community. Bringing life to an area still physically and economically depressed by the events of nine years ago will show extremists that the spirit they sought to eradicate still thrives and that new vitality will grow here.”

[Hat Tip: Capitol Confidential]

More Data on How the Market Effects the Provision of Health Care

It should be no surprise to my readers that I continue to believe that the way the health care market is institutionalized in the US has real negative impacts on our health care.  The most recent piece of information is from the Prescriptions blog reporting on a study that found that:

Conclusion: The consistent finding of higher use rates by physician owners across time clearly suggests that financial incentives linked to ownership of either specialty hospitals or ambulatory surgery centers influence physicians’ practice patterns.

This is why we need care guidelines that dissociate the recommendations for procedures from the financial incentives of those that provide those procedures.  I'm not saying that physicians are intentionally recommending unnecessary surgeries, I believe the effect is more indirect.  Instead, I'm suggesting that the way the system, and the incentives, are set up will influence the beliefs of practicing physicians leading them to prescribe treatment differently than they would in another system.  This can't be fixed without systemic change.

Math and Locavorism

I always enjoy complaining about silly fads.  While I love a good farmer's market as much as anyone else the whole locavore food movement always struck me as quite batty.  Whenever I did look into actual numbers, it just ended up looking battier.  Today's NY Times had some particularly striking numbers on the phenomenon.

"The result has been all kinds of absurdities. For instance, it is sinful in New York City to buy a tomato grown in a California field because of the energy spent to truck it across the country; it is virtuous to buy one grown in a lavishly heated greenhouse in, say, the Hudson Valley."

"The real energy hog, it turns out, is not industrial agriculture at all, but you and me. Home preparation and storage account for 32 percent of all energy use in our food system, the largest component by far."

"Indeed, households make up for 22 percent of all the energy expenditures in the United States."

"Agriculture, on the other hand, accounts for just 2 percent of our nation’s energy usage..."

 
That's just a sampling.  Take some time to read the whole article, at least if you have any exposure to this phenomenon.  I'm fully supportive of someone who desires, and is willing to pay for a particular type of consumption, I feel entirely different when they put a moral dimension on it that is based on pseudo-science rather than actual evidence.  Enjoy what you like, but if you make specific claims about it, be able to back up what you say, not repeat nonsense about food miles.  Now, if what you really like is more variety and heirloom tomatoes I'm right behind you, just don't pretend it's saving oil.

Are We Really Prepared to Prove the Extremists Right? Prove Them Wrong, Double That Aid to Pakistan.

There's another article on Pakistan and US security worries today.

While the administration has kept its public emphasis on the relief effort, senior officials are busy assessing the longer-term strategic impact. One official said the disaster would affect virtually every aspect of the relationship between the United States and Pakistan, and could have ripple effects on the war in Afghanistan and the broader American battle against Al Qaeda.
With Pakistan’s economy suffering a grievous blow, the administration could be forced to redirect parts of its $7.5 billion economic aid package for Pakistan to urgent needs like rebuilding bridges, rather than more ambitious goals like upgrading the rickety electricity grid.

Some security officials sound rather tone deaf:

“It certainly has security implications,” said another official who, like others interviewed for this article, spoke on the condition of anonymity because he was not authorized to discuss internal policy deliberations. “An army that is consumed by flood relief is not conducting counterinsurgency operations.” 

 Despite realizing the difficulties of the situation we remain sufficiently out of touch that we're bragging about low numbers:

On Thursday, the United Nations will convene a special meeting devoted to the floods, hoping to galvanize what has been a lackluster global response. Secretary of State Hillary Rodham Clinton is expected to announce that American public aid has surpassed $100 million, an official said.

 How many drone strikes does that buy?



There are some bright spots:

In recent days, the United States has sent 15 helicopters, rescuing nearly 6,000 people. On Wednesday, military cargo planes delivered 60,000 pounds of food and other relief supplies, bringing total deliveries to 717,000 pounds. The speed and scale of the effort, officials in both countries said, have helped bolster the checkered American image in Pakistan. 

But Pakistani officials can still be relied on to state the obvious:

“Americans have not yet registered the enormity of the crisis,” Pakistan’s ambassador to the United States, Husain Haqqani, said in a telephone interview from Islamabad, the capital. 

This problem has about the most obvious solution imaginable, double the aid spending, at least.  Doing this will save a multiple of that in security expenses down the road.  These people need help, without it they'll be desperate and turn where they can, in some cases undoubtedly to militant groups.  Much of the Islamic world has long been condemning us for being so willing to spend money on killing and comparatively so little on saving.  Are we really prepared to prove them right?

Faith and Politics and Obama

I don't want to get derailed on the many other issues brought up in this NY Times article.  The very last line struck a chord with me though and I believe it deserves reflection.

“I must say,” Mr. Caldwell said, “never in the history of modern-day presidential politics has a president confessed his faith in the Lord, and folks basically call him a liar.”

Since when do Americans deny any man's personal profession of faith?  We need to reflect on what it means to deny to another the ability to define for themselves what it is they believe.  How can it be valid for us to to deny what another expresses their faith to be and to then claim they believe something else, despite what they themselves claim?