Cato-At-Liberty correctly notes that Data Mining is not effective at catching terrorism. What it is able to catch are organized attacks aimed directly at disrupting the communication infrastructure.
It is also able to catch organized criminal activity including organized identity theft.
To have a working data infrastructure, the infrastructure has to have ways to protect itself from threats relevant to its nature. Crashing a data infrastruture, after all, is matters of percents. If one creates an attack that gains a given percent of computer at any given time, then the people attacking the system can bring the system down.
Unfortunately, I think there has to be data mining efforts in the communication system aimed at protecting the communication system. The problem is that FISA model for regulation this activity forces this activity into the criminal investigation model. The better model is to have the datamining efforts separated from the criminal investigation process entirely. The aim of the data mining should not be about seeking criminal prosecution of anyone, but should be about assuring the integrity of the communication system. The court oversight shouldn't be driven by the search warrant model used in criminal investigation, but should be something new aimed at analysis, understanding and prevention of cyber attacks.
For example, one of the biggest threats we face is with spyware. Spyware is a program installed on a computer than reports on the computer activity of the user to the person who installed the program. Spyware programs use the data communication infracture to communicate back to the host. The programs have discernable patterns. It would be possible for a dataminer to identify these patterns and create counter measures to help identify people engaged in spyware, and help protect people's privacy.
IMHO, the FISA court model is not working because it was a court created through political motivations in the Nixon years. As such it tries to stuff the paradigm used in criminal investigations on a field that needs to be investigating a different kind of threat.
I agree that there should be court oversight of the intelligence community. The court oversight needs to be designed to address the specific security needs of the intelligence community and must be designed so that it evolves and changes as communication technology evolves.
The warrant process used in criminal investigations is not the right model for overseeing the security aparatus for a robust and changing communication system. International security is about identifying threats and figuring out how to protect things. When the oversight is geared toward criminal prosecution, it forces the community in the wrong direction.
Thursday, November 05, 2009
Negative Campaigns
Someone named Dee left the comment on the last post.
That progressives write condescending messages is not surprising. This one struck me as odd. As you see, the notion of people voting for the bad to avoid something worse is the driving premise behind the negative campaign. The negative campaign tells people, you must vote for me because my opponent is worse.
Both parties go negative on a routine basis. There is a lot more press about Republicans going negative. An effective propaganda technique is to use one's partisan opponents as the negative example.
Regardless of which party chooses to go negative, the premise behind the negative campaign is the same.
I prefer to state the premise behind negative campaigns than simply evoking the image of negative campaigns as I think stating the premise highlights why this type of politics keeps leading our nation in the wrong directing. Yes, the negative campaign might help us avoiding making a worst decision, but we still end up making a bad decision.
In the case of health care, the Republican plan has the effect of establishing the Federal Government as the primary regulator of health care...this is counter to the 10th Amendment. Going against the Constitution like that is bad for those of us who like the system of distributed government outlined in the Constitution.
This plan that attempts to hold off the worse by promoting a bad idea fails to get us on a better path.
The reason I wanted to promote my reply to a full post is that I have been thinking a lot about the role of logic in society. Progressives yanked the study of logic from the curriculum generations ago. The primary goal of affirmative rationality is simply to state the reasons behind our actions. Being able to state the reasons behind our actions can help us determine if our actions will lead to a positive outcome. Without familiarity with logic, people simply engage in whatever activities seem effective at the time. Politicians go negative thinking as going negative is an effective tool against a political opponenets. Yet, when we think of the premise behind going negative, we see that the process systematically leads us down a bad road.
In the Bush years, many Republicans won simply because independents feared the Democrats, the Republicans--following their negative strategy--became a mirror image of the Democrats. The Republicans gave up fiscal conservatism and managed to grow the Federal government at the same rate as LBJ.
To get us off the road to socialism, the Republicans have to come up with a better strategy to simply popping up with bad ideas to desparately stave off worse ideas.
"'People vote for the bad, fearing the worse.'
Where do you come up with this crap?"
That progressives write condescending messages is not surprising. This one struck me as odd. As you see, the notion of people voting for the bad to avoid something worse is the driving premise behind the negative campaign. The negative campaign tells people, you must vote for me because my opponent is worse.
Both parties go negative on a routine basis. There is a lot more press about Republicans going negative. An effective propaganda technique is to use one's partisan opponents as the negative example.
Regardless of which party chooses to go negative, the premise behind the negative campaign is the same.
I prefer to state the premise behind negative campaigns than simply evoking the image of negative campaigns as I think stating the premise highlights why this type of politics keeps leading our nation in the wrong directing. Yes, the negative campaign might help us avoiding making a worst decision, but we still end up making a bad decision.
In the case of health care, the Republican plan has the effect of establishing the Federal Government as the primary regulator of health care...this is counter to the 10th Amendment. Going against the Constitution like that is bad for those of us who like the system of distributed government outlined in the Constitution.
This plan that attempts to hold off the worse by promoting a bad idea fails to get us on a better path.
The reason I wanted to promote my reply to a full post is that I have been thinking a lot about the role of logic in society. Progressives yanked the study of logic from the curriculum generations ago. The primary goal of affirmative rationality is simply to state the reasons behind our actions. Being able to state the reasons behind our actions can help us determine if our actions will lead to a positive outcome. Without familiarity with logic, people simply engage in whatever activities seem effective at the time. Politicians go negative thinking as going negative is an effective tool against a political opponenets. Yet, when we think of the premise behind going negative, we see that the process systematically leads us down a bad road.
In the Bush years, many Republicans won simply because independents feared the Democrats, the Republicans--following their negative strategy--became a mirror image of the Democrats. The Republicans gave up fiscal conservatism and managed to grow the Federal government at the same rate as LBJ.
To get us off the road to socialism, the Republicans have to come up with a better strategy to simply popping up with bad ideas to desparately stave off worse ideas.
Wednesday, November 04, 2009
GOP Health Care
The Republican Party put forward an alternative health care plan. The 219 page bill is a bit easier to read than the 1990 page Pelosi bill. Their site has a nice set of bullet points pdf.
However, I feel the program is still headed in the wrong direction. Too much effort is aimed at trying to save insurance when, IMHO, the insurance industry itself lays at the heart of our health care woes.
The only way to restore the pricing mechanism is to create a system where there is more direct negotiation between doctor and patient.
The bill includes some minor changes in the accounting of Health Savings Accounts, but does not seem to do enough to position health savings as a viable alternative to insurance. (NOTE, as pointed out in past posts, various parts of the Democratic proposals seemed directly aimed at eliminating Health Savings Accounts and penalizing people for self-financing their health care. Minor improvements here is better than the total elimination of health savings accounts.)
The Republican plan comes off as a bad bill in contrast with the worse bills before
Congress.
The engine for the unfettered growth of big government is that Democrats would come up with awful bills (like these health care proposals). The Republicans would come up with an alternative scaled down bill with a slightly better chance of success. Unfortuately, this process still has a single direction of greater government control an less individual liberty.
People vote for the bad, fearing the worse. As we saw in the 2008 election, when the cumulative effect of the bad finally tears down the economy, the worst is there to take total control.
I wish we could find a way around this idiocy where politics is the choice between bad and worse.
However, I feel the program is still headed in the wrong direction. Too much effort is aimed at trying to save insurance when, IMHO, the insurance industry itself lays at the heart of our health care woes.
The only way to restore the pricing mechanism is to create a system where there is more direct negotiation between doctor and patient.
The bill includes some minor changes in the accounting of Health Savings Accounts, but does not seem to do enough to position health savings as a viable alternative to insurance. (NOTE, as pointed out in past posts, various parts of the Democratic proposals seemed directly aimed at eliminating Health Savings Accounts and penalizing people for self-financing their health care. Minor improvements here is better than the total elimination of health savings accounts.)
The Republican plan comes off as a bad bill in contrast with the worse bills before
Congress.
The engine for the unfettered growth of big government is that Democrats would come up with awful bills (like these health care proposals). The Republicans would come up with an alternative scaled down bill with a slightly better chance of success. Unfortuately, this process still has a single direction of greater government control an less individual liberty.
People vote for the bad, fearing the worse. As we saw in the 2008 election, when the cumulative effect of the bad finally tears down the economy, the worst is there to take total control.
I wish we could find a way around this idiocy where politics is the choice between bad and worse.
Tuesday, November 03, 2009
Captured from Inception
George Sorros is correct in his observation that many things in the current economic paradigm are broken. What he fails to appreciate is that the things that are broken were the things designed by left leaning intellectual snits such as himself.
The prime example of a broken system is the NASDAQ as designed by the progressive thinking Bernard Madoff. The system was designed with short selling and options in mind and configured such that hedgefunds working in concert with brokers could undertake massive stock manipulations that allow the designers of the system to take over firms, or to simply profit from the destruction of firms foolish enough to list on the NASDAQ.
The credit default swaps that came into existence in the last days of the Clinton administration was similarly designed by people convinced they found a short cut to progress. Fannie Mae, Freddie Mac, the FLSIC system, etc, were all designed by progressives.
The center piece of the both the current health care and cap and trade legislation are highly partisan markets created and run by progressive drones implementing the philosophy of Sorros and his predecessors.
I was just watching a YouTube video by a Garrett Gundersun (that I placed on Salt Lake Sites). He was talking about the foolishness of our technocratic dream where we place our faith with investing technocrats, when our financial decisions should be driven by a pursuit of "personal abundance."
I don't know if Mr. Gunderson is someone worth following. Few gurus are. I've watched so many people wipe out incredible amounts of wealth based on really bizarre understandings of the market, that I've been at a loss.
Only a few people really stand out today. Pat Byrne of Overstock is on a roll with Deep Capture. However, "capture" may not be the right term. "Capture" implies that something was good at inception, but was later corrupted by evil doers.
So many of the markets that exploded in our face (the Federal Reserve, government backed re-insurance, the insurance industry itself) were captured at inception. The markets were designed as short cuts to progress, and the short cuts to progress have systematically undermined people in the real world ever since.
Ridding ourselves of the systemic faults that caused the 2008 economic dip will require more than wrapping our markets with highly partisan regulators. It will involve actual thinking about the very foundation of economics and the nature of wealth. An activity which has not been well addressed since Adam Smith's work on the Wealth of Nations.
The worst approach we can take is to continue along the lines of taking counsel from Sorros and the market manipulators whose efforts magnified the depth of the economic downturn.
The prime example of a broken system is the NASDAQ as designed by the progressive thinking Bernard Madoff. The system was designed with short selling and options in mind and configured such that hedgefunds working in concert with brokers could undertake massive stock manipulations that allow the designers of the system to take over firms, or to simply profit from the destruction of firms foolish enough to list on the NASDAQ.
The credit default swaps that came into existence in the last days of the Clinton administration was similarly designed by people convinced they found a short cut to progress. Fannie Mae, Freddie Mac, the FLSIC system, etc, were all designed by progressives.
The center piece of the both the current health care and cap and trade legislation are highly partisan markets created and run by progressive drones implementing the philosophy of Sorros and his predecessors.
I was just watching a YouTube video by a Garrett Gundersun (that I placed on Salt Lake Sites). He was talking about the foolishness of our technocratic dream where we place our faith with investing technocrats, when our financial decisions should be driven by a pursuit of "personal abundance."
I don't know if Mr. Gunderson is someone worth following. Few gurus are. I've watched so many people wipe out incredible amounts of wealth based on really bizarre understandings of the market, that I've been at a loss.
Only a few people really stand out today. Pat Byrne of Overstock is on a roll with Deep Capture. However, "capture" may not be the right term. "Capture" implies that something was good at inception, but was later corrupted by evil doers.
So many of the markets that exploded in our face (the Federal Reserve, government backed re-insurance, the insurance industry itself) were captured at inception. The markets were designed as short cuts to progress, and the short cuts to progress have systematically undermined people in the real world ever since.
Ridding ourselves of the systemic faults that caused the 2008 economic dip will require more than wrapping our markets with highly partisan regulators. It will involve actual thinking about the very foundation of economics and the nature of wealth. An activity which has not been well addressed since Adam Smith's work on the Wealth of Nations.
The worst approach we can take is to continue along the lines of taking counsel from Sorros and the market manipulators whose efforts magnified the depth of the economic downturn.
Monday, November 02, 2009
Is Health Care a Natural Monopoly?
Charm Coach asked me to expand on the question of whether or not insurance is a natural monopoly.
I admit, when I hear the term "Natural Monopoly," I think of instances where there is a physical reason for a company to have a monopoly. For example delivering electricity to houses requires telephone poles. The company that puts up the telephone poles is able to leverage that to gain control over everything that goes to a house that involve wires.
Railroads require a right of ways ... this is a physical barrier that can be leveraged to create a monopoly.
The medical industry does not have any natural barriers that would prevent doctors from popping in and out of the market. There are no barriers that prevent people from choosing which clinics to use.
Unregulated insurance does not have any natural barriers that prevent investors from creating new pools. The new pools may not be financially stable, but there are no natural barriers to prevent a group from declaring the existence of a new pool.
The barriers come from the way things are regulated. Politically connected insurance companies work with regulators to create a market that favors their products.
The real evil comes when insurance companies negotiate pricing deals with health care providers ... or take the step of using their insurance reserves to buy providers. They are then able to leverage both sides of the health equation to give themselves an unnatural advantage in the market.
It are these unnatural relations that give insurance companies their monopoly poweer. These unnatural powers are also the things that give insurance companies the ability to lock people outside their covered base from health care.
So, it is the political structure that creates monopolies in health care.
The current structure of our financial system also leads to the creation of monopolies. The free market described by Adam Smith had individuals reinvesting their resources as they see fit. Our current capital markets are designed more for the business war model of thought. The fractional reserve system of the fed and the capital market on Wall Street create a structure where market insiders are able to raise huge sums of capital in efforts to corner a market.
Of late, there's been a number of businesses with the model of dominate the market or fail. These efforts tend to undermine the entire market.
The structure of financial markets can create a drive for monopoly status.
IMHO, many of the forces that lead to consolidation in the market are unnatural creations of the political and financial market.
Of course, when we look at the areas where we see natural monopolies, one realizes that it is often possible to create a political structure to break down the monopoly power in an industry.
For example, we could create competition in data communications if we restructured the industry so that home owners owned the wire that ran from their house to a local communication center. If a buyer's coop in your neighborhood owned the wire to a communication center, a large number of internet companies and cable companies would offer service from that box ... giving people in your hood access to competition which is currently lacking.
The truth of the matter is that, if we worked at each of these issues, we could find ways to induce competition. For example, we could break the cable and internet monopolies simply by letting home owners own the data cable running from their house to a communication center. Internet service providers would then compete on providing services to communication center ... giving everyone in the neighborhood more communication choices.
I admit, when I hear the term "Natural Monopoly," I think of instances where there is a physical reason for a company to have a monopoly. For example delivering electricity to houses requires telephone poles. The company that puts up the telephone poles is able to leverage that to gain control over everything that goes to a house that involve wires.
Railroads require a right of ways ... this is a physical barrier that can be leveraged to create a monopoly.
The medical industry does not have any natural barriers that would prevent doctors from popping in and out of the market. There are no barriers that prevent people from choosing which clinics to use.
Unregulated insurance does not have any natural barriers that prevent investors from creating new pools. The new pools may not be financially stable, but there are no natural barriers to prevent a group from declaring the existence of a new pool.
The barriers come from the way things are regulated. Politically connected insurance companies work with regulators to create a market that favors their products.
The real evil comes when insurance companies negotiate pricing deals with health care providers ... or take the step of using their insurance reserves to buy providers. They are then able to leverage both sides of the health equation to give themselves an unnatural advantage in the market.
It are these unnatural relations that give insurance companies their monopoly poweer. These unnatural powers are also the things that give insurance companies the ability to lock people outside their covered base from health care.
So, it is the political structure that creates monopolies in health care.
The current structure of our financial system also leads to the creation of monopolies. The free market described by Adam Smith had individuals reinvesting their resources as they see fit. Our current capital markets are designed more for the business war model of thought. The fractional reserve system of the fed and the capital market on Wall Street create a structure where market insiders are able to raise huge sums of capital in efforts to corner a market.
Of late, there's been a number of businesses with the model of dominate the market or fail. These efforts tend to undermine the entire market.
The structure of financial markets can create a drive for monopoly status.
IMHO, many of the forces that lead to consolidation in the market are unnatural creations of the political and financial market.
Of course, when we look at the areas where we see natural monopolies, one realizes that it is often possible to create a political structure to break down the monopoly power in an industry.
For example, we could create competition in data communications if we restructured the industry so that home owners owned the wire that ran from their house to a local communication center. If a buyer's coop in your neighborhood owned the wire to a communication center, a large number of internet companies and cable companies would offer service from that box ... giving people in your hood access to competition which is currently lacking.
The truth of the matter is that, if we worked at each of these issues, we could find ways to induce competition. For example, we could break the cable and internet monopolies simply by letting home owners own the data cable running from their house to a communication center. Internet service providers would then compete on providing services to communication center ... giving everyone in the neighborhood more communication choices.
Intellectual Dishonesty
In my opinion, since the nature of the assistance is openly acknowledged, public assistance in health care is superior to the public option.
The goal of the current health care reform is intellectually dishonest. The current political effort is about finding ways to shove those with known expensive medical conditions into pools to cover their costs. To make up for the deficit, politicians wish to force others to buy insurance that is multiples of their expected expenses.
A far better approach is to create a structure where individuals have a mechanism to properly account for the care they receive, and to handle the exceptions with openly acknowledged assistance.
The intellectual dishonesty of pooled insurance diminishes our health care system. It leads to corruption and erodes the foundations of our health care.
The problem is that we are trying to design our entire health care system around exceptions rather than designing the system around the known and real needs of all people. All people have expected health expenses of several hundred thousand dollars in a full life time. Our system should be designed to help people save these resources.
As the distribution of income follows the distribution of wealth, if we had a system where people owned their health care resources, we would immediately eliminate the growing disparity in income caused by the foolish system of employer based health care.
A system based on intellectual honesty will always lead to better results than one based on intellectual dishonest.
The Medical Savings and Loan is an intellectually honest alternative to pooled insurance. The system creates a savings and lending account for all policy holders. People place money in their savings in times of health, and withdraw funds in times of need. When need exceeds savings, people can take out loans. If they need more money than they are capable of repaying, the system has them turn to public assistance.
People are actually wonderful creatures who take great pains to help each other. With the medical savings and loan helping identify those with extraordinary needs, people will be happy to find to find ways to extend such assistance.
The problem with an intellectually dishonest system (like the bills before congress) is that hard working people become victims of those gaming the system ... by following the inherently dishonest route, people will degenerate into petty jealousies, into conspiracies, and conclude that to survive they must become manipulators themselves.
Please contact your congressman and tell them that this path of dishonesty will lead us to ruin. The honest path would lead to a bright future.
The goal of the current health care reform is intellectually dishonest. The current political effort is about finding ways to shove those with known expensive medical conditions into pools to cover their costs. To make up for the deficit, politicians wish to force others to buy insurance that is multiples of their expected expenses.
A far better approach is to create a structure where individuals have a mechanism to properly account for the care they receive, and to handle the exceptions with openly acknowledged assistance.
The intellectual dishonesty of pooled insurance diminishes our health care system. It leads to corruption and erodes the foundations of our health care.
The problem is that we are trying to design our entire health care system around exceptions rather than designing the system around the known and real needs of all people. All people have expected health expenses of several hundred thousand dollars in a full life time. Our system should be designed to help people save these resources.
As the distribution of income follows the distribution of wealth, if we had a system where people owned their health care resources, we would immediately eliminate the growing disparity in income caused by the foolish system of employer based health care.
A system based on intellectual honesty will always lead to better results than one based on intellectual dishonest.
The Medical Savings and Loan is an intellectually honest alternative to pooled insurance. The system creates a savings and lending account for all policy holders. People place money in their savings in times of health, and withdraw funds in times of need. When need exceeds savings, people can take out loans. If they need more money than they are capable of repaying, the system has them turn to public assistance.
People are actually wonderful creatures who take great pains to help each other. With the medical savings and loan helping identify those with extraordinary needs, people will be happy to find to find ways to extend such assistance.
The problem with an intellectually dishonest system (like the bills before congress) is that hard working people become victims of those gaming the system ... by following the inherently dishonest route, people will degenerate into petty jealousies, into conspiracies, and conclude that to survive they must become manipulators themselves.
Please contact your congressman and tell them that this path of dishonesty will lead us to ruin. The honest path would lead to a bright future.
Lawyers and Drug Testing
I owe Evil Esquire a big apology. They had a poll question about drug testing and lawyers. Apparently, they wanted to know if lawyers should be subjected to random drug tests like so many other workers in our society.
I misread the question and answered:
On rereading the question, I realized that my answer was inapropriate, despite the fact that testing potentially harmful drugs on lawyers is a pretty good idea.
I misread the question and answered:
"Yes, I think lawyers should be used for drug testing.
The genetic make up of lawyers is remarkably similar to that of humans.
By testing potentially dangerous drugs on lawyers, pharmaceutical companies can avoid the ethical questions involved in testing drugs on people, while avoiding the bad publicity involved with testing drugs on adorable furry animals.
An added benenfit of testing deadly drugs on lawyers is that the process thins their ranks to the benefit of society.
On rereading the question, I realized that my answer was inapropriate, despite the fact that testing potentially harmful drugs on lawyers is a pretty good idea.
Saturday, October 31, 2009
Five hundred million per page
Representative Price points out that the health care night mare that Pelosi spat out will cost Five Hundred Million Dollars per page.
Trick or Treat
Happy Halloween.
For a super spooky treat this Halloween, the Leader of the House of Witches brewed up a special concoction called the "Affordable Health Care for America Act". The PDF is large. 1990 pages. The act contains a number of tricks played on the people and plenty of treats for lobbyists and the ruling class.
In a press release about bill, the Leader of the Witches cackled on air about how progressives have been skillfully manipulating the country for over a century with the goal of transition America from a free society with an open health care to a closed society with government care.
All the while, the half wits on the left lap up the notion that the over-priced, hyper-regulated health care system was somehow a manifestation of the free market.
Reading HR3200 made me sick. This new bill looks like it is twice as large and twice as bad.
On the bright side, one should realize that all government programs get worse with age. If we compare this bill with the health care our children will receive from the government, then we should feel lucky.
We would be luckier still if a miracle happens and the bills fail.
Staring at this bill. I feel worse that I would had I just eated a whole bag of Halloween candy.
Thursday, October 29, 2009
Reforming in the Wrong Direction
In speaking small businesses today, Barack Obama issued forth a technocratic vision of business. Small business is a petty small-minded affair in which people take out loans for predictable static returns. Small businesses hire people at fixed salaries, pay fixed insurance rates, etc., etc.. The small business owner is nothing but a soulless cog in a computer simulation run by an omnipotent 2nd year econ major.
Barrack Obama further claims that he is wonderful beyond any leader in the history of civilization as he and the Democratic Congress wish to relieve the petty-minded small business owner of healthcare though one of the greatest extra-Constitutional power grabs in the history of the nation. (NOTE: Amendment 10 of the Constitution reserves health care and most other matters to the states or to the people).
Sadly, a large number of Republican politicians seem to share this same technocratic vision of the economy in which the economy is top down equation that can be controlled with the right inputs from an unbridled Federal government.
The top down vision of the economy created by Marx is not new. It was, in fact, the rule of the feudal society and a long period called The Dark Ages.
From the Renaissance through the penning of the Wealth of Nations by Adam Smith, people began developing a different idea of the economy. Both the feudal and Marxian system see the wealth of the nation flowing from the glorious leader, through the political structure to the petty-minded people.
The free market brand of thought saw wealth as a creation of the human mind. Wealth was created by the investments of the people. The wealth of the nation did not flow from the king through the people, but was the accumulation of the wealth created by the people in their various undertakings.
If Adam Smith is correct, the Obama's stimulus and health care reform are not the cure of our economic woes, but the cause of it.
The technocratic view is not unique to Democrats. An increasing number of Republican politicians (Alan Greenspan, Poulson, etc.) appear to have adopted this view. Greenspan was enchanted with the notion that an all seeing and all knowing economist at the Federal Reserve can regulate the economy through a fractional reserve lending system. The Feds lend out a dollar at a given rate. That dollar is then lent by banks a dozen or so times
The fractional lending regime created an economy where people took wild margin plays against equities. The system of margin plays has proven to do little more than to create series of wild bubbles and chaotic market moves.
If the technocratic view is the problem, the cure is for people to deleverage and to return to the free market economy described by Smith … which was controlled by people building equity and saving … opposed to people taking out loans and running margin plays against the economy.
Health care reform should move away from the technocratic vision of insurance (with fixed monthly payments) to one in which people are building equity in anticipation of future medical expenses … such as the Medical Savings and Loan.
If the technocratic vision of a static economy that runs like a computer program is wrong (and Adam Smith was right); then the health care reform before Congress is reforming our health care system in the wrong direction.
Barrack Obama further claims that he is wonderful beyond any leader in the history of civilization as he and the Democratic Congress wish to relieve the petty-minded small business owner of healthcare though one of the greatest extra-Constitutional power grabs in the history of the nation. (NOTE: Amendment 10 of the Constitution reserves health care and most other matters to the states or to the people).
Sadly, a large number of Republican politicians seem to share this same technocratic vision of the economy in which the economy is top down equation that can be controlled with the right inputs from an unbridled Federal government.
The top down vision of the economy created by Marx is not new. It was, in fact, the rule of the feudal society and a long period called The Dark Ages.
From the Renaissance through the penning of the Wealth of Nations by Adam Smith, people began developing a different idea of the economy. Both the feudal and Marxian system see the wealth of the nation flowing from the glorious leader, through the political structure to the petty-minded people.
The free market brand of thought saw wealth as a creation of the human mind. Wealth was created by the investments of the people. The wealth of the nation did not flow from the king through the people, but was the accumulation of the wealth created by the people in their various undertakings.
If Adam Smith is correct, the Obama's stimulus and health care reform are not the cure of our economic woes, but the cause of it.
The technocratic view is not unique to Democrats. An increasing number of Republican politicians (Alan Greenspan, Poulson, etc.) appear to have adopted this view. Greenspan was enchanted with the notion that an all seeing and all knowing economist at the Federal Reserve can regulate the economy through a fractional reserve lending system. The Feds lend out a dollar at a given rate. That dollar is then lent by banks a dozen or so times
The fractional lending regime created an economy where people took wild margin plays against equities. The system of margin plays has proven to do little more than to create series of wild bubbles and chaotic market moves.
If the technocratic view is the problem, the cure is for people to deleverage and to return to the free market economy described by Smith … which was controlled by people building equity and saving … opposed to people taking out loans and running margin plays against the economy.
Health care reform should move away from the technocratic vision of insurance (with fixed monthly payments) to one in which people are building equity in anticipation of future medical expenses … such as the Medical Savings and Loan.
If the technocratic vision of a static economy that runs like a computer program is wrong (and Adam Smith was right); then the health care reform before Congress is reforming our health care system in the wrong direction.
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