Cuba Becoming More Capitalist To Save Socialism?

There was an article posted to McClatchy that appears to be by Frances Robies of the Miami Herald. Drudge linked it up today and when I read it I was reminded of George W. Bush saying that we had to become more socialist in order to save capitalism. Of course, this showed a complete misunderstanding of the state of capitalism and (what haven't been for decades) free markets in the United States.

But the article today was about Cuba becoming a little more capitalistic in order to save socialism. We know that increased socialism has led to some of the worst economies in the world (Cuba, Soviet Union) and that free market capitalism is what made America the most prosperous and powerful nation in the world well prior to the The Federal Reserve System, Income Taxes, FDR, The Welfare State, The Great Society and such. In fact, we can easily point to increased economic intervention as the root causes of the malaise which afflicts us now. Even the Communist Chinese had enough sense to keep their hands off their economy as possible to allow it to prosper, and now they make fun of us and our economic and fiscal policies. Strange how the tables have turned, yes?

From the article:

As the Cuban government struggles through a deep recession, its leaders have begun picking away at socialism in order to save it. But experts say the latest buzz by the Cuban government is simply another desperate fix to stem the slide of a failed economy that buckled long ago.

Even one of Havana's leading economists recently said Cuba's economy needed to be turned upside down -- "feet up." So taxi drivers got private licenses, farmers now have their own plots of land and government workers have to pack their own lunches.

"I think what they are trying to do is prepare the people for a hard landing," said Cuba expert Jonathan Benjamin-Alvarado of the University of Nebraska. "The government is really saying in so many words: We've got limited resources and can only do so much. I think they are stuck."

Since he took office early last year, Raúl Castro has been saying that the country's severely battered economy needs fixing. In a widely quoted August speech, Castro said Cuba was spending more than it made.

"Nobody, no individual nor country, can indefinitely spend more than she or he earns. Two plus two always adds up to four, never five," he said. "Within the conditions of our imperfect socialism, due to our own shortcomings, two plus two often adds up to three."

As with any government redistribution of resources ... 2+2 always equals 4 no matter how much the politicians like to try and claim they can make 5 out of it. Just like Alchemists found out they couldn't turn lead into gold, so it is true with those who might pretend to be "economic alchemists".

State of the Libertarian Party in Indianapolis

On one of the local political BLOGs someone made a comment about Libertarians supposedly being absent on opposing the government funded construction of the Colts' stadium and the recent bailout (by tax increase and even more borrowing) of the entity that operates it. They tried to spin things as Libertarians suddenly coming out of the wood work over the silly nanny-state smoking ban garbage that comes up perennially. Clearly, they weren't paying attention.

It did prompt me to think about how much the party has grown, how closer as a group of friends and 'comrades in arms' it seems many of us have become and so I thought I'd repost some excerpts of my response to that individual.

Libertarians did go off the hook on Lucas Oil Stadium, but arguably had a smaller and maybe less organized Marion County presence at the time. Libertarians were all over the CIB bailout and mismanagement garbage, I personally appreciated the Libertarians being invited by Chairman Lutz (R) to speak before his committee on that subject. Unfortunately, the Chicken Little crowd won that battle.

A few years ago at some of the (not directly party functions - just social in nature) Libertarian MeetUp group we would get five to eight people. In the last year there have been up to 30 or 35 attendees and the group recently split into a North Side and South Side group (check out MeetUp.com for details). Tim Maguire has been very active as the Marion County (LPMC) Chair, there is a core group of bright and active people and there is now even a Libertarian Party City Councilor.

At a recent (July 31?) Friedman Foundation event downtown where State School Superintendent Tony Bennett (R) spoke, and I think Councilor Ben Hunter's (R) wife was one of the organizers, the Libertarian Party of Indiana's Exec. Director Chris Spangle took home the prize for bringing the most people to the event and, the LPMC filled more than four tables (40+ people) at the Stossel / Economics Club event this week.

Note: The sense is that the party is continuing to grow as more people realize the other two parties are continuing to field less than impressive and often outright anti-Constitution candidates. More people are recognizing that the economic and foreign policy positions of BOTH the typical Democrat or Republican are harming our country. There is also a sense that existing Libertarians are becoming increasingly organized.

The smoking thing is just continuing to prove that SOME Republicans on the council aren't REALLY for small, unobtrusive government and low-taxes. In fact, Vernon Brown (D - 18th) has voted better than every single one of the Republicans [at least through August he had]. But, it always helps being the opposition to whatever tax increases or tyranny those in power want to bring forward.

For what it is worth, Christine Scales (R - 4th) has the best voting record of the Republicans and is proving to be someone who is really trying to do her own homework on issues and do the right things. As you would expect, none of them are perfect though and that's understandable.

Recent Jobless Claims Data - Two Stories To Get Whole Picture

The following two articles came out today. I am always struck by how when "continuing claims" are reported, they never (almost never?) actually report the number of benefit recipients who reached the end of the benefit period. So, when you see "continuing claims dropped 16,000" but have to go dig to find out that "400,000 had their benefits expire" ... well, you do the math.

Even more fascinating is that both articles are from the same news source, CNN/Money. I'm just surprised that when these things are written the authors don't think to go find what that number is (benefits expired) and just include it. Is that not part of the story?

From the first article:

The 4-week moving average for ongoing claims fell by 15,750 to 6,144,250, from the prior week's revised average of 6,160,000.

But the slide in continuing claims may not be a positive sign, Resler said, as it may signal that more filers are falling off that count and into extended benefits.

Continuing claims reflect people filing each week after their initial claim until the end of their standard benefits, which usually last 26 weeks.

From the second:

more than 400,000 people ran out of unemployment benefits in September, according to the National Employment Law Project.

and it also noted:

Some 1.4 million people will stop receiving checks by year's end

Anti-Free Market Busy Bodies Seek Total Ban On Smoking In Indianapolis Bars

Once again the ‘smoking ban’ in bars advocates have reared their nanny-state heads (Proposal 371). This time it looks like more of the Republicans on the council might stab their "small, unobtrusive government" conservative supporters in the back on the issue.

One would think nosy busy-bodies in government would have more important things to do (like reducing taxes, preventing crime, stopping transfers of public money to private organizations, trying to get out of the sports stadium business that is draining taxpayers and city coffers) … but, no.

For most Republicans or “conservatives” one would think they would expect their elected representatives to support and promote the principles of small, unobtrusive government … again, they would be sadly mistaken. To be sure, there are some like Councilor Christine Scales (R - District 4) or State Senator Mike Delph (R - 29th) that, even if the voting record is not perfect, really try to do the right things, do their homework and listen to all sides of an issue. I would even suggest that Libertarian, and my good friend, Ed Coleman (Indianapolis City Council - At Large) doesn't have what I'd call a 'perfect' voting record, but he sure is trending far and away better than anyone from the other two parties and is proving to be the best taxpayer advocate on the Council.

I question whether or not supporters of the ban that are e-mailing councilors are actually people who go to bars or would, however frequently, if they were all smoke free. Why wouldn’t they visit places like Scotty’s Brew Pub which is already smoke free? Of course, as with so many things, anytime people can relieve themselves of the opportunity to have to think about something or make a hard choice, they turn to government to force their wishes or opinion on everyone else. Didn’t this battle get fought a few years ago and the result was the current compromise that seems to work pretty well? BUT, no, those who would force their will on everyone else never rest until their victory is absolute – this is a lesson we should remember every time our politicians give a little ground, make a little compromise and budge just that little bit. And this why Libertarians typically oppose giving up any ground to the enemies of freedom and liberty.

Considering some core principles we should ask advocates of the total ban about:

Do you believe in private property rights? Specifically, that if I own property I can decide certain policies for that property so long as no one else is forcibly denied their rights?

Do you believe in voluntary association? Do you believe that I have the right to associate or not associate with whomever I choose?

Do you believe a business owner has a right, racial discrimination notwithstanding, to decide what customers he or she wishes to cater to?

Do you believe that people are smart enough that if they fail to verify ahead of time and end up at a smoking establishment that they may exercise their own judgment to stay or leave that establishment in favor of another that more serves their particular desires?

Do you believe that employees in smoking establishments most likely applied for those jobs with the full understanding that the environment was not smoke-free or were they somehow duped and then stuck there, possibly for years, with no other employment options?

If you support a smoking ban on establishments just because they open the doors to the public (who can choose or not choose to go there) do you also support a ban on smoking at private parties, in houses or other dwellings where more than the smoker may be present, in cars so long as more than one person is in it? What about exhaust fumes at drive through restaurants? What about exhaust fumes on I-69 during rush hour? Parking garages? What about standing too close to a bonfire? Or a grill?

There is a great line about “politics is the art of the possible” but I take that to mean that politics is how far one can get the opponent to budge on their principles. With luck, the opponent might not even have any core beliefs or principles and that makes the job ever easier. They will sway in the wind doing whatever is popular, what they are told to do or what is best for their future political career (Maybe like Ben Hunter, District 21? [note: he claims to be a small government conservative but after voting for a recent tax increase (proposal 285), voting to limit free speech and voluntary charitable contributions (237), voting to transfer public money to private organizations (18, 117)… he’s not fooling some of us]).

Even politicians who think they are doing the right thing because their constituents (or some vocal ones) are for something often fail to consider whether they are having to reduce the rights or freedoms of others . Is this not what our Republic and the ‘rule of law’ is intended to provide protection from? Specifically, the law is supposed to protect our rights, our lives and our property not to undermine them. This is in contrast to ‘pure democracy’ where majority rules and if 6 (or even 9) out of 10 people decide they want to take away your rights, your life or your property they can do so? That is called ‘tyranny of the majority’ or ‘tyranny of the masses’.

This time, one of the excuses is ‘economic development’. That if the city government bans smoking in all the bars, more organizations will hold their conventions here and buy services from the (inappropriately government owned and operated) convention industry. There is always the possibility that this could just be the latest excuse from the ICVA (Indianapolis Convention and Visitors Association) sales department? I’m not saying it is, but I know how sales folks come up with excuses and can see somebody saying that.

Let us not forget that nobody seemed real concerned that the hotel tax increase the City Council passed through a few months ago made it basically one of the highest taxes in the nation (from 9% to 10% in the last go around but from around 5% to 9% in the past few years prior. I bet food and beverage taxes like the extra 2% to subsidize a monopoly sports team gets figured in too). It was sad to not hear councilors ask questions of the convention center folks like, “how much MORE business could you bring if we figured out how to lower the tax instead of increasing it?”

Oddly, the argument that if we had casinos we might attract more convention business probably wouldn’t play well, but let’s make that argument now. There is probably a reason why Las Vegas is one of the top convention spots. Personally, I think weather and scenery might have a boat load to do with popularity of the top 20 or 25 locations too. But, never let intuition, logic or facts get in the way of an elected government busy-body with an agenda and ambition.

The ban debate, combined with the recent fervor over panhandlers makes one wonder if the City Council is trying to ‘shine up’ the city a bit - to sanitize it so we can make pretend like we’re the Disney World of the convention industry? The problem is, of course, we don’t have a Disney World, we don’t have Casinos, we don’t have awesome weather most of the year, no mountains and no ocean. Great city, you bet’cha but let’s not have false illusions about our drawing power.

Having government trying to shoehorn our city into being tops in the convention business is just economic intervention of the kind where poor and middle class people get taxed so that government officials can flail about trying to centrally plan the economy and engage in economic adventurism without having the guts to do it privately with their own money at risk. What’s interesting, is there is massive competition because half the cities in the country it seems decided to try and enhance their attraction to conventioneers and built out space (my guess is space has been built out faster than the convention business has grown).

Instead, why not just cut the crap, keep tax rates and regulation as low as possible and actually attract business and industry? That might bring higher paying jobs than just hospitality ones too. One has to think we’d end up with a more diverse and resilient business environment as a result. Just create the right environment for things to grow and they will.

UPDATE: some of the discussion is about companies supposedly having decided not to relocate to Indianapolis because we don't have a blanket smoking ban and that affects their cost to provide healthcare. In that case, I suppose we should ban Twinkies and soda pop to help reduce the obesity problem, thus lowering healthcare costs? If some big-government statist doesn't want to move a company here because our politicians aren't all up in everybody's private business, that seems just fine to me.

Please Watch These

I know he takes some criticism and sometimes seems inconsistent; but, he is pretty much the only guy saying the things that need to be said. You would think self-avowed "Communists" being appointed to positions of power in government would make newspaper headlines, heck that should be the lead story, but the mainstream media is far too cozy with government, fears losing "access" to celebrity politicians and their credibility, importance and necessity suffer as a result.

Health Care Reform IS Important

In the current debate over health care reform I believe both of the typical sides (left/right, liberal/conservative, statist/statist-lite) are completely missing the mark.

Wednesday night, at the Indianapolis North Side Libertarian MeetUp, I heard the story of a young man the other night who said that repair of his broken arm cost around $4,500. He said when he went to the emergency room they couldn't tell him what treatment would cost. Interestingly, I also was recently looking at a procedure and the surgeon had no idea what the total cost would be, he couldn't tell me. Huh?

Anyway, broken arm guy ended up at a med check place and after some questioning indicated that, including getting a couple of different casts over the healing cycle, he spent no more than 3 or 4 hours with an actual physician and did not require anesthesia.

Let's put this in perspective of other vocations.

A well paid Telecommunications or IT Consultant might make $120 to $220 an hour depending on what they are doing and whether it is 'after hours' work. It would not be unusual for a lawyer to charge $200, $230 or for an experienced partner or specialist (but perhaps not Johnny Cochran or Mark Garagos) up in the $300 or $400 an hour range. So, let's just use $250 an hour as a fair figure.

Four hours of time = $1,000 + materials (orthopedic cast, an x-ray).

So, maybe, worst case this should have cost less than $1,500 and maybe very close to $1,000 even ... CERTAINLY not $4,500.

Now, we know that since Medicare/Medicaid underpay physicians for services so much that it drives up costs on the rest of us by at least fifteen percent and potentially up to one third and that over reliance on "prepaid healthcare" separates consumers from the actual cost of each unit use of services. We also know that a high default rate on (far too high) medical expenses shifts the burden of those bills to those who do not default. We also know that the AMA has leveraged a lot of government protectionism of physician services into the marketplace which limits supply, specialization, innovation and other things that could drive changes in the industry or increase the supply of doctors.

So, when we talk about health care "reform" can we please talk about it outside the scope of just having somebody else (like the government) pay for everything and instead focus on why it costs $7,000 to lay in a hospital bed for two days with a kidney stone (arguably not a good use of the bed) or $4,000 to put a cast on a broken arm? How about $6,000 for an out patient procedure to fix an umbilical hernia? I'll bet, physicians or hospitals who declined to accept insurance or government payments for services could easily drop their costs down to $2,000 or $3,000 for the stone (including the MRI and the IV bags of fluid) and $1,000 or less for the arm.

The point is, libertarians and conservatives are not opposed to health care "reform". But, as is typical in arguments with more left leaning big government folks we just have a much better grasp of the root of the problem and the economics of it rather than just not caring and begging for our woefully inept government to come sweep the problem under the rug.

The cost problem in health care must get resolved before any kind of dialog on how to cover the 8.6 to 12.5 million chronically uninsured people is addressed.

The Government Can

"The government takes, everything we make
They're power hungry and malicious
Their economics are fictitious
Soon we'll have to eat our dishes..."

Will Indianapolis Vote To Stifle Free Speech Tonight?

It is very possible that the really bad anti-panhandling proposal the Indianapolis City County Council has under consideration will get called back for a vote tonight. I understand that a lot of people would like the panhandlers to go away, a majority in fact, but there are some better ways to approach this problem. At minimum this proposal needs to be pulled back and redone to focus on the intended problem. As it is now, it's like spraying the hose when an eye dropper was needed.

Unless, of course, they really intend to criminalize people like this: