The Patient Protection and Affordable Care Act, also know as Obamacare, has been dealt another blow. For the first time a federal appeals court has ruled the health care law as unconstitutional. But the battle is far from over. Since there have been multiple conflicting rulings, these law suits will inevitably make it to the Supreme Court.
Historically the Supreme Court has interpreted the constitution to grant to the federal government what ever power they feel the government should have. While it is clear from reading what the intentions of the founding fathers were about the meaning of the constitution that the federal government has no power to force people to purchase health care, the Supreme Court could easy assume the authority to reinterpret the constitution to give government that power.
Because we effectively have no constitution beyond what the government decides at it own discretion that we have, all arguments against Obamacare should be practical and not constitutional, at least outside the courts.
The health care mandate is effectively a massive wealth redistribution from the middle class to rich insurance companies. Since insurance companies produce no output by themselves, this guarantees that after the mandate takes effect, the rate of growth of wealth in this nation will fall. The middle-class families who now have no insurance or less insurance then the bureaucrats in Washington think they should have will be forced to sacrifice to obtain or increase their insurance.
Since people who have no insurance must pay out of pocket for doctor's visits and other medical expenses, they have an incentive not to over consume. Once they are forced by dictate to have insurance, the marginal cost of medical expenditures reduces to nearly zero. People who once had no incentive to consume medical care, will now have an incentive. As long as the cost in lost time is less then the gain from the medical care they will consume medical care.
What happens when the demand goes up? The price goes up. Basic law of economics. The government and insurance companies will respond to these rising prices by putting price caps. If prices are not allowed to rise, the quantity supplied will reflect the current price level. This means we will have excess demand or a shortage of medical care. The response to that will be to ration medical care. Those who are determined to have the most urgent medical need will be placed first in line and anything less serious will be forced to wait.
The problem with this form of rationing is that people who may not seem to need immediate care may be forced to wait too long. Also people who have no serious medical emergency but are only in for a check up may have an undiagnosed condition. Because prices are not allowed to go up, resources that might otherwise be allocated to health care aren't and the shortage will be permanent.
Under the free market, shortages do not exist. If demand spikes, for what ever reason, prices go up to encourage a reduction in demand. This is still a form of rationing just like what would happen in a planned economy. However, the higher prices create incentives to move resources into the health care sector and drive prices back down so that everyone can get the health care they need. With out this pricing mechanism, everyone gets less health care in the end.
Saturday, August 13, 2011
Friday, August 12, 2011
On the soul
Continuing my journey through The Last Superstition, an argument was presented concerning the soul. Before I get into that I would like to discuss just my issue with the arguments for God's existence that I brushed off in my prior post.
To get down to the real nitty gritty would require an explanation of Aristotle's notion of the 4 causes. However, my objection to the arguments are not that the conclusion, that there is a primer mover or first cause that is itself uncaused, but that the attempt to determine what this cause is like and even how many there are falls short.
Moving on to the soul, an argument based on forms is presented for the immortality of the soul. The soul itself is defined as the essence of the living being, what gives it life. Because of this meaning, Aristotle and Aquinas as well as the Catholic Church that follows their ideas accepts that plant and animals also have souls but of different types.
Now to show that the human soul, as opposed to the pure animal and plant souls, is immortal, Feser appeals to Aristotle's concept of forms. The claim is made that when we see an object, we have the form of that object in our intellect. No material thing has the perfect form, for example triangularity. No one can draw a perfectly straight triangle no matter how hard they try and even a computer is forced to accept a pixellated triangle. However, it is claimed, we have in our intellect the perfect form or the triangle. Since the perfect form cannot exist in matter, the intellect must be immaterial.
Do we have in our intellect the perfect form of the triangle? Or do we simply recognize the aspects of the imperfect triangle that give it triangularity? We see a shape composed of 3 lines. We do not even think to try to measure the angles since we know if it is a perfect triangle in Euclidean space, the angles will add up to 180 degrees and just accept that from appearance, the triangle is close enough. At no point do we need the form of the triangle to be in our intellect any more then an animal needs to have the form of an object it sees in its mind. Any animal can recognize food when it sees or smells it. Shall we conclude that the animal has the form of that object in its intellect, how ever lacking we may assume that intellect to be, an conclude that the animal has an immortal soul as well?
What about if we programmed a computer to recognize forms? Since we recognize forms only because we learn them not because they are innate in us, teaching a computer to recognize forms would be analogous. If I programmed a computer to recognize the shape of a triangle as an object with 3 reasonably straight lines, would the computer now have a soul?
Aristotelian logic is a rather interesting subject but we should not just accept his conclusions without some scrutiny else we may end up defending something absurd such as a computer with a immortal soul.
To get down to the real nitty gritty would require an explanation of Aristotle's notion of the 4 causes. However, my objection to the arguments are not that the conclusion, that there is a primer mover or first cause that is itself uncaused, but that the attempt to determine what this cause is like and even how many there are falls short.
Moving on to the soul, an argument based on forms is presented for the immortality of the soul. The soul itself is defined as the essence of the living being, what gives it life. Because of this meaning, Aristotle and Aquinas as well as the Catholic Church that follows their ideas accepts that plant and animals also have souls but of different types.
Now to show that the human soul, as opposed to the pure animal and plant souls, is immortal, Feser appeals to Aristotle's concept of forms. The claim is made that when we see an object, we have the form of that object in our intellect. No material thing has the perfect form, for example triangularity. No one can draw a perfectly straight triangle no matter how hard they try and even a computer is forced to accept a pixellated triangle. However, it is claimed, we have in our intellect the perfect form or the triangle. Since the perfect form cannot exist in matter, the intellect must be immaterial.
Do we have in our intellect the perfect form of the triangle? Or do we simply recognize the aspects of the imperfect triangle that give it triangularity? We see a shape composed of 3 lines. We do not even think to try to measure the angles since we know if it is a perfect triangle in Euclidean space, the angles will add up to 180 degrees and just accept that from appearance, the triangle is close enough. At no point do we need the form of the triangle to be in our intellect any more then an animal needs to have the form of an object it sees in its mind. Any animal can recognize food when it sees or smells it. Shall we conclude that the animal has the form of that object in its intellect, how ever lacking we may assume that intellect to be, an conclude that the animal has an immortal soul as well?
What about if we programmed a computer to recognize forms? Since we recognize forms only because we learn them not because they are innate in us, teaching a computer to recognize forms would be analogous. If I programmed a computer to recognize the shape of a triangle as an object with 3 reasonably straight lines, would the computer now have a soul?
Aristotelian logic is a rather interesting subject but we should not just accept his conclusions without some scrutiny else we may end up defending something absurd such as a computer with a immortal soul.
Journey into Superstition
It has been a while since I started reading The Last Superstition and I think an update is due. The book spends chapter 2 discussing Greek philosophy, specifically Plato and Aristotle.This lead directly into chapter 3's discussion of the medieval philosopher Thomas Aquinas.
Interspersed through these chapters are ad hominem attacks against Dawkins, Hitchens, Harris and Dennette, the infamous New Atheist. Much of these attacks are due to the apparent ignorance of this group, especialy those with training in philosophy, about the metaphysics and arguments of Aristotle and Aquinas. Since Aristotle's ideas as well as Aquinas' improvements have been rejected in modern philosophy, this omission should hardly be surprising.
As for the arguments themselves, Feser does give quite a few arguments for the existence of God. Unfortunately, due to the length required to sufficiently explain the argument and give my objections, I do not have the room to refute them here.
However, once argument that was given was with regards to sexuality. Basically, he objects to all sex acts that do not involve a man having vaginal intercourse with a woman with out and birth control. He argues that the biological nature or final cause of sex is procreation and thus any sex act that does not end with the man freely ejaculating into the women in such a way that is conducive to pregnancy is immoral.
This, of course, is silly. The biologically final cause of an action does not determine, in and of itself, whether or not an action is immoral. Consider this, the biological nature of walking is to move a person from one point to another. Walking on a treadmill frustrates the biologically final cause of walking. Using the same logic, we should oppose treadmills.
One might point out that walking on a treadmill is not as bad as using a condom because a condom prevents the sex act from producing life and nothing is more valuable then life. However, not having sex also prevents life and there is nothing inherently immoral about that. No one would even attempt to claim that treadmills are immoral. Why not even though they evade the biological purpose of walking?
Treadmills have human derived final cause of improving health. Because of our ability to reason we can over rule a biological final cause with our own desired final cause. Like walking has uses beyond just moving us from one point to another so too sex has uses other then simple procreation.
Based of this argument, Feser claims that marriage is about procreation. Husband and wife work together to support the family. This is not what we mean by marriage in modern times. In the past when marriage was solely about 2 people coming together to start a family, marriage as between a man and woman only made sense. However, the modern version of marriage is perfectly suited for couples who want no children as well as gay couples. Due to the existence of adoption agencies, if a gay married couple decided they did want to raise children, that option is as open to them as to heterosexual couples.
The mistake is to assume that the only proper final cause is the biological but that only leads to absurdity.
Interspersed through these chapters are ad hominem attacks against Dawkins, Hitchens, Harris and Dennette, the infamous New Atheist. Much of these attacks are due to the apparent ignorance of this group, especialy those with training in philosophy, about the metaphysics and arguments of Aristotle and Aquinas. Since Aristotle's ideas as well as Aquinas' improvements have been rejected in modern philosophy, this omission should hardly be surprising.
As for the arguments themselves, Feser does give quite a few arguments for the existence of God. Unfortunately, due to the length required to sufficiently explain the argument and give my objections, I do not have the room to refute them here.
However, once argument that was given was with regards to sexuality. Basically, he objects to all sex acts that do not involve a man having vaginal intercourse with a woman with out and birth control. He argues that the biological nature or final cause of sex is procreation and thus any sex act that does not end with the man freely ejaculating into the women in such a way that is conducive to pregnancy is immoral.
This, of course, is silly. The biologically final cause of an action does not determine, in and of itself, whether or not an action is immoral. Consider this, the biological nature of walking is to move a person from one point to another. Walking on a treadmill frustrates the biologically final cause of walking. Using the same logic, we should oppose treadmills.
One might point out that walking on a treadmill is not as bad as using a condom because a condom prevents the sex act from producing life and nothing is more valuable then life. However, not having sex also prevents life and there is nothing inherently immoral about that. No one would even attempt to claim that treadmills are immoral. Why not even though they evade the biological purpose of walking?
Treadmills have human derived final cause of improving health. Because of our ability to reason we can over rule a biological final cause with our own desired final cause. Like walking has uses beyond just moving us from one point to another so too sex has uses other then simple procreation.
Based of this argument, Feser claims that marriage is about procreation. Husband and wife work together to support the family. This is not what we mean by marriage in modern times. In the past when marriage was solely about 2 people coming together to start a family, marriage as between a man and woman only made sense. However, the modern version of marriage is perfectly suited for couples who want no children as well as gay couples. Due to the existence of adoption agencies, if a gay married couple decided they did want to raise children, that option is as open to them as to heterosexual couples.
The mistake is to assume that the only proper final cause is the biological but that only leads to absurdity.
Wednesday, August 10, 2011
Low interest rates
The Fed has announced, or specifically Ben Bernanke has announced, that the Fed will keep interest rates low through at least 2013. Though the current crisis has spurred an increase in savings, this foolish move will keep savings below what we need to rebuild our capital stocks to get our economy moving again.
We had historically low interest rates though the housing bubble. Because the borrowing was being funneled through the housing market, whose prices are not reflected in the inflation measures. Since inflation appeared low when in fact it was higher, the Fed assumed the target rate was correct. A similar occurrence took place during the tech bubble when stock prices were soaring and the inflation there was not reflected in inflation measures.
The low savings rate caused by low interest rates caused a huge problem. People did not have savings to use to purchase homes. The solution was to "encourage" banks to loan to people with low down payments. This was done in several ways.
Fannie Mae and Freddie Mac were created to purchased home loans from banks thus freeing up new funds to create new loans. Since Fannie and Freddie were government created entities, it was assumed they would have the backing of government funds if anything went sour. They lacked the incentives to verify that the loans they purchased were good investments and the banks knew that.
Under the old system, in order to purchase a home you needed to have a sufficient down payment to give you a vested interest in the home as well as a reliable income to show that you will be able to make the payments. Unfortunately this meant many blacks and other minorities could not own home. Some interests groups attempted to pressure banks to make more loans to minorities to try to fix the inequities. Of course these loans did not fix the underlying cause of these inequities, poverty, and lead these people to inevitable foreclosure.
With the Feds announcement that they intend to continue the practice that encourages bubbles and recession, where are we headed next? Recently gold prices have been increasing due to the fears of inflation. Is gold the next asset bubble or will there be something different? And after the next crash caused by artificially low interest rates, will the Federal Reserve learn its lesson or will the continue the insanity of doing the same thing over and over and expecting different results?
We had historically low interest rates though the housing bubble. Because the borrowing was being funneled through the housing market, whose prices are not reflected in the inflation measures. Since inflation appeared low when in fact it was higher, the Fed assumed the target rate was correct. A similar occurrence took place during the tech bubble when stock prices were soaring and the inflation there was not reflected in inflation measures.
The low savings rate caused by low interest rates caused a huge problem. People did not have savings to use to purchase homes. The solution was to "encourage" banks to loan to people with low down payments. This was done in several ways.
Fannie Mae and Freddie Mac were created to purchased home loans from banks thus freeing up new funds to create new loans. Since Fannie and Freddie were government created entities, it was assumed they would have the backing of government funds if anything went sour. They lacked the incentives to verify that the loans they purchased were good investments and the banks knew that.
Under the old system, in order to purchase a home you needed to have a sufficient down payment to give you a vested interest in the home as well as a reliable income to show that you will be able to make the payments. Unfortunately this meant many blacks and other minorities could not own home. Some interests groups attempted to pressure banks to make more loans to minorities to try to fix the inequities. Of course these loans did not fix the underlying cause of these inequities, poverty, and lead these people to inevitable foreclosure.
With the Feds announcement that they intend to continue the practice that encourages bubbles and recession, where are we headed next? Recently gold prices have been increasing due to the fears of inflation. Is gold the next asset bubble or will there be something different? And after the next crash caused by artificially low interest rates, will the Federal Reserve learn its lesson or will the continue the insanity of doing the same thing over and over and expecting different results?
Tuesday, August 9, 2011
Credit Rating
So what does it mean now that one of the 3 credit rating agencies has downgraded the US government from its coveted AAA rating? Apparently very little.
People are still running into US securities as he stock market continues in a downward spiral. Ironically, some blame Mondays dip on the lower credit rating. But if people were concerned about the government's ability to pay its debt, there would be movement either into stocks or corporate bonds and out of treasury bills.
The US government is not the first government to lose AAA rating. Japan got downgraded to AA- by S&P and they are currently the nation with the highest debt to GDP ratio of over 200% and yet they have managed to keep interest rate at a savings killing 1.5%.
Since it is not politically feasible to reduce spending as both Democrats and Republicans are unwilling to cut either entitlement or military spending, the debt of the US government will only go up and the percentage of the annual budget devoted to interest on the debt will only increase. These means that future generations will have to give up more of their blood and sweat through higher taxes to pay for our excesses.
To my daughters generation, I am sorry. I opposed the governments massive deficits and kept screaming at my representatives Washington but they only ignore my pleas.
People are still running into US securities as he stock market continues in a downward spiral. Ironically, some blame Mondays dip on the lower credit rating. But if people were concerned about the government's ability to pay its debt, there would be movement either into stocks or corporate bonds and out of treasury bills.
The US government is not the first government to lose AAA rating. Japan got downgraded to AA- by S&P and they are currently the nation with the highest debt to GDP ratio of over 200% and yet they have managed to keep interest rate at a savings killing 1.5%.
Since it is not politically feasible to reduce spending as both Democrats and Republicans are unwilling to cut either entitlement or military spending, the debt of the US government will only go up and the percentage of the annual budget devoted to interest on the debt will only increase. These means that future generations will have to give up more of their blood and sweat through higher taxes to pay for our excesses.
To my daughters generation, I am sorry. I opposed the governments massive deficits and kept screaming at my representatives Washington but they only ignore my pleas.
Sunday, August 7, 2011
The Last Superstition
I have started reading the book The Last Superstition: A Refutation of the New Atheism. Having only just read the preface and acknowledgements, I can say that this will be an interesting read. Edward Fesser, the author, is clearly frustrated by the success of gay rights groups in getting gay marriage legalized in California through the courts.
No doubt Fesser is happy that the hateful bigotted anti-gay rights groups managed to get prop 8 passed that defines marriage in the California Constitution as between a man and a woman. There are still legal challenges to the law and equal rights groups are trying to get the discriminatory definition changed in the 2012 voting season.
Fesser has promised to rationalize his bigotry in the book and states that if the reader does not agree, he needs to read the book to be convinced that his hate is justified or at least to understand his position. I have already explained why I support gay marriage so I expect to at least gain an understanding of his beliefs.
Though he went on a tirade about gay marriage, the book is not all about this one issue. As the title suggests, the book is really about countering the new atheist movement. Of course the gay marriage issue is one supported by the new atheists, gay marriage is supported by loving and compassionate people of all groups. He says he will go back to Aristotle and Aquinas claiming that there work has not been refuted. We shall see.
No doubt Fesser is happy that the hateful bigotted anti-gay rights groups managed to get prop 8 passed that defines marriage in the California Constitution as between a man and a woman. There are still legal challenges to the law and equal rights groups are trying to get the discriminatory definition changed in the 2012 voting season.
Fesser has promised to rationalize his bigotry in the book and states that if the reader does not agree, he needs to read the book to be convinced that his hate is justified or at least to understand his position. I have already explained why I support gay marriage so I expect to at least gain an understanding of his beliefs.
Though he went on a tirade about gay marriage, the book is not all about this one issue. As the title suggests, the book is really about countering the new atheist movement. Of course the gay marriage issue is one supported by the new atheists, gay marriage is supported by loving and compassionate people of all groups. He says he will go back to Aristotle and Aquinas claiming that there work has not been refuted. We shall see.
Monday, August 1, 2011
Crisis averted, for now
The Republicans and Democrats have come to an agreement. Few people are likely to be surprised that there was much compromise. The debt ceiling willing raised and token "cuts" will be made. There will be no tax hike in the current proposal and the proposed "balanced budget" amendment will not be made a requirement.
Proposed cuts, as those familiar with the dishonest accounting in Washington are aware, are in fact cuts in planned spending not cuts in actual spending. This means government will still grow just by less then planned. The proposed cuts are $900 billion with an equal increase in the debt limit. The social safety net and its massive unfunded liabilities will not be touched.
Since this legislation will not fix the true issue of deficit spending, a committee of 6 Republicans and 6 Democrats with come together to find a way to reduce the deficit spending by $1.5 Trillion. Since the expected revenue gain from the extended Bush tax cuts finally sun-setting does not count towards the total, we can expect either more cuts or higher taxes, and likely will get a combination of both.
Nevada's own Harry Reid called this a success of compromise by both parties. Unfortunately, the compromise is going to cost the average taxpayer. Democrats are unwilling to make necessary cuts and Republicans cannot support increases in revenue.
Items that should be cut or changed but will not be are corporate tax loopholes and corporate welfare. Eliminating both of these would help with the deficit as well as level the corporate playing field. These could be made revenue neutral by lowering the corporate tax rate to encourage corporations who have fled to come back to the US. When those companies come back, the new tax revenue collected would then be used to reduce the deficit.
What will likely happen? I expect that the upper bracket tax rates will be increased despite the fact that the rich can more easily move their money to avoid paying higher taxes. The revenue from the tax hike will be far short of what was expected as the rich move their money to protect it as they always do so we may see even higher taxes on the rich or increases in the lower brackets. There will likely only token changes if any to our unsustainable entitlement programs that will mean future generations will have an even greater burden placed upon them.
In the end, the politicians have compromised and it is our future that has been compromised.
Proposed cuts, as those familiar with the dishonest accounting in Washington are aware, are in fact cuts in planned spending not cuts in actual spending. This means government will still grow just by less then planned. The proposed cuts are $900 billion with an equal increase in the debt limit. The social safety net and its massive unfunded liabilities will not be touched.
Since this legislation will not fix the true issue of deficit spending, a committee of 6 Republicans and 6 Democrats with come together to find a way to reduce the deficit spending by $1.5 Trillion. Since the expected revenue gain from the extended Bush tax cuts finally sun-setting does not count towards the total, we can expect either more cuts or higher taxes, and likely will get a combination of both.
Nevada's own Harry Reid called this a success of compromise by both parties. Unfortunately, the compromise is going to cost the average taxpayer. Democrats are unwilling to make necessary cuts and Republicans cannot support increases in revenue.
Items that should be cut or changed but will not be are corporate tax loopholes and corporate welfare. Eliminating both of these would help with the deficit as well as level the corporate playing field. These could be made revenue neutral by lowering the corporate tax rate to encourage corporations who have fled to come back to the US. When those companies come back, the new tax revenue collected would then be used to reduce the deficit.
What will likely happen? I expect that the upper bracket tax rates will be increased despite the fact that the rich can more easily move their money to avoid paying higher taxes. The revenue from the tax hike will be far short of what was expected as the rich move their money to protect it as they always do so we may see even higher taxes on the rich or increases in the lower brackets. There will likely only token changes if any to our unsustainable entitlement programs that will mean future generations will have an even greater burden placed upon them.
In the end, the politicians have compromised and it is our future that has been compromised.
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