Numerous comparisons have been made between the current Iraq War and the Vietnam War, with some likening the two situations and others decrying the notion of any similarity. Some comparisons, including an analysis by Dr. Atul Gawande in the New England Journal of Medicine, show conclusively that improvements in medical technology have decreased the battlefield death rate significantly. Researching the statistics, Dr. Gawande shows that combat death rates from injury dropped from 30% during World War II to 24% during Vietnam, and to 10% in Iraq and Afghanistan. This decrease in mortality has been used to show that without modern medicine, American fatalities in Iraq would run at close to 2200 per year instead of the current 900 per year. But even at 2200 casualties per year, the Iraq conflict would pale in comparison to Vietnam, where on average 9000 American soldiers were killed each year during America’s heaviest presence (1966-1971).
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Category: Policy
You can’t be Whatever You Want to be
Why do we in America constantly tell children that they can be whatever they want to be? When asked what they want to be when they grow up, large percentages of adolescent boys reply that they want to be a professional athlete. We generally encourage our children to set their aspirations high, at President or professional athlete, at Astronaut or movie star. Such aspirations are wonderful in that they challenge children to reach for lofty goals, but the reality is that a tiny percentage of us will ever attain such positions.
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New Orleans, Build Upward
To the extent that any development in New Orleans makes sense, vertical development makes sense. New Orleans historically was a narrow sliver of a city curving along the banks of the Mississippi, where the only liveable high ground in the city was to be found. Historical neighborhoods like the French Quarter, Warehouse District, Faubourg Marigny, and Central Business District are thus densely developed areas with a majority of structures possessing multiple floors. Even Uptown New Orleans, a primarily residential area, possesses many multi-family homes and multi-floor homes built on relatively compact lots.
Why then are so many in neighborhoods across New Orleans and the metro area fighting vertical development? As developers trot out plans for high rise condominium and apartment buildings as a means to rapidly increase the housing supply, many neighborhood groups and even the city council are fighting to curtail growth. But what other options exist in a city that has an average elevation somewhere between zero and ten feet below sea level? High rise towers provide a much greater level of protection to residents and their property; many living in existing modern high rises experienced relatively little property damage even from Katrina. Since downtown New Orleans predates the automobile era, it also possesses human-sized blocks perfect for dense, pedestrian friendly redevelopment.
While the historical character of New Orleans’ architecture should be preserved in redevelopment, many projects are being sidelined due to height restrictions, minimum parking requirements, and other zoning restrictions. But if New Orleans is to accelerate the recovery and redevelopment process, its politicians and citizens will have to accept that higher density development is the only viable route forward. Vertical development can help minimize the threat posed by future storms while rapidly increasing the area’s housing stock. Let’s hope that the powers that be accept this and move projects to fruition with the expediency that true recovery dictates.
America’s Broken Universal Health Care
The United States provides universal health care. Sound laughable? It’s true: all individuals in America, whether citizens, immigrants, or tourists, are entitled to government subsidized care in the event of medical emergency. While the uninsured may not be able to get a routine doctor’s appointment, they are guaranteed life saving surgery and medical intervention, regardless of cost. Indeed, care for indigents can occasionally run into the hundreds of thousands per year, as they repeatedly return to the emergency room for treatments of illness caused by chronic diseases like diabetes. The US spends roughly 75 billion annually on treating the nation’s 40+ million uninsured; the situation among alcoholics in Seattle has become so absurd that they are being given housing and routine medical care, since this decreases the cost of treating them in emergency situations.
Perhaps it is no surprise then that America spends a larger percentage of its GDP on health care than almost any other nation, and yet it lags on a wide range of health indicators, including overall life expectancy. How did such a situation emerge? Largely by accident, it turns out. In 1986, the EMTALA was passed by Congress, denying hospitals the right to refuse critically ill patients. Federal and state governments partially reimburse providers for costs incurred for this treatment through Medicaid and Medicare. Unfortunately, critical care is provided without any cost-benefit analysis whatsoever; it is considered a criminal act to withhold treatment from elderly, terminally ill patients, even if it would extend their life by a matter of weeks.
As US healthcare costs continue to spiral upward at rates often double and triple that of overall inflation, the situation becomes increasingly untenable. But what are the alternatives to America’s current system?
1. Remove required treatment burdens from hospitals, leaving the burden of care to individuals, charities, and local and state government.
2. Provide routine medical care to the uninsured, eliminating the treatment gap for the uninsured.
3. Require all Americans to buy insurance, or to pay a healthcare tax to pay for the implied insurance provided by emergency rooms.
4. Begin to consider rationing publicly funded health care based on cost-benefit analysis, taking into account a procedure’s likelihood of success, its cost, the patient’s age, and other factors.
Option 1 is politically infeasible for an industrialized nation, and is included only for completeness. Providing routine medical care to the uninsured, as in option 2, would expand America’s current system to be more similar to European systems of comprehensive universal public health care. Nations like the UK and Canada ration non-critical care within their systems in order to control costs; the very notion of health care rationing is anathema in the US currently, making public dialogue on public universal care close to impossible. Australia, meanwhile, has a hybrid healthcare system which includes public insurance for all while enabling private care to co-exist, potentially providing a model for US healthcare reform.
Massachusetts has begun a program similar to that outlined in option 3, in which all residents without insurance are required to purchase insurance or pay a tax to subsidize the emergency coverage that all residents receive. Poor residents are provided with assistance to pay for an insurance policy, enabling all residents to acquire coverage. This system provides the benefit of extending coverage across the population, while forcing everyone to contribute, thus averaging out costs across healthy and less healthy individuals. Since the system provides a net increase in medical coverage, however, it will result in increased costs over time.
This brings us to option 4, the unspeakable in the American health care dialogue: rationing. In practical terms, medical decision-makers find it difficult to discuss the notion of saving $100,000 by not performing a procedure, even if it has a 1 in 1,000 chance of success. Cost-benefit based rationing of care is not a solution to the problems of health care access. Rather, it is an eventuality that will have to be confronted, as public expenditure on health care cannot forever grow faster than the economy. Until then, America’s broken universal healthcare system will continue to plod along, destined to hit the wall when we just can’t find another dollar to keep 95 year-old vegetables alive another minute.
A Tax Cut for All
With the 2001 tax cuts beginning to expire in a few years, perhaps it is time to revisit them. Those tax cuts, along with a subsequent tax cut in 2003, cost roughly $150 billion per year in lost tax revenue. Tax rates were cut across the board, with a drop from 15 percent to 10 percent in the lowest tax bracket, and a drop from 39 percent to 36 percent in the highest bracket. A myriad of other tax breaks including a cut in taxes on dividends and capital gains combined to make one of the largest tax reductions in years. Now, with the tax cuts set to expire in 2010, Democrats argue that they be allowed to expire to reduce the deficit while Republicans argue that they should be made permanent. A recent Congressional vote over a minimum-wage increase succumbed to this battle, as Republicans attempted to tie the repeal of the estate tax to a minimum wage hike.
There is room for compromise on this issue, where all Americans can enjoy a tax cut without increasing current structural deficits. A reduction in the lowest federal tax bracket (for income below $10,000) from 10% to 0% would provide $1000 in tax relief for every full-time American worker, from the richest to the poorest. The elimination of the lowest tax bracket would lift more Americans out of poverty than a hike in the minimum wage, since it wouldn’t have the adverse affects on employment that a wage floor can have. If developing nations like China and India can do without an income tax for the poorest in society, can’t America? One caveat: giving $1000 in taxes back to all 145 million American workers would cost $145 billion annually.
How can America pay for a tax cut even larger than the last round? For starters, since the lowest tax bracket would be eliminated, the Earned Income Tax Credit could be largely eliminated as well. The EITC rebates $40 billion per year to the poorest families in America, but adds a large regulatory burden for both families and the IRS by requiring taxpayers to claim the credit, with the IRS auditing them to ensure eligibility. Eliminating the EITC could help pay for a large chunk of lowest-bracket elimination while lightening the tax filing burden for a significant percentage of the population. Next, allow the upper tax bracket and estate tax reductions to expire in 2010, adding roughly $100 billion to government revenue. Finally, make permanent the 15% tax rate on dividends and capital gains, providing investment tax relief for the middle class and wealthy. The 15% rate on dividends and capital gains costs $5 billion to government coffers, but provides an incentive to the investing class to support the overall tax package.
All this leaves a neat compromise in which all Americans get a $1000 tax cut, and upper-middle class and wealthy Americans get to keep low investment tax rates in return for pitching in on broader tax relief. The elimination of the lowest tax bracket and the EITC would also simplify tax filing for millions of Americans, from poor working class families to the elderly and part-time workers as well. US mid-term elections take place tomorrow; if the Democrats take the House, this sort of tax cut would be a welcome new idea for their platform. If the Republicans narrowly maintain control, a broad-based compromise tax cut for all might be just the kind of legislation they need to break the legislative logjam. Any takers?
Corporate Income Taxes are Broken
While tax policy has long been used as a political tool, the basic purpose of taxation is to raise funds for the government. Ideally, taxes should accomplish this goal in as efficient and equitable a manner as possible. Tax codes at both the federal and state levels have long since diverged from this ideal, becoming bloated documents aimed at encouraging us to drive certain cars, have certain occupations, and make a myriad of other choices having nothing to do with government revenue. But for all their flaws, personal income tax codes in the US are simple and efficient in comparison with corporate tax codes.
Corporate income taxes are the only taxes in the US levied on a vague notion of “income”: the difference between revenues and all business-related expenditure. Personal income taxes are in effect revenue taxes, as they do not shrink for the person who spends every dime to get by, nor do they grow for the person who saves 20% of their income. Property and sales taxes likewise do not take into account the payor’s ability to pay; indeed, property taxes occasionally push property owners into bankruptcy. Only corporate income taxes attempt to tax based on a company’s ability to pay, as measured by corporate profits.
Unfortunately, determining a corporation’s profits is complex at best, and can be a subjective matter at worst as companies use myriad techniques to reduce their taxable profits. Small, individually-owned companies often commingle business and personal expenses, reducing taxable profits while gaining personal benefit. In the area of automobile leasing this is so common that accountants typically tell their small business clients to deduct 90% of a personal vehicle lease against their business revenue, as this is the “generally accepted” deduction for such an expense.
Large public companies also have been known to deduct expenses incurred for the benefit of company executives. Corporations use foreign subsidiaries to avoid taxes by paying those subsidiaries for rights to trademarks or other services, resulting in an expense for US accounting purposes. Public corporations also legally keep two separate sets of accounting books: one for the SEC and investors, which attempts to show maximum profitability, and another for the IRS which shows minimum profitability. The complexity of this system imposes a significant burden on both companies and the IRS, as both sides engage in a complex accounting dance to accurately determine profitability.
Why not tax corporations just as the government taxes individuals, by taxing their revenue and not their profit? Revenue is a much simpler number to establish and verify than profit, since no consideration of expenses is involved. The accounting burden for both companies and revenue collection agencies would be greatly reduced, decreasing the drag of compliance on the economy. Gross-receipts taxes, as they are often called, are effectively used in several states including Washington and Delaware. Since gross-receipts taxes are broad-based, US corporate tax rates of around 35% could be replaced by a revenue-neutral revenue tax at a rate of around 1%. For many profitable companies a revenue tax would result in a significant tax reduction, while millions of small businesses would now have to make a small 1% contribution to tax revenue for the first time.
Critics complain that revenue taxes hurt companies like wholesalers that have very low margins – but even commodity intermediaries aim to earn 2-3% in net margins, making the burden of a 1% revenue tax similar to their current income tax burden. And no one seems to complain that a profitless corporation can’t afford to pay its property or sales taxes! A complete migration of corporate taxation to gross-receipts taxation might seem close to impossible at the federal level, with all the winners and losers it would create. But such a system would deliver huge benefits by lowering compliance and audit costs while distributing taxation more fairly across all corporations.
A trailer is not a gun show!
I grew up on a country road outside the small town of Leesville, LA. At the entrance to the road was a trailer where a friend of mine used to live. Some time after he moved away, the trailer became “Bunn & Sons Gun Shop,” with a red arrow painted to indicate the “gun show” around back. Why was a gun show in continuous operation behind a trailer on my road?
I didn’t know it at the time, but it turns out that the “gun show” was a response to the Brady Bill, enabling Bunn & Sons to use a loophole in the bill to sell handguns without a mandatory background check. Now, since this was the rural south, folks would always complain about how somebody was trying to take away their 2nd amendment rights. What is the actual text of the 2nd amendment?
A well regulated militia, being necessary to the security of a free state, the right of the people to keep and bear arms, shall not be infringed. – Bill of Rights, Amendment II
Reading these words, and interpreting them literally, it seems that the second amendment protects the right of the people to bear arms as part of a well-regulated militia. While the NRA would like to delete the first clause of the Amendment, it defines the right in the context of a militia, as noted in this summary at Thomson Findlaw.
The courts have clearly decided that the right to own a tank, rocket-propelled grenade launcher, or even a sawed-off shotgun is not necessarily protected under the 2nd Amendment. In the US v Miller, 1939, the Supreme Court Justice McReynolds wrote,
“In the absence of any evidence tending to show that possession or use of a ‘shotgun having a barrel of less than eighteen inches in length’ at this time has some reasonable relationship to the preservation or efficiency of a well regulated militia, we cannot say that the Second Amendment guarantees the right to keep and bear such an instrument.”
Federal firearms regulations also regulate the sale and transfer of firearms through the aforementioned Brady Bill and other legislation. Until recently, they also banned an entire class of semi-automatic weapons known as assault weapons.
Back to Bunn & Sons, and their “gun show”: all Bunn may have been trying to do was increase his business by removing the hurdle of an electronic background check from the sales process. In a larger context, the NRA has fought to keep the private-sale loophole available, in order to eliminate the background check process where possible. But why is the NRA so afraid of background checks? They argue that the overwhelming majority of American gun owners are law abiding citizens; then why not subject gun sales to the same level of scrutiny placed on prescription drug sales? For better or worse, guns are a part of American culture, and European-style gun restrictions will not and should not take place here. But with the advent of instant background checks, is it too much to ask that we control gun sales at least as much as we control sales of heart medication?
Global warming is real; should you care?
There is little scientific dispute at this point that global warming is occurring, and that humans are causing some part of it, as even the Competitive Enterprise Institute (a conservative free enterprise think tank) is now willing to admit. The remaining question: just how big a problem is global warming, and what are the consequences if we do nothing? An Inconvenient Truth makes it appear that Florida will be underwater sometime soon if we sit idly by. Reality, at least as scientists currently understand it, probably lies somewhere between Al Gore’s doom-saying and CEI’s laughable slogan, “CO2: We Call It Life.”
Of all the potential effects of global warming, rising sea levels are thought to have the most catastrophic consequences. If the Greenland ice sheet or a large part of Antarctica really do melt, the resulting 20 foot rise in sea levels would destroy the majority of the world’s great cities and displace billions of people. But how long will a rise of 20 feet, or even two feet, take at current rates of warming and ice melt? Realclimate.org summarizes recent research here, wherein the most aggressive estimates indicate that Greenland’s ice sheet melting is increasing sea levels by up to 0.57mm per year. But if Greenland continues melting at that rate, it will take one thousand years to raise sea levels one foot!
Even an order of magnitude increase in ice melting would only cause sea levels to rise a foot by 2100. The Intergovernmental Panel on Climate Change Report’s most aggressive estimate calls for a three foot sea level rise by 2100; this estimate includes significant ice melt. While this scenario has significant implications for coastal cities, it is not apocalyptic, and it also represents an outlier prediction compared to most climate models. It seems then that we should care about global warming in the very long term, but it is unlikely to have a significant impact during our lifetime. There are dozens of environmental and social issues that deserve greater present concern, including the AIDS pandemic and infectious diseases like tuberculosis and malaria, which continue to kill tens of millions annually.
At the same time, it wouldn’t hurt to take some simple steps to curb CO2 emissions growth. The CEI and others complain that it is impossible to curb CO2 emissions growth without hurting the economy. On the contrary, prudent shifts in government policy can reduce emissions while increasing growth. If the United States were to fund all highway construction with gasoline taxes, for instance, this would pass the costs of car travel directly on to the end consumer – which increases economic efficiency while decreasing emissions. I’ve written previously about applying the gas guzzler tax fairly, so that consumers are not rewarded for buying large SUVs instead of large cars. Finally, ending the huge subsidies to the oil, gas, and coal industries would make alternative energy more competitive, while saving taxpayers billions.
What to do with North Korea
It’s official: North Korea conducted an underground nuclear test this morning, defying warnings from the UN, US, and its neighbors. North Korea’s tested weapon was small by nuclear weapons standards, and its missile systems are inaccurate, but the test confirms that the world’s most dangerous weapons technology is now in the hands of Kim Jong-Il. So what can the US and the world do now to prevent tragedy at the hands of a madman? Let’s review the options:
- The US could launch a preemptive air strike against North Korea to destroy its nuclear devices. If successful, this would almost certainly result in conventional war with North Korea. If unsuccessful, North Korea could nuke South Korea or Japan, killing millions.
- The US could try to cut off all economic support for North Korea. While the US may now be able to convince South Korea and Japan to cut off aid, China fears the collapse of North Korea and the subsequent flood of refugees more than the regime itself, and may agree only to token steps. If North Korea is completely embargoed, Kim Jong-Il might lash out in desperation.
- The US could begin a slow and orderly draw down of its troops in South Korea beginning next year, until no meaningful forces remain. This would leave South Korea to defend itself, with the understanding that if North Korea ever chose the nuclear route, the US would retaliate in kind.
Why is the last option most appealing? American forces in South Korea are now short-range targets for a North Korean desperation attack. By withdrawing our forces we would remove them from danger, while the US military would still have the capability to defeat North Korea should the need arise. Removing US forces also denies Kim Jong-Il the bogeyman he needs to justify his evil regime, weakening internal support for his rule.
If the US withdraws from the Korean peninsula, Japan, South Korea, and China will finally have to devise their own strategy for dealing with their bad neighbor. North Korea’s economy is in a death spiral; if these neighbors withdraw life support, the state will likely collapse. As long as the US is responsible for regional security, they have no incentive to make these tough choices. If we withdraw, North Korea’s neighbors may make the tough decisions, and resolve the problem on their own. On the other hand, if the situation destabilizes, we will have removed our soldiers from harm’s way, while placing confidence in our military’s ability to win a war if that becomes inevitable.
Detaining terrorists, or any foreigner?
The United States Constitution and its common law judiciary protect the writ of habeas corpus, a means by which an unlawfully imprisoned individual can petition for release from detainment. Habeas corpus is considered among the most important protections against wrongful imprisonment, so important that it is part of the main body of the Constitution, predating even the Bill of Rights. Why then did Congress attempt to take this right away from individuals living in the United States in the recently-passed bill on detainee treatment?
According to the Military Commissions Act of 2006, Senate bill S.3930 (House H.R. 6166), “No court, justice, or judge shall have jurisdiction to hear or consider an application for a writ of habeas corpus filed by or on behalf of an alien detained by the United States who has been determined by the United States to have been properly detained as an enemy combatant or is awaiting such determination.”
Non-citizens of the United States, including permanent residents, could therefore be held indefinitely by the government without ever being provided any of the rights we cherish here in the US. No right to an attorney, no right to a trial, nor even the right to be taken before a judicial body of any sort. If the United States government mistakenly designates a non-citizen as a terrorist, they could theoretically be held until death without having ever seen any aspect of legal or even military justice!
How does such a provision increase the security of the United States? If the government has evidence against an individual, why not allow that evidence to be brought before a judge, or even a military court, to decide whether continued detainment is warranted? If there is a need to temporarily hold potential terrorists before bringing them before a court, then why not establish a 90-day holding period? This would surely be Constitutional, and would enable the state to fight terror while preserving individual rights.
The current form of the Military Commissions Act is repugnant and un-American in its current form, and it is probably also unconstitutional. It is far worse to take away an individual’s right to contest detainment than it is to practice mock executions, forced nudity, and other forms of interrogation banned in the same Act. After all, the latter may humiliate, but do limited permanent damage, while there are few punishments worse than a life imprisonment without a conviction.
True Cost - Analyzing our economy, government policy, and society through the lens of cost-benefit 