Monday, June 30, 2003

Micky Kaus had a post about an apparent conflict between two reasonable sounding Republican complaints against a prescription drug benefit.

The first complaint is that, like all other government benefits, spending on this one will go way, way up in the future. Once the camel gets it's nose under the tent, spending on this new entitlement will spiral out of control.

The second Republican criticism is that drug companies will no longer make as much money, and will thus not have as much money to spend on R&D to develop new drugs.

He points to the apparent inconsistency of government drug spending growing out of control, and yet having drug companies not being able to afford R&D. He requested that someone E-mail him if they could resolve this, but while I E-mailed a response solving the problem, he hasn't posted anything to his site. I thought that I would post it here, on the off chance someone actually drops by, and the even smaller chance that they would be interested.

What will get government spending spiraling out of control are two factors, increasing numbers of people eligible for the program, and increasing numbers of drugs covered. As the Baby Boomers retire, and life expectancy rises, more and more people will qualify for a "seniors" drug benefit. Just an obvious conclusion from current demographics and trends. While the case for the benefits received by this growing number of government benefactees is less strong, the chance that they will in fact grow must approach 100%.

Both of these trends will act to dramatically increase government spending, but will also act to reduce drug company profits. The government will, like the governments of Canada and Europe, act to push prices down on the drugs that they include for any benefit. This will, likewise, push drug company profit margins down. As increasing numbers of people are covered for an increasing number of decreasingly profitable drugs, drug companies profits will be severely squeezed, leading to substantial cuts in R&D. Not only will lower profits (and therefore lower cash flow) hurt R&D, the very likelihood of potential drugs being included in a government price sceme will make the cost/benefit analysis numbers for potential drugs come out much worse, decreasing the likelihood of them being attempted.

On a tangent, I can see this having other effects as well. The Law of Unintended Consequences is alive and well. In addition to cutting R&D, what other things will drug companies do in effort to maintain profitability? It seems to me that they would try to divert whatever R&D money they have left to drugs which would be unlikely to be covered by any drug benefit. This would, of course, lead to an even greater lack of new drugs for the very people that Congress wants to assist.

Thursday, June 26, 2003

Steven Den Beste notes that any debt we may owe to France from the American Revolution has long been paid, after both World Wars. I've noticed many people talking about this supposed debt we owe France, usually in response to someone talking about the debt they owe us from WWII. It's usually accompanied by a snide comment, as in "You don't know much about history, do you? If it wasn't for France, we would be a part of the UK!"

I've actually never expected France to show much, if any, gratitude for our actions in WWII. That war ended more than 20 years before I was born, and in fact before the vast majority of either country's populations were born. It's been almost 60 years from France's liberation, and people just don't think that way. This line of reasoning is, of course, even stronger with regard to a 200+ year old 'debt'.

What makes the case for any US debt to France completely nonsensical, however, is related to another point Den Beste raised in a later post . Any debt we may owe is to the French monarchy, not to the heirs of it's opponents. If you want to talk about debts from the American Revolution, there is actually a far stronger case to be made that it is the French Republic who owes the US.

Our revolution was their inspiration, we began the series of revolutions which swept away the old monarchies.

We provided the proof that other forms of government, which gave power to a much broader range of people, were viable.

We weakened the French Monarchy by draining soldiers and funds.

I just don't understand why anyone would believe that we owe France anything. The closest equivalent I can think of (and it's really not that close), is to say that Communist China owes Russia for the support Mao received from the USSR.

Anyway, this talk of historical debts is really much ado about nothing. As I stated earlier, I don't expect anyone from either country to let this history influence them much one way or another. What I DO expect, is for someone who claims to be an ally to act like one. And if they fail to do so, then I will modify my actions accordingly. When a country's actions contradict their words, I know which to give credence to.

France is no ally of ours, and they are fast approaching enemy status as far as I am concerned.

Tuesday, June 10, 2003


Statistics are essential for dealing with most political issues nowadays. What are the effects of a tax cut? What would ratifying the Kyoto Accord cost? What would the benefits be? Are we in a recession? How much do the 'poor' pay in taxes? The answer to all these questions lie in statistics.

That partisans spin statistics like a top, when they aren't lying about them or outright making them up, is well established. I'm not interested in rehashing any of that, though a few days ago I found a good example in Newsweek. What I'm interested in exploring now is the extent that even solid figures, used appropriately in the correct context and by a fair and honest person, can STILL be misleading and wrong.

There is a concept in mathematics, the name of which unfortunately escapes me right now, in which the answer to a particular problem can only be taken to the decimal place of the least exact term in the equation. For example, in multiplying 102*10.5*2.05*7.055794654661, your answer should not contain ANY numbers to the right of the decimal point, because one of the figures being multiplied didn't have any. (By the way, if the 102 was given as 102.00, you would be justified in answering in tenths (the degree of precision now being limited by the 10.5)) Giving an answer out to tenths, or hundredths, or thousandths would give the illusion that your result is that precise, but that would not truly be the case. This rule really didn't really mean anything to me as a student, it was just one more thing to learn to keep from tripping up on a test. It wasn't until much later that I realized the wisdom of it.

Back to statistics, I wish there was a way to find a similar easy way to clue people in on the precision of any particular statistic, but I have never been able to come up with anything remotely feasable. Unfortunately, the very rule used in mathematics above actually acts to give users of various statistics a false sense of reliability.

Do I have an example? Sure, tons. Let's use a biggie - GDP. How is GDP calculated? I would bet that most people don't have a clue, perhaps even a majority of those who use GDP figures to buttress their own arguments or tear down someone else's. Here is a decent primer for the various methods used to calculate it. The most common (it has the benefit of being the easiest to understand and use) is the expenditure model:


Which means that GDP is made up of C (consumer spending) plus I (investment) plus G (government purchases) plus NT (net trade, export minus import).

Remember that the growth of this figure is constantly being reported, and is always given - annualized - to the tenth of a percent. What does this indicate to someone with some vague recollection of their Jr. High math class? First off, it's given out to tenths. Hey, it must be pretty solid. Then remember that they are extrapolating an annual number from monthly results, and realize that they really seem to be claiming accuracy into the hundredths.

But how accurate are GDP figures really? According to the Bureau of Economic Analysis, GDP increased (in chained 1996 dollars (ie. adjusted for inflation)) from 8508.9 in 1998 to 9439.9 in 2002. But let's think about what we were buying in 1998, and for how much. In 1998, you could buy a brand new Pentium II, for the bargain price of about $1500. Contrast that with 2002, when I bought one of the then new Pentium IVs for about 1500. Today you can get Pentium IVs for quite a bit less than 1000. (I bet you could easily buy a computer today for less than $500 that would run circles around a 'top of the line' 1998 Pentium II.)

Let's try a quick test now: How much would selling 10 million Pentium IIs at 1500 in 1998 have added to the calculated national GDP? And how much would selling 15 million Pentium IVs at 1000 this year add to our GDP? If you came up with 15 billion in each case, have a beer on me. But how can this be? How can increasing our computer production by 50%, and the quality of our product by several magnitudes possibly leave our Gross Domestic Product figures... unchanged? The answer is, even though it appears to be a solid, precise figure, GDP is actually a rather blunt instrument, and the longer the period you are looking at, the worse it does. The next time you see someone trying to compare GDP growth between decades, remember this page, it's implications on the GDP comparisions, and try not to laugh in their faces.

THIS phone, weighing 'just 28 ounces' with a battery life 'for 30 minutes of talk time and eight hours of standby', was selling for 3995.00 in the 1980s!

Another problem inherent is the inclusion of government spending. The examples of government overspending have been with us for my entire life, with the $100 hammer, and the $200 toilet seat cover being particularly ubiquitious. But even those examples don't come close to illustrating the waste that the G component includes. For an example of what I'm talking about, let's say the federal government builds a bridge. Let's further assume, to be more than fair, that it is built on schedule and on budget, and is built with the proper materials and within code specifications - a beautiful 25 million dollar bridge. This is what GDP is supposed to measure, right? Now for the other shoe to drop: it is named the Byrd Bridge, and built in a location in WV that not more than 50 people a day use. Will we really get 25 million dollars of utility out of that bridge? Of course not. I'm certainly not saying that there isn't waste in any of the other figures, but all governments are prodigiously wasteful, they always have been, and almost certainly always will be. The bigger the 'G' in the equation, the more the GDP figure overstates the 'true' GDP in my opinion.

Keep this in mind whenever you see comparisons between various country's GDPs. How much of each consists of individual decisions, and how much that of such and such a country's government.

And how much should military spending count towards GDP? I understand why it is counted in full now, but, especially when you consider how much of the US military spending is actually being devoted to protecting our allies, I wonder if this component could be better if treated a little differently.

I could go on, but it's getting late, and I think I've made my point.

Statistics are indispensible. It's impossible to make an informed decision about so many things without the use of various statistics. However, you always need to keep in mind the limitations, both real and potential, inherent in each one.

Sunday, June 08, 2003

Well, here's some news on Yahoo, from the AP:

French strikers disrupted train and bus service and sanitation workers dumped garbage in the street in the fourth day of a nationwide protest Friday against government plans to reform pensions.

The strikes came as tourist season gathered pace ahead of summer. On Friday, tourists were seen waiting in vain for airport buses.

Angry strikers stepped up their provocative action. Demonstrators cut power lines at the Gare de Lyon train station in Paris, halting all outbound traffic for several hours, a spokesman for state-run rail authority SNCF said.

Overall, one of every three trains in Paris was affected by the action on Friday. In the southern city of Marseille, only one tramway was running.

The trouble was expected to mount next week. Tuesday — the day Parliament begins debate on pension reform — is marked for major bus, train and airport strikes.

The transport workers, led by the Communist-linked CGT, have been joined by teachers and other public sector workers. Sanitation workers protesting in Lyon dumped garbage in front of City Hall in protest.

Not quite calling it rioting, but at least it's something.

And yes, if something like this were happening in the US, it would dominate news coverage not just here but all over Europe. While this can partly be explained by the fact that we are "the last superpower", while France is ... well, France - it doesn't explain the near news blackout.

Saturday, June 07, 2003

Both Instapundit and USS Clueless have items noting the current labor riots in France. Both have also noted the remarkable absence of media coverage of said riots. I thought that SURELY I would be able to find SOMETHING relevant in European papers. No luck so far, but I did manage to find this rather ironic item, in the UK's Observer:

Let's help rebuild Iraq's labour movement

Trade unionists around the world must help Iraqis create one of the vital building blocks of a free society - whatever the US corporations think.

Yes! Who wouldn't be thrilled to have the Iraqis unionized? Only those 'evil' US corporations, of course.

Thursday, June 05, 2003

Great piece by Jonah Goldberg the other day:

Diversity is another of those words we imbue with all nobility and goodness without question or reservation. And that's nonsense. If diversity were always and everywhere good we would be clamoring for more midgets in the NBA. We would demand that mobsters get jobs at the FBI and we would consider it a grave problem that not enough blind men — and women! — were applying to be crossing guards, snipers, and surgeons.

Indeed, if diversity were always a boon to the educational process, we would decry the ghettos of backwardness we call all-women's colleges and historically black universities. After all, are not blacks and women in the most need of educational support? Lee Bollinger, the former president of the University of Michigan (and current president of Columbia University) recently declared:

Diversity is not merely a desirable addition to a well-run education. It is as essential as the study of the Middle Ages, of international politics and of Shakespeare. For our students to better understand the diverse country and world they inhabit, they must be immersed in a campus culture that allows them to study with, argue with and become friends with students who may be different from them. It broadens the mind and the intellect — essential goals of education.

Well, if it's an essential goal of education, let's diversify Morehouse College right now before one more black kid is forced to study without the benefit of experiencing the glories of sharing a dorm with a few Asian and white kids. And since it's an established fact that blacks are more educationally disadvantaged than most, doesn't that mean that integrating black schools is even more of an imperative than getting a few more African Americans at Harvard?

Many of our greatest scientists, statesmen, soldiers, and artists attended remarkably un-diverse institutions. Indeed, many of our greatest black leaders attended all black, and often all black male, institutions of higher learning. And yet, if I were to say that a black man can't be properly educated unless some of whitey rubs off on him, I'd get in a lot of trouble.

But that's the diversity argument in a nutshell.

Wednesday, June 04, 2003

Last month I was flipping channels before going to bed, and I happened to land on Austin City Limits. They had a re-broadcast of a concert by Tom Waits from 1978, and I was absolutely mesmerized. I had a vague familiarity with his name, but I'm pretty sure that I had never actually heard his music before.

I've now bought a few of his older albums, and highly recommend them. (Not that that anyone reading this will likely give a damn about my musical choices.) He does a mixture of blues, jazz, and other influences. It has a strong feel to me of an older period (1930's?). Great, soulful, raspy voice.

Tuesday, June 03, 2003

On a message board that I frequent, two separate people have quoted from a Newsweek column regarding the federal court nomination disputes written by Eleanor Clift a couple of weeks ago. Amazingly, the article doesn't seem to be available on the internet anywhere, at least that I have been able to find (and I devoted more than a few minutes to locating it). I've refuted it both times, once in depth, and a second time on the fly. They tend to remove threads very quickly there, and so I actually (gasp!) visited my local library and made a copy of the article (Newsweek May 19, 2003 Page 9) to discuss here. Now if it comes up again, I will just link to this post.

The majority of the article is OK. With the exception of the final paragraph, the only quibble I have with it is that it lists the Democrat's complaints regarding a particular nominee without presenting the Republican response, but this is minor. However, the final paragraph is a major, major problem. I'll do a mini-Fisk on it:

"Battles over court nominees have intensified since 1996"

Sorry, they've 'intensified' since at least the Bork nomination battle, to say nothing of the Thomas fiasco. To establish the beginning date of the escalating nomination battles at 1996 places any blame or change in approach at the feet of a Republican majority, instead of at that of the Democrats where it belongs.

"when the Republicans unveiled a deliberate strategy to slow President Bill Clinton's appointees. The GOP put secret holds on nearly 60 nominees."

Prior to this article, I've never heard of any allegations, let alone solid proof of this allegation of the GOP's use of 'secret holds'. Ms. Clift certainly offers none. While it is extremely hard to prove a negative, I will offer substantial evidence that she is flat out wrong on this point. has a spreadsheet which gives various information regarding federal judicial vacancies for every month from January 1991 to February 2003. It makes for some quite interesting reading. On January 1, 1996, there were a total of 50 vacancies - the lowest total in Clinton's presidency. On January 1, 1997, there were a total of 83. While this rise may look a little suspicious, please note that a mere three months before, there were only 62 vacancies. Clearly there many new vacancies in this period, and the Senators were undoubtedly a little pre-occupied with the elections of that time.

While the vacancy figure continues to climb to a maximum of 100, it is also important to note the small fraction of the vacancies which Clinton even bothered to submit a nominee. While the site has an unfortunate gap in the information on pending nominees in this timeline, it appears that in the period from 8/96 to 6/97 - the time frame that the vacancy rate climbed so precipitously - Clinton NEVER HAD MORE THAN THIRTY nominees pending! It's sort of hard to blame the Senate for the vacancies when less than half of the judgeships have nominees pending. It's also rather difficult to have "secret holds on nearly 60 nominees" when the most nominees during the period seems to be 42.

Even without taking into account the normal time needed to perform (legitimately) the Senate's duty of advise and consent, I think that it is safe to say from these numbers that this claim is complete and utter bunk.

"When Clinton left office, the vacancies on the federal bench were at a record high"

THIS is the most obvious and egregious lie in the piece. I honestly cannot believe she wrote it, and that some fact checker and/or editor allowed it. It is so far wrong that it's almost breathtaking. According to, when Bush Sr. left office the vacancy rate was in triple digits. On 5/1/91 the vacancy figure was 146! When Clinton left office, it was in single digits. Could she have really made such an obvious and easily checked lie? Could it be instead which is peddling such trash? Let's let the ABA be the judge:

In total, during the 106th Congress, President Clinton nominated 116 individuals and the Senate confirmed 73 nominees (15 to the U.S. courts of appeals, 57 to the U.S. district courts, and one to the Court of International Trade) and rejected one. At the close of the 106th Congress 67 vacancies remained (25 in the U.S. courts of appeals and 42 in the U.S. district courts) and 41 nominations were returned to the President. In December 2000, President Clinton exercised his recess appointment power by appointing Roger Gregory to the 4th Circuit.

Note that this figure of 67 vacancies agrees with's number as of 12/4/2000. While the vacancy figure went up during the period between the election and President Bush's inauguration, this is also normal. Should the Senate be blamed for the 13 additional vacancies by January 2001, or should we use the ABA's figure of 67 for the "record high" number of vacancies at the end of Clinton's term. Ultimately, the lie is so huge it doesn't matter, so let's use 80.

The ABA has this to say for vacancies in the recent past:

• The current vacancy rate is high, but certainly not the highest in recent memory. During past-president George Bush’s term of office, there were 129 vacancies at the beginning of the 102nd Congress and 131 the following year. When Clinton took office in 1993, there were 115 vacancies on the bench and this climbed to 122 in 1994. The vacancy rates at the end of various sessions of Congress also have been as high or higher than now: 131 in 1991, 103 in 1992, and 112 in 1993.

This also agrees with's figures. Were the vacancies at the end of Clinton's term a "record high" or did she write a blatant lie? You be the judge. (My apologies for channeling Johnny Cochran for a moment).

"today they are the lowest in 13 years."

She's finally back on truthful ground, but she's spinning for all she's worth. We are currently at 45 vacancies, according to the federal government. This is actually the lowest in more than 13 years. What she doesn't mention is that under Clinton we were, not once, but TWICE down to 50 vacancies. One of these was in 1996, the year of those mysterious 60 "secret holds". Note that both of these lows came under a REPUBLICAN MAJORITY! With the Senate in the opposition party's hands, Clinton twice achieved a vacancy rate he never approached with a Democratic Senate. In contrast, Bush had to wait for the Senate to fall into his own party's hands before he could approach the low under Clinton.

Making this contrast worse, is that Bush (with the exception of the period immediately after his inauguration) has been far more proactive in nominating judges. In the same period of their respective Presidencies, where Clinton had only nominated people for roughly a third of the vacancies, Bush has actually already nominated people for several judgeships that aren't even vacant yet! Today there are more nominees than vacancies, pending announcements of people known to be retiring, etc.

"But Republicans say the system is broken, and Bush accuses Democrats of damaging judicial independence. That's a hard case to make: of the 13 circuit courts in the country, Republicans control eight, Democratic appointees control three, and two are divided between the parties"

This is simple a red herring. What does the make-up of the circuit courts have to do with "judicial independence"? Would having them all equally split between Republican nominated judges and Democratic judges mean that they are "independent" in any meaningful way? This split has nothing to do with "judicial independence" at all, they are simply a function of who has been getting elected President. While the last 10 years have been split 7-3 Democratic - Republican, over the last 20 it's been 12-8 Republican-Democrat, and over the last 30 years it's been 18-12 Republican-Democrat. Judges last a LONG time, so looking at these longer time frames is appropriate. The breakdown simply reflects the political realities of our system of government. So why the blather? I guess it's better to obfuscate than dwell on the actual arguments when you cannot answer them.

This final paragraph consists of nothing but blatant lies, lies of omission, exaggerations, and obfuscations. Pathetic.