Wednesday, February 22, 2006

Daniel Drezner has a detailed post on the Dubai Ports World controversy. Like Drezner, I think this is much ado about nothing.
I find it a helpful exercise to examine federal budget statistics in terms of dollars per capita. The raw numbers are just too big for our intuition to handle well. For historical context, the correct unit of measurement is usually GDP. However, if we're just looking at the present, I find dollars per capita gives me a more visceral understanding of how much money is involved.

Allow me to illustrate. The following quantities are given in dollars per U.S. resident.

Federal govt. outlays for FY 2007
total 9200
discretionary: defense 1740
discretionary: nondefense 1680
Social Security 1930
Medicare 1570
welfare programs 1240
other mandatory spending 542
undistributed offseting receipts -313
net interest payments 822

The estimated savings due to proposed cuts and reforms in Bush's 2007 budget is $68 per U.S. resident.

The data sources for my calculations are the White House (p. 7), the OMB (p. 133, 292), and the Census Bureau. (I used simple linear interpolation for my population estimate, so I only trust my results out to three significant figures, and have displayed them accordingly. Of course, my data sources are themselves estimates; I don't know to how many significant figures they should be trusted.)

Monday, February 20, 2006

A few reasons why Europe is not doomed

Mark Steyn continues to predict the doom of Europe.
Europe is bicultural: a fading elderly population yielding to a young surging Islam.
But Australia, like the US, is genuinely multicultural, at least in the sense that its immigration is not from a single overwhelming source. The remorseless transformation of Eutopia into Eurabia is already prompting the Dutch to abandon their country in record numbers, for Canada and New Zealand.

In the years ahead, North America and Australia will have the pick of European talent and a chance to learn the lessons of its self-extinction, as they apply to abortion and much else.
Steyn sees Muslim immigration as colonization.
Instead of a melting pot, there's conversion: A Scot can marry a Greek or a Botswanan, but when a Scot marries a Yemeni it's because the former has become a Muslim. In defiance of normal immigration patterns, the host country winds up assimilating with Islam: French municipal swimming baths introduce non-mixed bathing sessions; a Canadian Government report recommends the legalisation of polygamy; Seville removes King Ferdinand III as patron of the annual fiesta because he played too, um, prominent a role in taking back Spain from the Moors.
First of all, is Steyn correct "when a Scot marries a Yemeni it's because the former has become a Muslim"? My first thought is "yes, obviously." Here's my second thought. With nonzero probability, the Yemeni converts to Christianity, or the Yemeni becomes an atheist, or the Yemeni had secretly been an atheist all along, or.... Is this nonzero probability too small to matter? I don't know. All my evidence is anecdotal. I'd like to see more data to back up the underlying assertion: immigrants from Muslim countries to the West, and their descendants, will almost never marry a non-Muslim because they either take their faith that seriously or are afraid of angering their Muslim family members and peers. Of course, I could imagine how getting useful survey data on such matters might prove difficult. Moreover, even given such data, we wouldn't be able to predict the results of future surveys.

Uncertainty about the future also makes me hesitate to declare Europe is one generation away from Sharia rule. However bleak a picture I try to paint of the present, I always produce a lot of bright patches that give reason for optimism. For example, Flemming Rose, culture editor of Jyllands-Posten, thinks many Danish Muslims can be integrated into secular democracy.
In January, Jyllands-Posten ran three full pages of interviews and photos of moderate Muslims saying no to being represented by the imams. They insist that their faith is compatible with a modern secular democracy. A network of moderate Muslims committed to the constitution has been established, and the anti-immigration People's Party called on its members to differentiate between radical and moderate Muslims, i.e. between Muslims propagating sharia law and Muslims accepting the rule of secular law. The Muslim face of Denmark has changed, and it is becoming clear that this is not a debate between "them" and "us," but between those committed to democracy in Denmark and those who are not.

This is the sort of debate that Jyllands-Posten had hoped to generate when it chose to test the limits of self-censorship by calling on cartoonists to challenge a Muslim taboo. Did we achieve our purpose? Yes and no. Some of the spirited defenses of our freedom of expression have been inspiring. But tragic demonstrations throughout the Middle East and Asia were not what we anticipated, much less desired. Moreover, the newspaper has received 104 registered threats, 10 people have been arrested, cartoonists have been forced into hiding because of threats against their lives and Jyllands-Posten's headquarters have been evacuated several times due to bomb threats. This is hardly a climate for easing self-censorship.

Still, I think the cartoons now have a place in two separate narratives, one in Europe and one in the Middle East. In the words of the Somali-born Dutch politician Ayaan Hirsi Ali, the integration of Muslims into European societies has been sped up by 300 years due to the cartoons; perhaps we do not need to fight the battle for the Enlightenment all over again in Europe.
For sake of argument, suppose Steyn is right about Muslims in Europe. Does this imply Steyn's prediction of the subjugation and/or exodus of the West in Europe? If Steyn's right, then Muslims in Europe will become ever more assertive in making illiberal demands. Moreover, the Danish cartoons controversy is but one of many examples suggesting that such demands will become much more intense well before Muslims become the majority in Europe. Such premature demands will produce a political backlash, exemplified by politicians like Hirsi Ali. Now, suppose you were a European politician just swept into office by this backlash. Further supoose you agree with Steyn about Muslims, and that demography is destiny. What would you do? You'd try to change your country's demography. Eugenics, even in a positive form of offering natalist subsidies to certains subsets of the population, is just too offensive to modern notions of equality to be implemented in your country, and you may have moral qualms about it too. That leaves immigration policy. Now the solution is obvious; Steyn hinted at it when he said the U.S. and Australia our "genuinely multicultural." Your country must encourage immigration of a great variety of peoples, with preference given to those who would "enhance the cultural diversity of immigrant community." Picture "Free airfare!" banners at your consulates in Beijing and Mexcio City.

Strangely, Steyn dismissed this idea out of hand last November.
So Europe's present biculturalism makes disaster a certainty. One way to avoid it would be to go genuinely multicultural, to broaden the Continent's sources of immigration beyond the Muslim world. But a talented ambitious Chinese or Indian or Chilean has zero reason to emigrate to France, unless he is consumed by a perverse fantasy of living in a segregated society that artificially constrains his economic opportunities yet imposes confiscatory taxation on him in order to support an ancien regime of indolent geriatrics.
Perhaps the "talented ambitious Chinese or Indian or Chilean" will always prefer to immigrate to a place with more economic opportunity, like America. But (legal) immigration into America, when it's even possible, is a ridiculously cumbersome process even for the talented. Europe could compete by offering streamlined immigration procedures and tax incentives to the world's top talent (measured by things like pursuit or possession of advanced education). Suppose the US gets wise and offers the world's top talent a better deal. Well, there's still a lot of people with only average talent that would like to immigrate to a richer nation. For example, "More than 40% of Mexican adults say they would move to the USA if they could." That's more than 40 million Mexicans; surely a favorable immigration policy could encourage some of them to come to Europe. Moreover, there are countries poorer than Mexico; in these places economic incentives make it still less difficult to convince folks to immigrate to Europe.

Tuesday, February 14, 2006

Friday, February 10, 2006

In his State of the Union address, Bush punted on entitlement reform, with talk of a bipartisan commission. Or so I thought. Allan Sloan points out in the Washington Post that Bush's budget contains a Social Security reform proposal.

I don't know how hard the White House will push for it, but I'm heartened to see the concrete proposal of at least some benefits cuts via progressive indexing. Will Wilkinson makes some good points about this. Excerpt:
As far as I can tell, there is little to no evidence that converting social security to a means-tested benefits program would reduce political support for it. It is true that former Social Security administrator Wilbur Cohen’s assertion that a program for the poor will be a poor program is repeated endlessly. But truth is not established by repetition. Unemployment and disability insurance, unlike Social Security retirement benefits, kick in only in conditions of necessity. Nevertheless, or perhaps due to that fact, they are very politically popular, well-funded, and face no apparent political threat of reduction.

Indeed, there is compelling evidence that means-tested retirement benefits would be too generous creating a perverse incentive for workers to save too little in order to qualify for a beefy means-tested benefit.
Bush's budget also proposes private Social Security accounts. Are they worth the cost?
On page 321 of the budget proposal, you see the privatization costs: $24.182 billion in fiscal 2010, $57.429 billion in fiscal 2011 and another $630.533 billion for the five years after that, for a seven-year total of $712.144 billion.
The net costs could be zero or better depending on the offseting benefit cuts. But the details are unclear, at least to Allan Sloan:
It's not clear how big a reduction in the basic benefit Social Security recipients would have to take in return for being able to set up these accounts, or precisely how the accounts would work.
Also see Andrew Samwick's commentary.

At any rate, even if Bush wasn't really punting on Social Security reform, he has still inspired me to raise the bar for my own punting. I'm announcing the formation of a bipartisan commission to consider the mixed blessing of my growing Dr. Pepper can collection. The empty cans are glorious in their multitude, but space really is running out. Applicants: this is serious commission intended to address a serious issue, so blue ribbons are a plus (insert Pabst pun here).

Thursday, February 09, 2006

I'm finding it ever more difficult to take the cartoon controversy seriously.

Monday, February 06, 2006

Gary Becker has a good post on health care reform. Excerpt:
In contrast to employees who continue coverage by remaining with the same employer, individuals with their own health insurance plans sometimes lose coverage after contracting a serious illness, or by making too many claims. For various reasons, it is not possible for individuals to buy long-term health insurance, although what they want is protection against future major medical expenditures since it is uncertain how healthy they will be when they get older.

Bush's proposal to allow employers to offer portable HSAs is an important step toward providing such longer-term coverage for the many men and women who do not continue to work for the same employer, or who want to maintain their health insurance plans after retirement. If the ceiling on how much can be placed in these plans is raised to high enough levels, HSAs could cover all but the medical claims induced by major illnesses. Under present rules, individuals can have a health saving account only if that is combined with a catastrophic health insurance policy.
Can anyone point me to the "various reasons" individuals can't buy long-term health insurance? I could speculate about a number of possible reasons, but I'd be relying on purely anecdotal evidence, and I'd like to read something more conclusive.

Sunday, February 05, 2006

There's insensitive, and then there's insensitive.

Wednesday, February 01, 2006

From Bush's SOTU address:
Others say that the government needs to take a larger role in directing the economy, centralizing more power in Washington....
It's not just others:
We will increase our research in better batteries for hybrid and electric cars, and in pollution-free cars that run on hydrogen. We will also fund additional research in cutting-edge methods of producing ethanol, not just from corn but from wood chips, stalks, or switch grass. Our goal is to make this new kind of ethanol practical and competitive within six years. Breakthroughs on this and other new technologies will help us reach another great goal: to replace more than 75 percent of our oil imports from the Middle East by 2025.
The Onion must be quoted:
What's all this about alternative energy and encouraging creativity? I voted for an oil man, not Jimmy Carter!
Funding basic science research is one thing, but we should let the market decide what energy technologies are most promising. Bush also proposed making the R&D tax credit permenant. That's a very good idea, and he should have stopped there. As for the problem of Middle East oil sales funding our enemies within the Muslim world, this is either a problem worth solving or it's not. It's a not a problem which we should pretend to solve at the taxpayer's expense. For more on this point, see these (1 2) TCS columns by Arnold Kling.