Saturday, 18 December 2004

Arianna "Shit for brains" Huffington

Apparently, in Arianna’s world, a guy that creates a company from scratch in his dorm room—enriching millions in the process—is a demon when it becomes economical to offshore 3000 jobs to India:


Name: Michael S. Dell
Company: Dell Computers
Title: Chairman and Former CEO (Chairman and CEO until July, 2004)
Crime Against America: Dell’s Bangalore and Hyderabad, India, facilities employ close to 3,000 people.
Partner in Crime: Dell has contributed $3,000 to the Bush campaign in 2003 and 2004, plus an additional $25,000 the Republican National Committee, and $10,000 to the National Republican Congressional Committee. Dell CFO James M. Schneider is a $25,000 contributor to the RNC.

Even more unpardonable: he donated to Republicans. Arianna supposedly has an economics degree, though it appears that anything she learned has long since disappeared. She still has mastery of the Populism 101 material, though.

Markets in everything, Signifying Nothing version

Tyler Cowen has been beating the drum against social security privatization for a good while, and it has finally sunken in with me. After thinking about it enough, it appears that he is right: we will end up with two programs if we transition to private accounts and it won’t reduce the unfunded liability, which is the central problem. Presumably, when the actuaries refer to an unfunded liability they are referring to an excess in the present value of all cash outflows versus the present value of all inflows. If the first number exceeds the second, you have a liability. We’ve promised to pay too much and benefits will have to be reduced, or taxes raised, to bring the system into balance.

Private accounts alone won’t change the unfunded liability. However, Tyler offers an intriguing solution to part of that problem: auction off the right to leave the system. An auction provides a great mechanism to separate those that are risk averse from those that are not; those with financial savvy from those with none. It also creates a logical break point to show where they have left the system and have acknowledged that the system owes them nothing, though they have paid into it. They should similarly understand that they will need to save enough for their own retirement and will have to keep working without enough savings.

There would be an initial inflow of money that could be used to retire debt—thereby enabling future borrowing for the government to cover shortfalls—and presumably an increase in savings from those that leave the system; no more payroll taxes, higher disposable income. The system could then transform into a poverty program for the elderly, which should be far [Ed.: got a little carried away.] smaller than in its current setup.

I’m sure the details would need to be hammered out by actuaries—how many people would pay to leave the system, how much would they pay (meaning how much current debt could we retire) and how much would the unfunded liability would be reduced. Even with these questions, it seems like a sounder suggestion than getting people into a forced savings program where the government still implicitly takes responsibility for everyone’s retirement and the unfunded liability is unchanged.

Cass has more here.

Is there a political methodologist in the house?

I’ve seen this poll in a number of places, but Volokh conspirator Orin Kerr is the first I’ve seen that really dissects the results. Do 44% of Americans really want to curtail the civil liberties of Muslims in America? It doesn’t sound like it.

Big doings in Texas

On Thursday, the Texas Transportation Commission announced a private contract to build a 316-mile toll road parallel to the congested I-35 corridor. Spanish toll road builder and operator Cintra Concesiones de Infraestructuras de Transporte will pay the $6 billion construction cost and an additional $1.2 billion in concession fees to the state of Texas for improvements to other highways; in exchange, Cintra will collect tolls on the route for 50 years.

In North America, Cintra is one of the investment partners in the 407 ETR bypass of Toronto and recently made an agreement to operate the Chicago Skyway toll road (a section of I-90 connecting downtown Chicago to the Indiana Toll Road) for the next 99 years. TxDOT has an overview of the statewide Trans Texas Corridor plan; more details on this particular project are here and here if you can read Spanish.

Those who fail to read Downs

Christie Todd Whitman gets it:

A clear and present danger Republicans face today is that the party will now move so far to the right that it ends up alienating centrist voters and marginalizing itself.

On the other hand, the eternally vapid Kathryn Jean Lopez proves her need to stick to pimping subscriptions (☣) rather than attempting to make political commentary, while the new-to-me Ed Driscoll apparently also needs to make the steep investment in a copy of Downs. Barring such expenditure, at the very least they should realize that telling moderate Republicans to go fuck themselves until their votes are next needed in November 2006 is a bit rude. (þ: memeorandum)