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Laffer-able

By Big Tent Democrat, Section Other Politics
Posted on Tue Aug 04, 2009 at 02:43:57 PM EST
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Media Matters:

Economist Laffer on CNN: "[J]ust wait till you see Medicare [and] Medicaid ... done by the government"

Sheesh. There's that "Birther logic" at work again.

In the comments, andgarden makes a good point - Arthur Laffer will turn 69 on August 14. Does he have "government run health insurance" (aka Medicare)? If so, is he not aware it is government run health care and if he is just now becoming aware of that fact, will he be buying private insurance?

Speaking for me only

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    Laffer-able | 55 comments (55 topical)

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    First listening to this guy (5.00 / 1) (#5)
    by joze46 on Tue Aug 04, 2009 at 03:28:11 PM EST
    First listening to this guy, Laffer should he feel so embarrassed ?

    Especially after this guy made reference to a system perhaps that could affect the green concept with impact claims the Post Office is dysfunctional. Not totally. Even with online banking with regular timely schedule my mail appears pretty much on time for decades; my payroll check hard copy to varify deposit has always seemed to be there.

    United Parcel System, Federal Express, etc. it is incredible the basic transport and free market delivery system that exist, local and long distance business that has expanded since the Post Office sort of ratchets down.

    With online technology we can perceive that one day everyone will be connected just like the electric company and printed material will be through the Internet. Its just a matter of time when the real free market runs its course. That's the kicker. Those  other companies will always be there to transport material goods.  

    Laffer embarrassed? (none / 0) (#34)
    by cal1942 on Tue Aug 04, 2009 at 10:20:27 PM EST
    I think the stupidity rolls out of his mouth without shame.

    His infamous "curve" could only have come about while drunk.  

    Well, then again, considering that it's Laffer, maybe not.

    Parent

    Laffer is apparently 68 (5.00 / 2) (#6)
    by andgarden on Tue Aug 04, 2009 at 03:32:36 PM EST
    Someone should ask him whether he has signed up for Medicare.

    Heck of a question (5.00 / 1) (#8)
    by Big Tent Democrat on Tue Aug 04, 2009 at 03:39:14 PM EST


    Parent
    If he's (5.00 / 1) (#33)
    by cal1942 on Tue Aug 04, 2009 at 10:14:32 PM EST
    getting Social Security he didn't have to make an application.  The Medicare card arrives in the mail about a month before your 65th birthday.

    Social Security and Medicare are absolute models of efficiency.

    Parent

    I bet he's listed ... (none / 0) (#7)
    by Robot Porter on Tue Aug 04, 2009 at 03:36:55 PM EST
    give him a call.

    Parent
    The guy's a hack but (none / 0) (#13)
    by Samuel on Tue Aug 04, 2009 at 03:53:47 PM EST
    that's irrelevant.  It's free for him.  People accept items and services less critically at that price.

    Parent
    I think it's very relevant (5.00 / 1) (#14)
    by andgarden on Tue Aug 04, 2009 at 03:55:27 PM EST
    Follow BTD's line of questioning and see where it leaves Laffer.

    Parent
    Got ya. (none / 0) (#16)
    by Samuel on Tue Aug 04, 2009 at 03:59:17 PM EST
    You're saying that if he has it, it's funny that he doesn't realize the government runs it?  I get that.  I suppose he thinks it's funded through a charity.  

    The fact he would have it though does not reflect on his opinion of the quality as apples to apples comparison of private vs public would necessitate they be priced similarly.  

    Parent

    Good argument for a public option (none / 0) (#19)
    by Big Tent Democrat on Tue Aug 04, 2009 at 04:36:22 PM EST


    Parent
    Please clarify. (none / 0) (#21)
    by Samuel on Tue Aug 04, 2009 at 04:47:08 PM EST
    Do you mean a "free" public option with the goal being a shift to single payer by eliminating private competition?  

    Parent
    Medicare ain't free (none / 0) (#22)
    by Big Tent Democrat on Tue Aug 04, 2009 at 04:48:02 PM EST
    Check your pay stub (assuming you have a job) - you will see something called FICA.

    Parent
    I sure hope (none / 0) (#23)
    by eric on Tue Aug 04, 2009 at 04:49:08 PM EST
    that the government never takes over FICA!

    Parent
    Really?!?!? (none / 0) (#24)
    by Samuel on Tue Aug 04, 2009 at 04:50:59 PM EST
    Yea it's the exploitation of the young to fund the richest generation in the history of the United States.  

    It's not like when I sign up for the service that's the day I actually pay all those numbers on my check...sunk cost is the point, the money is already gone so the mariginal cost of receiving the coverage at the age of 68 vs not receiving is how much BTD?

    Parent

    Um, Samuel ol' boy (5.00 / 1) (#35)
    by cal1942 on Tue Aug 04, 2009 at 10:26:45 PM EST
    apparently you haven't figured this out, but, with some luck one day you too will be old.

    This is an intergenerational thing.

    Parent

    Sounds like a great brochure. (none / 0) (#41)
    by Samuel on Wed Aug 05, 2009 at 08:47:57 AM EST
    Medicare has a 41 trillion dollar unfunded liability at present. It's not in a savings account.

    It's a ponzi scheme injected with a false moral dichotomy. A scam, a racket.  41 trillion is absurdly large.  What is mathematically unsustainable will cease to continue.  

    The main difference between this and financial ponzi scheme is that choice of participation is non-existent.

    Parent

    It wasn't free (none / 0) (#27)
    by Big Tent Democrat on Tue Aug 04, 2009 at 05:30:37 PM EST
    is the point.

    Parent
    Sure. (none / 0) (#30)
    by Samuel on Tue Aug 04, 2009 at 06:54:30 PM EST
    That's your point but from Laffer's perspective the marginal cost of joining the program is zero dollars and zero cents.

    Parent
    Heh (5.00 / 1) (#31)
    by Big Tent Democrat on Tue Aug 04, 2009 at 08:05:09 PM EST
    He is willing to sacrifice his health care for mere dollars? Really?

    Parent
    Yes. That would be a good question... (none / 0) (#32)
    by Samuel on Tue Aug 04, 2009 at 09:06:27 PM EST
    to ask him if he were to have made the decision to opt into a government program rather than maintain private insurance.  If he were to have made the decision to go gov, this is what he would be saying (assuming it's not for the purpose of appearance):  The benefit he would get from additional dollars would outweigh the detriment he would get from (what he claims) would be a lower quality form of health insurance.

    What I am saying is that this does not make him a hypocrite necessarily.  The marginal value of dollars eclipses the marginal detriment of poorer coverage.

    All that aside, I can agree that anyone attempting to deride gov health insurance, while not purporting to realize that medicare is a gov program, has obviously not paid enough mind to empirical scenarios vs logical reasoning at best.

    Parent

    Also (none / 0) (#25)
    by Samuel on Tue Aug 04, 2009 at 04:52:44 PM EST
    You sounded like a Libertarian there.  Good job (seriously).  

    Parent
    If you say so (none / 0) (#28)
    by Big Tent Democrat on Tue Aug 04, 2009 at 05:31:07 PM EST


    Parent
    Heh (none / 0) (#15)
    by Big Tent Democrat on Tue Aug 04, 2009 at 03:57:44 PM EST


    Parent
    Right. (none / 0) (#17)
    by Samuel on Tue Aug 04, 2009 at 03:59:32 PM EST


    Parent
    I'll ask Laffer that (none / 0) (#40)
    by jimakaPPJ on Wed Aug 05, 2009 at 07:44:50 AM EST
    when you ask Onama to name staes 51 through 57..

    Laffer's point was obviously about the Government Option...and the problems Medicare will have when Rangel Inc steal $400 billion from it..

    Parent

    Barely on topic, but this was too funny (5.00 / 2) (#29)
    by andgarden on Tue Aug 04, 2009 at 05:41:38 PM EST
    On the CBS evening news, Gene Taylor accosted by a bunch of Mississippi whites over healthcare. Obama's got a friend in CBS news.

    Also (4.40 / 5) (#2)
    by ColumbiaDuck on Tue Aug 04, 2009 at 03:03:42 PM EST
    I never understood what these guys had against the Post Office.  i can send a letter anywhere in country for a paltry 42 cents and have a 99.9999999999% chance that it gets there no problemo in a couple of days.  I wish most private businesses were that competent.  

    The only thing I have against the USPS (5.00 / 2) (#3)
    by Big Tent Democrat on Tue Aug 04, 2009 at 03:10:54 PM EST
    is that Lance Armstrong led their cycling team . . .

    Parent
    I recently sent a letter ... (5.00 / 4) (#4)
    by Robot Porter on Tue Aug 04, 2009 at 03:19:59 PM EST
    and a 2-day UPS package to my parents across the country.

    The U.S. Postal Service letter beat the UPS package.

    Parent

    42 Cents? (none / 0) (#9)
    by squeaky on Tue Aug 04, 2009 at 03:39:31 PM EST
    The rate went up to 44 cents for a regular letter on May 11.

    Parent
    heck (5.00 / 1) (#12)
    by ColumbiaDuck on Tue Aug 04, 2009 at 03:52:03 PM EST
    I'll even pay 50 cents to send a birthday card and know I can procrastinate until almost the day of and STILL have it get there on time.

    Parent
    Wrong. (none / 0) (#10)
    by Samuel on Tue Aug 04, 2009 at 03:40:40 PM EST
    That's the cost of the stamp.  Including the tax funding the post-office generate an annual loss...unlike the private market competitors.  

    Parent
    So? (5.00 / 2) (#18)
    by ColumbiaDuck on Tue Aug 04, 2009 at 04:05:41 PM EST
    It doesn't bug me if the post office doesn't turn a profit.  Unlike Jack Donaghy, i don't see dollar values attached to everything in my vicinity.

    I care that I get good service for a reasonable price.  The Post Office delivers (literally!) and is easy to use and access.  And that includes any amount the taxpayers pay (which amounts to about $23 per person this year - totally reasonable for a reliable service in my book).

    Let's put it this way - I'm happy to help out the Postal Service that does what is says and provides a public good.  I'm getting much less for all the money I've poured into AIG.

    Parent

    Sure. (none / 0) (#20)
    by Samuel on Tue Aug 04, 2009 at 04:45:11 PM EST
    If I'm against subsidizing what amounts to basically a junk-mail advertising distribution system (and high volume is at a lower rate that we pay for!) that doesn't mean I'm for subsidizing market volatility insurance.  

    My Real Response: Look up the post-office stats before the legislation restricting private market competitors was lifted.  Competition was the catalyst behind improving their efficiency.  Fed-Ex and UPS created the systems that they use now for packages.  

    Until monopoly status for non-urgent letters for the USPS is removed from the law books, it's not possible to evaluate the alternatives and therefore rate the USPS against anything.  

    I don't know where you got your numbers.  What I found was a loss of 2.5 billion in 2008.  


    Parent

    Well if you support competition (5.00 / 2) (#26)
    by ColumbiaDuck on Tue Aug 04, 2009 at 05:05:47 PM EST
    You should love the public insurance option!  Private and public competing to supply you with health care.

    I got the numbers here.  Shortfall divided by 300 million Americans.

    Parent

    If a public option (none / 0) (#42)
    by Samuel on Wed Aug 05, 2009 at 08:51:20 AM EST
    receives 0 tax payer funding than I suppose it's a competitive and therefore I would not object.  

    Parent
    You're a bit slow (5.00 / 1) (#38)
    by cal1942 on Tue Aug 04, 2009 at 10:54:38 PM EST
    The $2.5 billion you claim is very small potatoes.

    You don't seem get that the low cost government service is essential.

    Start peeling off these public services and leave us all at the mercy of private operators?  NO THANKS.

    This isn't a cute little game pal where we dispose of fundamental services so that a small handful of people can make a fortune at everybody's expense.

    With your ideology, next it will be no public roads, no public schools, etc., etc. until we become a third world country.

    Parent

    What's the thesis? (none / 0) (#43)
    by Samuel on Wed Aug 05, 2009 at 08:57:22 AM EST
    If we get rid of the post office then Fedex will charge absurdly high rates?  Well then wouldn't UPS attempt to undercut?  What keeps prices down in non government industries?  

    Right though - public schools are great.  The one thing kids need more of is low quality protected (unionized) teachers and standardized testing to allocate funding.  Kids don't respond well to classroom situations?  Diagnose it as dysfunctional and pump him full of adderol rather than reaximine schools individually - which has shown to be very difficult with the unions and beurocrats making money on maintaining things.

    Parent

    As I said (none / 0) (#46)
    by cal1942 on Wed Aug 05, 2009 at 09:37:59 AM EST
    your way we become a third world country.

    Just as you didn't understand Medicare; it's called community and without community we're finished.

    That school thing you're talking about, look elsewhere, beyond the buildings and the teachers.  Look at the weaknesses in the community.  Weaknesses courtesy of your ideology.  Your ideology has brought us a middle class only sustainable with two income households, a departure from the past that's weakened the cohesiveness of the family and when families lack cohesion the community as a whole decays.  Your kind talks about family values but the truth is you're ruining family values.

    Mister, you're clueless.

    Parent

    Definitions please. (none / 0) (#48)
    by Samuel on Wed Aug 05, 2009 at 10:17:31 AM EST
    I don't understand.  You've identified me, correctly, as favoring free market solutions.  Then you go on to say that my 'ideology' is responsible for a series of problems without acknowledging that they arose in the environment of the welfare state and public schooling.  How could it be, considering the undeniable statistical growth of the US government, that small government proponents are responsible for augmenting existing problems when the aggravation of problems occurred in an environment precisely contrary to what they proposed?  If a doctor recommends you get a tumor removed, you ignore his advice and the tumor kills you, it is not the doctor's fault.  

    "Your kind talks about family values but the truth is you're ruining family values." - ?  

    I can offer a host of reasons that two income households have become necessary - can you provide me with one reason that less government involvement in the economy would cause this?  

    Just so you don't think I'm bluffing here are a few:
    -Increased government spending devalues the dollar therefore causing wage/salary increases to lag behind price increases in real terms.
    -Government institutions and legislation allowing for "easier access to credit" resulted in rising prices as it artificially boosts demand.  This can be seen with college education in this country - increased access to financing maintains demand so that price reduction from the college's perspective is not necessary.  Inflated prices (facilitated through government induced credit access) do not a corresponding rise in wage/salary, increasing the likelihood that two income streams are necessary.  

    As for what I had asked you:  I'm assuming you're conceding that Fedex would not hike rates if the USPS disappeared because other competitors would keep prices down.  


    Parent

    Fed Ex, wha? (none / 0) (#55)
    by cal1942 on Wed Aug 05, 2009 at 06:19:44 PM EST
    No Fed Ex, UPS etc. could only lower prices so far until they can no longer operate and are forced to merge for survival.  Private firms require profit to operate.  You seem to not understand this basic fact.  When delivery firms merge we have a monopoly.

    There simply is no way that private firms can match the overall efficiency of the USPS.

    Inasmuch as your dollar argument is concerned a strong dollar can harm exports and decrease employment.

    Increasing income inequality, weakened labor unions, politically depressed minimum wage, foolish trade policies, etc., etc.

    Easier access to credit and rising prices?  If you're referring to the housing bubble then again you have it wrong.  That bubble was driven by the finance industry's unchained greed and outright fraud.  A result of deregulatory madness.

    In the last 30 plus years the combination of free market, supply side conservatives and free market loving neo-liberals have weakened our communities.

    That cabal is destroying our nation community by community.

    Parent

    I saw (none / 0) (#36)
    by cal1942 on Tue Aug 04, 2009 at 10:37:36 PM EST
    the troll rate you gave Columbiaduck.  Very bad form.

    So I'll repeat what CD said.  I've got a few years under my belt and have yet to experience a loss via the US Postal Service.

    Fast, low cost, matchless service.

    Parent

    I believe you. (none / 0) (#44)
    by Samuel on Wed Aug 05, 2009 at 09:03:30 AM EST
    So broken down:

    "Fast" - Yep

    "Low Cost" - 2.5 bil "small potatoes" loss last year plus liabilities for their employees are funded by the government.  Price of a stamp isn't the whole picture.

    "Matchless" - They have been granted a legal monopoly on non-urgent correspondence.

    I rated a 1 because the point about USPS costs did was inaccurate - didn't realize it was a sentiment-o-meter and not for rating the quality of argument.

    Parent

    There was (none / 0) (#47)
    by cal1942 on Wed Aug 05, 2009 at 10:01:14 AM EST
    nothing wrong with his point. He shells out 44 cents for a stamp and it's delivered rapidly anywhere in the country.  In spite of the appropriation to make up the budget shortfall the cost is still very low, lower than any private firm could possibly achieve.  If private companies handled all of our mail the cost to ColumbiaDuck would skyrocket beyond cost of stamp and his share of the appropriation.

    You seem to think that private equals high efficiency, an illustration of your thoughtless approach.  You couldn't be further off the mark.

    I've worked in both private and public organizations in the same line of work and I have to say that no private firm I worked for was any more "efficient" or cost conscious than the government agencies I worked for, in fact less cost conscious.  

    You're also forgetting profit, necessary for a private firm and seem blissfully unaware of the margin demands from the finance industry.

    I could troll rate virtually every comment you make because your arguments are thoughtless.

    By the way $2.5 billion is small potatoes even compared to "on budget" let alone "total budget."

    So here's a little math tip for you.  A million is a thousand thousands.  A billion is a thousand millions.  A trillion is a thousand billions.  

    Parent

    Sigh. (none / 0) (#49)
    by Samuel on Wed Aug 05, 2009 at 10:40:08 AM EST
    I don't understand the hostility but I do appreciate what I feel is a somewhat intellectual discussion with you nonetheless.

    "In spite of the appropriation to make up the budget shortfall the cost is still very low, lower than any private firm could possibly achieve."  -  You or I can neither prove or disprove this as the USPS is granted monopoly rights through legislation.  Please stop making this claim as though it's empirical.  

    The desire of a firm to increase profit is what drives efficiency behind almost all the goods and services we use everyday.  I'm arguing that the USPS has no incentive to reduce costs and therefore it is likely that competitive firms would be capable of reducing their costs as a failure to do so would result in bankruptcy rather than the taxpayers making up the difference every year.    

    Obviously making room for profit will increase end costs to the user, I do not deny this.  My argument is that the profit margin will always decrease with raising prices as customers will be lost to competitors.  Therefore firms are inclined to reduce costs to increase their margins.  Depending on the specific markets, firms will reduce price after reducing costs, losing out on profit/unit but gaining on net profit.  

    When you say "blissfully unaware of the margin demands from the finance industry" are you talking about how CEOs of publicy traded companies make decisions to generate short-term stock gains over long term growth?  If so, that's a good point but one would have to consider the source of the excess liquidity which allows for volatile stock prices and whether that is a free market effect or the result of government regulations (such as 401k tax breaks).

    Parent

    Actually... (5.00 / 1) (#50)
    by ColumbiaDuck on Wed Aug 05, 2009 at 02:10:55 PM EST
    you are wrong.

    The desire of a firm to increase profit is what drives efficiency behind almost all the goods and services we use everyday.

    The desire of private firms to maximize profit is often at odds with what is good for the country.  Let's take this as an example:  a private firm will stop offering service to rural areas.  Because costs are greater in delivering there, it wouldn't be "efficient" to continue to offer rural service.  So those folks get dropped.  (or charged so much they might as well get dropped).  But that's bad for our country.

    Same with education.  Public schools have to teach everyone - that is good for our country but it is not "cost effective".  Same with electricity - it is good for rural areas to have power and water, but it costs more money.

    There are areas where private companies do a good job; but when we are talking basic public services, the needs to have a functioning society is at odds with their need to make money.  

    Thank you cal1942 for defending me, but it's probably a lost cause....

    Parent

    Let's boil this down (none / 0) (#54)
    by cal1942 on Wed Aug 05, 2009 at 05:50:48 PM EST
    You're making a claim that private = more efficient.

    Hardly empirical evidence.  You should stop making that claim it's an argument that should be classified as an opinion based on inexperience.

    You concede that postal activity would cost more in private hands. Those increased costs could be a drag on all economic activity.

    Inasmuch as a USPS budget shortfall is concerned the value of spreading that loss hasn't occurred to you.

    Parent

    Most "Other" Private Businesses (none / 0) (#56)
    by squeaky on Wed Aug 05, 2009 at 06:31:50 PM EST
    Nixon turned the USP into a private corporation.
    In addition, the Post Office Department was abolished as a cabinet department and reorganized as a government-owned corporation: the U.S. Postal Service.

    WiKi

    Parent

    I cant believe guys like him get some credit (none / 0) (#1)
    by LatinoDC on Tue Aug 04, 2009 at 02:57:26 PM EST
    for their "economic knowledge"

    Stunning (none / 0) (#37)
    by cal1942 on Tue Aug 04, 2009 at 10:39:30 PM EST
    to me as well LatinoDC.

    I don't feel he's comptetent to carry out the trash.

    Parent

    This guys not too bright. (none / 0) (#11)
    by Samuel on Tue Aug 04, 2009 at 03:42:15 PM EST
    As for the 41 trillion dollars of unfunded liabilities...  Right.

    is samuel actually (none / 0) (#39)
    by cpinva on Wed Aug 05, 2009 at 01:07:48 AM EST
    laffer's dumber, younger brother? both have an amazing capacity for demonstrating just how totally ignorant they are of basic economics, and just basic facts, in public.

    there's a reason dr. laffer has never been nominated for a nobel in economics, he just isn't very bright.

    What basic economic principal (none / 0) (#45)
    by Samuel on Wed Aug 05, 2009 at 09:05:30 AM EST
    did I violate in any of my arguments?  

    "totally ignorant they are of basic economics, and just basic facts" Then present a single factual argument since you've identified many.  Please share.

    Parent

    Not really worth the time (none / 0) (#52)
    by ColumbiaDuck on Wed Aug 05, 2009 at 02:55:41 PM EST
    Because you clearly don't understand the difference between something that benefits to society versus something that is nice for an individual to have.

    But by all means, I welcome you to take a time machine back to the libertarian, lassez faire  land of 1890 and see how well privatization of almost everything worked. (hint:  there were a lot more illiterates...)

    Right. (none / 0) (#53)
    by Samuel on Wed Aug 05, 2009 at 04:05:09 PM EST
    We've gone from claiming empirical evidence that a state granted postal monopoly is more efficient than the same service if provided by private firm despite no evidence logically or empirically (that latter being impossible due to legislation) existing...to...claiming public schools are the optimal solution because more people read in 2009 than 1890?  

    This dichotomy of benefiting society vs benefiting individuals is ridiculous.  "Society" I'm assuming is the collective of individuals.  If I want to live up on a mountain how does "society" benefit from subsidizing my mail?  Like what has literally happened there?  Well, the government took money from one person and gave it to me so that I could live up on the mountain and pay a fixed rate on my mail.  That's not everyone benefiting. That's me getting a benefit at the expense of someone else.

    But seriously, you realize that you were wrong about the post office right?  Like when you say

    "It doesn't bug me if the post office doesn't turn a profit.  Unlike Jack Donaghy, i don't see dollar values attached to everything in my vicinity.

    I care that I get good service for a reasonable price.  The Post Office delivers (literally!) and is easy to use and access.  And that includes any amount the taxpayers pay (which amounts to about $23 per person this year - totally reasonable for a reliable service in my book)."

    You do realize that
     -you dismiss my point that the actual price is higher because of the losses covered by the taxpayer by saying you don't care if they turn a profit.
     -you immediately say what you do care about it price after that.
     -you then allude to the fact that the covering of losses by the taxpayer should be included in the actual price if you are to analyize it correctly.
    (OK so up to there all you managed to do was claim that my point was invalid to your criteria (despite the discussion being aggregate efficiency), then immediately use my point to bring about your conclusion)...
     -you conclude that 23/person is well worth it which is entirely subjective and by including this one can surmise that you feel your subjective opinion on your particular return on those 23 dollars is in some way relevant to the discussion of whether or not the post office is efficient.

    And then you changed the subject a million friggin times rather than saying "oh yea, i didn't realize that taxpayers funded the losses".  I was just trying to give you a piece of info that had nothing to do with all these other subjects - and the response i got was your best attempt to prove that my added info was somehow irrelevant while you yourself felt it necessary (rightly so) to consider my purportedly irrelevant info in your subsequent conclusions.  

    Parent

    Laffer-able | 55 comments (55 topical)

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