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January 30, 2006

Excellent piece by Arnold Kling

Very, very well done: in "Stuck on 1968" Arnold Kling reminds us of the conventional wisdom of well-educated Liberals in 1968 and then reviews what's happened in the nearly 40 years since. Economics fans should find the part about Paul Samuelson and Milton Friedman especially interesting.

I have just one quibble and one thing to add.

Kling asserts that liberals think that anyone who is not a liberal must be "incorrigibly stupid". Not quite. As we know from A Conflict of Visions, imperfect intelligence is what conservatives tend to attribute to liberals. Most conservatives would quickly note, however, that they, too, are imperfectly intelligent: social and economic institutions are not easy for any single person to understand.

Liberals, on the other hand, believe that institutions and their workings are usually quite easy to understand. So easy, that even non-liberals must understand them, too. Liberals thus tend to believe that non-liberals are not merely stupid, they are evil. Liberals do refer to conservatives as stupid, of course, but especially these days, angry allegations of bad faith--of evil character--dominate.

And I'd add this brief review of 60's lIberals. They were right--to their great and everlasting glory--on civil rights. They were right to oppose the draft. Some parts of their safety and environmental programs were reasonable. (Taking the lead out of gasoline and car seatbelts, for examples.)

But IMHO two generations of experience shows they were wrong about almost everything else. From education to crime, from welfare to tax rates, and on each and every aspect of our foreign policy. The Liberal worldview is perhaps well-intentioned, but everyone knows what the road to Hell is paved with.

(Yeah, yeah, this post is partisan. But also read this cry from the heart from a good Liberal: "Just when will it be ok to say that the liberals from the generation of the 1960s have no idea what they're doing and never did? . . . When can it be said that a NASCAR dad can be trusted as much as a college professor to know what's good for himself?" Via Vox Baby.)

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Kyle N

It was not so much that the 60's lefties were wrong, its that they took everything too far. Public safety is good, so thousands of niggling regulations should be better right? Equality of opportunity is good, so forced equality of outcome is better. War is bad, so spitting on our troops must be the way to go.
You see they really are stupid, they have no sense of moderation.

cactus

I'm probably more liberal than the median economist and I wasn't alive in 1968 but I agree that most of the 1968 vision was crap. I also think Kyle N nails it above in a sense - there is a pendulum, and any group eventually pushes things too far.

At this point, conservatives have been running the show for a while, and as a result, we have started seeing failures in the conservative thought process. I remember the Wall Street Journal and almost everyone else ponting out over and over how Clinton's tax increases would lead to economic damnation. Apparently they were all right, but it took 8 years. (And if you are one of those who insist that the economy only picked up and the deficit started getting paid off when the Republicans took control of Congress, here are the OMB figures: http://www.whitehouse.gov/omb/budget/fy2006/sheets/hist01z2.xls.) Similarly, things didn't work out quite as advertised during the Reagan administration.

Right now we're being assailed with platitudes about how the market economy always works best, and yet in the last few years the countries with the fastest growth rates have been a bit more along the lines of half-command economies like China or Vietnam. (I certainly wouldn't advocate either model.) We pay more and less get than most industrialized countries for things like healthcare, despite the fact that many of them have a socialized healthcare model. (I've posted OECD healthcare expendintures and measures of success in other comment threads at this site.)

I agree that communism is a threat. But whatever Kling says, in Latin America where I grew up, from the '80s to to about 2000, the bigger threat - the cause of more people dying, and often dying violent deaths, was not the left but the right. (I note that US support for right wing dictatorships in that time has been partly to blame for the a swing too far to the left in many Latin American countries in recent years.)

I think there's a happy medium somewhere, and in some ways we're getting closer to it, but in some ways not. People on the left and on the right have blinders on as to the failings of their own philosophical failings but have an easy time spotting those of others.

Jake

Here is another way the left is stuck in 1968.

They all believe that the population of the US is the same as it was in 1968 at 175 million people.

So every house, every road and every suburb built since 1968 was a waste of resources because they were not needed.

Every gallon of gas, every kilowatt and every cubic foot of natural gas used over 1968 amounts is wasted. And we could easily cut back to 1968 levels by conservation.

That is the main reason the left has blocked any attempt by the US to increase its energy supply.

Jake

Cactus:

Three reasons why other countries spend less than we do on medical care:

1. In America, half of a person's lifetime medical costs are spent in their last six months of life. Government run systems in other countries refuse to spend that money.

2. 30% of our medical insurance premium goes to pay the costs of lawsuits. Government run systems in other countries do not allow suits for pain and suffering.

3. Government medical programs survive by rationing out health care. Canada saves money by establishing long waiting lists for life saving operations. The government plans on people dying before they come to the head of the line. Northern Minnesota hospitals are filled with Canadians who can’t get treatment in their own country (Thank you Canada for making health care a big industry in Minnesota).

cactus

Jake,

1. For some reason, the last 6 months of life not only are more expensive but also arrive earlier in the US than in many developed countries (http://ocde.p4.siteinternet.com/publications/doifiles/012005061T003.xls) that spend a heck of a lot less money than we do (http://ocde.p4.siteinternet.com/publications/doifiles/012005061T002.xls) according to OECD figures.
2. I'd like to numbers. I've heard this figure before - even seen similar claims on editorial pages of newspapers. I've never seen the numbers themselves or where they come from. FWIW - I've also heard that medical malpractice awards are down even as insurance rates are up. Until I see the numbers, I don't believe either claim.
3. See the links above - the average Canadian lives 2 and a half years longer than the average American, and Canada spends 9.9 of their GDP to our 15 percent of GDP to accomplish it. Their rationing seems to be accomplishing something our market isn't. That said, there are always those who can afford to bypass the rationing. Some do it by coming to the US for some procedures, but I would be surprised if you cannot bypass the rationing and purchase care directly in Canada as well if you are willing and able to pay for it.

Jake

cactus:

Awards may be down but settlements are still sky high. These lawsuits are a direct tax on the workers because as insurance premiums go up, there is less money available for wages.

If the lawyers are taking so little out of the medical systems, why are they willing to bribe Democrats in the amount of $128 million in the last election? Obviously the Democrats have made a contract for a percentage of the loot stolen from working people with medical lawsuits. For comparison, oil interests gave Republicans $15 million in the last election.

President Bush said in a speech last month that the administration has determined that a large amount of medicaid and medicare dollars goes to lawyers and it has to stop.

cactus

Jake,

If you want to compare political donations of lawyers to something in order to figure out what is happening in healthcare, donations by oil companies are irrelevant (especially when 2 oilmen are in the White House). A relevant comparison to money donated by attorneys and similar groups would be to political donations by insurance companies and/or other associations (or even companies) opposed to lawsuits. Presumably, they get something for their donations too.

Again... I'd have to see the data to believe that 30% of insurance premiums goes to lawsuits. W

Lee

"1. In America, half of a person's lifetime medical costs are spent in their last six months of life. Government run systems in other countries refuse to spend that money."

Some countries refuse to spend money on the last YEARS of life. In New Zealand's system if you are sixty and have cancer you can expect your treatment to be only painkillers.

Reason 4 that other countries spend less on health care is that they provide less health care. Britain is toying with the novel idea of keeping unhealthy people out of the health care system.

cactus


Lee

To cite once again http://ocde.p4.siteinternet.com/publications/doifiles/012005061T003:
the folks in New Zealand live about a year and a half longer than we do out here.

I keep hearing that foreigners treat their elderly poorly and provide lousy care. The data seems to indicate that despite this shabby treatment and lousy care, and despite the fact that pretty much everyone in the developed world spends a lot less than we do, everyone else lives longer and is healthier. This either means that treatment abroad is not so shabby and/or there is something wrong with Americans and/or the data is bad.

There doesn't seem to be any evidence that the data is bad. There doesn't seem to be anything that would indicate that Americans prefer to die early. Other than poor bang for the buck, the other major difference between ourselves and most of the better performing OECD countries is the way our medical system is run.

Kyle N

Cactus, I do not disagree with your general statement about the pendulum swing and such. But on some specifics. It is nearly impossible to compare life expectency of nations due to a host of factors. 1) Genetics, 2) climate 3) diet 4) customs, ect.
I agree that our current health care system is screwed, but that is due primarily to Government intervention. Many years ago the government caused our health insurance to be tied to employment.
Then they created Medicare, a poorly run outfit if there ever was one. I fear that some sort of universal insurance will be neccesary, I hope it is done with a maximum possible use of market forces.
I do not believe that the free market is a panacea of all ills, but its pretty damm close.

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