Wednesday, April 30, 2014

Jobs vs Gates Reconsidered

Hooray for the hippie, but hats off to the nerd.

By Nick Paleologos
April 30, 2014

I’ve been an Apple Guy ever since 1991 when I was first smitten by that beautiful little box called the MacIntosh. When it’s creator, Steve Jobs, succumbed to cancer back in the fall of 2011--like millions of others--I became obsessed with retracing every step of his extraordinary life.

In 1995, before there was an iPhone, or iPad, or iPod, Steve Jobs was asked whether he considered himself a hippie or a nerd. Without hesitation he answered hippie. Imagine that. At his core, this giant of American industry—volatile, impatient, mercurial, charming, arrogant and visionary—considered himself an artist above all else.

Steve Jobs defined his own persona for all time in a famous 1997 commercial which he wrote and narrated himself. Crazy. Misfit. Rebel. Troublemaker. Not fond of rules. No respect for the status quo. The bad boy with the big ideas. Seriously, what’s not to love?

By the same token, I never much cared for that other fella--the bespectacled nerd with the pocket protector full of pencils. Did I mention he also happens to be the richest guy in the world? Yeah, that too. His software? Clunky. His products? Boring. His personality? Blah. The best I could ever muster for the planet’s biggest billionaire was a Bronx cheer.

That is, until now. Life is funny isn’t it? In due time, few will ever remember how Microsoft founder Bill Gates made his fortune. What will be truly unforgettable is the extraordinary way that he spent it.

Last week, the soft-spoken philanthropist sat down with NPR’s David Green to talk about malaria in sub-Saharan Africa—of all things. You see, in today’s Africa, a child dies every minute from malaria. It is the leading cause of death there, and in many other developing countries as well. 

But as Gates was speaking, you could almost hear the keystrokes clicking as he put that excel sheet--which is his brain—to work on behalf of the greater good of humanity.

“We have a lot of interventions where we're saving lives for less than $2,000 per life saved. By making sure new vaccines are invented, making sure they get out to all the kids on the planet, we're taking diarrheal deaths, pneumonia deaths, and bringing those down pretty dramatically. And any country where we can save a life for a few thousand dollars, we'll do it. It turns out that the place you can really make dramatic reductions in the number of children who die is in the very poor countries.”

Let’s see, if we could save a couple of million kids’ lives…at a couple of grand a pop…well, you get the picture.

Just to prove the point--and without any fanfare, or fancy commercials--the decidedly un-cool Bill & Melinda Gates Foundation has already dumped $1.8 billion into eradicating another child-killer, polio. How’s he doing? Last year there were only 400 cases of polio—in the entire world.

This year?

“In Nigeria,” Gates says, “we've had only one case--which is way down from last year.”

Apparently, if the Taliban would stop killing vaccinators in Pakistan, polio—with a big assist from Gates--could be consigned to the dustbin of history in less than 3 years. All of which makes me think its time for a new take on an old commercial:

Here’s to the quiet ones.
The contributors. The researchers. The volunteers.
The fearless folks on the front lines.
The ones who see things we don’t and do something about it.
They’re not fond of injustice.
And they have no respect for inaction.
We don’t hear from them, or glorify them.
But we have to respect them. Because they change things.
They push the human race forward.
While some may see them as the quiet ones, we see nobility of spirit.
Because the people who are quietly committed to changing the world…are the ones who do.

Alas, with apologies to the hippie, my hat’s off to the nerd.

Friday, April 25, 2014

Don't confuse me with the facts.

By Sean McElwee  April 23, 2014
The great 20th-century economist John Maynard Keynes has been widely quoted as saying, "When the facts change, I change my mind. What do you do, sir?" Sadly, in their quest to concentrate economic and political power in the hands of the wealthiest members of society, today's Republicans have held the opposite position – as the evidence has piled up against them, they continue spreading the same myths. Here are six simple facts about the economy that Republicans just can't seem to accept:​

1. The Minimum Wage Doesn't Kill Jobs.

The Republican story on the minimum wage takes the inordinately complex interactions of the market and makes them absurdly simple. Raise the price of labor through a minimum wage, they claim, and employers will hire fewer workers. But that's not how it works. In the early Nineties, David Card and Alan Krueger found "no evidence that the rise in New Jersey's minimum wage reduced employment at fast-food restaurants in the state." Since then, international, national and state-level studies have replicated these findings – most recently in a study by three Berkeley economists. Catherine Ruetschlin, a policy analyst at Demos, has argued that a higher minimum wage would actually "boost the national economy" by giving workers more money to spend on goods and services. The most comprehensive meta-study of the minimum wage examined 64 studies and found "little or no evidence" that a higher minimum wage reduces employment. There is however, evidence that a higher minimum wage lifts people out of poverty. Raise away!

2. The Stimulus Created Millions of Jobs.

In the aftermath of the 2007 recession, President Obama invested in a massive stimulus. The Republican belief that markets are always good and government is always bad led them to argue that diverting resources to the public sector this way would have disastrous results. They were wrong: The stimulus worked, with the most reliable studies finding that it created millions of jobs. The fact that government stimulus works – long denied by Republicans (at least, when Democrats are in office) – is a consensus among economists, with only 4 percent arguing that unemployment would have been lower without the stimulus and only 12 percent arguing that the costs outweigh the benefits.

3. Taxing The Rich Doesn't Hurt Economic Growth.

Republicans believe that the wealthy are the vehicles of economic growth. Starting with Ronald Reagan in the 1980s, they tried cutting taxes on the rich in order to unleash latent economic potential. But even the relatively conservative Martin Feldstein has acknowledged that investment is driven by demand, not supply; if there are viable investments to be made, they will be made regardless of tax rates, and if there are no investments to be made, cutting taxes is merely pushing on a string. Thomas Piketty and Emmanuel Saez, two of the eminent economists of inequality, find no correlation between marginal tax rates and economic growth.
In fact, what hurts economic growth most isn't high taxes – it's inequality. Two recent IMF papers confirm what Keynesian economists like Joseph Stiglitz have long argued: Inequality reduces the incomes of the middle class, and therefore demand, which in turn stunts growth. To understand why, imagine running a car dealership. Would you prefer if 1 person in your time owned 99% of the wealth and the rest of the population had nothing, or if wealth was distributed more equally, so that more people could purchase your cars?
Every other country in the Organization for Economic Cooperation and Development has far lower levels of inequality than the United States. Since there are no economic benefits of inequality, why hasn't the right conceded the argument? Because it's based on class interest, not empirical evidence.

4. Global Warming is Caused by Humans.

Even as global warming is linked to more and more extreme weather events, more than 56 percent of Republicans in the current congress deny man-made global warming. In fact, the infamous Lutz memo shows that Republicans have actually created a concerted campaign to undermine the science of global warming. In the leaked memo, Frank Lutz, a Republican consultant, argues that, "The scientific debate is closing [against us] but not yet closed. There is still a window of opportunity to challenge the science."
In truth, the science of global warming is not up for debate. James Powell finds that over a one year period, 2,258 articles on global warming were published by 9,136 authors. Of those, only one, from the Herald of the Russian Academy of Sciences, rejected man-made global warming. That one article was likely motivated by the Russian government's interest in exploiting arctic shale. Another, even more comprehensive study, examining 11,944 studies over a 10-year period, finds that 97 percent of scientists accepted the scientific consensus that man-made global warming is occurring.
This is not an abstract academic debate. The effects of climate change will be devastating, and poor countries will be hurt the worst. We've already seen the results. Studies have linked global warming to Hurricane Sandydroughts and other extreme weather events. More importantly, doing nothing will end up being far more expensive than acting now. One study suggests it could wipe out 3.2% of global GDP annually.

5. The Affordable Care Act is Working

President Obama's centrist healthcare bill was informed by federalism (delegating power to the states) and proven technocratic reforms (like a board to help doctors discern which treatments would be most cost-effective). Republicans, undeterred, decried it as Soviet-style communism based on "death panels" – never mind the fact that the old system, which rationed care based on income, is the one that left tens of thousands of uninsured people to die.
From the beginning, Republicans have predicted disastrous consequences or Obamacare, none of which came true. They predicted that the ACA would add to the deficit; in fact, it will reduce the deficit. They claimed the exchanges would fail to attract the uninsured; they met their targets. They said only old people would sign up; the young came out in the same rates as in Massachusetts. They predicted the ACA would drive up healthcare costs; in fact it is likely holding cost inflation down, although it's still hard to discern how much of the slowdown was due to the recession. In total, the ACA will ensure that 26 million people have insurance in 2024 who would have been uninsured otherwise.
It's worth noting that every time the CBO estimates how much Obamacare will cost, the number gets lower. Odd how we've never heard Republicans say that.

6. Rich people are no better than the rest of us.

Politicians on the right like to pretend that having money is a sign of hard work and morality – and that not having money is a sign of laziness. This story is contradicted by human experience and many religious traditions (Jesus tells a graphic story about a rich man who refused to help the poor burning in hell). But it's also contradicted by the facts – more and more rich people are getting their money through inheritances, and science shows that they are no more benevolent than others.
More and more, the wealthy in America are second or third generation. For instance, the Walton family, heirs to the Walmart fortune, own more wealth than the poorest 40 million Americans. Thomas Philippon and Ariell Reshef have found that 30 to 50 percent of the wage difference between the ļ¬nancial sector and the rest of the private sector was due to unearned "rent," or money they gained through manipulating markets. Josh Bivens and Larry Mishel found the same thing for CEOs – their increased pay hasn't been correlated to performance.
If rich people haven't really earned their money, are they at least doing any good with it? Studies find that the wealthy actually give less to charity as a proportion of their income than middle-class Americans, even though they can afford more. Worse, they use their supposed philanthropy to avoid taxes and finance pet projects. Research by Paul Piff finds that the wealthy are far more likely to exhibit narcissistic tendencies. "The rich are way more likely to prioritize their own self-interests above the interests of other people," Piff recently told New York magazine. "It makes them more likely to exhibit characteristics that we would stereotypically associate with, say, assholes."

Monday, April 7, 2014

The Myth of Democrats and Deficits

After paying for WWI, democrat Woodrow Wilson left his republican successor with a surplus.

After slashing taxes and a stock market crash, the next 3 republicans left Franklin Roosevelt with a deficit.

After battling through the Great Depression and WWII, democrats Roosevelt & Truman put the budget back in the black.

Between 1953 & 1980, each party added roughly a quarter of a billion dollars to the deficit—slightly more for the democrats because of the Vietnam War.

Between 1981 & 1992 republicans Reagan and H.W. Bush cut taxes and ran up an unbroken string of six-figure annual deficits—the largest ever.

Democrat Bill Clinton inherited a $300 million deficit and turned it into an $86 million surplus.

Republican George W. Bush cut taxes, launched 2 major wars, and created the largest deficits in the history of the country.

Despite inheriting massive deficits and a Great Recession, democrat Barack Obama has managed to cut the annual deficit by more than half in his first 5 years.

See for yourself (below):

Sunday, April 6, 2014

Low taxes on rich means more jobs? FALSE.

Between 1946 and 1963 the top tax rate was 91% and the unemployment rate averaged 4.6% per year.

Between 1965 and 1981 when the top tax rate was lower (70%) the average unemployment rate was higher (5.7% per year).

Between 2003 and 2012 the top tax rate was much lower (35%) and the average unemployment rate was even higher (6.8% per year).

See for yourself (below).

Source: The Tax Foundation; National Bureau of Economic Research;
and the US Bureau of Labor Statistics