A couple of interesting articles on banks that I've run across lately. The first has to do with toughening regulations on the banks, forcing them to keep more capital. I'm certainly all for that, but I wonder if the changes listed really accomplish anything. The problem I see is that mark-to-market accounting was suspended after the banking crisis for some classes of assets. And as long as those assets can be valued at whatever the companies want, the requirements seem pretty meaningless.
The only reason I give any credit at all to that article was that it was cited encouragingly by Paul Krugman, whom I admire, and who certainly knows more than I do. I wonder if he's missing that (potential?) loophole, or if it really isn't there.
The other interesting one has to do with how banks are now (or, at least, seem to be) manipulating the commodities markets via some seemingly completely unrelated to banking maneuverings.
I don't really know anything, beyond what he's reported, but it's pretty scary. Everyone should be watching what's happening, because that has the potential to be a tax on the entire rest of the economy. But hey, that's economic efficiency, right? Isn't that why we don't need any more regulations?
Showing posts with label paul krugman. Show all posts
Showing posts with label paul krugman. Show all posts
20140215
20110408
Moving Costs down the Income Ladder
I've been hearing about Rep Ryan's budget proposal that would, among other things, eliminate Medicare.
I guess it's pretty typical for a Republican proposal: push as many costs as possible off of the government and onto the poor and working class.
In this case, it's ending Medicare and replacing it with a voucher plan. This is projected to save $5.8T over the next ten years, because the vouchers allowed can be set at a constant value over those ten years. Of course, that $5.8T will still need to be paid (and since Medicare's rates are lower than the rates for private insurance, the true amount will go up), and who will pay it. It will be everyone on Medicare. And of course every one of those people will have their share of the $6T or so to pay. Of course.
So this attempts to push the cost off onto the patients.
Who, mostly, will not be able to pay it. So the costs will be pushed back onto government when these people are coming into the emergency rooms for life-extending measures when they can't afford them. Or onto their kids. Yeah, that's an improvement.
And that's ignoring the GOP attempts to repeal the recent healthcare bill, which outlaws denials of insurance based on pre-existing conditions. If the repeal effort succeeded (it can't, for the foreseeable future, but stay with me for a minute, now), what happens to all those currently on Medicare who have pre-existing conditions? How many people on Medicare don't have something that can't be considered a pre-existing condition? I'm going to go out on a limb, here, and guess that it's significantly less than 10% of them.
So what good are the vouchers if you can't get insurance to begin with?
Granted, that lowers the government's initial obligation catastrophically, but it also results in a lot of dead people.
Having a heart, here, is actually good for the country. Keeping people alive, even if they're past working age, is still good for the nation.
And I've ignored another issue: jobs.
And I wrote the rest of this before seeing Krugman's take, but that backs up some of what I posited.
I guess it's pretty typical for a Republican proposal: push as many costs as possible off of the government and onto the poor and working class.
In this case, it's ending Medicare and replacing it with a voucher plan. This is projected to save $5.8T over the next ten years, because the vouchers allowed can be set at a constant value over those ten years. Of course, that $5.8T will still need to be paid (and since Medicare's rates are lower than the rates for private insurance, the true amount will go up), and who will pay it. It will be everyone on Medicare. And of course every one of those people will have their share of the $6T or so to pay. Of course.
So this attempts to push the cost off onto the patients.
Who, mostly, will not be able to pay it. So the costs will be pushed back onto government when these people are coming into the emergency rooms for life-extending measures when they can't afford them. Or onto their kids. Yeah, that's an improvement.
And that's ignoring the GOP attempts to repeal the recent healthcare bill, which outlaws denials of insurance based on pre-existing conditions. If the repeal effort succeeded (it can't, for the foreseeable future, but stay with me for a minute, now), what happens to all those currently on Medicare who have pre-existing conditions? How many people on Medicare don't have something that can't be considered a pre-existing condition? I'm going to go out on a limb, here, and guess that it's significantly less than 10% of them.
So what good are the vouchers if you can't get insurance to begin with?
Granted, that lowers the government's initial obligation catastrophically, but it also results in a lot of dead people.
Having a heart, here, is actually good for the country. Keeping people alive, even if they're past working age, is still good for the nation.
And I've ignored another issue: jobs.
And I wrote the rest of this before seeing Krugman's take, but that backs up some of what I posited.
20100922
All-Time Whiners
There seems to be an amazing amount of whining among the very wealthy lately, about the prospect of a 3.6% marginal increase in top-end tax rate.
First there was the University of Chicago law professor (linked to a response, because the original has been taken down) who, on income of upward of $300k (six times the national median income), said, "After all, we can afford it, and the world we are now living in has that familiar Marxian tone of those who need take and those who can afford it pay. The problem is, we can’t afford it."
Ignoring that "those who need" are not the ones in any position to "take", the fact that he is investing some of his income is undeniable proof that, in fact, he can afford it.
Next, there's the incorrigible Ben Stein acting put upon because of those tax increases. Ignoring Paul Krugman's takedown of the inheritance claim in there, the simple answer to Ben Stein's question is that the economic policies he supported (Stein's ties to the Republican party go back to at least the Nixon administration, for whom he was a speechwriter) put too much stress on the government's cash flow in the form of debt, and that stress needs to be relieved.
If he wants to consult history on how onerous that tiny tax increase is, he might want to refer to the Eisenhower era, where the top marginal tax rate was 90%.
First there was the University of Chicago law professor (linked to a response, because the original has been taken down) who, on income of upward of $300k (six times the national median income), said, "After all, we can afford it, and the world we are now living in has that familiar Marxian tone of those who need take and those who can afford it pay. The problem is, we can’t afford it."
Ignoring that "those who need" are not the ones in any position to "take", the fact that he is investing some of his income is undeniable proof that, in fact, he can afford it.
Next, there's the incorrigible Ben Stein acting put upon because of those tax increases. Ignoring Paul Krugman's takedown of the inheritance claim in there, the simple answer to Ben Stein's question is that the economic policies he supported (Stein's ties to the Republican party go back to at least the Nixon administration, for whom he was a speechwriter) put too much stress on the government's cash flow in the form of debt, and that stress needs to be relieved.
If he wants to consult history on how onerous that tiny tax increase is, he might want to refer to the Eisenhower era, where the top marginal tax rate was 90%.
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