Tuesday, June 7, 2016

Sanders Revolution - Why Not

Today in a glowingly supportive story in the Washington Post, Katrina Van den Heuvel, declared that though Clinton may take the nomination, Sanders won the debate.  Not with me.  Here is why.

She defined the Sanders platform as:
- The $15 minimum wage
- Medicare-for-all
- Tuition-free college
- Breaking up the banks
- Rebuilding our infrastructure
- Getting serious about climate change.

Let's take them in order:
A $15 minimum wage is perniciously bad - cruel - for people who are discriminated against, particularly young and minority workers.   The full argument is, for example, here.

Medicare for all.
If you want to provide a medical safety net, then provide clinics for basic health care.  If you try to provide Medicare for all you will find it unaffordable to provide middle class health care - choose your own doctors, upscale hospitals, access to all medical devices and drugs, etc. - to all.  The case is made here.

Tuition-free college
This plan offers a subsidy to middle-class kids who don't really need the money, encourages financially constrained students who might not have gone to college to enter the system en route to a degree, but forces them to find living costs without reorganizing the university to account for working students, encourages marginal students with a low chance of completing a career-enhancing degree to attend school, mostly wasting government money (see here) and their own time.  Europe has many examples over time of this, creating an underclass of permanent student.

An argument can be made for a significantly reorganized education credential using MOOCs and Technical Colleges to train the workforce we need, but not to create more sociology and ethnic studies graduates from middle class families.  The arguments are detailed here and here.

Communist and Socialist societies such as the Soviet Union, India, China, Cuba and, more recently,  Venezuela have tried these three policies before.  The results have been starvation and deprivation.  Let's not go down this path here.  People need to work and get paid what their work is worth to someone who is getting paid by a consumer, not what a politician imagines they should be paid.  Once paid, they can spend money to acquire goods and services for themselves up to the limit they have earned.  For those that cannot do so, we should have safety nets for the most vulnerable old, disabled, children and those down on their luck - temporary, unless the inability is permanent - that help them get back on their feet.

Breaking up the banks
The argument here is that there should not be another 'bail out.'  Or that the 'banks' are ruining the middle class in some ill defined way.  I note that the total government contribution to the actual banks during the financial crisis was fully paid back with interest and profit.

This is a bogey man populist argument for government intervention to solve a non-problem.  This is in a market that is already highly regulated and we think we've already taken care of whatever element of a problem there was.  Mr. Sanders blames the banks for the last recession.  Admittedly, the 'banks' are not blameless and more executives that committed fraud should have been prosecuted (doesn't the government do that?).  A more likely set of driving culprits for the recession was Federal policy supporting home ownership, mortgage brokers, and the quasi-government mortgage buying firms Freddie Mac and Fannie Mae.  These guys hold the smoking gun.   Overall, a non-issue.

Rebuilding our infrastructure
I could go for some of this and more of it if I thought our current political system was capable of not wasting all the money.  Example one: The costs of building urban train transit per mile vary amazingly.  An article here from the Atlantic says: NYC plans 8.5 miles estimate at  $17 billion, or $1,240,000/Km.  Madrid just built 41km for $58,000 per Km.  Singapore just built 22 Miles with 28 stations for $4.8 billion - $139,000/Km.  Paris and Berlin estimated recent additions at $250,000 per Km.  We cost ourselves 20x-5x what others do this work for.  Example two:  Larry Summers notes, here, that a bridge we took 11 months to build in 1922 now takes 5 years and counting to renovate.  Get me to a place where government works and I'm happy to give them more money to spend.  I support decreased crony capitalism and streamlining infrastructure investment rules and government purchasing reform.

Getting serious about climate change.
I am a climate change skeptic.  I believe that we are having an impact.  I don't believe our impact is going to be catastrophic.  That case is explained here.  Because I don't believe, I don't want to spend a bunch of money and regulate us to a lower standard of living to as great an extent as others.

 Accurate Reality:  Mr. Sanders' grab bag of progressive ideas have broad appeal to those who want the world to be nicer and the government to do more.  Unfortunately, most of the ideas are recylced socialism and rely on the benevolent all seeing government servant of the people to have any chance of success.  The non-existence of such a beast was proven in the 1930s.  These programs have been proven to not work.  I don't support programs which have been proven not to work.  Others are just based on misinformed opinions.  I disagree with 5 of his 6 core policies and shy from the other due to the accumulated barnacles of government.

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