Good from afar, far from good

I realized that quip to describe the phenomenon where someone of the opposite sex looks attractive from a distance, but less so the closer you get to them, also applies to the poor and needy.

Deserving from afar, far from deserving?

I’ve noticed that the folks who tend to be strong advocates for the generic needy (the needy from afar), become less so the closer they get to specific needy people and to their own wallets.

I, again, recall a conversation with a friend who owned a car lot. He was a strong advocate for the deserving and faceless “minimum wage worker,”, because they were powerless against employers. But, apparently the car salesmen on his lot weren’t deserving of that treatment since he treated them as contractors so he wouldn’t have to be locked into paying them minimum wage.

Health insurance is another example. The faceless uninsured was used to garner support for Obamacare because everyone ‘deserves access to health care’. But, put faces on some of the uninsured and look at some of the choices they’ve made — like paying for an expensive cell phone plan, instead of buying insurance — and the ‘deserving’ moniker starts to make less sense.

This exposes a good tactic to use in conversations with people who have the ‘deserving from a far, but far from deserving’ affliction. First, put some faces on those who they think are deserving.

Their next argument will be that those are only a few abusers or outliers and ‘that should be fixed, but doesn’t take away from the vast majority of the other (faceless) deserving.’

To which, a good response is, “How do you know? Are you guessing?”

Think about that

From John Goodman’s piece in the Wall Street Journal, A Costly Failed Experiment (emphasis added):

With Sunday marking the fourth anniversary of the Affordable Care Act being signed into law, it’s worth revisiting the initial purpose of the president’s signature legislation: Universal coverage was the main goal. Four years later, not even the White House pretends that this goal will be realized. Most of those who were uninsured before the law was passed will remain uninsured, according to the Congressional Budget Office.

Democrats also fixated on another goal: protection for people with pre-existing conditions. One of the first things the new law did was create federal risk pools so that people who had been denied coverage for health reasons could purchase insurance for the same premium a healthy person would pay. Over the next three years, about 107,000 people took advantage of that opportunity.

Think about that. One of the main reasons given for interfering with the health care of 300 million people was to solve a problem that affected a tiny sliver of the population.

More recently, the president has had to explain why between four million and seven million people are losing their health insurance despite his promise that they would not.

Yes, think about that. Thinking isn’t something we do very much of this country anymore.

Signals v causes in youth sports

A Facebook friend liked this article about youth sports and what parents should say to kids when they play. I found that article, the article it references and the discussion in the comments interesting — especially because I’ve been coaching a youth sports team for a few years.

I find the youth sports scene interesting for a number of reasons. One reason is that cause and effect of success and failure is hard to determine, but that doesn’t stop people from trying. The articles above are good examples.

They say college athletes said their parents just told them that they like watching them play. 

Is that a signal or a cause? The articles make it sound like a cause.

But, it’s likely that most college athletes were excelling in their sport from an early age due to natural physical advantages, above average interest in learning the sport, some competitive grit and/or environmental factors that may have provided them with multiple times more exposure to the sport than the average kid.

It’s easier to say “I just like to watch you play” to someone who is in the top 5% of their age group than to somebody who is in the middle or bottom.

Also, I’m sure many parents whose kids didn’t make a college or high school team said that, too. I’d guess that for every set of parents of a college athlete who said that, there are ten sets of parents of non-college athletes who said the same. Why didn’t it work for them?

My parents usually said something like that. They’d usually ask if I had fun and tried my best. I didn’t play high school or college athletics. And, I’m doing okay. As near as I can tell, I’m doing about as okay as many who did play high school and college sports.

Sports Craze & False Choice

Redistribution based on income inequality is a false choice. The reasoning goes something like this:

  • There are wealthy people and poor people.
  • Ignore why they are that way. Like many poor people are just kids starting out and many wealthy people have worked hard and saved their whole lives.
  • Poor people place a higher value on an extra dollar than a rich person who already has plenty.
  • Ignore that the behavior of rich people and poor people do not support this claim, otherwise poor people may be more interested in doing things that can earn and save them more dollars.
  • Therefore, we should redistribute more dollars from the wealthy to the poor.
  • Ignore the already high rate at which this is done.

Why do we only focus on wealthy people in our redistribution schemes?

In my opinion, things mustn’t be too bad if we can afford to support a host of marginal men’s and women’s sports programs from grade school through college, where most people who participate — especially at the higher levels — have few prospects for continuing in those sports after they get past those supported programs, except maybe to teach the next generation of youth to take advantage of those programs or to tell their glory day stories in the break room.

How many poor people could have been helped with the taxpayer money that has been put into all sorts of sports projects? Locally, we have taxpayer-funded pro sports stadiums and amateur sports facilities. Apparently playing soccer on grass is just too hard. Spending millions on fake grass fields for pre-teens to hone their soccer skills is the new norm.

Why don’t we look at more of such things and say if we really take external approaches to helping those in poverty seriously, why don’t we cut out all this other stuff?

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And from Dr. Sowell…

From this week’s Random Thoughts column:

Once, when I was teaching at an institution that bent over backward for foreign students, I was asked in class one day: “What is your policy toward foreign students?” My reply was: “To me, all students are the same. I treat them all the same and hold them all to the same standards.” The next semester there was an organized boycott of my classes by foreign students. When people get used to preferential treatment, equal treatment seems like discrimination.

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Raise your hand if you’ve worked for less than minimum wage!

Don Boudreaux, of Cafe Hayek, made a very timely post for me: Other Unseen Consequences of Minimum Wage Legislation. One of his graduate students is beginning to study links between minimum wage and people working in illegal or illicit activities.

It’s timely because I’ve been working on a post covering this very topic. I’ve been struggling to edit it because it is complex — and I have more topics than just illegal activities.

One thing that annoys me about the minimum wage debate is how simple it is. It typically centers on only two factors: the minimum wage rate and unemployment. There are many more factors that don’t get much or any attention.

One factor is that even with a mandated minimum wage, people still work for less than minimum wage — legally and illegally, in legal activities and illegal activities.

I enjoyed Boudreaux’s post because it validated two things. One, that minimum wage may have one unintended benefit in pushing people to work in illegal activities. Two, that this topic doesn’t have much discussion. Boudreaux writes:

Darwyyn [his graduate student] is in the early stages of her research.  So far, the only significant and relevant study she’s uncovered is a very good October 1987 paper…

One study so far from 1987. Proof this is not much discussed.

And for me, this is only one part of many factors that don’t receive attention. As I mentioned above, I view this particular factor in three categories, people who work for less than minimum wage…:

1. Legally in legal activities

2. Illegally in legal activities

3. Illegally in illegal activities

Boudreaux’s graduate student’s focus is on #3. This factor was the target of my first attempts at a concise and emotionally attractive argument against the minimum wage in this post.

But there’s still two other categories in this one factor. Raise your hand if you ever worked for less than minimum wage in either of those two categories!

I have. While there are many more examples from my life, I’ll pick two.

I. Illegally in legal activities. When I was a kid, the local bike shop owner offered me an off-the-books job. He’d pay me $4 cash for every bike I assembled out of the box for his showroom. He also gave me a generous discount to things I bought at his shop and gave me access to tools to help me maintain my bike.

This made sense for him. This freed up his experienced mechanics to work on higher margin repair and maintenance work for customers, while giving me the easier job of assembling bikes.

I wasn’t efficient at assembling bikes to start with, so I rarely cleared the minimum wage. As I became more efficient, I could clear the minimum wage. This is a good example of something a lot of people have a hard time understanding, what low-skilled workers are worth. For the bike shop owner, my worth wasn’t measured in hours worked, it was worked in the number of bikes I could produce for him to sell.

And, as my productivity improved, so did my wage rate. I may not have had a chance to improve my productivity if the bike shop owner followed the law and paid me more than I was worth to begin with.

Assembling bikes isn’t illegal. But, I believe I was probably too young to work, I got paid in cash (so no records, no taxes) and often made less than minimum wage, which I think made my employ illegal.

II. Legally in legal activities. As an adult, I volunteer to organize and coach a youth sports team. This is no small task. It takes quite a bit of time and effort and there are plenty of people who do it for pay.

However, I do receive benefits. I get to do something with my kid (he’s on the team). I enjoy the sport and, as I’ve come to know the other kids on the team, it’s rewarding for me to see their knowledge, skills, teamwork and sportsmanship develop.

I’ve also learned quite a bit about a sport I knew nothing about when I started and about coaching, leadership and delegation. I also find it to be a thought-provoking exercise. The key task of a coach is prioritize the 10 things that you need to work on down to 1 or 2 so the team can make the most progress in the next game. More on that in another post.

Those benefits to me are worth well more than a wage I could have earned. Nobody will say I shouldn’t do this because I don’t make minimum wage, even if I was poor. There are plenty of poorer coaches that do exactly what I do.

And, it’s not a matter of resources. For me to make the minimum wage would cost each set of parents about the price of a latte each week.

But, since I’m doing this for individuals — the parents and the kids — nobody really thinks about the minimum wage. If was doing it for some faceless “business”, they might.

Minimum wage is dumb

Whether raising the minimum wage, or having one, helps or hurts is something economists disagree on.

Few economists, however, think whether it helps or hurts is irrelevant. If they think it helps, they support it. If they think it hurts, they don’t.

But, that’s the wrong way to look at it. It’s dumb either way.

If you don’t like a job, quit. You are not entitled to a job.

If the minimum wage is relevant, why does any employer pay more than the minimum to any employee?

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Sachs on Freakonomics

Freakonomics podcast host Stephen Dubner speaks with economist Jeffrey Sachs about the Pope’s recent drubbing of markets.

Several things about this rubbed me the wrong way.

First, the quote from the Pope (in the linked Freakonomics blog post) starts off with “Some people continue to defend…” As I wrote here, readers deserve to know who the Pope is talking about.

Second, Jeffrey Sachs tried too hard to clean up the Pope’s words. Around the 16-17 minute mark, Sachs comes out with ‘getting people into positions where markets work for them, and not against them, is extremely important.’

Granted, I think somewhere Sachs admitted that he switched to his view, not necessarily the Pope’s, but I think the podcast was about making sense of the Pope’s opinion.

This even seemed to annoy Dubner, as he replied:

Of course, that makes sense. But compared to what the Pope has written about capitalism…it was much heavier on the can’t work part and here’s why it doesn’t work. What is the Pope actually calling for?

Third, Sachs complains that the Global Fund to Fight AIDS, TB and Malaria, a fund he helped “architect 12 years ago” (a little self-promotion never hurts), recently fell short of its funding goals. I wasn’t clear on who they were going to for ‘replenishment’, but it sounds like bureaucrats in government.*

Sachs says:

When it [the Fund] came to the replenishment, just now, it couldn’t raise the funds for the minimum package. It was saying that it needed at a minimum to fight these three diseases $5 billion a year, mind you hundreds of million of people and their lives are at stake. $5 billion we know in macroeconomics is nothing in this world, and yet they could not raise $5 billion a year. They raised $4 billion a year.

And that may not sound so consequential [You're right, especially since one sentence ago you said $5 billion is nothing, that would mean $1 billion is even less] when you’re in a village and the rapid diagnostic tests aren’t there or there’s a medical stock out…this is life and death [oh, that's when it become consequential, in micro]. Since I’m living in a neighborhood, if not down the block, then a few blocks away, or a couple miles away [let's keep hedging on terms] are billionaire hedge fund owners taking home personally paychecks of a billion dollars for the year, the fact that we can’t come up with $5 billion for this institution from all worldwide sources (governments?) is the globalization of indifference.

 

Too easy to pick on unpopular hedge funds, many who put their own skin in the game. Let’s not mention sacred cows like taxpayer funded sports venues, where billions of taxpayer money is tied up so team owners can afford to pay millions, even hundreds of millions, to the best kids game players. Soon the team owners will want to offload the liabilities of sports injuries on taxpayers, too.

I wonder if he also views that as a marker for the ‘globalization of indifference’.

Of course, you can probably also tell by the comments I inserted in the quote that Sachs’ verbal fitness annoyed me in how he framed $5 billion as inconsequential in macro, but a billion very consequential in micro in the span of three sentences.

My BS detector rings off when someone tries to sell me on something because, well, it’s just not that much money. Of course, it’s always enough that they can’t come up with it themselves.

*Sachs said “George Bush said, ‘we won’t let money stand in the way, you show that this works and the money will be there’”. So, I’m assuming it’s folks like Sachs trying to convince bureaucrats how to spend taxpayer money, rather than raising money from individuals. Which is the last thing that I found annoying that I will comment on.

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“Some say…”

Reporters and columnists love to use this. It usually goes something like this, “Some say that drinking is bad for you.” Or, “Some say paying taxes is good for your health.”

I’m sure I’ve used it myself, but I try not to. I think readers deserve to know who says it. I’ve started quite a few blog posts to address something ‘some say’, but when I did my research to figure out exactly who said it, I no longer thought it was worth writing about.