Well, the verdict is in.

Please make no mistake about it, this marketing push isn’t really about obstruction, but about the upcoming elections.  Just as President Clinton did brilliantly prior the 1996 elections when he cast all Republicans as following Newt Gingrich and obstructing spending laws, the Obama administration is moving forward in much the same pattern.

This is possible because the White House, regardless of occupant, has historically been able to control the news cycle.  In my opinion, this should be an indictment on journalism as a whole when alternatives which exist aren’t being reported, but simply put:  when the President talks, news happens.  When your normal representative talks, you’re lucky if you even hear about it.

It worked during the Clinton Administration on spending, it worked during the Bush (43) Administration on the Patriot Act, & it certainly might work again this time. Irregardless, the campaign is back and in high gear (here via USA Today):

…”Too often, the Republican leadership in the United States Senate chooses to filibuster our recovery and obstruct our progress,” Obama said. “And that has very real consequences.”…

Or here via NY Times blog, here via WaPo, & on and on and on…

From a critical point of view however, obstructionist should not automatically be a pejorative.   Without analyzing what exactly is being obstructed, this is little more than name calling.

As an example, if say in the 1940s Congress was actively trying to “obstruct” the intermittent of thousands of innocent Japanese-Americans, this would not only be a moral good, but any thoughts to compromise solely to be seen as a non-obstructionist would be wrong.  What would be a compromised alternative?  House arrest?

Additionally, we have to be on the lookout for the differences between the marketing of bills and their actual language.  Think of the new health care legislation.  President Obama’s promises of more health care for all at cheaper prices, simply don’t seem to be fulfilled by the 2500 page law passed… or maybe they are being fulfilled, but like the Patriot Act, no one really knows what the new legislation actually means (here via Cato):

…The Patient Protection and Affordable Care Act represents the most significant transformation of the American health care system since Medicare and Medicaid. It will fundamentally change nearly every aspect of health care, from insurance to the final delivery of care.

The length and complexity of the legislation, combined with a debate that often generated more heat than light, has led to massive confusion about the law’s likely impact….

Or on yesterday’s Meet The Press Rep. Van Hollen stated (transcripts here via MSNBC):

…The frustration is there are lots of important bills to push for jobs that are sitting over in the Senate.  But it’s not the fault of the Democratic leadership in the Senate.  I mean, frankly, you know, John Cornyn and his allies have been trying to block a whole lot of very important jobs measures.  We in fact sent a piece of legislation over very recently that would remove these perverse tax incentives to ship American jobs overseas, that give American corporations a bonus if they ship American jobs overseas….

Just like health care, the basic idea that our representatives are working on private job creation incentives is a good one.  But just like the Obama Administration’s promises on health care, Rep. Van Hollen is selling us a job creation bill which has little chance of actually creating jobs.

To translate – what they mean by “removing incentives” is to increase taxes on businesses who outsource.  Now, some may want this to happen for various reasons, but the economics are pretty straight forward.  Tax increases have never increased jobs & forcing a tax such as this could actually result in companies simply moving their head quarters as well.

To be fair, there are bills I don’t believe the Republicans should block, for instance the extension on unemployment benefits (though it seems likely to pass soon: here via The Hill).

Yes, the point isn’t that the Republicans are doing the right thing and the Democrats are failing at every single step, the point is only intended to remind us of the old saying about representative governance:

The people will get the government they deserve.

& so long as we allow marketing campaigns to have more force in elections than critical analysis does, we will likely continue to be disappointed.

Internal administration documents reveal that up to 51% of employers may have to relinquish their current health care coverage because of ObamaCare….

Publicly however…. in speech after speech we were told things like, you won’t have to give up your existing coverage even while internal documents predicted:

…The “midrange estimate is that 66% of small employer plans and 45% of large employer plans will relinquish their grandfathered status by the end of 2013,” according to the document.

In the worst-case scenario, 69% of employers — 80% of smaller firms — would lose that status, exposing them to far more provisions under the new health law….

I’m unsure what the machinations coming will be from the White House – something along of the lines of this was only one report taken out of context – likely enough to allow true believers to sigh and continue to support this president.

Either way – this really doesn’t change much in the way of the facts pertaining to health care reform.  The bill is going to be a disaster for the US & if these policies are allowed to fully mature, this will go down in history as a major mistake that the public should’ve prevented.

It wasn’t all that difficult to see what they were selling couldn’t possibly contend with reality.  When people were told by their leaders that this reform would increase demand, increase regulations, and yet still decrease costs they could’ve easily spotted it for the scam it was.

Instead, the average citizen plodded along and by default told their leaders not to stop this.  They told them in polls they hated it, but didn’t want it prevented.  They tell them in polls today they hate it, but don’t want it repealed.  They told them when few wrote – please stop this.

No – the only thing this “new” information tells us is that the government’s own reports confirmed what many independent sources were saying & this administration, cloaked in the mantle of transparency, hide this information from the public and told a completely different story about the legislation when asked.

Maybe this will move some fence sitters against Obamacare and maybe this can be used as motivation to push back some of the legislation, but the truth is we the people failed the day the law was signed.

…The Quinnipiac polls, conducted in three states across the past month, all find likely voters to have complex and contradictory views on these repeal lawsuits as well as health care reform itself.

By a slight majority, likely voters tend to oppose the health care reform law. But they also tend to oppose the repeal lawsuits as a “bad idea” that would, for a sizeable portion of voters, make them “less likely” to support a given candidate….

Which seems roughly equivalent to wanting to win the football game, but not really wanting to deal with scoring points…. or as Politico reports:

…In short, voters simultaneously don’t want to [sic] health care reform but don’t want to challenge it either…

There is a scientific explanation for this called cognitive dissonance (DA posts here).  There’s also some logical evidence that helps explain why we as humans seek to reduce anything seen as contentious by the rest of society.

It’s frustrating because time and time again it seems the majority does understand that government is not some Utopian solution.  For instance, they seem to understand that the current tax code is 60K pages of government sponsored corruption where the normal citizen or even the IRS agent has little idea exactly what all 60K pages means together, but special interests, nonprofits, businesses, and others all work to make the code a little better for themselves. (Freedomworks – Top Ten Reasons to Scrape the Code here).

Yet polls showing voter disgust, such as the dismally low congressional approval ratings, only show feelings.  The reality is even with rates of congressional approval as low as 16%, the rate for the election of incumbents is well over 90%.

There’s a Japanese Proverb that begins with “Vision without action is daydream.”  Well, here we are, proving, that some truths are universal.  Proving that believing in something strongly or knowing something real well is meaningless if never acted upon.

Use a simple analogy to prove this true – what good is the best doctor in the world without patients or students?  What good would have come out of Newton’s genius, or Salk’s genius, if their abilities were followed up by only inaction?

The only good thing that can really be said about genius without action, is that it doesn’t directly harm anyone.  You can make a moral argument that Salk had some level of obligation to help since he could, but inactive genius shouldn’t be the main concern as the real problems will come from people acting without understanding.

& there’s where the second 1/2 of the proverb comes “Action without vision is nightmare. ”

Too bad we’re seemingly in a society today where both are true depending only upon the group in question.

…Technological innovation — in pharmaceuticals, biotechnology, medical devices including imaging, and enterprise IT — exploded in the thirty year period 1970 to 2000…

…Then about a decade ago, the US medical technology sector entered a prolonged innovation drought. In pharmaceuticals, new drug introductions declined by almost two thirds, while drugs patented in the latter part of the boom period lost protection, this despite a near tripling in R+D outlays. (New drug introductions rebounded modestly in 2008 and 2009, but still haven’t regained their 2004 levels)….

He goes further to note that this dip in activity wasn’t just about new drugs:

…The drought wasn’t confined to pharmaceuticals and biotechnology. Imaging, a dazzling success story for three decades, has seemingly run out of gas. Imaging equipment sales collapsed precipitously in the US, by roughly 40%…

…Enterprise clinical information technology seems to have hit a similar flat spot. The major commercial IT platforms for hospitals and health systems are more than a decade old.

& all of that makes complete sense based upon what we know about the last couple of decades.

Since the mid-1990s (well really, since the 1960′s), we have increased regulation on the medical industry on a constant basis.  From minor changes in who qualifies, to new regulations such as HIPA, to very large new regulatory pressures such as the Medicare Prescription Drug Benefit, resulting in an explosive growth in government expenditures of health care:

There have also been additional pressures.  Increases in financial and IT regulations through SOX and other legislation have increased companies’ weariness to put themselves at risk and increased costs of doing business.

These pressures in increasing the costs of doing business, combined with the federal government expenditures crowding out private spending, has resulted in higher costs for businesses and therefore consumers as well.  The new heath care and financial overhaul bills will continue this pressure.

The big cost however is what the author notes:  the lack on innovation.  When the government seeks to consistently erect new and more costly barriers to entry, competition will naturally decline.  The correlation to that behavior is that costs will grow more rapidly as we know competition in the long-term generates downward pressure on prices.

As we see now – prices are increasing, availability is decreasing, as the government decreases the availability of future competition in industries the government tightly controls such as health care.  Conversely with those industries with fewer barriers to entry have downward pressure on prices, such as cell phone or internet providers.

While I consider this failure of centralized control as a major factor, Mr. Goldsmith posits three contributing factors, risk aversion from management, size and increasing bureaucracy, and the fact that we are losing out globally for scientific talent:

1. Firms that used to be run by scientists and engineers are now run by attorneys and marketing executives….
2. Their ability to foster innovation has succumbed to a bureaucratic management culture….
3. Bright young foreign science and technology graduates are returning to India or China instead of staying here and creating new products or companies….

While I agree with all of these things, I think reasons 1 & 3 can be combined easily to a more basic point about government interference and centralized control.  Indeed they are symptoms of the problem and not necessarily the disease.

Having said that, I think it’s also important to note that reason number 2 exists due to the same thinking reasons 1 & 3 do – the belief that centralized control is a nominal good (DA post on business trends here).

The author seems remiss in not making the connection, even if he did eloquently, maybe unwittingly, stumble across it when writing about global competition:

…If they have more freedom to innovate in their home countries, that’s where they’ll go….

For as long as we continue to discuss symptoms and not the actual disease, we will continue to miss the point.

…At a time when America’s economy is still in bad shape and when we face numerous problems abroad, Obama has put the country through a shattering political battle—and, with legal challenges and promises of repeal, the fight may be just beginning.

This seems, at the moment, less a monument to idealism than to hubris.

Rep. Mike Honda, D-CA seems to think Fannie Mae knows their stuff (via Politico here).  In asking for more money to prevent legal foreclosures, he gives us this:

…In addition, Fannie Mae estimates that as many as 50 percent of the minority homeowners who received a subprime loan should have qualified for a prime loan. This clearly indicates the need for housing counseling services….

With all due respect to Mr. Honda, I think all this clearly indicates is poor critical thinking skills.  When a GSE which apparently knew nothing about the impending crisis and was proactively laying down on the job when it came to auditing loan standards gives you estimates on who might or might not have qualified for what kind of loan – laughter is the appropriate response.  Not regurgitation.

Cato on telephony deregulation, cell phone innovation, & ingratitude (here).  Discussing his memories as a child where phone line were costly and long distance was only slightly less expensive than actual driving as compared to today’s age:

Then came the breakup of the AT&T monopoly in 1984. Phone technology and competitive service provision exploded. In 1982, Motorola produced the first portable mobile phone. It weighed about 2 pounds and cost $3995.

Within a very few years they were much smaller, much cheaper, and selling like hotcakes.  Today there are some 4.6 billion mobile phones in the world, and counting, or about 67 per every 100 people in the world.

Then he moves forward to the ingratitude:

And to celebrate this incredible achievement, Slate and the New America Foundation are holding a forum titled “Can You Hear Me Now? Why Your Cell Phone is So Terrible.”

From the CEI (Competitive Enterprise Institute), we learn the EPA is about to expand its powers (here):

Washington, D.C., March 30, 2010 – The Environmental Protection Agency and the National Highway Traffic Safety Administration (NHTSA) are expected this week to finalize their joint greenhouse gas (GHG)/fuel economy standards rule. This will make carbon dioxide an “air pollutant subject to regulation” under the Clean Air Act for the first time. The rulemaking, and the endangerment finding that is its prerequisite, will allow EPA to immediately exercise and continue to amass powers never delegated to the agency by Congress….

I suppose those supporting the decision know nothing about the EPA’s massive failure in just the Energy Star program.

Lastly, as a reminder, most places and people in the US did NOT buy homes they couldn’t afford (via WSJ here):

The U.S. still is feeling the effects of widespread housing bust, but a new report serves as a reminder that large swaths of the nation didn’t experience a boom in home prices and hasn’t suffered from the bust….

In fact, most of the insane double digit growth in real estate prices were in 5 main areas – NY corridor, Florida, Arizona, California, Nevada.  Make of it what you will that almost all flyover states never experienced the irrational boom, to be inevitably followed by the burst.