Flags

When used on a speaker's platform, the flag, if displayed flat, should be displayed above and behind the speaker. When displayed from a staff in a church or public auditorium, the flag of the United States of America should hold the position of superior prominence, in advance of the audience, and in the position of honor at the clergyman's or speaker's right as he faces the audience. Any other flag so displayed should be placed on the left of the clergyman or speaker or to the right of the audience.


14 USC § 7(k)


It's not that hard.

Student Loans

The student loan debate currently being pushed to the forefront by President Obama is like the rhetorical gift that keeps on giving.  I could write pages on the interesting facets of this, but I'll start with the basics:

In 2008 the Democrat controlled House and Senate passed, and President Bush signed, a law lowering the interest on Federally backed student loans from 6.8% to 3.4% for 5 years.  Those 5 years expire this year and so presently the President is going around talking to college campuses about how he wants to stop the Republicans from raising the interest rates and how he understands the plight of these poor college students having to pay on their student loans because he and the First Lady just paid off their loans 8 years ago.  Romney and the House Republicans (lead by Boehner) also want to extend the lowering, but Boehner wants to "offset" the cost by reducing the expenditures in Obamacare.

There are so many interesting quirks to this it's hard to see where to start, but I think I'll pick the fact that this shows us how invasive a "temporary" program is.  I didn't really follow this particular debate in 2008, but I'm sure there were 10 year budget projections showing what this cost, under the assumption that it only lasted 5 years.  But now, 5 years later, the debate isn't about lowering student loan income, it's about preventing it from going up.  Both politicians and commentators frequently take the sunset clauses on these "temporary" programs seriously.  They shouldn't.  If it was a good idea to lower student loan interest rates, it should have been done in perpetuity (the same is true for the Bush tax cuts).  The only difference between cutting student loan interest rates (or taxes) for 5 years and forever is that you get to debate it again in 5 years with a "temporary" program, and blame the other side for wanting to go back to the status quo ante (even though that's actually what you agreed to do when you created the program).

The second interesting thing is that the President's student loans dragged him down so much that he couldn't pay them off until just 8 years ago.  After he had bought a condo (and a house) and "should have been saving for [his children]".  Obama received a $100,000 advance for the publication of his first autobiography while he was still in law school.  For the last 5 of those years the Obamas were making well over $200,000.  For two of them they were making enough to be the "super rich" that aren't paying their fair-share of taxes.  There are two possibilities here, neither of them very favorable for the President. The first is that despite being "super rich" (by his own definition) he really didn't have enough money to pay off his student loans.  That eviscerates his argument (which he has been continuing to make at these taxpayer funded campaign speechs at Universities) that those over $250,000 are just throwing away money and need to be giving more in taxes.  The other is that, despite having an abundance of discretionary income, he chose not to pay off student loans because the opportunity cost favored keeping them.  I suspect this what really happened.  He had a student loan at around 6% (this is before the rates were lowered in 2008) and he could make more money on that money than he was paying in interest (and he certainly couldn't get a loan that low) so he didn't see any point in aggressively paying it off the way you would, say, a credit card.  This destroys his argument for artificially cutting the rate in half from what was already so cheap he chose to keep it around when he didn't have to.

The third, and most disturbing, interesting thing is the games the Republicans are playing here. When the Democrats created Obamacare they took some of the easier-to-cut sections of Medicare and slashed them to make the budget work.  I made the argument at the time that this was like renegotiating a mortgage that was going to bankrupt me and then turning around and spending the "savings" on credit cards.  This is exactly what Boehner wants to do here.  The Republicans have been arguing since it passed that we can't afford Obamacare.  And we can't.  Now we have a Republican Presidential candidate who has committed to dropping Obamacare completely, a Supreme Court case that many people consider likely to throw the entire bid out as unconstitutional, and a Republican Congress that says it's still unconstitutional and we can't afford it, but we can cut some of the money we don't have out of Obamacare and use it to pay for another bad idea.  Obamacare is a bad idea, and we ought to throw it out, but "saving" money by not funding certain care items while keeping the rest of the restrictions and regulations and then spending the "savings" on another bad idea is an even worse idea.

There are a bunch of other issues particular to the way student loans are subsidized and how this contributes to the rapid inflation of education costs, the fact that through this program a 25 year-old plumber gets to pay the bank 6% for the loan on his truck and tools and subsidize the 3.4% (higher risk profile) loan for the education of a 25 year-old lawyer, or the question of why the Federal government is involved in education funding at all, but I'm honestly not as interested in the standard issues with student loans as the politics of the rhetoric itself.

Laws

The internal effects of a mutable policy are still more calamitous. It poisons the blessing of liberty itself. It will be of little avail to the people, that the laws are made by men of their own choice, if the laws be so voluminous that they cannot be read, or so incoherent that they cannot be understood; if they be repealed or revised before they are promulgated, or undergo such incessant changes that no man, who knows what the law is to-day, can guess what it will be to-morrow. Law is defined to be a rule of action; but how can that be a rule, which is little known, and less fixed?

Another effect of public instability is the unreasonable advantage it gives to the sagacious, the enterprising, and the moneyed few over the industrious and uniformed mass of the people. Every new regulation concerning commerce or revenue, or in any way affecting the value of the different species of property, presents a new harvest to those who watch the change, and can trace its consequences; a harvest, reared not by themselves, but by the toils and cares of the great body of their fellow-citizens. This is a state of things in which it may be said with some truth that laws are made for the few, not for the many.

In another point of view, great injury results from an unstable government. The want of confidence in the public councils damps every useful undertaking, the success and profit of which may depend on a continuance of existing arrangements. What prudent merchant will hazard his fortunes in any new branch of commerce when he knows not but that his plans may be rendered unlawful before they can be executed? What farmer or manufacturer will lay himself out for the encouragement given to any particular cultivation or establishment, when he can have no assurance that his preparatory labors and advances will not render him a victim to an inconstant government? In a word, no great improvement or laudable enterprise can go forward which requires the auspices of a steady system of national policy.

But the most deplorable effect of all is that diminution of attachment and reverence which steals into the hearts of the people, towards a political system which betrays so many marks of infirmity, and disappoints so many of their flattering hopes. No government, any more than an individual, will long be respected without being truly respectable; nor be truly respectable, without possessing a certain portion of order and stability.

-- Federalist 62 (emphasis added)

Nominating process

There's all sorts of talk right now about whether the slowed-down nominating process the Republicans put in place in 2008 was a good idea. I don't care. I'm more interested in the brokenness of the process in general. I'm pro electoral college (and, in fact, think we ought to have some of the electors sent there by state legislatures like we used to do with Senators) so it may come as a surprise that the non-representative nature of the nominating process really bothers me. The problem is that the electoral college was designed to give some relief to the less populace states in our federation on the choosing of the President. That makes sense. The nominating process doesn't seem designed at all.

At present nearly 10% of Romney's delegates are from territories that don't get to vote for President. I'm actually opposed to our permanently retaining territories that are never going to become states, but if the purpose of the nominating convention is to win the Presidency, do we really care what people who can't vote for President think? I'd be okay with in if they got some nominal vote, but the people of the Virgin Islands and the Northern Mariana Islands together get as many votes as New Hampshire (which, admittedly, has an oversized influence because of when it votes).

Only fourteen of the 60 States or districts who have primaries or caucuses are closed. In the rest either Democrats can help select the Republican representative (I'm sure they will have only the best interests of Republicans in mind) or you have to at least not be party affiliated. Though if you're in a semi-closed state the chance you're going to register with a party is pretty much zero. I would not only have closed primaries, I would require that you have been registered with the party for at least two 30 months.

California and New York, states where the Republican nominee is guaranteed zero electoral votes, are two of the three largest delegations to the convention (Texas is number 2). On top of that nearly half of the California and New York delegates (123 out of 261) come from districts that are 60% or more Democrat. According to Sean Trende at Real Clear Politics, 8 districts from Los Angeles County cast just barely more votes in the 2002 Gubernatorial primary as a single majority-republican district. Yet they would get 8 times as much influence in the nominating process. To make matters worse, California is an open primary, so nobody is checking whether the delegates from Nancy Pelosi's district even reflect the desire of the Republican who lives there. I'm not saying we shouldn't care about these people's voice in the primary, but we shouldn't care a lot more about Republican's in Nancy Pelosi's district than those in Paul Ryan's.

On the flip side, the current procedures give extra bonus delegates to majority Republican states. Unlike the issues with allocating delegates based on general-population district lines that in lots of cases were intentionally drawn to polarize towards one party or the other, I can see why this makes sense. The nominee is supposed to be somebody who represents the will of the Republican electorate, so it makes sense to give bonuses to majority Republican states. But the nominee is also supposed to be somebody who can actually win the Presidency. Given that the important thing is winning the electoral college in the fall, wouldn't it make sense to give similar (or even greater) bonus delegates to the states with the closest elections in the past Presidential election? Hugh Hewitt has recommended at least once having the nominee determined only by the closest states. That seems like a recipe for a splintered party to me. It's one thing to give extra credit to electorally important states, it's another entirely to say to Texas or Georgia that the party doesn't care what you think, we're going to find a moderate who does well in Ohio and Pennsylvania.

We also have a bunch of unbound delegates who got their position through some previous party position. I actually don't have a problem with these. The "super delegates" bring some of the horse trading in order to get the desires of various factions of the party fulfilled while finding the most likely candidate to actually secure the election into the convention. If it's a close call, that's a role I don't mind seeing.

If I were head of the primary process, I would allocate votes among the states based on the number of popular votes they cast for the Republican in the prior election. Then I would give a bunch of extra votes to the 4 closest states. The national convention needs some way of allocating votes within states other than congressional districts which are drawn based on general population and frequently drawn to intentionally skew towards one party or the other. I would suggest something like forcing proportional distribution based on the entire states' returns. I would love to draw districts, but you would need special districts established for the purpose if you wanted to fairly district among just one party, and that doesn't seem practical.

Obama is right

In a post on PowerLine, John Hinderaker started a firestorm on conservative blogs this morning by pointing to (and dismantling) Obama's claim that he "would put our legislative and foreign policy accomplishments in our first two years against any president — with the possible exceptions of Johnson, F.D.R., and Lincoln".

I must say, Obama is right. The standard consistently used to judge Presidents in rankings is something along the lines of how much lasting change they have made to the structure of the Union. This is completely consistent with Obama's worldview (which you would expect, because those rankings are put together by progressive intellectuals). So the economy may have been much worse when Reagan took office and much better at this point in his Presidency, but that's immaterial. Harding took a deflationary depression and turned it completely around within 3 years but consistently appears in the bottom of Presidential rankings. FDR managed to keep the Great Depression going for a decade, but always appears at the top. If you listen to a progressive academic, and Obama has spent his life listening to progressive academics, Presidents aren't measured by how well the economy does.

A much bigger deal than is being reported

Last night, in order to avoid voting on Obama's jobs bill, Harry Ried changed the rules of the Senate to disallow the introduction of amendments after cloture is invoked. This is an arcane bit of Senate procedure, but the important point to take away from this is that the rules have been changed by a simple majority to prevent the minority from exercising a power they usually possess. This is exactly what I urged the Republican senate to do to allow votes on circuit court judges to pass with a majority, but they were unwilling to do because once Pandora's box is opened the procedure could be used by Democrats in a future Senate. I argued at the time, we now know correctly, that this was irrelevant and Democrats would change the rules as soon as it became convenient.

In light of this, I'd like to propose two changes to the Senate rules for the new Republican majority in 2012:

1) Allow appointments to pass by simple majority. First off, this is extremely politically advantageous, because Republicans tend to accept any judge who is qualified as a matter of training and experience, even if they dislike the positions they take, while Democrats reject any judge whose philosophy they disagree with, so Republican presidents have much more difficulty getting their nominees through the Senate. But secondly, I think the current position is unconstitutional. The Senate can do whatever it wants to its procedures for introducing new legislation, but appointments are an executive power that merely requires Senate "consent". The Senate should not allow itself to withhold consent if the majority of its members agree.

2) Allow any repeal bill to pass with a simple majority. As I stated on my post on Heinlein, giving a power to the government necessarily entails a restriction on personal freedom, and we shouldn't need a super majority to give that freedom back. (This also has convenient side effect that it makes repeal of Obamacare almost guaranteed)

Social Security IS a Ponzi Scheme

Ponzi Scheme (n): an investment swindle in which early investors are paid with sums obtained from later ones in order to create the illusion of profitability (Merriam-Websters Dictionary of Law, 1996)

Rick Perry is taking a lot of heat not only from the liberal media but also from conservative media for "doubling down" in the debate and calling Social Security a Ponzi Scheme. I understand the mainstream media saying this, they're practically cheerleaders for the Democratic Party and they're very much invested in the lies that have been told about Social Security for half a century. I don't understand the conservatives, though. Yes, sometimes it's politically dangerous to call a spade a spade, but Social Security _is_ a Ponzi Scheme. That it has ever been anything else is one of the great political lies of the 20th Century (maybe THE great political lie of the 20th century) and conservatives should be eager to discredit it (while proposing solutions to the problem that don't pull the rug out from under seniors who are depending on it).

The reason this is so important is that huge portions of otherwise well informed Americans have actually fallen for the statements they get from the Social Security Administration on their paystubs and in the mail that list their "contributions" and "account balance". These are outright lies. No one has ever made a "contribution" to Social Security in the entire history of the program, and no one has ever had an "account balance". Social Security "accounts" don't exist in any meaningful way and the sooner people come to grips with that the sooner we can fix the system.

For those of you who don't know, this is how Social Security really works.

1. You pay a payroll tax. This payroll tax, as a matter of statute and case law is not earmarked in any way and can be spent at the whim of the Federal Government. (See Helvering v. Davis)
2. The Social Security Administration uses part of the income from this tax to fund the benefits to current recipients and "invests" part of it in Treasury instruments, which the Treasury promises to pay back if the Social Security Administration asks for it. The money that was invested in the Treasury is then spent as part of the general US budget for farm subsidies and road building and international aid and whatever else the Fed does.
3. When one of several things happens (death of a spouse, disability, retirement) the Social Security Administration uses some complex formula based on how much you put in and how long you worked to cut you checks from current payroll tax revenue (plus the trust fund, though that rarely happens). This formula is defined by law and subject to change at any time. (i.e. When the Social Security Administration sends you glossy material in the mail saying that you are guaranteed to get X when you retire they mean "pursuant to current law". If Congress changes the law tomorrow to say you get 10 percent of that then tomorrow you will be guaranteed 10 percent of that.)

So lets compare and contrast this with a classic Ponzi scheme. Social Security uses the money from later investors to pay the benefit of early ones so it's clearly at least partially inline with the dictionary definition.

You could argue that the trust fund means that even though in practice it pretty much always pays benefits entirely out of contributions, it's not dependent on them, so that's different from a Ponzi scheme. But you would be wrong. At the end of 2010 Social Security had $2.5 trillion in the trust fund and in 2010 they paid out $584 billion in disbursements (2011 Trustees report, table III.A1) and disbursements are expected to increase rapidly and forever, so we would expect the trust fund to run out of money in less that 5 years if we stopped contributing. And that's not the worst of it. As I've said elsewhere, I don't believe in the trust fund. There are commentators that say the Treasury would never default on the Trust Fund notes because it would cause US bonds to collapse. But they don't have to. The Social Security Administration is a creature of statute law and Congress could vote tomorrow to forgive the trust fund debt to itself and there would be no bond implications (I would actually argue that bonds would become stronger because we don't have the huge unfunded social security liability stressing them). If we suddenly needed to increase expenditures by half a trillion per year to cover Social Security expenses I suspect changes would happen in short order.

You could also argue that Social Security isn't doing this "in order to create the illusion of profitability" because everything I've just stated is a matter of plain statute law, so it's not like Bernie Madoff who was claiming he invested in X and Y. Everybody knows how Social Security works so nobody is fooled into thinking it's a profitable investment. But that's not true, either. I'll demonstrate this by asking what the Social Security would do if they wanted to convince gullible masses that their "contributions" in Social Security "accounts" would yield particular "guaranteed returns". Exactly what they've been doing for years, marking your payroll tax as a "contribution" on your pay stubs and sending you stuff in the mail about your "account". And it's working. In the past week alone I have encountered two people who honestly believed that they have made contributions to Social Security accounts that exist as actual assets somewhere and were somewhat hurt and felt they had been lied to when I told them what I expressed above. I agree they have been lied to, but if the government has been lying to people and telling them that they have money in accounts somewhere, then they are clearly "creating the illusion of profitability".

The only other argument I've seen for why Social Security isn't really a Ponzi Scheme is precisely that it is a government program so whereas a Ponzi Scheme depends on getting more and more investors in order to meet its promises to past investors and inevitably fizzles when not enough gullible people can be found, the government can threaten to put you in prison unless you pay more and more money to support the program for prior investors. I'll admit, this is somewhat different from a classic ponzi scheme (though I'll argue it's worse) but it's not going to prevent a fizzle. The number of investors per recipient is declining and at some point people are going to say "enough" and cancel the program. Social Security started by charging 2% limited to $60. Currently it is sapping around 12% of our income (limited to $12,000) but according to official estimates it's going to require more than twice that by 2025 (including funds to the "general fund" in order to offset repayment of the trust fund) and it grows every year.

Social Security IS a Ponzi Scheme and it's critically important that we as conservatives explain this to people. Until people understand that the underpinnings of the program are a lie we can't have a responsible discussion of the program. If Social Security is like a 401(k) then I would be criminal (or at least progressive) to suggest that Warren Buffet shouldn't be able to get his money out of his account when he retired. If, on the other hand, Social Security is more like welfare it seems insane to think that wealthy retirees should be receiving it at all. One of the most powerful complaints about Paul Ryan's budget is that it reduces Medicare (he doesn't actually deal with Social Security at all) payments for those under 55. This is so powerful because people feel like he's stealing money from the accounts where they have been making contributions all these years, but those contributions were taxes, and they've been spent. And the government is unlikely to be able to raise the money to repay them under the current program in 15 years anyway.

We need to drastically reshape Social Security. I'm fine with the Ryan plan and I'm likely to be fine with the Perry plan, but if I were writing a plan I would go much farther. I understand, particularly politically, the desire not to affect seniors who have already retired under the presumption that they would get what Social Security promised them, but I would prefer if we as a country got to the point where we understood it is essentially a welfare program and if you managed to retire with a hundred million in the bank maybe you shouldn't get the full amount of welfare the SSA said you were going to get (even though you believed them when they lied to you and said you were contributing it to an account and would get a substantial return). After all, many of the investors who believed Madoff and Ponzi when they lied to them didn't get anything back, and even I'm not suggesting that.