Data Is Beautiful

Those that are regular readers of BeeLine know that I love data.

You would then have to know it was love at first sight when I came across the Twitter feed of @DataIsBeautiful.

@DataIsBeautiful provides a steady stream of beautiful data visualizations to provide you with better insights into almost everything you might (or might not) need to know.

For example, what time of day is President Trump most likely to tweet?

Trump gets his mind (and fingers) working early in the day. He must get motivated watching those early morning news shows.

How about the changing face of the most valuable brands in the world. Four out of the top five today are newcomers since 2006. Tech brands are in control. Notice as well that each of the top brands is an American company and this has been the case since 2006. My how Marlboro has fallen.

Over a century ago, Albert Thayer Mahan stated that "whoever rules the waves rules the world." If that is still the case, China is now challenging the United States in this chart showing "Major Military Wasrships 1970-2009".

Note how far Russia has fallen. The United States has also reduced its fleet by over half over that period. Great Britain's fleet has also been cut in half.

Concerns about nuclear energy? This chart says that fear is misplaced.

Do you want to stop annoying your fellow office mates? Avoid this office jargon.

We're on a journey here so don't quit reading yet.  No blue sky thinking ahead but I want to touch base and run a few more things up the flagpole with you from @DataIsBeautiful. Then again, if you don't like this data, now is the time to get off the bus.

This is the original source graph  of a link cited in @DataIsBeautiful on the Frequency of Dining Alone by age. Data is provided in this graph as the percent of meal spent alone in both 2003 and 2015. The original graph appeared on Pudding.cool

As you see, the general trend is that as we get older we tend to eat more meals alone. However, this trend is particularly pronounced as we age through the teen years until we get married. It then falls through the twenties (more people getting married at these ages) until we hit the mid 30's and it inexorably increases over time. Divorces and deaths clearly are a part of this equation from that point forward.

What I found interesting in this chart is the noticeable increase in the number of people eating alone in their early 20's in 2015 compared to 2003. This clearly seems to be a result of later marriages.

Speaking of divorces, this chart from FlowingData.com was linked by @DataIsBeautiful that shows divorce rates by occupation.

Who do you marry for the best chance to not be eating alone?

An actuary. Their divorce rate is less than half of the median divorce rate.

Who should you avoid marrying if you don't want to eat alone?

Bartenders and Gaming Managers. Of course, even if you don't get divorced marrying someone in these occupations means that you are probably going to eat a lot of dinners alone anyways considering their hours.

One other interesting chart on divorce rates from FlowingData.com looked at median salary rate for the various occupations vs. the divorce rate. As you might expect, tighter incomes puts more pressure on marriages.

This chart also confirms what many a mother has told her daughter over the years (and looking at recent medical school enrollment numbers , what father's should be telling their sons today) .

Marry a doctor! 

High incomes. Low divorces rates.

Data is beautiful!

Russia? What About The Pakistan Scandal?

Russia. Russia. Russia.

A day does not go by when we don't hear about Russia meddling in our election or the Trump campaign colluding with Russia to defeat Hillary.

This is despite the fact, even if it is proved that Russia did meddle or the Trump campaign did collude, there is no law against this or statute that prevents a candidate from "colluding" with a foreign state or anyone else in a political campaign.

Of course, there is a law against foreign nationals donating any money in connection with any election in the United States.

I will let you be the judge on whether Hillary Clinton violated this law in substance by soliciting contributions to the Clinton Foundation. Over 40% of top donors to the Foundation were based in foreign countries.

Does anyone realistically believe that the Clinton's would have raised 1% of what they did for the Foundation but for her Presidential candidacy and her role as Secretary of State?

Look no further than the fact that contributions to the Clinton Foundation dried up immediately after Clinton lost the election last November. It also ceased operating the Clinton Global Initiative, the most high profile activity of the Foundation and laid off 22 employees, right after the election.

Should Clinton have become President you can be assured that she would have been beholden to many, many, many, many multiples of foreign influence compared to anything involving Donald Trump.

How much reporting do you see on all of this?

Similarly, how much reporting in the mainstream media have you seen about the curious case of Imran Awan?

Imran Awan was an IT professional who worked for DNC Chairwoman  and Congresswoman Debbie Wasserman Schultz and a number of other Democratic congressmen. Since 2004, he was paid more than $2 million as an IT support staffer working for Democrats on the Hill. His wife, Alvi, was paid more than $1.3 million since 2007 in a role supporting her husband. Other family members of Awan were also reportedly being paid by the House Democrats to help with IT issues in their offices. All of these family members came here from Pakistan.

I started following the curious case of Awan back in February when it was reported that Awan and his compatriots were under criminal investigation for stealing computer equipment from 20 member offices and also accessing House IT systems without the knowledge of lawmakers.

Do you see any potential problems with a Pakistani Muslim family having access to all of the emails and other computer files of members of Congress? This even extended to Awan having access to Debbie Wasserman Scultz's computer password. If you are paying attention that means that Awan had the means to access all of the Democrat National Committee emails that ended up on WikiLeaks. Was it really the Russians?

In addition, consider the Congressional responsibilities of the various Democrats that the Awan family were supporting from an IT perspective.

The five. . .employees worked for at least three members of the House Permanent Select Committee on Intelligence, and five members of the House Committee on Foreign Affairs were among the dozens of members who employed the suspects on a shared basis. The two committees deal with many of the nation’s most sensitive issues, information and documents, including those related to the war with radical Islamic terrorism.

Jamal Awan handled IT for Rep. Joaquin Castro, a Texas Democrat who serves on both the intelligence and foreign affairs panels.

Imran Awan handled IT for Rep. Gregory Meeks, a senior member of the House Foreign Affairs Committee where he is the Ranking Member on the Subcommittee on Europe, Eurasia, and Emerging Threats.

Imran Awan also worked for Rep. Andre Carson, an Indiana Democrat and one of two Muslims in the House of Representatives, and Rep. Jackie Speier, a California Democrat. Both are members of the intelligence committee.

In another curious development, Wasserman Schultz threatened the Capital Police investigators to return her stolen equipment or to "expect consequences" in the middle of the investigation.

Despite the fact that her equipment had allegedly been stolen by Imran Awan and family prior to February, when the investigation was first disclosed, Wasserman Schultz inexplicably kept him on the payroll until just this week when Awan was arrested at Dulles Airport attempting to flee to Pakistan. He is charged with bank fraud for allegedly lying about a housing equity loan to pilfer $165,000 from the Congressional Federal Credit Union. The money did not end up in a house but in a wire transfer to Pakistan. Only now is Awan of the Wasserman Schultz House payroll account.

Considering the continuing payments to Awan even after he was under investigation, don't you have to at least consider that Debbie Wasserman Schultz was being blackmailed in some way?

That is what other IT support personnel on the Hill believe according to The Daily Caller.

Sources on the Hill speculated that the brothers were blackmailing members of Congress with secrets captured from emails. "Members of Congress have displayed an inexplicable and intense loyalty towards the suspects," technology aides told The Daily Caller.

The baffled aides wonder if the suspects are blackmailing representatives based on the contents of their emails and files, to which they had full access.

“I don’t know what they have, but they have something on someone. It’s been months at this point” with no arrests, said Pat Sowers, who has managed IT for several House offices for 12 years. “Something is rotten in Denmark.”

In the meantime, his wife and 3 children abruptly left the country for Pakistan several months ago and Awan seems to have been planning to join them beyond the reach of U.S. justice.

In addition, despite the healthy salaries that Awan and his family earned working for the House Democrats, one member of the family filed for bankruptcy in 2012.

What is even more curious is that when Awan has visited Pakistan in the past he has received VIP treatment including a VIP police escort because of his connection to the U.S. Congress. His wife is also reportedly under "government protection" in Pakistan since she returned to her family.

All of this leads to some interesting questions of exactly what is going on here.

The most obvious is uttered by Scott Johnson at Powerline.

Something is happening here. One can only infer that some serious breach of security involving a spy ring seeking to misappropriate confidential and classified information is involved.

Indeed.

I was happy to see that the FBI arrested Awan as he was about ready to get on a plane to Pakistan. However, why did they not detain his wife before she left?  She was questioned and allowed to leave despite the fact that she was carrying over $12,000 in cash and had most of their personal property with her. And why did it take from February to now to make an arrest?

It also does not give me much comfort that a major tip in the case came from a retired Marine officer who rented the house that Awan owned as the Daily Caller News Foundation's Investigative Group reported.

Shortly after the criminal probe was revealed in February, Imran abruptly moved out of his longtime home on Hawkshead Drive in Lorton, Va., and listed it for rent on a website that connects landlords with military families.

One of the new tenants — a Marine Corps veteran married to a female Navy Officer — said he found “wireless routers, hard drives that look like they tried to destroy, laptops, [and] a lot of brand new expensive toner.”

The tenants called the Naval Criminal Investigative Service and, not long after, FBI agents arrived together with the Capitol Police to interview them and confiscate the equipment. The Marine spoke on condition of anonymity because of concerns for his wife’s naval career, saying she doesn’t want to be associated with a national security incident.

“It was in the garage. They recycled cabinets and lined them along the walls. They left in a huge hurry,” the Marine said. “It looks like government-issued equipment. We turned that stuff over.”

Considering the facts in this case, don't you think one of the first things that should have been done is obtain a search warrant of Awan's house? After all, he has been under investigation for stolen government computer equipment for at least six months.

There is one other curious thing about all of this.

Imran Awan's attorney just happens to be a long-time associate and aide of Hillary Rodham Clinton.

What is he saying about the investigation and arrest of his client?

He states that Awan's arrest is “clearly a right-wing media-driven prosecution by a United States Attorney’s Office that wants to prosecute people for working while Muslim.”

Meanwhile the mainstream media only wants to talk about Russia.

What about Pakistan?

Why Is Health Care So Expensive?

Why is health care so expensive in the United States?

This chart compares per capita health care expenditures with life expectancy between various industrialized countries around the world.

The United States is spending significantly more than most developed countries yet it has life expectancies that are lower.

Why is that and what can be done about it?

There are a number of reasons why we get the health care results we do in America.

Technology. Most health care technology is developed in the United States and it is also more broadly and widely used than in the rest of the world. A case in point is that in 2008 (I don't know if it is still true) Pittsburgh had more MRI machines than the entire country of Canada. However, not every technology adds value. In fact, in most businesses, added technology lowers costs and makes things better. That has not been the case with health care. More technology has just meant higher costs.

Choice. Americans have much more choice in their treatment and care. For example, in Canada it can take months of waiting to have surgery. The average wait time was 20 weeks for surgeries in Canada in 2016. For neurosurgery it was 47 weeks. For orthopedic surgery the average wait was 38 weeks. Countries with socialized medicine limit care to limit costs.

Consider knee replacement rates across the globe. The United States has nearly twice as many procedures per 100,000 population as the world average. This chart also does not adjust for age. Older populations should require many more knee replacements. Countries like Austria, Finland, Germany, Switizerland, Canada and the U.K. all have much older populations than the U.S. For example, the median age in Austria is 43.8, it is  46.8 in Germany and 42 in Canada. It is 37.9 in the United States.

I recently heard two people discussing health care costs. One was very much in favor of more government involvement in health care. He cited the Veteran's Administration as an example of something that has been successful. His friend laughed and said something about the waiting times and the bureaucracy of the VA. The proponent agreed but said it could be solved by hiring more doctors, nurses and administrators. However, that is the problem with socialized systems of care. Costs are kept down by limiting the supply. There is no other way to do it.

Wealth. A big reason that health care is expensive in the United States is that there is a lot of money to spend on it. It is also true that a lot of that money is also someone else's money. When it comes to your health or the health of a loved one, there is almost no limit on what you will spend for their care. There is absolutely no limit if someone else is paying the bill.

I recently highlighted a chart from Mary Meeker's 2017 Internet Trends report that showed the percentage of health care expenditures in various countries that were paid out of pocket. Barely 20% of health costs in the United States are directly borne by the patients that receive the treatment. In Mexico and India it is around 90%. In China it is over 70%. In the U.K. and Germany it is over 50%.

In the United States someone else is usually paying the medical bill and it should be predictable what the effect on costs that will have. Very few will not want to expend effort and every dollar for their care or for that of a loved one.

Health. Our wealth also is affecting our health. Too many Americans eat too well and exercise too little. That combination takes a toll on longevity. You can have the greatest health system in the world but outcomes are going to be dependent on the conditions of the patients.

This particularly true for older Americans. One global study found that 68% of elderly Americans had two or more chronic conditions. The next highest country in the world, Canada, had 56%. In the U.K. it is only 33%.

It is not much different in looking at inner city schools. These schools generally are spending enormous sums of money compared to rural districts. However, the outcomes of the inner city schools are generally vastly inferior to the rural districts that are spending far less money. A lot has to do with the students they get coming into their classrooms.

Outcomes are heavily dependent on inputs ---in education...and in healthcare.

If you don't think that wealth affects health, take a look at this graph that I recently came across that shows global cancer incidence and mortality by region.

What I found striking in looking at cancer incidence is that the highest rates of cancer are all in areas that are generally the wealthiest parts of the globe. Cancer incidence is lowest in those areas which are the poorest.

For context, here is a map that groups countries by how advanced their economies are.

There is a direct correlation. In every advanced economy, cancer rates are high. In every low-income economy cancer rates are low.

Of course, as you might notice, the survival rates are much, much higher in the advanced economies and they are very, very low in the low-income economies. The end result is that deaths from cancer are remarkably consistent across the world although the incidence of the disease varies greatly. The incidence of cancer in North America is 3 times that of South-central or Western Africa but mortality is about the same.

All of this comes into better focus when it is considered how much of health care is spent in the United States on the elderly. Despite the higher overall per capita cost of health care in the United States, costs up until the age of 55 are about the same as in other countries. Our costs explode beginning at age 65 when Medicare takes effect. Therefore, the entire difference in our higher per capita health care costs are due to vastly higher costs for the elderly.

This chart, that was originally developed by Carnegie Mellon University professor Paul Fishbeck, compares our per capita health care costs by age to Germany, UK, Sweden and Spain. It graphically demonstrates this reality. It was also prepared before Obamacare took effect meaning that we may have actually be in worse shape in the younger age cohorts than we were before.

Liberal progressives argue that we need to move to a Medicare-for-all approach to lower our costs. They argue this would lower costs-especially administrative costs. However, this data suggests that the costs for the elderly---primarily covered by Medicare in the U.S.--- is exactly where we are most out of sync with the rest of the world.

This should raise concerns that turning more of the health care system over to the federal government (via Obamacare or anything similar) may be a path to further worsening our health care cost situation, not improving it.

All of the above should provide you with a better perspective of why the United States has higher costs than than rest of the world.

As you can see, it is a multi-dimensional problem that is extremely complicated. There is no easy answer. In fact, everything suggests that the problem will get even worse no matter what the policymakers do. Every factor above is trending against controlling health care costs.

More and more medical technology becomes available everyday. Americans have rebelled against every attempt to limit choice in selecting doctors, hospitals, etc. Americans are getting older. Americans are not getting any healthier and the United States still has more money to spend on healthcare than any other country. Attempts to control costs are akin to trying to change course heading into a Category 5 hurricane.

What can be done?

I guess the simplest answer is the one that the "sustainability" lobby is promoting today as the best way to save the planet from climate change. It is argued that this would have the biggest difference in saving the planet from carbon emissions.

Don't have a child.

The same is obviously true for health care.

No child means no health care costs for the birth of that child. It also means that child will never have any health care costs. And there will be no health care costs for their children and grandchildren.

Problem solved.

Solutions are so easy in the liberal mind.

Friday Favorites-Fixing Health Care

There is one thing that both Republicans and Democrats agree on.

Health care coverage in the United States is unaffordable.

However, neither party seems to have a good prescription on how to deal with it.

The Democrats think that having the government paying more of the cost and controlling more of the care will solve the problem.

That led to the misguided Obamacare bill that has proven to be nothing short of disastrous.

It is unclear at this point what the GOP thinks should be done. Some Republicans want to just repeal Obamacare. Some want to replace it. Some want to revise it. However, I have not seen anyone argue for attempting anything revolutionary regarding healthcare as I suggested last March.

That blog post was the most popular piece I have written this year in terms of views. It must have struck a chord somewhere.

Since the U.S. Senate is at a standstill in its health care discussions, I thought it might be worth revisiting that post as a Friday Favorite. Feel free to forward to your favorite Senator.

My suggestion for a broad-based tax to finance the cost of the catastrophic coverage would include some type of import or border tax. If we are going to allow imports access to our market it is reasonable that they should help bear some of our social costs. This also has the advantage of being very consistent with President Trump's economic policies.

If he wants to truly "Make America Great Again" what could be better than a universal health care plan that is paid for by a tax on imported goods?

In the words of our President, "It would be YUGE" and "It would be BEAUTIFUL."


Revolutionary Replacement
(originally published 3/9/17)

I was an early critic of Obamacare and have also been very skeptical of Republican efforts to repeal and replace the law.

How can I be so critical of Obamacare but also so skeptical of GOP efforts to repeal it? I might add that I have become even more skeptical of the efforts at repeal since I have seen the GOP bill that would attempt to do so.

I wrote a blog post in 2013 before the Obamacare law became effective that predicted its failure due to its neglect of the realities of the health care cost curve.

Until we recognize the reality of the health care cost curve, the fact that many people will avoid paying for health insurance on their own, and the failure to align incentives and penalties, we will continue to be frustrated with the costs and consequences of our U.S. health care system. Instead of improving a bad situation, Obamacare is only going to make a bad situation even worse.  It's in the curve.  If we really want to do something about health care in this country, we need to first consider the curve or we will continue to see bad consequences.

What is the health care cost curve?

This is a graphic depiction of it from that blog post. The absolute dollar numbers are a little dated but the distribution of the costs across the population are true year after year.

I administered large self-insured corporate group health plans for over 20 years and the same distribution of costs is found in any large group.

The reality is that most people have very little in healthcare costs in a given year.  A handful of people will have enormous costs.  A few will have very large costs.  The majority will have almost no costs.

For example, the bottom half of a population will only consume about 3% of the costs of the group.

The top half will consume 97%.

The top 5% will consume 50% of the total health care costs.

The top 1% will consume 20% of the total costs.

This is why most people will gamble if left to their own devices if they are faced with expensive health care insurance. They will simply not part with their money today against the chance that they might get sick tomorrow. That is basic human nature.  Live for today and think about that other stuff tomorrow.

In fact, most people will pay no more than 20% of the true cost of health insurance without showing significant resistance to its cost. It is not a coincidence that many corporate plans (and even Medicare Part B premiums) charge 20% of the full cost of premium to the enrollee.

This is why Obamacare failed to attract the young and healthy to its risk pools. The insurance costs too much (even with generous subsidies) for the young. In fact, almost every Obamacare enrollee is getting substantial subsidies. Total cost last year= $56 billion and people still complained about the cost. Of course, Obamacare made the insurance even more expensive for this group by mandating all sorts of costly benefits while also requiring premiums for older, sicker Obamacare enrollees to be no more than 3 times the cost for younger enrollees. The actuaries would set that number at 5 times.

On the other hand, Obamacare was a great deal for the 5% or 1% who consumed most of the healthcare. And they made it even easier by allowing those people to wait to enroll until after they got sick with very limited penalties.

The GOP effort will not be materially different from what I have seen. It will improve some things at the margins but it is still not considering the health care cost curve and its consequences in its design as well as aligning incentives in relation to human behavior.

What type of plan should the GOP consider? It needs to be revolutionary and it probably has to go where the GOP would not be expected to go by proposing an across the board tax to fund some of the costs.

It starts first with the concept of the federal government assuming the role of providing some level of catastrophic insurance or being the reinsurer for private carriers for those with large claims costs. In effect, you take 20-50% of health care costs and you fund them nationally.

These are costs that anybody in our society may have to shoulder and almost no one is able to do so without some type of insurance coverage.They become costs by and for the "public welfare".

That federal coverage might attach at a level of $100,000, $250,000, $500,000 or some other level of claims in one year by one person. Private coverage would only have the liability up to that amount. It is a cost/benefit question of where you set that level and how much revenue is needed to fund this cat coverage.

Due to the fact that this type of coverage would benefit everyone it should also be financed by a general broad-based tax. That is the only way to do it if we want some type of universal health care coverage.  Everyone should contribute to the cost of the coverage as everyone has the potential to benefit. In this way it would be much like Social Security and Medicare. This avoids the problem of people deciding they will not buy the coverage on their own. They will be automatically enrolled in catastrophic coverage where the costs can most affect the risk pool for the rest of us. (see the cost curve above)

If it is desired to provide coverage for routine medical care it should be done with some type of health savings account amount that would be provided to everyone annually. For example, $500 per year that could be used for routine care and which could be rolled over to subsequent years if it was not used. This provides an incentive for people to use their health care money prudently.

Private insurance would only be used to fill the gap between the annual amount and the level of catastrophic coverage. This should bring the cost of insurance premiums down significantly.

Private insurance could also be used creatively to fill that gap. Some plans might offer comprehensive coverage which would be very expensive. Some might offer very limited coverage and be cost effective. There could also be income-based deductible plans to benefit the poor or the federal catastrophic coverage could have lower attachment points for those with lower incomes to lower the gap insurance coverage costs for these groups.

If you don't think this would have a large effect on insurance premium costs consider my personal experience in shopping for health care coverage for Mrs. BeeLine who needed a short-term policy for less than 6 months between expiration of group coverage and the start of her Medicare coverage.

An Obamacare policy for her cost $805/month. A catastrophic plan with a $1 million limit (still generous for 6 months) cost $173/month. A big difference in the cost is that open ended cost liability that the carrier assumes. Of course, Obamacare regulations under the Obama administration made it illegal to buy the limited plan even though it perfectly fit my wife's needs. The irony is that the "catastrophic" plan actually had a lower deductible and out of pocket costs than the Obamacare plan. That is how bad Obamacare really has become.

Private insurance would not be required but those who used healthcare services and could not pay due to failure to have health insurance, the federal government would enforce payment through liens on future pay (or federal benefit payments). Such payments could be enforced up to a healthy percentage of an individual's future income or benefits. This would be a necessary penalty to insure there was an incentive to buy insurance currently.

Obamacare is not structured anything like what I am suggesting and the GOP should not be trying to fix it with anything resembling it. It will be nothing more than Obamacare Lite as many are already calling it. The GOP should truly be repealing and replacing it.

Obamacare is the opposite of what a well thought out national health care policy should be in almost every respect. It assumes that healthy people can be convinced to voluntarily sign up and pay for health insurance. This has proven to be a fallacy.

It tries to focus coverage on low end services by providing a lot of free stuff like preventive exams, contraception services and the like.

It does not use a broad-based tax but rather taxes select people or groups (medical device manufacturers, high incomes etc) to fund the free stuff making it nothing more than a gigantic redistribution scheme.

It does not do anything to try to align incentives to make sure people have some "skin in the game". In summary, it has done very little to address the biggest problems in health care---high costs, affordability and access.

There is a way to repeal and replace Obamacare.

A revolutionary plan along the lines I am describing has some elements that both Republicans and Democrats should like. There are also elements that both would dislike. That tells me that it is probably a sensible replacement approach.

It just will take some revolutionary thinking to do it.

And some political fortitude.

Unfortunately, neither seem to be in evidence in Washington today from what I can see.

Gender Studies?

Colleges do a lot of things today that make you wonder what has become of education.

I can think of no better example than the "Gender Studies" major.

What exactly does a student majoring in "Gender Studies" do for a living after they graduate?

Don't get me wrong, there is a lot of value for anyone in understanding the differences between males and females. These differences have confounded men and women from the beginning of time.

We interact every day of our lives with people we do not fully understand. How much easier life would be if we had better insights on the differences in gender?

Are men really from Mars and women from Venus?

However, Gender Studies in colleges and universities seem not to be interested in teaching the differences in gender but seem more intent on political and social statements or pretending that gender is just a name---and not science.

For example, here is how UCLA describes its Gender Studies department.

The Gender Studies department provides a quality education that emphasizes analytic and writing skills, qualitative research methods, and a historical and transnational understanding of social inequalities. Our faculty integrate feminist pedagogical approaches and their own research into their teaching. Our core courses address the concepts of gender and the body, gender and power, and gender and knowledge through a range of topics such as freedom and liberty, social movements, masculinities, work and leisure, politics of social justice, intersectionality, colonial and sexual violence, and visual culture and citizenship.

Incredibly, there are 250 students majoring in Gender Studies at UCLA according to its website.

Count me as one parent that would not like to be paying the tuition bills for that course of study for my child. Of course, I am on the hook for it whether I like it or not, as is every other American taxpayer, in the form of federal student loans that now total over $1.4 trillion.

Meanwhile, the University of Tennessee, has encouraged all of its faculty and students to stop calling each other "he", "she", "him" and "her".

The preferred pronouns?  "Xe", "Zir" and "Xyr" !

UT-Knoxville even put a handy conversion table on its website to facilitate the changeover.

If this is the thinking at the University of Tennessee I can only imagine what it is like at Berkeley, Bennington and Bowdoin.

Who are the students majoring in Gender Studies?

You would think there should be equal interest in the subject material if it was a fair and balanced view of gender studies.

However, this picture on the UCLA website of its Gender Studies graduates does not show one male. Gender Studies seems to be nothing more than a cover for Feminist Studies.

Of course, it is not unusual to see women outnumbering men in college classrooms these days. It is a big problem that I have written about previously. An unintended consequence of the dearth of male college graduates (about 6 women graduate from college for every 4 men) is that fewer women are marrying.

What difference does it make whether you both went to college? It becomes important because those who have college degrees tend to make more money. Does a women want to marry someone who makes less money than she does? 

You would think that it shouldn't matter but it seems that it is pretty important.

It seems that there is a gender difference involved. Is this being studied in Gender Studies?

The problem is that even though the world has changed our basic biology and the way the male and female brains are wired has not changed with it. There are primal emotions deep within us that dictate a lot about what we are looking for in a mate.

Many marriage experts will tell you that the most important factor that a woman is looking for in a husband is security. Women want to feel secure that they will be protected and cared for. Men, on the other hand, are looking most for respect. They want to have the respect of their wife.

Do you see a potential problem when the wife is out-earning the husband in the house considering these underlying factors in marriage involving men and women? How does the wife feel secure? How does the husband feel respected?

How are these gender differences playing out in the real world?

It seems that the oversupply of educated women in the world is now causing increasing numbers of women to freeze their eggs due to the dearth of equally qualified men according to a new study which was led by researchers at Yale University.

Researchers found that in more than 90 per cent of cases, the women were trying to buy extra time because they could not find a partner. Experts said the study busted the myth that “selfish career women” were choosing to stall their fertility to prioritize their careers. 

Another subject for the Gender Studies department?

While we are on the subject of how men and women are wired differently, this is another interesting chart I came across recently. Unfortunately, it is small comfort to the unfortunate women who have not been able to find love and are spending thousands of dollars to buy precious time on their biological clock.

It seems that there are huge differences in how men and women view each other.

A big one is that time is more fixed for women. It is much more flexible for men.

These charts put that in context with a large exclamation point. They compare a woman's or man's age to the age of the opposite sex who look best to them.

You can see from the data that women generally find that men of approximately the same age look best to her. They prefer men a few years older when they are younger and a few years younger in later years but there is not a lot of variation from their own age.

Men have an entirely different perspective. I stated above that men looked at time in a more flexible way. I guess it depends on how you define the word "flexible".

Yes, there are real gender differences. It may not be politically correct in this day and age. Our colleges might want to re-label the charts above with with "Xe" or "Zir". However, pretending these differnces do not exist does not make it go away.

Is any of this being studied in Gender Studies?

It's a SNAP!

In 1996, amid predictions of disaster and impending doom from the Democrats, President Bill Clinton signed welfare reform legislation that was passed by a Republican Congress. Liberal groups claimed that the legislation would result in substantial increases in poverty, hunger and other social ills. In particular, they claimed it would result in increased child poverty.

After all, isn't it always about the children when it comes to politicians and social issues?

The proponents of welfare reform were concerned that prolonged welfare dependence had negative effects on society and the development of children. Their goal was to disrupt inter-generational dependence by moving families with children off the welfare rolls through increased work and marriage.

Underlying the welfare reform law was a simple requirement that a portion of the able-bodied adults in the Temporary Assistance for Needy Families (TANF) program needed to work or prepare for work if they wanted to receive welfare assistance. Welfare was not intended to be a lifestyle. It was designed to allow someone to build a bridge to a productive life.

After welfare reform was enacted a miraculous thing occurred. More people that were on the TANF program started working and fewer people stayed on welfare. Welfare rolls were cut in half over the next decade and the poverty rate for black children reached its lowest level in history.

The Great Recession blunted the advances that were being made in confronting the inter-generational dependency on welfare only to have President Obama fully gut all that progress by jettisoning the law’s work requirements in 2012 by bureaucratic order.

Is it really the Democrat party anymore? Or has it just become a Dependent Party?

I wrote in April about how Maine is once again enforcing a work requirement on able-bodied adults in order to receive food stamps (officially called the Supplemental Nutrition Assistance Program (SNAP).

What happened once Maine starting enforcing the rule this year?

75% of these people decided that the idea of working, getting trained or volunteering was too much effort to expend to continue getting food stamps. Maine had 12,000 such individuals receiving food stamps at the beginning of the year---it now only has 2,680 as of the end of March.

Maine is a small state. Georgia is a much bigger state. It has recently started rolling out a similar program.

The blog Political Calculations tells the story of what happened when Georgia ran a simple social welfare experiment in selected counties in the state beginning last year.

The result---200,000 individuals dropped out of the food stamp program in just one month after the work requirement was instituted!

Earlier in 2017, the state of Georgia ran a social welfare experiment, which resulted in the state decreasing the number of welfare recipients enrolled in the state's Supplemental Nutrition Assistance Program (SNAP) by over 200,000 individuals in a single month.

Georgia's secret? Back in January 2016, the state launched a pilot program in three of the state's counties requiring all able-bodied food stamp recipients without children to find work or lose their SNAP benefits. In August 2016, the state expanded the program to 24 counties, and also set a hard deadline of 1 April 2017 where all childless, able-bodied SNAP beneficiaries in these counties would become ineligible for the state's food stamp program unless they were employed.

Perhaps the most remarkable aspect of the data is the sheer drop in enrollment levels in the month before the hard deadline came and went, where if jobs were truly hard to obtain for the affected SNAP benefit recipients, we should have seen the enrollment levels stay elevated through March 2017 before seeing such a sharp decline resulting from their loss of eligibility. It also far outstrips the state's previous experience in enforcing work requirements in its food stamp welfare program to reduce its welfare rolls, which came as part of the 1996 Welfare Reform Act.

Notice how the food stamp rolls declined right after the 1996 Welfare Reform Act only to start to climb after the 9/11 economic effects followed by the disastrous Great Depression of 2008-2010. You can also see that the food stamp rolls looked like they might be ready to level off in 2012 right before the Obama administration changed the work requirement rules. From that point forward, another 250,000 people went on food stamps in Georgia until it topped out at 2 million in 2014.

Let's put that 2 million number in context. The city of Atlanta has a population of around 460,000. At one point in time, 4.5 times the number of people who live within the city limits of Atlanta were on food stamps in the state of Georgia. That is about 1 of every 5 people in the state of 10 million. Over 5 million live in the Atlanta metro area.

Removing over 200,000 people from the food stamp rolls in a single month by just asking able-bodied people without children to work to receive the benefit says a lot about the need to carefully consider how we structure our social welfare programs.

The money also adds up. The reductions in the numbers of those on food stamps in Georgia from its height in 2014 to where it is today equates to annual savings of $671 million to taxpayers.

Human beings respond to incentives. If you doubt it, look at the chart above one more time.

We quickly understand what is in our interest and what is not, and we respond accordingly. We will act in accordance with what is in our best interest. Period.

Incentives drive the world. If the incentives for people are properly aligned, you will get the result you want. If the incentives are not properly aligned, you will get poor results.  Whenever you get a poor result it is likely that you will find that the underlying incentives were not aligned properly.

When we start studying the incentives that drive people, and develop public policy around that reality, the country and world we live in will be a much better place.

When you get it right, it's a SNAP!

Maine and Georgia seem to be on the right track.

Parents Are The Problem?

There was an interesting column by David Brooks in The New York Times recently on the topic of "How We Are Ruining America."

According to Brooks, those that are ruining America are the members of the college-educated upper middle class who have become parents and are now in the process of ruining America by dedicating their lives to insuring that their children also have the opportunities to succeed.

He is not happy with the so-called "behavior codes" that these parents are embracing "that put cultivating successful children at the center of their lives."

Excuse me?

I thought the core idea of parenting was to exhibit behavior codes that are intended to cultivate successful children.

Brooks questions it all. He seems to see it as a crime that parents are involved and want to invest in their children.

As soon as they get money, they turn it into investments in their kids.

As life has gotten worse for the rest in the middle class, upper-middle-class parents have become fanatical about making sure their children never sink back to those levels, and of course there’s nothing wrong in devoting yourself to your own progeny.

Nothing wrong with it? I would think most people would say that there is everything right with.

If Brooks left it like this it would be bad enough. However, he takes it a step beyond and makes the argument that successful college-educated parents are actively working to make sure that "children of other classes have limited chances to join their ranks."

I am not sure how that squares with his argument about how important "behavior codes"are in bringing up children.

Aren't there both positive and negative behavior codes?

Is it the fault of a parent with positive behavior codes that another parent has negative behavior codes?

Brooks seems to be another progressive, liberal that wants to find fault with everything and everyone but those who actually should be accountable.

Exhibiting the right behavior codes has little to do with how much money or education one has. I have known highly educated, wealthy people who were terrible parents and their children proved it.

On the other hand, I have known people who did not have two dimes to rub together who nevertheless exhibited great behavior codes and also had the children to prove it.

It used to be that almost every parent's dream was that their children would have more opportunities than they did. This was particularly true for generations of immigrants and poor families. Brooks suggests that zoning restrictions, poor inner city schools and college admission policies today make that impossible today.

There have always been rich neighborhoods. Inner city schools have better funding than ever before. Look no further than the District of Columbia. Federal student loans are readily available for almost everyone who wants to go to college. That was not the case for my father and grandfather.

I have written before that there is a lot more income and class mobility than is generally acknowledged by members of the progressive, liberal establishment like David Brooks.

For example, children born in Houston, Texas (considered to be the most ethnically and racially diverse city in the nation) whose parents are in the bottom 10th percentile on income end up, on average, in the 38th percentile by age 30. 22% of the poorest end up in the the top 20% of income earners. 42% are in the middle class or better. That seems to contradict the basic thesis of Brooks that the poor are being kept down.

On the other hand, despite the best efforts of their upper class parents, children with parents in the upper quintile do not automatically get a free pass to stay on top. On average, only about 35% of children raised in households in the top quintile enjoy the same income lifestyle as their parents when they are adults. This chart (published in a New York Times story on the study) shows the chances of someone raised in both the bottom fifth and top fifth ending up in the top fifth as an adult.

It makes you wonder if progressive liberals like Brooks read the New York Times that they are writing for?

I could also not help thinking of the Brooks column as I watched the U.S. Women's Open this weekend that was played at Trump National Golf Club in Bedminster, New Jersey.

Notice the final results.

There was not one American in the Top 10. Nine of the top ten finishers were Asian---eight were South Korean.

It looks a little bit like the finalists in the U.S. Spelling Bee except they all had parents of Indian heritage in that competition.

Do you think the behavior codes of the parents of these players might have something to do with this? I have to think these parents dedicated their lives to insuring that their children would succeed at the game of golf.

As well as the behavior codes of the young ladies who practiced, persevered and prepared for the thousands of hours it took to get their games to this level.

I guess Americans need to take those South Korean parents to task for actively working to make sure that "children of other classes countries have limited chances to join their ranks."

I will wait for the Brooks column on that subject.

The Socialist State of Seattle

CNBC just named the state of Washington as the top state for business in its annual scorecard on state economic climate.

Based on what is going on in the state's biggest city, Seattle, you have to wonder how much longer Washington will maintain that status.

Seattle's city council unanimously (9-0) passed an income tax of 2.25% on total income recently on individuals with more than $250,000 per year in income and married couples of $500,000 per year. The income tax will apply to no one else. Just the "rich".

This comes on the heels of the Seattle city council increasing the minimum wage in the city beginning in 2014 from $9 in stages to the progressive dream of $15 per hour. The minimum wage was first increased to $11 per hour and in January, 2016 was upped to $13 per hour. It is now at $15 per hour for large employers. That rate will eventually apply to all employers.

The early reports are in and, like many progressive ideas, the measure seems to be hurting those it is supposed to help. Workers in those low wage jobs saw have seen incomes fall (due to reduced hours) according to a recent University of Washington study.

In case you are curious, this is the political affiliation of the Seattle city council.

Credit: Wikipedia

In addition to the income tax and minimum wages increases, the city council has also passed a couple other prized progressive policies---a soda tax and a "secure scheduling ordinance" which mandates that employers set their employees' schedules weeks in advance and penalizes companies for changing them.

You may not be familiar with the platform of the Socialist Alternative party that Council member Sawant is affiliated with. Wikipedia describes it as "a Trotskyist political party active in the United States" which describes itself as "a national organization fighting in our workplaces, communities, and campuses against the exploitation and injustices people face every day".

A few of the issues that the Socialist Alternative Party is interested in per Wikipedia.

• The party advocates nationalizing the top 500 corporations and banks within the U.S. economy and running them under the "democratic management of elected representatives of the workers and the broader public."
• The party advocates for creating "living-wage union jobs for all the unemployed through a massive public works program to develop mass transit, renewable energy, infrastructure, healthcare, education, and affordable housing."
• The party wants to replace all health insurance companies with a publicly funded single-payer system.
• The party wants the federal government to bail out states in order to prevent cuts and layoffs. It seeks a massive increase in taxes on the rich and corporations.
• The party wants to raise the federal minimum wage to $15/hour, adjusted annually for cost of living increases and regional differences, as a step towards a living wage for all.
• The party seeks to repeal all "anti-union" laws. It advocates for democratic unions run by union members in order to advocate for better pay, working conditions, social services. The party advocates for full-time union officials to be regularly elected and receive the average wage of those they represent.
• The party wants to establish a guaranteed living wage pension.
• The party wants to shorten the workweek with no loss in pay and benefits and to share out the work with the unemployed and create new jobs.

How long would Seattle and Washington be considered a wonderful place to do business if this platform was put in place?

Credit: Seattle Times

There is one big problem with the Seattle income tax ordinance.

It is totally and utterly unconstitutional and illegal based on fair reading of the Washington state constitution and state statutes.

First, the city has no grant of authority from the state to enact an income tax. Cities are granted powers by the state. There is no power for Seattle enact a tax on its citizens without that authority.

It is important to also point out that Washington has no state income tax to begin with. In fact, voters in Washington have voted against implementing a state income tax seven times! It was last rejected in 2010 with 66% of state voters against the measure.

Do you think that having no state income tax might also have something to do with the state's favorable economic climate in the CNBC survey?

Further, a 1984 state statute prohibits a county, city, or city-county from levying a tax on net income.

The proponents of the city income tax argue that it is taxing "total income" rather than "net income". That is a distinction without a difference. The practical effect is the same for most taxpayers as city income taxes generally do not allow itemized deductions anyway. However, in taxing "total income, Seattle also must intend to not allow any above the line deductions for sole proprietors. This means that they will be effectively taxed on gross revenues without any deductions for costs of goods sold. 

How would you like to be a Subway franchise owner in Seattle and not be able to deduct the salami you put on a sandwich you sell or the $15 minimum wage you pay your worker to do it?

The income tax on the rich runs further afoul of the state constitution in that it declares that "all taxes shall be uniform upon the same class of property." The Washington Supreme Court has consistently ruled that income is property. Therefore, a tax that levied only on a small group of individuals is not uniform and is not constitutional.

Why would the Seattle city council pass legislation when they clearly have no authority to do so?

It is a typical strategy from the liberal, progressive playbook. You don't work to change state law or the state constitution if it stands in your way. That is too hard, requires too much work and takes too long. 

You pass something that is clearly illegal but look to find one, two or five judges somewhere to rule that it is. It is that simple.

Here is how Socialist Alternative Party Council member Sawant defended the Seattle income tax vote in a recent tally with supporters according to the Seattle Times.

“When we fight, we win!” they chanted with Sawant, who said more public pressure may be needed.

“If we need to pack the courts, will you be there with me?” she asked.

Notice that there is nothing in her rhetoric to change state law. Rather than trying to pack the voting booths in the state she merely wants to pack the courts with her supporters to intimidate the judiciary.

The socialists in Seattle believe that the constitution is for chumps.

Amazon Prime Day

Black Friday (the day after Thanksgiving) has traditionally been considered to be the biggest retail shopping day of the year.

Amazon seems to be intent on giving Black Friday a run for its money with its Prime Day (July 11). However, it actually begins at 9pm EDT tonight to make it a 30 hour Prime Day.

Prime Day is basically a Cyber-Monday-in-July sale that promises extra savings over and above Amazon's usual discount prices. There are many special deals throughout the day so you are best advised to check back to the site often during the day.

In order to take advantage of Prime Day deals, you must be an Amazon Prime subscriber.

At one time that might have been an obstacle for many American shoppers. That is no longer the case.

79 million American households now have an Amazon Prime membership. It is expected to reach 85 million by year-end.

Let's put that in context. There are only 90 million households that are hooked up to cable tv. Total U.S. households are 125 million. That means about two out of three U.S. households have an Amazon Prime membership today.

Credit: 13D Research

Consider that in 2010 Amazon Prime membership was a mere 10 million households. Two years ago it was about half of what it is today.

The regular cost of a Prime Membership is $99 per year. That means that Amazon is bringing in around $8 billion in revenues just from its membership fees! That pays for a lot of free shipping.

Those memberships also translate into more sales. GeekWire reports that the average Prime members spends $1,300 per year on the Amazon site compared to $700 for non-members.

What effect is this having on retail in the United States?

A lot.

Credit: MKM Partners

And it is sure to get much worse for bricks and mortars retailers.

In particular, it is going to get much, much worse for the owners of the real estate of those retail stores.

There is no place that the risk of owning retail commercial real estate is higher than in the United States. It has more than 3 times the square feet per capita of retail space than countries like the U.K or Japan, 15 times what Germany has and 60 times what China has.

Credit: Zero Hedge

Happy Shopping!

Go here for your Amazon Prime Insider Guide for all you need to know about shopping on Prime Day including how to initiate a 30-day free trial if you are one of the disadvantaged 1/3 of all U.S. households (like me) who does not have a Prime membership.

Trump and Trade

President Trump has recently returned from the G-20 summit in Hamburg, Germany.

The anti-capitalist protestors called it "Welcome to Hell". I guess they have not visited North Korea or Venezuela recently.

They actually seemed to create "Hell" with their presence in Hamburg.

Donald Trump made the trade imbalance of the United States a major issue in the campaign. He stated that the United States was being particularly disadvantaged in trade with China and with the NAFTA countries of Canada and Mexico.

What are the facts?

I came across the chart below in an article previewing the major issues at the G-20 summit by Stratfor. It shows the trade balance that United States has with each member of the G-20.

It puts the trade issues in context. I think it also shows that Donald Trump knows what he is talking about irrespective of the talking heads on the network and cable news who try to minimize him at every turn.

Does this look like the United States is "winning" when it comes to international trade?

A few observations.

China's $366 billon trade surplus is not a surprise although it is always shocking to look at the numbers. In 1993 the trade deficit with China was a mere $23 billion.

However, look at the numbers with the NAFTA countries-Canada and Mexico. The United States ran an $83 billion trade deficit with those two countries last year.

When Bill Clinton submitted the North Atlantic Free Trade Agreement to the U.S. Congress for approval in 1993 the United States had a $5 billion trade surplus with Mexico. It is now a $66 billion trade deficit. The trade deficit with Canada has grown from $11 billion to $17 billion.

Here is what President Clinton said at the time.

I believe that NAFTA will create a million jobs in the first 5 years of its impact. And I believe that that is many more jobs than will be lost, as inevitably some will be, as always happens when you open up the mix to a new range of competition.

NAFTA will generate these jobs by fostering an export boom to Mexico, by tearing down tariff walls which have been lowered quite a bit by the present administration of President Salinas but are still higher than Americas'.

Looking at the numbers above and knowing what has happened to U.S. manufacturing jobs over the last 20 years, has NAFTA been anything close to what we were told it would be?

When Mexico also has a $66 billion trade surplus with the United States, don't you also think that Trump has a little leverage when it comes to who will pay for the wall he wants to build?

I also found it interesting from the chat above that the United States actually ran a trade surplus with Saudi Arabia last year. In 2008 the United States had a trade deficit of $42 billion with the Saudis. Imports from Saudi Arabia dropped from $55 billion to $17 billion in a span of eight years. Can you say fracking? Williston Basin? Permian Basin?

There are many who continue to argue that Trump's statements and positions on trade are irresponsible and could provoke a trade war.

However, if you look at the chart above, who has more to lose? The reality is that our trading partners have far fewer options when it comes to their economy than does the United States in any altercation involving trade.

What is most interesting is that a recent study suggests that Trump's aggressive statements about trade might actually be working to benefit the United States while also actually leading to more free trade.

HotAir.com has the story.

The Center for Economic Policy Research in London has just reported that the other 19 G-20 economies took 52 steps against United States commercial entities in the first six months of this year.

And that, the Center reports, is — wait for it — down 29% from the first six months of last year when someone, let’s say, more aloof and less outspoken was president of the United States. These actions against U.S. interests include quotas, duties and tariffs on imports from the U.S., measures against dumping and tax incentives for exporters that could adversely U.S. companies.

Simon Evenett, one of the authors of the Global Trade Alert and a professor of economics at Switzerland’s St. Gallen University,  puts it this way:

“The G20 countries that had hit U.S. interests more often before President Trump was elected are the very G20 countries that have cut back on protectionism the most in 2017,” said . “Why should [they] do that unless they feared being singled out for retaliation?”

Evenett thinks such countries have gotten the tougher message out of the new Trump administration.

“It is actually possible,” added Andrew Kenningham of Capital Economics, “that rather than prompting a global trade war, Trump’s rhetoric and policies may have little effect or even lead to more free trade.” 

It does not get much worse for Trump's critics than that.

We often hear how much they fear Trump and his policies.

However, as I wrote shortly after Trump was elected, the biggest fear that the Democrats and Never-Trumpers have is not that Trump will fail---it is that he will succeed!