Voter Mistake: Overestimating the Power of the Presidency
It is true that the presidency has tended to become more powerful over time, but it is by constitutional design and accumulated procedures a position of influence more than power.
Except for the role of "commander in chief of the Army and Navy," the power to "grant reprieves and pardons," and "the power to fill up all vacancies during the recess of the Senate" (and these expire at the end of the Senate's next session), the U.S. Constitution gives the president no unrestricted powers.
The description of the president as the "most powerful man in the world" is probably related to his role as commander in chief, specifically with his not inconsiderable power to command the firing of nuclear weapons. No small thing, admittedly, but it is a power that would be cold comfort if used. Very cold.
A key characteristic about the presidency is that the U.S. president is both "head of state" and "head of government." In a constitutional monarchy such as the United Kingdom, the head of state is the king/queen and the head of government is the prime minister. In such countries, the prime minister is far more powerful than the U.S. president, at least if her party has a parliamentary majority. In modern parliamentary systems, where there is no king or queen, a "president" fills the head of state role in a ceremonial fashion, perhaps asking the head of one of the parties to fill the prime minister role and form a government. If the prime minister can form a government without resorting to a coalition, she has much more direct power than the president.
As Republicans have proved in the past six or eight years, the real power in the government, however unwieldy, is found in the Congress, which itself is checked both by its own bicameral structure and the power of the president to veto bills. In that sense, the president has some limited negative power over Congress.
The tendency of people to think and vote as if the President of the United States is the most powerful leader in the world, guarantees disappointment. The President cannot possibly live up to the messianic expectations of the electorate
—unless of course the President is the Messiah.
The electorate should vote for the president, of course, but it should pay more attention to Congress, which means paying attention to the mid-term elections as well as the presidential-year elections. One of the parties, the Republicans, seems to understand this. The Democrats do not.
The president, in his role as head of state, is a readier symbol for the people to hold onto than the arguably more powerful speaker of the house and thus commands more attention and influence. But power? Nah, unless he drops that bomb. Wile E.
Government: Lincoln's Vision
"... we here highly resolve that these dead shall not have died in vain -- that this nation, under God, shall have a new birth of freedom -- and that government of the people, by the people, for the people, shall not perish from the earth."
- Government of the people: While England itself had a constitutional monarchy, with a functioning representative body called the Parliament, its colonies had no representation. They were at the mercy of whatever Parliament--or the King--wanted to do. Taxation, under these circumstances, felt especially onerous.
- Government by the people: While government workers in England were fellow citizens and neighbors, governors and other representatives of the Crown, were appointed by and came from England.
- Government for the people: While Parliament tended to make legislation with the citizens of England in mind, this applied equally well to any legislation that impacted the colonies. Such legislation was made for the benefit of England.
- Government of the people: The people (or at least white men) within the united states would vote to determine their temporary representatives and administrators
- Government by the people: Government officials--administrators, employees, representatives, judges--employees would come from the pool of local citizens. They would be neighbors, insiders not outsiders.
- Government for the people: The purpose of government would be to serve the people, not the English crown or any other outside group.
We're Back: Topics to Come
- Government: Lincoln's Vision
- Government of the People: We Have Met the Enemy
- Government by the People: Our Neighbors
- Government for the People: Who's Your Customer?
- Taxes: The Necessary Good
- Spending: The Other Necessary
- Debt: The Good, the Bad, and the Ugly
- The Earth: Sustainability Isn't Good Enough
- A Principle: We Are in This Together
- A Principle: Look for the Optimum
- A Principle: Ideology Is for Sissies
- The New Democracy: One Dollar, One Vote
- Social Security: The Big Easy
- Medicare: The Hard Truth
- Health Care: Pay to Stay Well
- Infrastructure: Our Strength and Vulnerability
- Higher Education: Stratospheric Debt
... And more. See you around. Wile E. Wonka
Why the Government's "Strings Attached" Bailout Is Working
Let's Get Away from Employer Provided Health Insurance.
- Keep the government out and let it happen (because it will). This emphasizes individual responsibility abd is a libertarian, almost Ayn Rand approach.
- Get the government in, big time.
The most radical approach--a single payer option--would relieve business of the need to provide health insurance benefits. While the costs of such a program should give everyone pause, it would be a boon to a U.S. business.
A more conservative approach could also be used to move the country away from employer provided insurance (where it is going away anyway). Some ideas that have been proposed and on which there is fairly widespread agreement.
- Allow individuals to shop for insurance coverage all across the country. This increases insurance competition and would reduce insurance rates some.
- Allow individals to buy health insurance with pre-tax dollars, which would put them on the same playing field as workers who get tax-free health insurance from their employers. (The negative version of this is treat employee benefits as income and tax them.) This is only fair--and should encourage people to buy their own health insurance.
- Force insurance companies to cover pre-existing conditions, with some controls designed to prevent people from dropping insurance to save money and coming back in to gain coverage for serious medical conditions. This would essentially create a national "group," which reduces the value of employer-provided coverage and increases the value of indivudal coverage.
- Institute an "individual mandate," similar to the individual mandate for auto insurance in many states. Individuals would have to carry insurance or pay an income tax penalty. (Do not, on the other hand, institute and employer mandate.)
- Emphasize catastrophic/Health Savings Account insurance at reasonable rates. These plans are cheaper because they are true insurance plans, protecting against catastrophe, instead of pretending to cover all health issues. Their high deductibles force individuals to either get gap insurance (an option), to shop around, or just to be more responsible for their own basic maintenance.
If Congress Fails to Pass a Health Plan ...
It's already happening. Employer provided health insurance is just too expensive. Small businesses haven't been able to afford it for a long time. They pay high rates--double, we discovered when we were in business--what you can buy as an individual. And the rates have been going up dramatically every year. If you think large corporations are going to be able to continue providing coverage, think again. Chrysler and General Motors went into bankruptcy, largely because of huge legacy costs generated by their commitments to worker/retiree pensions and health care.
Even when companies continue to offer health insurance, workers and would-be workers are at risk, especially older workers too young for medicare. If you're 50 to 65, watch out. You'll be first in line to be laid off and last in line to be hired--precisely because you are too expensive to be covered.
While this is painful, it may not be entirely bad in the long run. Our reliance on "benefits" has had some unfortunate consequences.
- Workers are insulated from medical costs: With health insurance provided for them, workers have no incentive to pay attention to medical costs and every reason to demand the latest and the best medicine has to offer.
- Medical providers are insulated from price pressure: With workers not paying attention, medical providers are free to ratchet up charges, pad invoices, order unnecessary tests, by expensive equipment duplicated in nearby facilities, and so on.
- Insurance companies are insulated from price pressure (sort of): To some extent, insurance companies benefit from the same absence of price pressure as providers. However, insurers are really middle men who pass on the costs in the form of insurance to companies and individuals.
Employer provided health insurance has other consequences.
- People think employers must provide health insurance. Why? Do employers provide auto insurance? Or home insurance? Or long-term care insurance? Why is it their business? Why is a good thing? Does it make a business a better business? Does it help a company serve its mission? Does it make a company more competitive, especially in the global market where health insurance is either not provided at all or provided by the government?
- People think they must work for a company that provides health insurance. In setting this as a priority, they often wind up working for a company they don't like in other respects doing work they hate, and generally limiting their options.
In another post, we'll talk about what we might do instead. Wile E.
Focus on the Good News.
- Durable goods orders increase: The Commerce Department reported that orders for durable goods--manufactured products expected to last at least three years--increased 3.4% last month. This was the first advance in six months. Most of the increase came from orders for military aircraft and parts, machinery, computers, and fabricated metal products. (3/27/2009)
- New home sales rise: The Commerce Department reported that sales of new homes rose 4.7% in February from a month earlier. In combination with the equally unexpected increase in existing home sales, this means inventories are being drawn down and suggests that home sales are reaching a bottom. Watch for these developments: 1) prospective buyers, thinking the bottom has been reached, will come back into the market in droves; 2) prospective sellers, thinking the bottom has been reached, will remove their homes from the market waiting for prices to increase. With few new homes being built, we could move quickly into a high-demand low-supply situation, in other words a seller's market, precipitating rapidly rising home prices. This would intensify if homebuilders can't get loans from banks and begin adding to the supply of new homes. (3/26/2009)
- Existing home sales rise: The National Association of Realtors reported that existing home sales were 5.1% higher in February than in January, thanks in great part to distressed sales (foreclosures and short sales). Still, the increase was a surprise and good news. It means that existing house inventories are being drawn down, which is necessary for the market to bottom. In the meantime, savvy buyers are getting sweet deals. (3/23/2009)
- Suddenly, banks are in the black: Citigroup CEO sparked a stock market rally when he announced that the company had made a profit in the first two months of the year, its first in 15 months if it holds up. A day later, JP Morgan Chase reiterated that it had made a profit in the first two months of the year. Wells Fargo has said its results for the two months were strong. (Colorado Springs Gazette, 3/12/2009.)
- Jobs are being created: While the recession has claimed 4.4 million jobs, it has created 2 million others, according to government data. While this is a net loss, it's important to remember that jobs are created, even in an economic downturn. At his point, most of the new jobs are in education, health care, and government. However, there are new openings in private industry, especially for highly skilled workers. Engineers and the like. (AP via Colorado Springs Gazette, 3/10/2009)
The Bad Economy Has a Bright Side
- Oil prices have plunged, part one: From above $140 a barrel, they are now below $40 a barrel. This has obvious benefits to the consumer and, according to Economist James Glassman, may function as a $350 billion stimulus package.
- Oil prices have plunged, part two: You know that part about how, thanks to our oil addiction, we send all of our money to people who hate us. Well, the countries that love to irritate us--Iran, Russia, and Venezuela, to name three--aren't getting as much of our money these days. And they aren't quite as cocky.
- Oil prices have plunged, part three: Even though oil prices--and with it, gas prices at the pump--have dropped, Americans are still driving less. That multiplies the above benefits.
- Americans are becoming more frugal: This is exasperating economists and feds who say we need to spend more, but this is not a bad thing. The main reason for the bubble is that we were spending too much, gorging ourselves, and it made us sick. Now we're recovering--we're spending less, saving more, and paying off our bills. Healing is painful, but it is, after all, healing. For the most hopeful view on this phenomenon, visit daveramsey.com.
- We're going to get infrastructure: The perceived necessity of an economic stimulus plan is driving our new president and Congress to come up with a stimulus package that by all accounts will be heavy on infrastructure spending. While there are arguments about how well and how fast infrastructure spending will work as stimulus, it is the pragmatic choice. Unlike just handing out money, which the right favors in the form of cutting taxes and the left favors in the form of doling out checks, spending on infrastructure employs people in real jobs to build real long-term assets for the country. Besides, those assets are falling apart and need fixing.--Wile E.