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May 25, 2005

Future Electoral College Breakdown

Posted by tunesmith at 05:49 PM

Kos has an interesting article about how population growth will change the balance of power among the states in the Electoral College. Seems many of the currently red states will gain power in the E.C., while the blue states will lose power.

Read the Wall Street Journal article he links to, because it answers many obvious questions about it. It doesn't really mean that Democrats are in danger - in fact, it could be a huge advantage to the Democrats, because higher populations usually trend Democratic. If Florida becomes reliably Democratic, then it could be tough for the Republicans in the future. Then again, it might be nothing, because both parties change identities on demand as populations change.

What would be more interesting is to compare the E.C. breakdown in future years with the projected national vote, and see if it becomes even more out of whack. If so, it's yet another reason to expand the number of Representatives in the House of Reps. It would make the E.C. be more representative of the national popular vote.

Update: I don't have time to do it, but here's how it would work. You take a look at the 2000 or 2004 election results. For each state, you find the percentage of total state population that voted for the Republican and Democrat, as well as the number of people who voted, total. You apply that to the 2010, 2020, and 2030 decades to equalize for those reapportionments.

Then for 2000 or 2004, you take the percentage of voters that voted for each candidate, for each state. By applying that to the state's Electoral Votes, you get the percentage of Electoral Votes ("Electoral Power") that each candidate got. By doing this for all states, you can figure out the amount of raw Electoral Power each candidate got. You compare this to the national popular vote to see how out of whack the Electoral College's underlying physics are compared to the popular vote.

Then you do the same for the future decades. When you've finished, you can see how an identical party breakdown compares under different apportionment scenarios. If the split between raw Electoral Power and popular vote is wider in the future, then that's bad news.

May 16, 2005

Scotus Bedfellows

Posted by tunesmith at 03:52 PM

Strange 5-4 decision on allowing interstate wine sales. Majority: Kennedy, Scalia, Souter, Breyer, Ginsburg.

Minority: Thomas, Rehnquist, O'Connor, Stevens.

Update: It turns out that that particular lineup has never happened since this nine made up the Court. Professor Bainbridge has a good examination.

May 15, 2005

Political Blogging Again

Posted by tunesmith at 03:54 PM

Political weblogging is starting to bore me.

People blog because they feel they have something to say. That feeling is driven by two things - a desire to explore their opinions, and a belief that what they have to say is new.

Political blogging was thrilling a couple of years ago, when it was full of discovery of the other communities. Many of us had a hunger to develop our fledgling opinions. The first time I wrote about Iraq, opinions like "reducing our dependence on foreign oil" felt fresh and a bit politically dangerous. We were talking about Congressional amendments and liberals were actually arguing about whether Bush was on the level. Each time we found someone else that agreed with us, or a community that did, it was thrilling. Now we know that Bush had firmed up his Iraq plans three months before that point and was just trying to cynically use Congress and the U.N. to manipulate a justification. Now we have our places to go and reinforce our opinions.

So... the center-left political weblogging group has arrived. It's not so much a matter of firming up opinions anymore. It's more about getting them represented in the popular press.

It's a worthy cause, but I find it tiring. I really don't enjoy writing letters to editors and sending off angry email missives to columnists. I don't enjoy calling customer service departments to complain about things, either. I also don't see it as my calling.

Here's another thing - the rise of large community sites like Daily Kos can serve as a discouragement. You can go over there and find just about any center-left political opinion, repeated infinitely. There's so much reinforcement going on that it can often sound like dogma or rote.

I really hate dogma and rote. In personal situations, I can usually sense when someone says something mindlessly. It usually points to a blind spot.

That's the penalty of too much reinforcement - it actually creates blind spots. It helps people get radicalized.

Occasionally, I'll get drawn into challenging viewpoints that are commonly held on the left. My most recent argument was about how the living wage isn't all it's cracked up to be, and how expanding an EITC-like policy is often a more effective and efficient way to go. Other times I've argued strongly about the results of the 2004 elections, and how Bush was actually the democratic winner. I've debunked more than a couple stupid statistical studies that "prove" 2004 fraud. I regularly oppose the more extreme abuses of the Peak Oil arguments. And I'm regularly opposed to isolationism (both in foreign policy and in trade), and that's a conversation that is too-long ignored among the left.

But how worthwhile is it to invest energy in shoring up the base? That's not where change really happens, and it's not where the potential conversions are. It's something I can get wrapped up in when I feel like having a fight, but it isn't productive.

So it ends up begging the question, what is productive at this point? We're at the very early stages of Bush's second term. Weblogging continuing on its past trajectory won't be very interesting, not if it's just more people posting thoughts, commenting, complaining to each other, and occasionally mailbombing some hapless columnist.

The next few steps are different than the last few steps, and attract a different sort of person. The next few steps are very activist-heavy. More blog-based PACs with press releases, pundits, protests, ads, and fundraising. What's next is hit squads. I was drawn to the community-building aspects, opinion development, and engineering truth-based consensus. There doesn't seem to be much appetite for that lately.

May 13, 2005

Nuclear Text Messaging

Posted by tunesmith at 01:21 AM

There's a pretty cool system being put together here - give them your SMS cell phone information, and you'll be informed the minute Frist pulls the trigger to try and vote on the nuclear option. You'll even be given phone numbers to call to pressure Congress not to do it.

May 04, 2005

Research Binge

Posted by tunesmith at 05:19 PM

I stayed up last night researching various things, and ended, exhausted, with several open browser windows. I'm going to write it up here because I have a feeling that others will find it interesting, and because I'd like to close my browser windows.

For a while now, I've wondered what positive impact raising the federal minimum wage would have on payroll tax revenues, and therefore the solvency date of Social Security. I also know that the minimum wage has been shrinking over time.

First, I found this table showing how the minimum wage has been shrinking in real terms in recent years. Here's a graph:

Now, several states have their own minimum wages that are higher than the federal minimum wage. Here's a table. It seems that right here in Oregon and Washington, we have the highest in the nation - plus, they are indexed for inflation. That seems like good news. $7.25 in 1996 dollars, if I'm calculating this correctly, is about $6.22, so you can see where that lies on the graph.

Now, I said it seems like good news. I went over to its article on wikipedia to get some counterpoints. First, let me just say I love wikipedia. It's a place I can go to get consensus counterpoints, knowing that for sufficiently popular subjects, the authorship has grudgingly hashed things out to fairly represent both sides. It's great for politically divisive subjects like this. It turns out that most economists believe that minimum wage, when its many costs and benefits are looked at, is a net loss. "Most", meaning, it is a slight consensus. The more complete way of looking at it is that the need for labor is inelastic up to a certain point - minimum wage is fine, and a net gain, up until that balance point, but beyond that point, it is a net loss. However, it is like most things in economics, where you don't know if you've reached that magical balance point until you've blown right past it. Raise it too high, and the economy starts to suffer as a whole. Most Republicans think that "too high" point is lower than where most Democrats think it's at. :)

We'll come back to this in a moment. I was also researching GDP. One of the common arguments between the left and the right is that one side will often exaggerate the damage or cost of a program by focusing on it in raw dollar figures, comparing it to other cost in the past. The response is usually to complain that our economy has been growing since then, so it's better to look at it in terms of GDP. An excellent example is the national debt. Our national debt is the highest it has ever been in dollar terms, but as a percentage of GDP, it's still not as low as it was during Reagan's term, and the beginning of Clinton's term. When people talk about increasing our nation's financial health, they talk about improving the debt-to-GDP ratio.

Here's a graph of our debt-to-GDP ratio over the last many years:

It's pretty obvious the negative effect that Reagan/Bush I had on the ratio, how much Clinton improved it, and how Bush's presidency has made it dramatically drop again. However, it's not as extreme as it was fifteen years ago, and his budget projections show the ratio rising again (even though it's more likely they will be falling at a gentle slope).

Now, the reason this is used as justification is because the GDP is widely seen as a measure of increasing national financial health, much like an individual's increasing wages. But it turns out that isn't really accurate. From the wikipedia entry on GDP, you can see there are a lot of problems with it. For one thing, it doesn't account for the long-term costs of nonsustainable practices, like the overproduction of natural resources. It doesn't account for opportunity costs. One well-known example is that when a factory produces goods and also pollutes a river, that boosts GDP. When the citizens then clean up the river, that boosts GDP again.

There's a different index that tries to take all this into account - it accounts for the costs of our environmental policies and other externalities. It accounts for the rising wealth gap between our rich and poor. It's called the Genuine Progress Indicator (GPI), and it's supposed to be a replacement for the GDP. Other countries are actually using this thing. It is developed by an organization called Redefining Progress, which releases occasional supports detailing the health of the nation in terms of GPI. Here is a graph of how the growth of our GPI looks, compared to the growth of GDP:


The reason the two start diverging wildly around the 70's is evidently because that is when the gap between the rich and the poor started increasing dramatically.

With that data, it should be possible to calculate multipliers to convert any GDP-based data into GPI terms. I think with that, we'd see that things are far worse now in real terms than they were before. Some back of the envelope scratchings show that the 2002 debt-to-GPI ratio had already returned us to the same point we were at in 1988. (More recent (or projected) GPI numbers are not available yet.)

While reading about GPI, I came across this interview from one of the economists behind the GPI, and he talked about the minimum wage. It turns out that a far superior technique to increasing the welfare of the poor is through refundable tax credits like the EITC. This basically gives the benefits of a minimum wage, without the costs. By giving people a tax credit, where the difference actually gets refunded to the person if they didn't earn enough to exhaust it, it raises the boats without hurting the businesses that would have to deal with the higher minimum wages. He also talks about free trade versus fair trade, and his opinions of the "right" way to handle it - on the whole, it sounds very balanced. Check it out, it is a good read.

Finally, while following links, I came across information about various UN-recommended techniques to increase financial health in nations and micromarkets. One was converting to GPI-related banking systems, but another was a suggestions to use microcurrencies. I've been interested in this subject for a while, but never to the point of seriously studying it. This is basically locally-oriented favor-tracking. In general, people say that to decrease our environmental footprint on the world, it is better to restrict your commerce in as local a fashion as possible. Local microcurrencies or LETS - where everyone agrees to invent and use a currency that is only good in their locale, after which they trade goods and services in that currency when it's convenient - are a great way to save dollars for other expenses, and raise wealth. I think it's fascinating, and it's one of the areas that I bet will see a tipping point on the web if anyone manages to create a good website for it. It's a perfect add-on to the various peer-to-peer websites we see cropping up all over the place. Imagine it attached to something like craigslist or a political volunteering site. There is already something called Favors, but I'm not sure it's quite the same thing.

May 03, 2005

How To Fix Social Security

Posted by tunesmith at 07:25 PM

First, let it be said that the best approach right now is for our politicians to not even join the discussion about how to tinker with Social Security. We have much more serious problems with the nation's financial health, than a deficit date ten years out and an insolvency date thirty years out.

But this is a discussion board, and we can't really resist thinking of ways to tinker with it anyway. And most of us, uninformed as we are, start to immediately think of ways to raise taxes or cut benefits.

It turns out we wouldn't really have to do either, at least not explicitly. Read on for a summary of what could solve Social Security's solvency "problem", without introducing any of the trauma that Bush would.

All of these recommendations (pdf) come from Robert Ball, a long-time commissioner of Social Security (via Matt Yglesias at Talking Points Memo.)

Right now, over the next 75 years, SSA projects a shortfall of 1.89% of taxable payroll. What that means is that you just need to either raise revenue, cut expenses, or find some other way to make up that shortfall. But remember that raising the tax rate is not the only way to raise revenue. And cutting benefits is not the only way to cut expenses. Here are the recommendations that Balll makes, and how much they positively affect the taxable payroll deficit:

Restore the maximum taxable earnings base to 90%, the level set in 1983. + 0.61%
One of the main problems is that the wealth gap has been increasing - there is a wider distance between the rich and the poor. A side effect is that while the cap has been rising with inflation, the wealth gap has meant that the taxable earnings base has fallen to below 90% . So, this proposal would restore a level that was set twenty years ago. In addition, while the cap would be raised, the corresponding benefit levels would be raised as well, which would retain the "same rules for everyone" balance that protects Social Security's "third rail" status. Removing the cap while retaining the benefit cap would remove some of Social Security's balance, and would make it more vulnerable. Removing the both caps (all at once) entirely can be considered traumatic to people living in expensive markets that aren't otherwise rich - a large tax hit phased in all in one year.
Retain the estate tax at 2009 levels, but devote it to the trust fund + 0.51%
This is a good political compromise, because the 2009 estate tax rates have a high exemption level, but the money that gets taxed would then go to beneficiaries who need the money to protect them from poverty, rather than to the government to pay for normal budgets. This isn't a tax hike at all, merely a reallocation.
Invest some assets of the trust funds in stocks on a system-wide basis + 0.37%
Unlike the private accounts, this would be investing system-wide money into the stock market. The advantages are that no one person would have to liquidate their positions in a down market. It would all even out and the system would be able to ride out the highs and lows. Invested conservatively, this would give better returns than the Treasury Bonds. This doesn't raise taxes or cut expenses, although it does restrict the government from being able to benefit from Social Security's surplus.
Switch to the more accurate CPI ("chained index") for determining growth of benefits after retirement date. + 0.35%
This is technically a benefit cut, but it is evidently a more accurate inflation tracker than the inflation number we use now. (Remember, we are wage-indexed before retirement date, but inflation-indexed after retirement date.)
Cover all state and local government employees + 0.19%
Not all state and government employees are part of the social security system at this point. By converting them to have their pension plans be added on to social security, rather than replacing them, the additional payroll taxes would increase the health of Social Security. This raises revenue without increasing tax rates.
Optional: Increase the payroll tax rates by 0.5% both for workers and employers, starting in the year that the trust fund starts to shrink. + 0.60%
This one is truly a tax hike, but if the trust fund starts shrinking at a later date than is projected right now, then the date of this new tax would be delayed as well!

Now, it turns out that some of those improvements interrelate, so the overall positive impact isn't as good as simply adding them together. But, the summary is that if we implement the first three, Social Security is brought out of the "danger zone" from an actuarial percentage. (They're okay with it being with plus-or-minus 0.7%, because of how much things can change in our economy over the next several years.) If we implement the next two, we're actually in surplus by 0.05%. And if we implement the final bit, we'd have projected solvency for decades beyond the 75-year projection period.

If you would like more details, go read the report authored by Ball - it explains things much more clearly than I can in this limited space. The only thing he didn't go into that I've been curious about is how much payroll tax revenues would increase if we raised the federal minimum wage.

May 01, 2005

Whither Trust Fund?

Posted by tunesmith at 02:27 PM

This is the main thing I don't yet understand about the Pozen plan:

What happens with the Trust Fund? My main objection to prior plan proposals is that there's always been this magic hand-waving where the Trust Fund just kind of disappears, which means that everyone who has paid payroll taxes for the last twenty years has been screwed, by an average amount of over $1000/year. However, I'm unclear on what happens with the Trust Fund this time. I think they declare it "gone", but they also mandate general fund transfers, which is how the Trust Fund would be paid back anyway. And over its lifetime, the general fund transfers would probably exceed the current sum of the Trust Fund.

So in that sense, the Trust Fund argument has less power than it had before. The reason is because it reduces us to arguing about and predicting the future motivations of Republicans. For example:

We're going to come to a time where those general fund transfers will be commonplace. Do you really expect Republicans to accept that? They're just going to argue that Social Security is too expensive. They'll either vote to raise payroll taxes, or, more likely, cut benefits further. This is certainly correct, but the Republicans can just easily feign indignation and claim it's ridiculous while they run for office. The argument is just less effective than it was before. Before, benefit cuts were steep enough that the general fund transfers would never have been enough to pay back the trust fund, which meant a robbery of the trust fund. Now it's not so clear.

Everything else still makes this a raw deal. It's marginally better than the one they were discussing before (progressive wage/inflation indexing is better than straight inflation indexing), but it shouldn't be converted away from wage indexing at all. And the personal accounts are just stupid - your return has to beat inflation just to break even, and in order to match what most of us would get under currently scheduled benefits, the additional return would have to be astronomical.

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