Countdown to Extinction: The 2016 Presidential Election

[jlaurson]

Today one of the most infuriating things is nuclear power. To my knowledge there has never been any nuclear power plant built without (usually huge amounts of) public money. Of course almost all of the nuclear research (that made such plants possible at all) was also funded with public money. Then energy providers were privatized. The plants had been paid for and provided very cheap energy, big payday for those companies and huge dividends.

Moreover, the governments then guarantee to purchase the energy at a set, above-market rate, for x amount of years, further subsidizing the venture. And they don't oblige the companies that run these plants to care for the permanent disposal solutions.

I'm all for nuclear energy -- if for no other reason than keeping the science behind it from falling asleep, as there's always the realistic hope of attaining the technology for fusion energy one day (but also because energy needs to come from somewhere and alternatives have their various [non-calculated] disadvantages, too -- but my preferred solution, namely: No subsidies for ANY kind of energy production... while tracking the social/environmental/value* cost of ALL... would probably take care of the problem on its own. I don't think there's a private company that would care to run nuclear power plants for profit without getting its pockets lined by the government. (Granted, then we'd have to do all-state funded research on nuclear energy, rather than outsourcing at least some of the research and trials to the not-quite-free market...)

Now in Germany all plants are going to be shut down eventually. But the energy companies do not have enough money left for the huge costs the deconstruction and the care for nuclear waste etc. is goin to cost. That money rests now with the people who were paid dividends 10 years ago or so. So now the government tries to make deals that those companies are forced to pay at least some of the "external and (almost) eternal costs" of nuclear power but in light of the experiences we have had so far with the problems of storage of nuclear waste it is extremely likely that most of those costs will be paid by the taxpayers.

Here the companies are in the right of course; Germany, for populist, non-scientific reasons voided contracts with these companies which it should have been sued over until no tomorrow.

[Mookalafalas]

"This party does not prey on people's prejudices," [Ryan] continued. "We appeal to their highest ideals."

I have a new-found respect for Paul Ryan if he managed to keep a straight face while he said that.

[Madiel]

Privatization of profits, socialization of costs is the secret of much private wealth.

Yup.

[Florestan]

states that were on the border of failing like Romania (sorry, Florestan, but this seems to be the case) going from a dictatorship to some metastable state teeming with corruption

There´s nothing you should be sorry about: that is the case.

[Mookalafalas]

I'm impressed by the prescience of the OP, recognizing the extinction of the GOP so far ahead of the rest of us.  Does this mean that for the democratic party there will be the equivalence of an apotheosis?

[drogulus]

Privatization of profits, socialization of costs is the secret of much private wealth.

     Clinton tried socialization of profits, called a budget surplus, which ended the '90s boom.  Privatization of profits isn't an imposition on private sector businesses, it's the public sector doing its "promote the general welfare" thing. Socialization of costs pays for private sector profits by covering the savings burden. The private sector that takes savings out of income subtracts it from spending (thrift paradox), spiraling the economy down. National financial savings (the "national debt") records the spending replacement as liabilities to the government. That's why you don't try to "fix the debt", the debt is the fix.

[Madiel]

     Clinton tried socialization of profits, called a budget surplus, which ended the '90s boom.  Privatization of profits isn't an imposition on private sector businesses, it's the public sector doing its "promote the general welfare" thing. Socialization of costs pays for private sector profits by covering the savings burden. The private sector that takes savings out of income subtracts it from spending (thrift paradox), spiraling the economy down. National financial savings (the "national debt") records the spending replacement as liabilities to the government. That's why you don't try to "fix the debt", the debt is the fix.

There has to be a balance, though. Private profits ought not mean a very few people making very large amounts of money at the cost of everyone else. Promote the general welfare, yes. Promote the welfare of a select few, not so much please.

[drogulus]

There has to be a balance, though. Private profits ought not mean a very few people making very large amounts of money at the cost of everyone else. Promote the general welfare, yes. Promote the welfare of a select few, not so much please.

     I was referring to a more general view of private sector gain that includes higher wages and profits. In order that an economy grows the real production/consumption cycle, the money circuit is balanced for optimal performance, so the tax comes back late enough (salami-sliced as a deficit by budgeteers), and not too early (budget balance/surplus is economic imbalance). Where I differ a bit is in identifying efficiency with ideas of fairness. Economists know you raise efficiency in a dollar circuit by sending more dollars through the spending classes, for the reason I stated in my last comment. High spenders, low and middle income chiefly, raise GDP when they get up in the morning, high savers (rich "job creators") are the major source of the savings glut government spending replaces. High savings defines being rich. You don't have to spend all or near all of your income.

      The economic justification for progressive taxation (it reduce the savings burden, spares live dollars by taxing dead ones) dovetails with the ethical justification. My general approach to ethical issues in economics and elsewhere that only ethical notions that can pass an efficiency test can operate for long, that is, if a society could somehow not get richer by means of sending more dollars to spenders, we wouldn't dream of progressive taxation or public works. It's only because it satisfies both ethical notions and efficiency tests that we continue for centuries to define a rich society as one with rich people in it. Since I "conjoin" fairness and efficiency, I've accepted that there indeed has to be a balance of profit and wages, for both reasons.

[Florestan]

Promote the general welfare, yes.

This sounds as good as it gets. The only difficulty is to define "general welfare".

[Madiel]

This sounds as good as it gets. The only difficulty is to define "general welfare".

Indeed. There are theories about that, though, including one I came across in legal philosophy many years ago that suggests what you want is a system where you'd be reasonably with your individual lot if you didn't know your individual place in society - if you could wipe people's memory of whether they were rich or poor or presitigious or not, what would they be happy with?

The recently published annual Happiness Index certainly goes along with that notion, that the happiest, best-functioning societies are the ones that are the most equal.

[drogulus]

This sounds as good as it gets. The only difficulty is to define "general welfare".

     If that's the only difficulty, nobody need bother. If you decide you need a road and build it, "promoting general welfare" will be the explanation you apply.

     Applying general welfare is not made easier or harder by the definitions. Do we need a tunnel connecting New York and New Jersey? Either yes or no, but I'll wager the practical application of this instance of "general welfare theory" depends not at all on Socratic definitions of the horse trader kind. Like you Socrates purported to think definitions came first, and argued that no one could be a horse trader without an absolute definition of a horse. OK, this is obviously Plato, but I doubt these guys ever once sat down to a meal after long deliberations on the absolute definition of food.

     

Indeed. There are theories about that, though, including one I came across in legal philosophy many years ago that suggests what you want is a system where you'd be reasonably with your individual lot if you didn't know your individual place in society - if you could wipe people's memory of whether they were rich or poor or presitigious or not, what would they be happy with?

     A Theory of Justice by John Rawls is the source for the theory. It reminds me of MMT in that it's quite clearly a culmination of less comprehensive practical understandings. This theory simply completes, by explaining what we do, a "why".

[Florestan]

The recently published annual Happiness Index certainly goes along with that notion, that the happiest, best-functioning societies are the ones that are the most equal.

What do you mean by "equal"?

     If that's the only difficulty, nobody need bother. If you decide you need a road and build it, "promoting general welfare" will be the explanation you apply.

I got it: "promoting general welfare" means whatever government does, and whatever government does means "promoting general welfare". 

[Gurn Blanston]

What do you mean by "equal"?

I got it: "promoting general welfare" means whatever government does, and whatever government does means "promoting general welfare". 

Given that he is talking about a hypothetical 'perfect society', what would you speculate 'equal' means?

Of course, reality always intrudes, but that isn't what we are discussing here. Building a road is a perfect example of something which is good for the community as a whole, thus, the general welfare is promoted. It isn't a difficult concept, really...

[Florestan]

Given that he is talking about a hypothetical 'perfect society', what would you speculate 'equal' means?

That´s not what I inferred from orfeo´s post. I think, on the contrary, that he is talking about existing, real societies.

Building a road is a perfect example of something which is good for the community as a whole, thus, the general welfare is promoted.

That is true, but drogulus seems to reject any notion that government should operate on, and within, principles, and to embrace the position that whatever is expedient is also legitimate. I respectfully disagree.

[(poco) Sforzando]

Building a road is a perfect example of something which is good for the community as a whole . . . .

Except when it isn't. The Cross-Bronx Expressway in NY (conceived by power-broker Robert Moses), a perpetual traffic nightmare to this day, has been credited with disrupting an already poor neighborhood and increasing urban blight and crime in the notorious South Bronx area of the city. Other of Moses's plans, especially an expressway that would have sliced through lower Manhattan in the Canal Street/Chinatown area, were finally defeated after strenuous public opposition. (Apologies to those not intimately familiar with this part of US geography, but it's my area of the world and I care about it.)

[drogulus]

I got it: "promoting general welfare" means whatever government does, and whatever government does means "promoting general welfare". 

     Yes, I do mean that. An idea of government promoting general welfare is put into documents and speeches and critical responses because we agree on promoting general welfare and also agree that no a priori definition will suffice for what that is. It's defined "in use". What's your idea of general welfare? What's mine? You can see Plato doesn't tell you. He says there's an a priori Form of it. It's not that I don't take his word, it's that the words don't resolve to a meaning in use. They don't add to the discussion.

     An a priori definition of public good is no more useful than an a priori definition of a tunnel connecting New York to New Jersey. All there are are plans, plans about plans, ethical/political descriptions of why plans, what kind, and A Theory of Justice master plan, as an example. You argue about master plans in the same consequential way you do other plans that operate closer to the ground. Does it work? Is a modern democracy that's "by the people", a "government is instituted among men" that shall provide "equality before the law", and so on, what Rawls was describing in his master plan? It looks like it.

     

That is true, but drogulus seems to reject any notion that government should operate on, and within, principles, and to embrace the position that whatever is expedient is also legitimate. I respectfully disagree.

     You're close, but I think you have to get a little closer. I do think legitimacy has to have a lot of expediency in it. I think I'm describing that.

[Florestan]

     Yes, I do mean that.

Then on what ground(s) would you have opposed Nicolae Ceausescu and his government? They talked all day and night, and put into documents and speeches, about how they promoted the general welfare of the Romanian people at levels unseen before not only in the country but also worldwide; they did build bridges, dams, roads, hospitals, schools, blocks of flats etc. I really do wonder: what faults could you have possibly find with them?

[Gurn Blanston]

Except when it isn't. The Cross-Bronx Expressway in NY (conceived by power-broker Robert Moses), a perpetual traffic nightmare to this day, has been credited with disrupting an already poor neighborhood and increasing urban blight and crime in the notorious South Bronx area of the city. Other of Moses's plans, especially an expressway that would have sliced through lower Manhattan in the Canal Street/Chinatown area, were finally defeated after strenuous public opposition. (Apologies to those not intimately familiar with this part of US geography, but it's my area of the world and I care about it.)

There will always be exceptions, and people who bend rules to their advantage. It doesn't invalidate the basic intent of the rule. If it did, every rule ever created would eventually be invalid!

In any case, the 'promote the general welfare' is an ideal. How often have ideals become long term realities?  Isn't that why we change governments regularly? So that more 'general welfare promotions' are more evenly balanced? Christ, I hope so!   

[(poco) Sforzando]

There will always be exceptions

Hardly an insignificant exception. The South Bronx became a major symbol in the 70s of urban blight and decay. Remember Jimmy Carter's visit in 1977?

[Gurn Blanston]

Hardly an insignificant exception. The South Bronx became a major symbol in the 70s of urban blight and decay. Remember Jimmy Carter's visit in 1977?

True, and yes, I do.

But if you have to build exceptions for corruption into every ideal you have, what's left? And why bother?

Nothing is going to be done about situations like that as long as the people who are in power remain in power. They think they are doing the right thing by doing nothing, so why would they change? I expect the justifications for it are right around the corner though; let's see.