Ahead of the Curve with the Professor

Monday, September 28, 2009

WMOX Agenda - Tuesday September 29 2009

I will be coming over from the 'burbs of Brandon in the am to join the Morning Show crew tomorrow. As usual we have a full agenda which no doubt will change by the morning or during the show. Here are some of the things on the agenda for the morning:

  • Iran and Afghanistan boil over while we debated health care.
  • Chinese tire tariffs and the threat of trade wars.
  • ACRON, the culture of corruption and the media.
  • Race, civility and politics.
  • The latest in the health care debate - the politics and economics.
  • What are the flaws in Medicare?
  • Has Obama fallen to earth?
  • Why does big drug and big insurance support health care reform.
  • The latest economic stats, budget projections, unemployment and GDP and the Fed's latest moves.
  • Upcoming economic challenges for the Fed.
  • Did taxpayers make money on TARP (the bailout)?
  • After the big Tea Parties in DC, Jackson, Meridian and the country.
  • What ever listeners which to talk about.
Looking forward to talking to the folks in Meridian.

- The Professor

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Saturday, September 19, 2009

Conserative Resurgance

Today, the New York Times had a story about the conservative and GOP resurgence which is no doubt fueled largely by the grass roots of the Tea Party movement. Not that long ago following President Obama's election many had opined that the conservative movement was dead and it and the GOP were headed to the dust bin of history.

It is amazing how often the pundits are wrong about the demise of an ideology and political party. In my lifetime, the conservative movement and GOP have been pronounced dead following Goldwater's landslide loss to LBJ in 64, Nixon's resignation in 74, the election of Bill Clinton in 1992 and the election of Barack Obama in 2008. Out of the ashes of these defeats came Ronald Reagan, The Contract with America and growing renewal of the conservative movement.

Liberalism and the Democratic was declared dead in 72 following McGovern's defeat and again in 1980 with the rise of Reagan and to a lesser extent with George W Bush's reelection in 2004. That lead to Democratic resurgence in 76, 92 and the Democratic take over of Congress in 06 and rise of Obama.

History shows us that political parties may die off like the Whigs in the 1800s, but ideologies do not. This is not surprising since political ideologies with thought out worldviews grapple with issues that civilization has been grappling with since government was first established.

History is littered with "smart" people who predicted the demise of broad based political party. As Yogi Berra said, predictions are hard especially about the future.

- The Professor

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Cracking Acron(s)

Thanks to the efforts of two courageous young journalists, the bulk of the media as well as Congress is now turning their attention to ACRON. For a more detailed account of how these two young people scooped the industry, this Washington Post story is an excellent account. You can tell if a story has legs if it attracts attention of Leno and the John Stewart and the Daily Show. If you are on the left and loose the Daily Show, the battle is over.

- The Professor

The Daily Show With Jon StewartMon - Thurs 11p / 10c
The Audacity of Hos
http://www.thedailyshow.com/
Daily Show
Full Episodes
Political HumorHealthcare Protests

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Chinese Tires, Trade Wars and the Great Recession

Recently, the Obama Administration imposed a 35% tariff (tax) on tires imported from China. The International Trade Commission exercised its authority to to impose tariffs if imported goods represented a major "market disruption." China prediciatdily responded in kind by slapping a tax on chicken exports from the United States.

In some cases, such moves can be justified on the grounds of "unfair" competition such as massive government subsidies which make it impossible to compete against a government sponsored enterprise. More often such tariffs (taxes) come about since the party being protected has political influence and uses its power to eliminate the competition through government policy rather than a superior product. End result is that consumer looses the benefits that competition offers. For example, look how US based automobiles improved with the competition from Japan in 70s and 80s.

Not only do consumer suffer from taxes designed to eliminate competition, the response of the trading partner is to institute their own taxes to "protect" their import sensitive markets. These "tit for tat" moves generally escalate into a trade war in which consumer and business in both countries end up loosing.

The most well know of these tariffs that lauched a trade war is the Smoot-Hawley tariffs of the 1930. After the market crash of 1929, President Hoover and Congress passed one the highest tariffs in history despite the objection of close of hundreds of economists. Predictably, our trading partners passed their own tariffs which ultimately shut down the export sector of the US economy. Many analysts of the period cite these tariffs as one of the policy actions which converted the the recession caused by stock market crash into the Great Depression.

Today, we have a fragile economic which struggling to recover from the Panic of 2008 and the resulting Great Recession. Like it or not we know live in the era of globalization and have many sectors of the economy whose biggest markets are overseas. Today, exports are nearly ten times larger than they were in 1930s and has been some what stable. If a full scale trade war should break out the doom and gloomers about our economic future would be correct.

Both the New York Times and Wall Street Journal Op-Ed pages have warned about the dangers of protectionists policies. Rarely are these organizations of the same page about much of anything. In addition, these is one of those areas that economics profession is in agreement on for the most part.

- The Professor

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Friday, September 18, 2009

Carolina Hoops - 100 Years

This year is the 100th anniversiay of Carolina basketball. Below is great video to mark that miletone. It is just under a month for mid-night madness. Go Heels!!!!

- The Professor


PS - In case you have not seen Tyler Hansbourgh debut as advertising check out this AT&T commerical done in Chapel Hill.


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Wednesday, September 16, 2009

WMOX Agenda - Thursday September 17, 2009

I will be coming over from the 'burbs of Brandon in the am to join the Morning Show crew tomorrow. As usual we have a full agenda which no doubt will change by the morning or during the show. Here are some of the things on the agenda for the morning:

  • ACRON, the culture of corruption and the media.
  • Race, civility and politics.
  • The latest in the health care debate - the politics and economics.
  • What is market based alternative to Obama/TeddyCare?
  • Has Obama lost is touch and fallen to earth?
  • Why does big drug and big insurance support health care reform.
  • The latest economic stats, budget projections, unemployment and GDP and the Fed's latest moves.
  • Upcoming economic challenges for the Fed.
  • Did taxpayers make money on TARP (the bailout)?
  • After the big Tea Parties in DC, Jackson, Meridian and the country.

What ever listeners which to talk about. Looking forward to talking to the folks in Meridian.

- The Professor

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Quote - Plato

"One of the penalties for refusing to participate in politics is that you end up being governed by your inferiors." --Greek philosopher Plato (c. 428-348 B.C.)

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Monday, September 14, 2009

Quote - Thomas Jefferson

"I think we have more machinery of government than is necessary, too many parasites living on the labor of the industrious." --Thomas Jefferson

No doubt Jefferson would have understood the concept of the looters and munchers from Atlas Shrugged.

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Stossel to Fox News




John Stossel, one of my favorite reporters, has joined Fox News. In particular, he will have his on show on the Fox Business Network. (the announcement from Fox) He seems to be one of the few reporters who really understands and appreciates economics. He seems to be a libertarian.


Not only will this be a boost for Fox it will give Stossel a chance to shine. No doubt he was not in tune with thought process at ABC. In addition, 20/20 aired Fridays at 9 central which is not a good time slot for a thoughtful show.

In addition, to his work at 20/20, Stossel writes a weekly column which is available on Wednesday. Many of Stossel's reports are available for teachers through the Stossel in the Classroom program. I have used them and the students tell me it has opened their eyes about economics.(See earlier post on Stossel and his report on health care

It may be time to upgrade my cable package so I can Fox Business.


- The Professor

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Friday, September 4, 2009

Show Followup - 9/3/09, The FDIC and China's Gold

Yesterday, we discussed a couple of items on WMOX for additional study.

- The Professor

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iPhone and Health Care Economics


At first one would not think that the iPhone and health care economics have much to do with each other. At one level they do not, but the impact of the iPhone on AT&T is similar to the likely impact of health care reform on federal spending.


The iPhone is by any standard the most successful wireless device ever to hit the market. Users like myself use it ways they could not have envisioned with a typical smart phone much less a regular cell phone. As a result, data usage has exploded on the AT&T network well beyond projections. Due to the extra traffic loads, service quality has fallen. (For more on this see this article in the New York Times)

No doubt if Obama/Teddy Care is passed it will change the way health care is delivered and consumed. This will no doubt lead the the $1 trillion plus price tag look cheap. History teaches us as that entitlement programs cost more than projected. As evidence consider Social Security, Medicare, Medicaid, reform in Massachusetts, government health care in Canada and England.. In each of these cost exploded since this programs changed the behavior in ways that could not have been foreseen since these programs dramatically changed how people use these services.

The iPhone and the history of entitlements are game changers which fundamentally change how services are used. In all of these cases, it impossible to foresee the impact of paradigm change. The iPhone case should remind us how difficult it to paraphrase Yogi Berra predicating is hard especially about the future.


- The Professor


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Teddy and the USSR


Frequent WMOX guest, Professor Paul Kengor has gotten a lot attention lately on what he uncovered on Senator Kennedy and the Soviet Union. In his great book, The Crusader: Ronald Reagan and the Fall of Communism on the Ronald Reagan and the end of the Cold War, Paul discusses letter to the Soviets from Senator Kennedy. These letters which are from declassified Soviet archives show how Kennedy contacted the Soviets in an effort to stop Reagan's efforts. For more on this checkout out Paul's recent Op-Ed or our interview with Paul on WMOX in 2006 on the his book, The Crusader.


- The Professor

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John Stossel on Health Insurance


Below is a great 20/20 segment by John Stossel on health care. This enlightening segment shows that the key understanding health care is that since most health insurance claims are other people's money costs can never be controlled unless that is recognized.


Stossel is one of the few reporters at ABC or any of other non-cable networks that truly understands economics and markets. I occasionally use some of his segments in my classes to illustrate key points. Students find his presentations very useful. For those teachers either college or high school out there, there is a program sponsored by the Center for Independent Thought Stossel in the Classroom.


- The Professor
PS - Thanks for the tip on this from the Heritage Foundation which mentioned this video in their daily email, The Morning Bell.



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Wednesday, September 2, 2009

Quote - Samuel Johnson

"You raise your voice when you should reinforce your argument." --English author Dr. Samuel Johnson (1709-1784)

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Quote - C.S. Lewis

"Of all tyrannies, a tyranny sincerely exercised for the good of its victims may be the most oppressive. It would be better to live under robber barons than under omnipotent moral busybodies. The robber baron's cruelty may sometimes sleep, his cupidity may at some point be satiated; but those who torment us for our own good will torment us without end for they do so with the approval of their own conscience. - British novelist C.S. Lewis (1898-1963)

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WMOX Agenda - Thursday September 3, 2009

I will be coming over from the 'burbs of Brandon in the am to join the Morning Show crew tomorrow. As usual we have a full agenda which no doubt will change by the morning or during the show. Here are some of the things on the agenda for the morning:
  • The latest in the health care debate - the politics and economics.
  • What is market based alternative to ObamaCare?
  • Has Obama lost is touch and fallen to earth?
  • Why does big drug and big insurance support health care reform.
  • The latest economic stats, budget projections, unemployment and GDP and the Fed's latest moves.
  • Cash for clunkers and cash for refrigerators.
  • Upcoming economic challenges for the Fed.
  • Did taxpayers make money on TARP (the bailout)?
  • Update on the Tea Party movement in Meridian, Mississippi and the country.
  • Book reviews - Mark Levin, Freedom and Tyranny.
  • What ever listeners which to talk about.

Looking forward to talking to the folks in Meridian.

- The Professor

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