Saturday, December 4, 2010

The Plot to Destroy Terrestrial Broadcasting takes Shape

“…we should expect a linear relationship between costs imposed on broadcasters and the likelihood of them abandoning over-the-air broadcasting. Every dollar of additional costs for broadcasters is one less dollar of profit, and thus reduces the attractiveness of over-the-air broadcasting as a business model. And don’t forget the pot of gold at the end of the rainbow: once broadcasting leaves the spectrum, much more valuable services can utilize those frequencies.” Thus spake Stuart Benjamin in early 2009 in “Roasting the Pig to Burn Down the House: A Modest Proposal”

Professor Stuart was hired by the FCC Chairman Julius Genachowski later that same year, he “joined the Commission in December 2009 as the agency’s first Distinguished Scholar in Residence. He resides in OSP (Office of Strategic Planning) and works on spectrum reform, First Amendment issues, and long-term strategy (emphasis added). He is on leave from Duke Law School, where he is the Douglas B. Maggs Professor of Law. He specializes in telecommunications law, the First Amendment, and administrative law.”

It appears the FCC is beginning to take action in keeping with the ideas of Professor Benjamin. On November 30 TVNewsCheck published an article “FCC begins TV Spectrum Revamp”. In the article Chairman Genachowski said, “The spectrum is too valuable and our spectrum needs too great for it to be used inefficiently in this manner, especially given that less than 10% of Americans receive broadcast television only through over-the-air spectrum signals.’’

So, the plan is to move more stations to the VHF band, a band by-the-way that has proved problematic after the digital transition. The idea is to have 2 stations share a single 6MHZ band while retaining their right to “must carry” on cable. This will free up the more desirable UHF band for wireless broadband. But it will also impose yet more cost by forcing some broadcasters to, yet again, buy VHF transmission equipment.

On December 2 TVNewsCheck published a story “FCC Plan Makes VHF a High Priority”. I’ll simply quote from the beginning and end of this piece.

“As part of its plan to shift 120 MHz of spectrum from TV broadcasting to wireless broadband, the FCC wants to pack TV stations more tightly together in the remaining 180 MHz of spectrum to free up some for auction.

To do that most efficiently, it must make the VHF portion of that remaining spectrum (chs. 2-13) more hospitable to broadcasting.”

The article goes into the issues with VHF, citing Television consulting experts who discuss some of the additional costs and reduction in performance broadcasting would experience going back to VHF, concluding with the following paragraphs.

“Since the digital transition, most stations are now broadcasting in the UHF band. Some of them are worried that in trying to improve the VHF band, the FCC is signaling that it intends to force some UHF stations back to the VHF band.”

“Among them is Dan Ullmer, chief engineer at WECT Wilmington, N.C., which made the leap from VHF to UHF in September 2008 when it because (sic) the first station in the nation to switch to all-digital service.”

‘“We have really good coverage along the coast now,” he said. “Going to VHF would be going backwards for us. We have built out all-new UHF facilities, UHF antennas. All that would have to be changed out. We'd have to enter another major transition in the market, which would likely disenfranchise our viewers. They've already been through a major transition here.”’

So, Professor Benjamin’s ideas are becoming manifest. There is no doubt where this is headed. They have made it very clear that the goal is to promote wireless broadband at the expense of terrestrial broadcasting. With the rulemaking vote of November 30, the process begins. It sets the stage for forcing broadcasters back to an inferior frequency band and having THEM pay for it, both of which make broadcasting less viable. Recall Professor Benjamin, “Every dollar of additional costs for broadcasters is one less dollar of profit, and thus reduces the attractiveness of over-the-air broadcasting as a business model.”

Friday, November 26, 2010

Debt, Moral Hazard, Praxeology

There is a common thread through most of Professor Krugman’s essays; Selective Moral Hazard.

He believes in the concept of moral hazard, but apparently only for bankers. I agree with the conclusion of today’s essay, I just wish he were more consistent in his application. Were we to take into consideration moral hazard when implementing economic/public policies affecting individuals we would bring personal responsibility and praxeology back into our economics.

As a good Keynesian Leftist (excuse the redundancy), Professor Krugman believes government should take responsibility for solving the current financial mess. And in applying moral hazard to this situation it would be logical to ask government to solve a problem for which they are primarily responsible. But that would be like asking a committed AND currently intoxicated alcoholic to run an AA meeting. It’s a mockery.

Our financial system is built on a scheme that has been gradually implemented over the last 100 years. We’ve made the transition from the gold standard to a complete fiat monetary system in several stages, culminating in Nixon’s closing of the gold window in 1971. At that point all international currencies were floating, each against all the others, and countries could no longer exchange American dollars for gold. But money has been created by debt for many, many years because that’s what a fractional banking system does, it creates money through debt. But 100 years ago, at least SOME of the money was back by gold. Now, none of it is. We are currently on a debt standard. Practically all money is created by debt and backed by the economic strength of the issuing country or in the case of the Euro, countries; Hence the problem.

We are reaching the limits of the “debt standard”. Eastern philosophy embraces Yin and Yang and the ebb and flow of change. Everything changes and nothing lasts forever. This debt standard will come to an end. With what shall we replace it? Anything we do will be painful. We could start all over with new debt but it will start us back on the same road. We know where it ends. Perhaps we should take another look at gold. It too will be painful and to implement a classic gold standard would require going back to a true laisser-faire economic system. But doing that would also apply moral hazard equally to all participants in the economy; bankers as well, with bad decisions resulting in bankruptcy. What could be more fair that that?

Thursday, November 18, 2010

Socialism, Alaska Style

What's the first thing that comes to you mind when you think of Alaskans? For me, it's rugged individualism. I've always seen Alaska as the state where its citizens preserve, at least to some degree, the ideal of frontier life. The people there are unique and embody the core ideals of America; tough, self-reliant individuals who make a living in a demanding and somewhat hostile environment.

The state has consistently been represented by Republicans; currently its Governor and Lt. Governor are Republicans, of the 3 person Congressional delegation, two are Republicans and the state legislature is Republican 55 to 45 %. The recently Senatorial election where Lisa Murkowski was re-elected as a write-in over the Tea Party selected Joe Miller should on its surface be somewhat surprising. But I think this election underscores my contention that most Americans are comfortable with a large federal government.

Alaska, I learned depends on the largess of the Federal Government for about 1/3 of its GDP. A significant portion of that is probably the oil profits that are distributed to all the citizens the amount of which was increased by a previous governor, Sarah Palin.

Lisa Murkowski who pretty much inherited her Senate seat when her father died was a protege of Ted Stephens who was famous for his ability to bring home the pork. She instinctively knew that Alaskans didn't want that to end. Joe Miller, whose nomination was endorsed by the Tea Party movement, would have been obligated to not use earmarks and other schemes to raid the federal treasury. So Ms. Murkowski embarked on a write-in campaign and became the first federally elected official to win by write-in since Strom Thurmond in 1954.

This election is just more anecdotal evidence that Americans, even Republicans, are comfortable with the concept of looting ones fellow citizens.

Sunday, November 7, 2010

Nancy Pelosi, Minority Leader

Nancy Pelosi has decided to run for Minority Leader and the polticial literati is shocked. They all expected her to resign her seat and go back to San Francisco to play with her grandchildren. Really?? This is a woman who craves power and enjoys the trappings of power. She's an idealogue who wants to impose her policy proscriptions on the masses but make no mistake this is also about Nancy Pelosi, her ego and desire to remain relevant.

C-SPAN this morning is taking calls on the question, "should there be a change of leadership in both parties". It's amazing how much agreement there is on Ms. Pelosi; the Democrats and Republican callers generally agree she should become "Minority Leader". It's been a while since I've seen this level of agreement by Republicans and Democrats.

The Hypocrisy of the Tea Party (and Republicans)

I saw an interesting statistic recently. A poll on the popularity of Social Security and Medicare revealed that 73 or so percent of the American people support these programs. That’s not very surprising. What is surprising is 62% of self identified Tea Party supporters also are in favor of these programs. Keep in mind that both of these programs were initiated by Democrats, Social Security by F.D.R. and Medicare by Lyndon Johnson. These programs are straight-forward wealth transfer entitlement programs designed to pay benefits to one group with the taxes extracted from another group. The very same type of socialistic programs the Tea Party rails against.

The Tea Party movement is primarily a response to the alarming levels of debt that have accumulated in the Bush 43 and Obama administrations, most of which was caused by the recent economic/financial crisis. But I don’t see the Tea Party as our salvation. True, they’ve awakened many to the problem, but the fact of the matter is they, like many of us, are also part of the problem.

Thirty-two percent of the current Federal Budget goes to Social Security and Medicare. Only 38.6% of the 2011 $3.554T budget is discretionary and almost half of that is defense spending, probably the most constitutional of all spending and the spending that supports what all politicians agree is the “primary” role of government, protection of its citizens. So, from where are the cuts to come??

Most Republicans who are sympathetic to the Tea Party movement like Marsha Blackburn of Tennessee equivocate and only promise an “adult conversation” about solutions while Tea Party politicians like Michele Bachmann are actually discussing cuts in Medicare and Social Security by “weaning” those that don’t need it from the system, this is known in policy circles as “means testing”. It’ll be interesting to see how long she supports such policies when her constituents get wind of this…assuming her constituency tracks the same as those in the above poll.

The Tea Party movement should give freedom loving Americans hope. It shows that liberty still has a pulse. But my point is it’s a weak pulse. To rail against socialism but support SOCIAL security and Medicare when it benefits oneself is hypocritical in the extreme and reveals a perverse understanding of freedom and its corollary, personal responsibility.

Sunday, October 17, 2010

Two Questions for Candidate Rob Woodall

I have two questions. The first is rhetorical for Tea Party supporters and Republicans but I would like an answer from Mr. Woodall. I will preface this question to Mr. Woodall and this audience by telling you I’m a big and small L libertarian and I plan to vote for Mr. Woodall.

We all say we are for small government. We all are concerned about the deficit and the mounting national debt that we will leave for the next generations to pay. We also all know that entitlements, particularly social security and medicare benefits for the Baby Boom generation are the crux of the problem.

Many think it is immoral for the government to tax us and redistribute the money. Well, the government has been taxing us for social security and medicare for decades and redistributing those funds. When the system began to slip toward insolvency in 1983 Congress increased social security taxes ostensibly to shore up Social Security but put the money in the general fund and spent it, leaving IOUs that will need to be funded soon.

Without discussing the constitutionality of SS and Medicare as a redistribution program it is immoral. If so why is it moral for us, when it’s our turn, to accept medicare and social security, knowing full well that we are burdening the next generation with economically debilitating debt and/or additional taxes? Is that not just as immoral? That’s question one. So, we have a choice, or do we, which leads to my second question.

There’s no law that I can find requiring me to register for social security but it appears to be illegal to NOT sign up for medicare when I turn 65? Is that true?

Friday, July 23, 2010

Addicted to Bush? Addicted to Socialism!

I have no reason to doubt most of Mr. Krugman's figures (See Paul Krugman's editorial in the July 23 edition of the New York Times). Although I suspect the 9% of GDP deficit number being assigned to Mr. Bush is probably not totally accurate. As Mr. Law from Texas who supports "His Eminence" Mr. Krugman's arguments notes the "newly-elected POTUS was required to go to work early by going to DC to engender confidence and leadership during the '08 financial crisis". If so, then he can also take some responsibility for the current deficit. You can't have it both ways.

As a Libertarian, I don't support Republican or Democrats as they are two sides of the same coin and have basically similar policies that change only on the margin. But should the Republicans regain control of Congress in November, something I doubt will happen, the constraints of our current financial situation will hopefully force them to embrace something considered radical. We cannot extricate ourselves from this current mess by traditional tax cuts, or by the quasi-central planning schemes of the Democrats.

We need to change our tax system and go to something consumption based like the FairTax. We need to release private business to do what only free-market capitalism can do, create wealth. If one looks at the miracle of the American experiment since its founding, it has been our belief in the free-market and the actions of individuals in that free-market that has created the wealth we have enjoyed. Even the poorest in this country live lives of relative plenty compared to the poor in the 3rd world.

The causes of our financial situation extend back much longer than the recent Bush administration and I would argue go back decades when the seeds of the housing crisis were planted. Those policies and subsequent Federal Reserve policy and the belief of our ruling class in Keynesian economics' reliance on perpetually low interest rates, promote boom-bust cycles. And so here we are.

It's unrealistic to believe that the ruling class will come to embrace some of the lessons of "Austrian" economics any time soon but leaving that alone, releasing capitalism by radically changing our tax system offers the best hope for the future. Some may consider it risky and ill-advised. I think it's safer than going back to the policies of George Bush or even worse European-style democratic-socialism, both of which won't work and can only make the situation worse.

Sunday, March 21, 2010

The Economic Consequences of THE BILL

The Health Care Bill will pass today. While it may hurt the Democrats politically come November, it will, in the long-run be a net positive for their Party, at least until the effects of this and the accumulated entitlements of the past 70 years catch up with them (and the Republicans) and ruin our currency and our economy.

How have we gotten to this point? It’s a drug called entitlements. It started innocuously enough as a scheme to provide some minimal money to the elderly poor in their declining years. It passed with only 35 or so votes against it. It had vast bi-partisan support. But instead of just providing support for a specific poor group, it was decided to make it a “social insurance” program to which ALL would entitled. In this way the initial recipients would not have the stigma of receiving charity. And since everyone would benefit eventually it guaranteed support (purchased votes) from the Republicans. With that vote we began our gradual slide to economic Armageddon.

The vote today provides another opportunity to addict the American people on the Entitlement Drug. It is a difficult drug to eschew. As more and more people become addicted to the new entitlement the power of the Democrats will grow. Given in small doses over time, it can hook the even most moral, liberty loving citizen.

For example, the Tea Party movement professes to be a lover of liberty and individual responsibility. But, how many of them are willing to give up their Social Security? I think, not many. They know full well there is no account in their name that is their money. They know full well that they’ll be taking money from their younger fellow citizens. They will rationalize their position because they’ve been taxed for 40 years and are therefore entitled to the benefit. And by law, they’re right, but morally, money taken from them by force should not entitle them to extract money from their fellow citizens by force.

Earlier this week Rush Limbaugh mentioned a group of seniors who traveled by bus to Washington to spend a single day lobbying their Representatives. Their complaint is the $500B cut in THEIR Medicare. They’re concern that expanding this entitlement will reduce THEIR entitlement…..this is what we’ve become, a bunch of pigs at the public trough fighting for our morsel.

The cost of this Bill is astronomical. Instead of the almost $1T estimated cost over 10 years it’ll probably be closer to $2.4T; this on top of an estimated $1T ANNUAL deficits EVERY year for the next 10 years. With a current debt of $14T, we’re facing a potential debt of $26.4T DEBT by 2019. And this may be low. At some point the only choice will be printing money to reduce the debt through inflation. Our currency will then devalue at an accelerated pace, leading to a monetary and economic crisis.

If there is a positive side to this vote it is a rather macabre one; an extreme economic crisis brought on by government greed MAY wake the people up to the brilliance of our founding principles; individually responsibility, limited government, economic liberty and peace.

Sunday, February 21, 2010

A Libetarian Awakening??

The CPAC (Conservative Political Action Conference) meeting this week is notable for two names….Glenn Beck and Ron Paul. Glenn Beck the author and radio/television talk show host seems to be a conservative evolving into a libertarian. Ron Paul, the Republican Congressman from Texas, who ran for the Republican Presidential Nomination in 2008, has always described himself as a libertarian. He actually ran for President as a Libertarian in 1988.

Glenn Beck’s appearance and Ron Paul’s winning of the presidential straw poll with 31% are notable. It makes the point that traditional conservatives are, at least to some degree, rebelling against the Republican Party. And if rebelling is too strong a verb, they are at minimum sending a message that business as usual will not do. This along with the Tea Party movement should bring some alarm to Party officials. While the Republicans will pick up seats in the Senate and House this November, they may not do as well as they could if these disgruntled conservatives think the Republican on the ballot is nothing more than a Democrat lite.

Glenn Beck, in his speech, beat up the Republican Party pretty badly, and with good reason. Based on the response to his talk you’d think that conservatives are actually ready to embrace personal responsibility and limited government. According to Mr. Beck the only true function of government is to “protect us from the bad guys”, to wit; a Justice Department and Defense Department….very libertarian. Call me crazy, I don’t think they are ready to really embrace these notions.

The ones who voted for Ron Paul in the straw poll are concerned about the government debt and the economy more than anything else. I don’t think most of them support his foreign policy; isolationism with the exception of trade. Ann Coulter, for one, likes Ron Paul except for foreign policy. This vote is a message to the party to rethink its domestic policy. Ron Paul would shrink the size of government, abolish or seriously refocus the Federal Reserve and go back to a gold standard. He embraces Austrian Economic theory which is the 180 degree alternative to Keynesian Economics. He would abolish Social Security and Medicare/Medicaid…….SCREEEEETCH. WHAT??? You mean I wouldn’t get MY Social Security?

So, what will be the outcome of all this politically? As a perpetual skeptic I’m not expecting much. Our entire culture, even among conservatives, embraces entitlements to some degree; at least when it comes to them individually. Our biggest entitlements are social security and medicare. Together they represent unfunded liabilities of up to $70T by some estimates. They are, therefore, the lion’s share of our future fiscal problems but I’d be willing to bet that a large majority of Republicans expect to get theirs and will not tolerate much “adjustment”.

But that’s ok too. When the whole system implodes people will learn that life and death go on and the ultimate truth; that they are responsible for their own lives will be learned. And the lessons of our Founders will be re-learned.

Sunday, January 24, 2010

Scott Brown and Freedom

I’m encouraged that there may actually be a spark of freedom left in the American psyche. The election of Republican Scott Brown to the U.S. Senate from the State of Massachusetts is nothing short of amazing. It gives to a Republican the Senate seat that has been held by a Democrat since JFK defeated Henry Cabot Lodge in 1952. In contemporary politics it is at minimum a repudiation of at least some of the policies (ok, one policy, healthcare) of President Obama and the Democratic Party. Republicans will extrapolate for narrow political purposes the implications of this election. But Republicans are more interested in regaining power than in promoting freedom. The broader question is what does this mean for the future of freedom in our country?

I’ll state my conclusion up front, probably not much. In the continuum of America’s decline toward democratic socialism, this is but a blip in the positive direction. The American people are, generally, there are exceptions to be sure, but generally they are more interested in promoting their interests in federal largess at the expense of their fellow citizens. If you doubt that, how many of us would be willing to forgo our social security? That payment is forced extraction from a current tax payer directly to a current recipient. Sure, the government has been taking money from you by force for years, if not decades, but does that negate the amorality of your living at the expense of others? I don’t exempt myself from the dilemma. I hope to not take Social Security when I turn 66. My wife won’t like my decision. It could get dicey.

The Republicans are energized and think they can gain seats in both the Senate and House this year. And they probably will. They may even take control of the Senate or the House which will definitely force the Democrats to move back to the center. The Democrats grand attempt to move the country left will have failed. But that doesn’t mean the electorate has realized the error of their ways and will now embrace freedom, free market capitalism, constitutionally limited government and individual responsibility. No, the only thing this election reveals is that the voters of Massachusetts were concerned that they may get less money back from the federal government than they send. This notion of using government to loot others is explained very well in “The Law”, by Frederick Bastiat. In the section entitled “The Choice before us”, he explained.

This question of legal plunder must be settled once and for all, and there are only three ways to settle it:
1. The few plunder the many.
2. Everybody plunders everybody.
3. Nobody plunders anybody.
We must make our choice among limited plunder, universal plunder, and no plunder. The law can follow only one of these three.
Limited legal plunder: This system prevailed when the right to vote was restricted. One would turn back to this system to prevent the invasion of socialism.
Universal legal plunder: We have been threatened with this system since the franchise was made universal. The newly enfranchised majority has decided to formulate law on the same principle of legal plunder that was used by their predecessors when the vote was limited.
No legal plunder: This is the principle of justice, peace, order, stability, harmony, and logic. Until the day of my death, I shall proclaim this principle with all the force of my lungs.

Unfortunately, we’ve made our choice and this election will not change our decision.

Saturday, January 16, 2010

In God we Trust

If I hear another survivor of the earthquake in Haiti thank God for saving them, I'm going to pull out my last few strands of hair. So God decided to save your sorry ass and not the other oh pick a number, say, 50-200 thousand people. Seems to me he could save the whole bunch, I'm mean, damn, He or She is God, for God's sake.

The good Reverend Pat Robertson, who can always be counted on to contribute the most incredible quote, says that Haiti was cursed by God for making a pact with the devil a couple of hundred years ago in exchange for helping them break away from the French. The French? Since when has a country needed God’s help to defeat the freaking French? But I digress. My ‘Ole buddy Pat is the only one making any sense here. There has to be SOME reason why this god forsaken country has been so forsaken by God. Pat is being vilified by Christians and non-Christians alike for his assertion but at least his point of view has some logical consistency. There has to be some reason God would save some and not all. Either that or there is no unified holistic intelligence in the Abrahamic tradition controlling every aspect of life on earth, including earthquakes. Me thinks it’s the latter.