Posted by on January 31, 2017

I am not much for betting, but I thought it could be fun to put some money on Trump not serving out his first term.  (I was thinking impeachment or resignation, but I guess that there are darker ways for this to happen, too.)  I put my subjective probability at a seemingly generous 20% that he wouldn’t make the four years.  Given the history, with only two failed attempts at impeachment (Andrew Johnson and Bill Clinton) and one harried resignation (Richard Nixon), I thought that I would get at least the 4:1 odds of my estimate.

Imagine my surprise to jump on some betting websites and find them all quoting the odds at even!  Even though I should have considered health issues for a 70-year old, albeit one who seems out to prove the old saying about “only the good die young,” this still seems out of whack.  But then Trump issued his Executive Order (“EO”) on immigrants and refugees, and the logic of the bookies became clearer.

Elements of the EO were immediately blocked by the courts.  Trump has absolutely no understanding of the US political or legal system and an ego too big to solicit or listen to wise counsel, assuming that any is available in his inner circle.[1]  This is a recipe for continuous friction with the judiciary.  A sufficiently frustrated Trump could easily try to override court rebukes in an unconstitutional manner.   There are already rumors that Customs and Border Protection agents are ignoring the court orders.  If this kind of thing happens, and it is traceable to the White House, then Trump will find himself in the dock very quickly.

If he is impeached, the knives will probably be out for him on both sides of the aisle.  This goes without saying with the Democrats.  For the Republicans, it is nearly equally likely, unless Trump scores some overwhelming and early successes on the economy or foreign policy which could make him untouchable for many Republicans.  He has certainly set himself up for a fall.

Even given his recent performance and my new insight, I still might try to put some money on the other side of the wager.[2]  But I am less convinced of this position than I was just a short time ago.  And this is only day 11 of the Trump presidency.  Buckle up.

Better Voting Comes to Maine

One of the little noticed results from the voting in November was the passage of Maine Question 5, which established ranked choice voting (“RCV”) in that state.  Starting in 2018, RCV will be used for primary and general elections for U.S. senate, congress, governor, state senate and state representative.  I believe that this is the first time that RCV will apply on a state-wide basis, although it has been used elsewhere for local elections and for certain forms of early balloting.  One form or another of ranked voting is also used in a number of foreign countries.

In RCV, voters rank as many candidates as they wish on their ballots, including not ranking some candidates at all.  If one candidate receives an outright majority of first-choice votes, then that candidate wins.  However, if there is no outright majority, then the candidate with the fewest first-choice rankings is eliminated and the votes of the people who ranked this candidate first automatically go to their second choice.  This process continues until one candidate wins the majority.

This form of voting has been shown to increase the quality of political discourse.  Since candidates must appeal to more than just their “base,” since lower rankings from outside their core supporters may also be important, there is less negative campaigning and more attempts at logical persuasion.  Very importantly for a libertarian like me, or for anyone who relishes (unlike Bernie Sanders) an economy that gives me 23 different deodorants and detests a political system that only gives me two political parties, this form of voting greatly improves the chances for third-party candidates.

With RCV, voters are able to rank, for example, their third-party favorite first and their “least bad” choice among the two major parties second.  Endless discussions about “wasting a vote” or “spoiler candidates” disappear.  To see this, imagine a vote where Trump and Clinton are each the first choice of 45% of the population, with an enlightened 10% of Economic Man readers going for Gary Johnson.  The EM readers also all choose Clinton as their second choice on the theory of “she is wrong about absolutely everything, but within normal parameters.”  There is no majority at first but Clinton wins 55% to 45% after Johnson is eliminated.  The enlightened EM readers can vote for Johnson without fear of putting Agent Orange in the White House.

RCV would go a long way to overcoming the inherent bias in favor of the major parties that comes from our “first-past-the-post” voting system.  If you want an amount of choice in your politics closer to your underarm opportunities, remember this if you have the opportunity to vote for a RCV proposal in your locale.

This Makes a Change: A Good Unintended Consequence

One of the unintended consequences of Obamacare’s push for broader insurance coverage has been to increase deductibles.  Although this is much regretted by policyholders, it has the beneficial consequence of moving the American medical system in a saner direction.

I have seen estimates that upwards of 85% of medical costs are paid with OPM (“other peoples’ money”), from either an insurance company or the government.  The figure for hospital care is even higher.  There is no market that can function with so little engagement by the consumer.

Insurance should only be, as the term “insurance” implies in all other contexts, for catastrophic events.  Not the routine matters that medical insurance has typically covered in America.  This will create greater scope for the price mechanism and the free market to do its usual job of improving quality while reducing costs.

A recent article in Time magazine, entitled “What Happens When Doctors Only Take Cash,” shows this very well.  It describes the Surgery Center of Oklahoma, which is one of a growing number of medical facilities that do not take insurance or government payments.  The founders of the Surgery Center claim to have seen an increase in business since Obamacare came into effect: “I guess it’s ironic that Obamacare created this market for us,” says one of the founders, with a laugh.

The consequences are exactly what the economic textbooks would predict.  The facilities tend to specialise in certain procedures.  They post their prices in a clear and transparent manner, and usually on an all-inclusive basis that includes any post-operation care and follow up.  They are much cheaper than standard medical facilities, even after the discounts that insurance companies and large consumers are able to negotiate, but they also compete on service.  As one happy client said “I’ve really never experienced this quality of care.”  The article didn’t quote any figures on outcomes, but since the prices are inclusive and the facility would have to absorb the cost of botched care, I strongly suspect that these are good.

In summary, despite all the claims that medical care is inevitably subject to “market failure,” the Surgery Center of Oklahoma seems to do what we expect from free markets and competition: produce high quality and low prices.  This is also what happens in the other limited areas of medicine that operate on market principles, such as laser eye surgery and elective plastic surgery.

Numerous commentators claim that Obamacare, for all its faults, has at least slowed the rise in medical expenditures.  This is a favorite argument, for example, of the arch apologist and political hack Paul Krugman.  For once, the likes of Krugman may actually be right, but not for the reasons they imagine.  Through no fault of his own, Obama may have actually created space for the free market to perform its usual good work.

And Now For Something Lighter

It was a pleasure to watch the PC revolution eating its own children in the run-up to the Women’s March on Washington.  Cultures were being appropriated and privileges were being checked en masse.  It reminded me of this classic scene from The Life of Brian, a film which contains everything you need to know about religions and other forms of mass hysteria (including the PC movement and identity politics).

I have commented before about the superiority of the Brits when it comes to the use of our common language.  This goes double for politicians.  Here are some excellent examples from Prime Minister Questions in the UK Parliament.  Pay attention American politicians: this is the proper way to insult.

Finally, if you are not among the 26 million (as of last count) who have already seen this bad lip reading video about the inauguration, this is a must see.  If you are borderline incontinent, then be sure to hit the toilet before watching.  You have been warned.

 

Roger Barris

Weybridge, United Kingdom

 

I Wish I Had Said That…

“He who defends everything, defends nothing” by Frederick the Great, pointing out why being the “indispensable nation” is impossible

 “For economists, greedy intentions establish no presumption of social harm.  Indeed, their rule of thumb is to figure out who could get rich by solving a problem – and start worrying if no one comes to mind” by Bryan Caplan in his book The Myth of the Rational Voter

 “My dear, find what you love and let it kill you” by Charles Bukowski, the novelist, who certainly followed his own advice

 

[1] Kellyanne Conway is widely reputed to be tight with Trump.  Here she is defending the EO: “325,000 people from overseas came into our country just yesterday through our airports….You’re talking about 300 and some who have been detained or prevented from gaining access to an aircraft in their home countries.  That’s 1 percent.”  Her math skills are certainly deplorable.

[2] This is also the more natural hedge position for a #NeverTrumper like me.  If he survives the term, at least I will have some winnings to compensate for four years of Trump.

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12 Comments on "A Flutter on Trump"

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Anonymous
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What do you mean with ‘harried’ as concerns the impeachment of Nixon? Do you believe his ignominious behaviour (taping the democratic convention, sacking the judiciary that took issue with that, etc) did not warrant impeachment? Or do you merely think it went very quickly, as it it should have?

Patrick
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Still negative on Trump, my friend. He is the president, we should give him a chance. As a business person and great father yourself, i would have thought that you would see two fundamental skills about Trump that will make him go down as one of the best president in a long time. He knows how to get stuff done and he knows how to bring up kids in a respectful fashion. And he is totally un PC which again is an important trait for fatherhood and entrepreneurship. I hope you will be wrong and I will be right, only… Read more »
Anonymous
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The good thing about Trump, his historical importance, is that, for (better or) worse, he is the fulfilment, the end-point, of the ‘promise’ of that american 18th century hyper-democratic religion: in the end, the political leader of a group of ordinary men will be an exact copy of those ordinary men. Nothing will distinguish the leader from the people he leads. Nothing he will think will be different from what they think; nothing he will say will be different from what they say; nothing he does will be different from what they do; it will, paradoxically, be a complete reversal… Read more »
Anonymous
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Fabulous quote. Mencken, that most un-american american europeans love to quote.

Anonymous
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I agree with most of what you say, and Charles Krauthammer, another great american essayist, said all of that best: that it is a truism of democracy that whoever ends up running the country is not worthy of the office because the things you have to do to get there are nothing any decent person would ever want to subject himself to. But your comments on the germans are mistaken: the germans are no longer trying to wipe out that black mark. It has been wiped out. Exceptionally talented politicians of a kind you won’t find anywhere else (Schmidt, Kohl,… Read more »
Anonymous
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Very much like the blog (“Unbroken”). However, I believe the respective history of the Japanese and the Germans may explain why there is that understandable discrepancy: Germany did not have its Nagasaki, no Hiroshima. It is easier to repent in public if you have not been on the receiving end of a crime that was far greater than the one you committed. Not “Black Book” but “Black Rain” is the relevant cinematic reference here.