Dead Animals Mean Food

Moral and health hazards abound when looking into what to eat. That we eat too much meat in this country, is not controversial. That we have a lot of industrial agriculture that is not good for the environment or for animals is also pretty well understood. It has become an increasingly commonly held belief that farm subsidies are antiquated and mostly neither a good use of money nor a producer of good results.

One of the moral issues that I tend to get prickly about is vegetarianism...particularly veganism. Our health would be better if we ate more veggies, and it would probably be better still if we were all vegetarians subsisting on legumes, whole grains, fruits, veggies, dairy and eggs. Of course, that doesn't mean that a vegetarian diet is best for the world or the environment, and certainly not one that results in no dead animals for our food. Even vegan diets are responsible for the killing of many millions of animals as the direct result of farming.

More subtle is that meat can actually be a very ecologically efficient food source. The way much of it is produced in the US, it is not, however. There are a couple reasons. One is we eat too much meat, and so need to produce too much, and the cost/time efficient methods to do so are not ecologically efficient and so we are where we are. Another reason (outline in the post, which is reviewing this book) is that we have made some of the ecologically efficient methods illegal--particularly feeding waste to pigs.

Until we fix industrial agriculture, it will be hard to determine what is the "best" diet for us to have. Still, that doesn't mean we should just keep on as is. Strong pushes to increase fruit and vegetable consumption and to reduce meat consumption are very good ideas. Moral grandstanding by vegans is probably counterproductive, particularly when done by the poorly informed.

Yea, but No...

I really don't like arguments that are true, but so incomplete that they may as well be false, which is why I'm not so fond of this Orszag article in the NY Times. I think my biggest gripe is with this line (and his subsequent arguments):

Yet no one wants to make an already stagnating jobs market worse over the next year or two, which is exactly what would happen if the cuts expire as planned.

The problem, of course, is that it's kind of garbage. Yes, if the tax cuts expire demand could go down a bit more, but it also might not. Savings rates have jumped dramatically, and if people are already saving as much as possible, then there might not be much cutting back to do, and ending the tax cuts will only reduce savings rates. Not that anyone has actually studied anything here. The problem is that it seems everyone takes the "ending the tax cuts will make the economy worse" meme at face value. People who want to end the tax cut point out that other stimulus would be much better.

I'm hardly Greenspan in terms of my views on fiscal discipline or the economy, and I don't think that ending the tax cuts would have no effect, but it is not clear to me that it would be more than a blip. If our economy is already pricing the tax cuts ending into it's behavior, then there will be no difference. If uncertainty is making things worse, then it is better to end them now (that would be more certain than a temporary extension).

Capital Gains and Inflation

Stealing the title from Matt. Also commenting on that theme; this is also a followup on the last post...

Inflation is a double edged sword. Higher inflation reduces the value of any saved cash, but it also reduces the real value of any debt. Investments that hedge against inflation are, therefore, things that have a value that is linked to inflation.

Real estate is an inflation hedge because if inflation happens, my house gets more expensive in dollar terms, even if it's "value" remains the same, but the amount that I paid for it and my monthly mortgage payment so long as I have one don't change a bit.

The downside of inflation is that the cash I have stashed in the bank is worth less.

Taxing Capital Gains

I'm pretty sure that I understand capital gains tax arguments in exactly the opposite way that they tend to be presented--i.e. that low cap gains tax stimulates investment thus spurring the economy. The way I see it, the higher the cap gains tax is the more an individual must invest to have the same dollar return on investment, and it is the dollar return that people want and need. The percentage is only relevant to the extent that larger percentage returns equal more dollars.

I agree much more strongly with the idea that it is largely people who live off capital gains (i.e. the rich) who want who want lower cap gains taxes, and this is because at that level of wealth, there is a pretty good chance that near 100% of wealth is already tied up in investments and that no additional diversion (or at leas not a substantial one) can be made to offset higher capital gains taxes.

Basically: higher capital gains taxes should create more investment (from working people saving for retirement), boosting the economy, and that it will come at the expense of people who are living off of capital gains.

New (to me) Idea from a Politician!

Interesting proposal here. Similar to cramdown (bankruptcy modification of a mortgage to a lower principle value) but with an added benefit to banks to help them offset the immediate loss. I think it will work in places where people would like to stay but can't afford. It wouldn't work so well in places where there are no jobs and people want to relocate.

As an aside, however, I would like to say that upping the duration of a mortgage from 30 to 50 years really doesn't help much. For a $150k mortgage at 5.25% interest the mortgage payment on a 30 yr loan is $828.31, at 50 years it only goes down to $707.82. Now an extra $100 a month is a fair amount to a lot of people, but the extra 20 years it takes to pay off is, to me anyway, much bigger. The main reason is that interest alone is $656.25, so if you got a 10,000 year loan you would still be paying $656.25 per month.

For very long term loans a small increase in the payment can make a large difference in the time to pay it off. In the example above, an extra $50 per month on the 30 year loan would reduce the total time to pay off by nearly four years.

President Obama = Charlie Brown

And he just keeps thinking that Lucy isn't going to pull the football away. At least, that's the message I get from this.

The White House is struggling with whether to propose ideas that would appeal to Republicans, and thus get support on Capitol Hill—such as tax cuts—or whether to promote ideas that officials believe could have more economic impact but might hit political resistance, such as more aid for states and more infrastructure funding.

It's really simple, and I thought Obama was supposed to be smart: he can send the most right wing bill in the world to congress and he will receive ZERO Republican votes for it. They don't care what's in the bill. They are fighting him.

Iraq War Over...Still Killing Troops and Civilians In Afghanistan

So now that we pacifists have won the day and no more war evah*, I just wanted to put a handful of links to various retrospectives.

Someone who was right.
Someone who was wrong and admits it.
Someone else who was wrong and admits it (longer winded).
Someone who was wrong and is trying to excuse it.
Along with someone who is calling that bullshit.

As for me. I was pissed as hell back in 2002-3 that the entire of our government and the vast majority of media was so gun-ho to go to war in Iraq. I wasn't entirely up on the history of the region, I didn't care for Sadam, and I was even willing to concede that he maybe had some chemical or biological weapons. I still thought it was a bad idea, a distraction, a waste of money, and likely to cause a great deal of suffering. Mostly, I was pissed at how my opinion was deemed fringe and wrong by so many "Serious People" who were wrong wrong WRONG!

Now many of those who were right back then are pretty keen to get the hell out of Afghanistan, while many of those who were wrong and have since admitted it are pretty keen to...get the hell out of Afghanistan. Of course, we aren't going to do that, because the "Serious People" in government, even those, like Obama, who thought Iraq was wrong, think that we must stay in Afghanistan...I guess because there are people there who don't like us that we haven't killed yet or something.

*by "evah" I mean we will constantly be at war for the rest of my life, but we are going to pretend that we are a peaceful nation because we have (probably) stopped killing people in Iraq.