The Greek Circle

http://www.nytimes.com/2012/05/30/business/global/athens-no-longer-sees-most-of-its-bailout-aid.html?_r=1

The primary goal of this financial rigmarole is to blind the European taxpayers (ie the Germans) to the reality of their position. Imagine having a sordid, lying, cheating, stealing Section 8 tenant--then solving her insolvency by paying yourself the rent she owes you. Of course, this is only a temporary expedient until she reforms her ways!

Though most people cannot understand the procedural intricacies of the Eurocrats and their obliging Greek "friends", an editorialist can readily sum the figures for his readers. That sum, by the way, seems to be about $70 billion out the door and in the wind thus far, with real interest rates consuming about $5 billion a year so long as the Germans continue to service 75% of Greek debt. But, in addition to paying interest, they persist in sending more fresh capital into the black hole. Their total default exposure is around $170 billion just for Greece's public debt. Greek banks also owe debt to the Germans in the multibillion dollar range. If Greece leaves the EU, the nominal cost will probably be $300 billion or more. The real cost involved in radically upending business expectations and altering the terms of trade will be substantially higher. And the cost will fall upon the creditors primarily in either case. 

And then we have the Iberians.

The Meaning of American "Poverty"

http://article.nationalreview.com/?q=NjJiMDE5Y2M1OWNmNDFhMDIwNWMxYTA1Mzk5ZDkxMTk=&w=MA==

 

Welfare does not count as "income" for determining whether a household is defined as poor by the government. This greatly diminishes the relation between its definition of poverty and the reality of poverty. But, of course, the Left considers close relations with reality too painful to contemplate, much less seek out. Hence, this rather successful propaganda campaign that brays about the high "poverty" level and the need to increase welfare spending (though the poverty determination formula prevents even a tripling of welfare spending from impacting the "poverty" rate). What we have here is another number without a comprehensible meaning to the vast majority of Americans. But, who can compete for public legitimacy with the propagandizers of the Census Bureau who churn out these lies?

Another important reality rarely noted is the incentive structure the government foists upon the poor to not work too much or get married: both work and marriage reduce the various forms of welfare payments.

Redefining "Dignity" and "Pride"

http://www.nytimes.com/2006/07/31/business/31men.html?adxnnl=1&pagewanted=all&adxnnlx=1318172581-aGaU9McISvTHvJDEZTsZDQ

This article is actually from a couple of years ago, pre-recession. But, the trends it gets into are multi-decade in nature. The mystery under examination is the huge number of American men, age 30-54, who do not work, even in a period of 4% unemployment. Fully 13% do not work, some of whom are looking, most of whom are not.

It's useful, first, to separate those looking for work (unemployed) from those not looking (idlers). These are clearly distinct categories. The unemployment figures are well-known; the number of idlers is a more interesting issue. From the numbers in the article and supporting data provided, the trend toward increased idlers was mostly gradual in the 50s, 60s, and 80s. In the 70s, 90s, and 00s it increased rapidly. Approximate number of idlers in each year:

1968: 3%
1980: 6%
1990: 6%
2000: 7.5%
2005: 8.5%

Unfortunately, the stats (on race, education, income) the Times provides do not distinguish between unemployed and idlers--an idiotic misstep. After all, the point of the article is to investigate the mystery of increasing idleness.

Some percentage of the idle work off the books at any number of casual, temporary, informal, or illegal jobs. Mostly, this type of thing is ill-paid and irregular. The main inducements to idleness are likely disability and Medicare benefits or a wife who takes up the slack with her income. A third of the unemployed and idlers have $50k+ household income--either they have significant financial resources or spousal income.

Given that the federal disability program increased its charity cases from 3 to 6.5 million from 1990 to 2005--it's fair to say it's being gamed by millions. This was a time period when jobs were becoming less strenuous and dangerous and population only grew 15%. The problem is that neither the Social Security bureaucrats nor the administrative law judges, who determine whether someone qualifies for disability payments, have an incentive to ensure a fair decision. They take the easy way out--approval (sometimes after appeals of the initial decision) for almost everyone who applies for this charity. No doubt many more will suddenly become disabled during this recession.

The racial breakdown for these men (unemployed and idlers), somewhat disguised by the statistical presentation the Times chose, is thus:

White:     11.5%
Black:      27%
Hispanic: 13%

The blacks are a special problem, as in so many other areas of life. Their excessive rate reflects various causal factors: a high rate of criminality, residence in areas with few jobs, poor education and training levels, the alternative appeal of criminal activity (esp drug dealing), the collapse in black America of the tradition of men supporting women and children, habituation to the low income/welfare dependency lifestyle.