Finnish Broadcasting Co. YLE, TV1, Nov 11th 2009 at 8.00 pm.

[LINK HERE] to Finnish Broadcasting Web Site to view pictures of graphs shown on the broadcast.

Voiceover (VO), reporter Martti Backman: Governments around the world are preparing for a grand climate conference, which should decide how humanity responds to the threat of a climate catastrophe. Negotiations are under way to replace the Kyoto treaty with a new treaty of Copenhagen.

VO: The threat is based on assessments by the Intergovernmental Panel on Climate Change, the IPCC. According to the panel, the Earth is going through an unprecedented period of temperature increase, caused by man and his carbon dioxide emissions from burning coal and oil.

(Pictures from An Incovenient Truth)

The Earth’s climate has always been changing. But now we are told that warming is happening faster than ever. The view is based on this figure.

(Picture: The global warming hockey stick graph. Music: Electric organ sounds from an ice-hockey game)

VO: This ten-year-old figure, dubbed as the hockey stick, was meant to revolutionize the dominant view of global climate history. The stick’s handle stretches for almost a thousand years, creating an impression of a steady climate, and its’ rising blade in the late 1900′s is proof of sudden, strong warming, which is caused by man.

According to the older view, climate has naturally varied considerably over the past millennium, and in the middle ages it was clearly warmer than today. But in the hockey stick graph, the Medieval Warm Period and the little ice age after it have disappeared. The hockey stick was promoted to honorary status in the IPCC’s third assessment report’s cover. It became the logo of catastrophic climate change. The stick was used to back up the claim that, 1998 was the warmest year of the millennium.

Steve McIntyre: ”At the time I was doing mining exploration business and I just wondered, in the most casual possible way, how they knew that. So that led me start looking at the data and six years later, I’m still doing it”.

VO: The Canadian statistician Steve McIntyre had doubts about the scientific strength of the hockey stick graph, and he decided to unravel the numbers behind it, with the diligence of an auditor. The father of the hockey stick, professor Michael Mann resisted McIntyre’s efforts to get hold of his research data, and it wasn’t until 2003 that McIntyre succeeded in getting access to the data.

McIntyre: ” It turned out that he had modified a principal components method incorrectly and the modified method produced hockey stick-shaped graphs ninety-nine percent of the time. It also emphasized a class of proxies, strip-bark bristlecone pines that previous authors had said were not actually a temperature proxy”.

VO: Temperature records measured by thermometers are at most 150 years long. Earlier histories have to be reconstructed with so-called proxies, or surrogate thermometers. Past climates are deduced for example from tree rings and lake sediments or varves.

The shape of the hockey stick was to a large extent caused by tree rings from a few North American bristlecone pines. McIntyre succeeded in deconstructing the stick. The United States National Academy of Sciences set up a committee to investigate his findings. The committee found that, McIntyre had been right to question the temperature reconstruction and announced that, bristlecone pines should no more be used as proof of climate change.

Steve McIntyre, an outsider in climate science, had succeeded in breaking Mann’s hockey stick, the icon of the climate change movement. But the story was not over. A whole factory started to produce new sticks to replace the broken one.

McIntyre: “There was another class of study, which used a series of tree rings from a scientist called Keith Briffa, from Northern Russia, from a site called Yamal, and this had an even bigger hockey stick-shape than the Michael Mann -hockey stick and this one – - has been used in multiple studies as well and so, over the past few years I’ve been trying to get information about how this particular series was constructed”.

VO: Keith Briffa is one of the big names in climate research. He is a professor in the IPCC’s scientific stronghold in Britain, the Climate Research Unit at the University of East Anglia. He is also a lead author of the past climate chapters of the IPCC’s assessment reports.

McIntyre had to fight for three years to get Briffa’s Yamal data under his microscope. But a lot happened before that.

The well-known medieval warmth was disturbing to the scientists close to the IPCC, the so-called hockey team. In the mid 1990′s the American geologist David Deming received an astonishing e-mail, in which one prominent climate researcher announced to his colleagues:

Actor’s voice: “We have to get rid of the medieval warm period.”

(Picture of Deming’s written statement from the Senate Environmental committee website)

VO: Deming testified about the e-mail at hearings in the United States congress.

Soon after this e-mail, Keith Briffa published a study, where the millennial temperature history looked like this: (the upper curve appears on screen)

VO: The Briffa study was based on a very limited number of tree ring samples from the so-called Polar Urals region in Siberia. With the help of just three short tree ring series he claimed that the year 1032 in the middle of the balmy middle ages, had been the coldest in the millennium. And the modern period appeared to be very warm. A real hockey stick.

A couple of years later, Briffa’s colleague returned to Siberia to drill new tree ring samples. When they were added to Briffa’s original data, the curve looked surprisingly like this: (lower curve appears on screen, the curves merge).

The hockey stick had disappeared, and the medieval warm period had been reinstated as warmer than the present.

McIntyre: “Unfortunately, this updated Polar Urals result was never published and Briffa, in his works since 2000, has made no – - reference to this updated study”.

VO: The updated Polar Urals series was forgotten. Instead, Briffa replaced his original weak Polar Urals data in 2000 with new tree ring series drilled from the Yamal peninsula hundreds of kilometers away. With this data, the climate reconstruction looks like this: (lower curve appears).

VO: The blade of the hockey stick rises at the end of the millennium stronger than ever and the medieval warm period is clearly shadowed by it, if not made to vanish completely.

Yamal data became the most important temperature proxy for all later hockey sticks, and it was used in at least seven temperature reconstruction studies.

But McIntyre knew something about the construction of hockey sticks, and he could not believe in the Yamal curve. The contradiction to established paleoclimatic knowledge was simply too big.

McIntyre: “And the question is just, why was the Polar Urals update not reported? And if the Yamal series was going to be used rather than Polar Urals, that should have been clearly explained to readers. The criteria for preferring one rather than the other should have been also clearly explained”.

VO: Finnish Lapland lies at the same latitudes as Yamal, and there are plenty of Finnish studies on past climates based on tree rings. These studies are considered to be among the best in the world, for their sample quality as well as methodologically. What kinds of hockey sticks have been found in them?

Kari Mielikäinen, professor of forest research (Metla, Finland): “We have this long series going back over 7,000 years, and there’s no hockey stick there.”

VO: Briffa’s Yamal hockey stick was published in the prestigious journal Science. McIntyre asked for a copy of the raw data from Yamal.

McIntyre: ”Briffa refused. The editors of Science refused to require Briffa to provide the measurement data…”

VO: It took McIntyre three years to get hold of the data, although one of the most important rules in science is that, raw data should be made available to anybody who is interested in checking and replicating a study.

Finally Briffa made a “mistake”. He published yet another article based on the Yamal data in a journal of the British Royal Society. The prestigious scientific society held on to the principle of data transparency and forced Briffa to make his raw data public. In September this year, the Canadian climate auditor had his forebodings confirmed.

McIntyre: ”So after, after sort of, three years of frustration and trying to examine the data that Briffa had used and probably four years of people saying that this data supported the Michael Mann -work on other grounds, it was really quite frustrating to find that it was built up on ten trees that had been not randomly selected”.

VO: So the Yamal data included only ten living trees from the 1990′s, and the rapid growth of these individuals caused the steep rise of the hockey stick blade. In Finnish dendrological studies, hardly anything would be said based on just ten trees. What’s demanded is at least 50 trees for each year, and several other quality criteria as well. How have these criteria been observed in the Yamal data?

Kari Mielikäinen (professor of forest research, Finnish Forest Research Institute Metla): “Rather weakly it seems. It looks like there are problems with both cohort structure and also the regional distribution (of the sample).”

VO: McIntyre conducted a simple statistical exercise. He replaced the 10-tree Yamal sample by a larger 34-tree sample collected from the same area. (In this figure) the added material is depicted with the black curve, and the combination of both data sets as a green curve.

VO: The hockey stick blade disappears, or actually turns downwards. And the medieval period is again warmer than the present.

McIntyre: ”I think that the preferential selection of Yamal, rather than Polar Urals, biases the result that’s presented to the public”.

VO: All good proxy-based climatic reconstructions should compare the results with adjacently located measurements from thermometers. When this is done in the Yamal area, it emerges that none of the near-by weather stations have recorded warming that would explain the hockey stick graph. In other words, if those ten trees have grown abnormally fast in the 1990′s it is due to something else than heat.

Mielikäinen: “If you choose one convenient series just to prove a point, be it a hockey stick or anything, you are definitely on a wrong track.”

VO: Problems with tree ring studies will be addressed next summer in an international scientific congress chaired by Mielikäinen in Rovaniemi (Finnish Lapland).

(pause)

VO: The author of the Yamal reconstruction, Keith Briffa, has disputed the criticism aimed at his study, but it still draws heated debate.

Briffa’s employer, the IPCC-affiliated climate research unit CRU maintains a global database of temperature measurements from weather stations. This database is central to the conclusion that global temperatures have risen to a worrying extent during the past 40 years. The CRU has combined thermometer readings into a global average with a method which it refuses to disclose, but which allegedly has brought added value to the raw data. McIntyre has requested the data from CRU director Phil Jones, but he has been turned down, and others as well.

McIntyre: “An Australian named Warwick Hughes had asked for the data and Warwick Hughes had published some articles that had been critical of how the temperature histories had been prepared, and Jones said ‘Why should I send – we have twenty-five years invested in this, why should I send the data to you when your only objective is to find anything wrong with it?”, which is a very unscientific statement.”

VO: The CRU database is the most important scientific justification for the demands that the most ambitious treaty in mankind’s history should be finalized in Copenhagen in December. In spite of this, there is no way to replicate its’ validity.

Recently the CRU director Phil Jones has announced that the original measurement data does not exist anymore because of data storage difficulties. A dog ate the world’s most important scientific measurement homework.

(Pause, move to Korttajärvi, central Finland.)

VO: Materials for the hockey stick factory have also been collected from Finland.

Reporter Backman, standing on a jetty: “This small Korttajärvi in Jyväskylä has become a focal point in the international climate debate. Based on samples taken from its’ bottom sediments, some foreign researchers claim that, an unprecedented warming occurred at the end of the 20th century. Finnish researchers, on the other hand, have used the lake to show that climate has always changed, even more than recently, and irrespective of human influence.”

VO: Five years ago, one of the Korttajärvi researchers responded to MOT’s question about the IPCC’s claim that recent temperatures are highest in a thousand years.

(Interview footage from MOT archive, 2004)

Ojala: “Based on these studies it seems that this claim is not quite true, at least for the Northern hemisphere, at least for Scandinavia. We’ve clearly had much warmer winters here in the Nautajärvi and Korttajärvi area, than what we are experiencing now.”

Question by Backman: “What’s your estimate, how much warmer was the medieval period in Finland, compared to the present?”

Ojala: “It is difficult to say exactly. But we may speak of half a degree (Celsius), even a whole degree based on several European studies.”

VO: At least two research teams close to the IPCC added the sediment data collected by Finnish researchers as part of their own paleoclimatic model reconstructions. This was done with agreement, but the Finns were surprised to see that in a study published this September, their data and interpretation of its’ meaning had been turned upside down. Here is the millennial temperature reconstruction from Korttajärvi done by the Finns:

VO: And here we have the same data presented by the hockey team:

VO: A nice hockey stick has emerged from the Korttajärvi mud. What in the Finnish study signified cold, had been turned into warmth in the IPCC science and vice versa. This interpretation passed the scientific peer review.

Dr. Atte Korhola, professor of environmental change at the University of Helsinki, is an expert in lake sediment studies.

Atte Korhola: “Some curves and data have been used upside down, and this is not a compliment to climate science. And in this context it is relevant to note that the same people who are behind this are running what may be the world’s most influential climate website, RealClimate. With this they are contributing to the credibility of science – or reducing it. And in my opinion this is alarming because it bears on the credibility of the field, and if these kinds of things emerge often – that data have been used insufficiently or even falsely, or if data series have been truncated or they have not been appropriately published (for replication), it obviously erodes the credibility, and this is a serious problem.”

VO: The author of the September study, Darrell Kaufman, admitted his mistake two weeks ago and sent a correction to the journal Science. But the main author of a previous study, Michael Mann, the father of the original hockey stick, still sticks to the claim that a hockey stick was found at the bottom of lake Korttajärvi.

(Pause)

VO: The climate studies used by the UN affiliated IPCC are usually computer simulations, based on models emulating the behavior of global climate. Some traditional researchers have criticized studies based on just computer simulations, calling it “playstation climatology”.

According to the most prominent computer models, human activity should cause global warming that looks like this:

(Graph showing rising projections to 2100.)

But the measurements show that, real temperature has so far varied like this:

(Graph showing land and satellite based measurements of global temperature until 2009 – clearly below the model simulations.)

VO: A poorly known fact is that, global climate stopped warming after a two-decade period (in the late 1900′s). Since 1998 there has been no statistically measured global warming. Instead, the climate has slightly cooled for several years. Not one of the climate models used by the IPCC was able to predict this turn of events.

Some new studies predict the cooling phase to continue longer, maybe for a couple of decades. In spite of that, many leading scientists affiliated with the IPCC still claim that global warming continues, even faster than predicted.

Meanwhile, some of the catastrophic consequences predicted by the models have been revealed as overblown. The Arctic sea ice has started to recover from its’ minimum area recorded two years ago, Antarctic melting has slowed down to a minimum during measured history, sea level rise has not accelerated from its’ previous rate, and hurricane seasons have been mild. Nature has not obeyed the manuscript.

Korhola: “In late summer 2008 I was in England, where all newspapers ran a front-page story about a scenario predicting the total disappearance of Arctic sea ice by that summer. And these predictions were distributed by two leading researchers of the National Snow and Ice Data Center in Boulder, Colorado, Mark Serreze and Jay Zwally. Well, what happened was that these predictions did not come true, but that 2008 was clearly a better year than 2007 with the collapse in ice extent, which was apparently caused by anomalous atmospheric pressure and wind conditions in the Arctic regions.”

VO: Richard Lindzen is a professor of climate science at the Massachusetts Institute of Technololy, one of the world’s most prestigious science universities. He is one of the few scientists who do not study climate by simulating it with computer models. He studies observations from the real natural world.

Richard Lindzen: “This field is completely sick in that way, I mean, you have models you know that they don’t work, you know they don’t reproduce a – phenomenon, but you bend data to fit the model. I don’t think this can go on for long without being embarrassing”.

VO: In September, Lindzen published a study that hit the core of the climate debate. Based on radiation measurements, he calculated how much the doubling of atmospheric carbon dioxide concentration could really warm up the Earth.

The Earth is protected from cosmic freezing by the atmospheric gas blanket. According to the catastrophic warming theory, the CO2 emitted from burning oil and coal thickens the blanket and thus causes the temperature to rise dangerously.

An undisputed scientific fact is that, a doubling of CO2 in itself is enough to cause a one degree (Celsius) of atmospheric warming, which would not be a problem. But the climate models have been fed with the assumption that the warming caused by CO2 increased the concentration of water vapor, which in turn would further thicken the blanket and multiply the total warming a couple of times, up to a fateful six degrees.

Lindzen: “The models do exactly what they are supposed to, given their sensitivity. They all show the blanket thickens and it thickens by the amount consistent with the sensitivity of the models do of doubling of CO2. Do the same thing to nature, and it does exactly the opposite, and it does it more powerfully. So you have all the models agreeing with each other, and all of them wrong compared to nature.”

VO: The question of water vapor feedback is the key in determining the threat of a climate catastrophe. The climate models assume that, the higher the surface temperature rises, the thicker the warming blanket gets. But is this really happening?

Lindzen and his team compared sea-level temperatures with the satellite-based measurements of incoming and outgoing radiation in the upper atmosphere. While all computer models show that, as the surface temperature rises, less radiation escapes to space:

(Graph of 11 model simulations with downward sloping lines)

VO: The reality measured from nature is exactly diametrical:

(The 12th diagram ‘ERBE’ by Lindzen added to the graph set, showing a rising curve)

VO: It turned out that, cloud cover changes as the surface warms, but it was not getting thicker; it was thinning. In this way, nature prevents the atmosphere from excessive heating. The cloud cover reacts to temperature changes like an eye’s iris to changes in light, by contracting or expanding. Lindzen calls this thermostatic behavior the Iris-effect.

And what is the significance of this effect to the estimates of human-caused climatic warming?

Lindzen: “It’s saying that, instead of the one degree being magnified, it should be shrunk by at least a half.”

Question by Backman: “And how much would this sensitivity be in degrees of Celsius?”

Lindzen: “Now, in terms of degrees of Celsius it says that we shall expect doubling the CO2 might contribute in the order of half a degree to the global mean temperature anomaly.”

Backman: “And how big a problem is that?”

Lindzen: “None. We see that from month to month, year to year all the time. I mean the truth is, we have seen already two thirds, three quarters of a degree. This is not the period when the world is falling apart. It’s a period when the population has grown, when famine has been defeated, when people live longer than ever and there is large number of people that are supposedly terribly warming the earth, are living better for the most part.”

VO: Lindzen’s study shows with measurements that the assumption of an impending climate catastrophe is basically wrong. The IPCC camp has reacted to the study with complege silence.

Lindzen: “I think it’s because it’s so simple and obvious, and I think even the alarmist groups know that the better part of wisdom is not to publicize this.”

VO: Professor Atte Kohola is not skeptical of the potential threat of climatic warming like his colleague in Boston, but both scientists are worried about the politicizion of climate science.

Korhola: “Especially now with the Copenhagen conference approaching, one gets the impression that also among scientists, many have lost control. Especially when you compare original studies to how they are presented to the public, in the mass media, there is a huge gap in what comes out. We get a lot of material with terms like dramatic, catastrophic, unprecedented, and among some researchers there is even talk of planetary doom and saving the planet.”

Lindzen: “The real question is, why the last few years have seen this huge boost with all these crazy movies – “Inconvenient truth” – nonsense spewed out, hysteria? We are all going to die, if we don’t change our light bulbs immediately. I can only say, somebody must have noticed that the temperature has stopped increasing and they had all these agendas by now to make billions of dollars, and do this and do that, get people to pay taxes and feel happy about it, because they are saving the earth and so on. So you have the politicians, the bureaucrats, the scientists and so on, and all felt you know that if the temperature continues this way, this is finished if we don’t get it through immediately so the volume has increased.”

VO: MOT asked for an interview with the director of the Finnish meteorological institute, Dr. Petteri Taalas, who is sympathetic to the IPCC’s main line. He refused.

END.
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In 1956, the economist Charles Tiebout provided the framework that best explains why people vote with their feet. The “consumer-voter,” as Tiebout called him, challenges government officials to “ascertain his wants for public goods and tax him accordingly.” Each jurisdiction offers its own package of public goods, along with a particular tax burden needed to pay for those goods. As a result, “the consumer-voter moves to that community whose local government best satisfies his set of preferences.” In selecting a jurisdiction, the mobile consumer-voter is, in effect, choosing a club to join based on the benefits that it offers and the dues that it charges.

America’s federal system allows, at the state level, for 50 different clubs to join. At first glance, the states seem to differ between those that bundle numerous high-quality public benefits with high taxes and those that offer packages of low benefits and low taxes. These alternatives, of course, define the basic argument between liberals and conservatives over the ideal size and scope of government. Except for Oregon, John McCain carried every one of the 17 states with the lowest tax levels in the 2008 presidential election, while Barack Obama won every one of the 17 at the top of the list except for Wyoming and Alaska.

It’s not surprising, then, that an intense debate rages over which model is more satisfactory and sustainable. What is surprising is the growing evidence that the low-benefit, low-tax alternative succeeds not only on its own terms but also according to the criteria used by defenders of high benefits and high taxes. Whatever theoretical claims are made for imposing high taxes to provide generous government benefits, the practical reality is that these public goods are, increasingly, neither public nor good: their beneficiaries are mostly the service providers themselves, and their quality is poor. For evidence, look to the two largest states in the nation, which are fine representatives of the liberal and conservative alternatives.

One out of every five Americans is either a Californian or a Texan. California became the nation’s most populous state in 1962; Texas climbed into second place in 1994. They are broadly similar: populous Sunbelt states with large metropolitan areas, diverse economies, and borders with Mexico producing comparable demographic mixes. Both are “majority-minority” states, where non-Hispanic whites make up just under half of the population and Latinos just over a third.

According to the most recent data available from the Census Bureau, for the fiscal year ending in 2006, Americans paid an average of $4,001 per person in state and local taxes. But Californians paid $4,517 per person, well above that national average, while Texans paid $3,235. It’s worth noting, by the way, that while state and local governments in both California and Texas get most of their revenue from taxes, the revenue is augmented by subsidies from the federal government and by fees charged for governmental services and facilities, such as trash collection, airports, public university tuition, and mass transit. California had total revenues of $11,160 per capita, more than every state but Alaska, Wyoming, and New York, while Texas placed a distant 44th on this scale, with revenues of all governmental entities totaling $7,558 per person.

What might interest Tiebout is that while California and Texas are comparable in terms of sheer numbers, their demographic paths are diverging. Before 1990, both states grew much faster than the rest of the country. Since then, only Texas has continued to do so. While its share of the nation’s population has steadily increased, from 6.8 percent in 1990 to 7.9 percent in 2007, California’s has barely budged, from 12 percent to 12.1 percent.

Unpacking the numbers is even more revealing—and, for California, disturbing. The biggest contrast between the two states shows up in “net internal migration,” the demographer’s term for the difference between the number of Americans who move into a state from another and the number who move out of it to another. Between April 1, 2000, and June 30, 2007, an average of 3,247 more Americans moved out of California than into it every week, according to the Census Bureau. Over the same period, Texas saw a net gain, in an average week, of 1,544 people. Aside from Louisiana and Mississippi, which lost population to other states because of Hurricane Katrina, California is the only Sunbelt state that had negative net internal migration after 2000. All the other states that lost population to internal migration were Rust Belt basket cases, including New York, Illinois, New Jersey, Michigan, and Ohio.

As Tiebout might have guessed, this outmigration has to do with taxes. Besides Mississippi, every one of the 17 states with the lowest state and local tax levels had positive net internal migration from 2000 to 2007. Except for Wyoming, Maine, and Delaware, every one of the 17 highest-tax states had negative net internal migration over the same period. Conservative researchers’ technical explanation for this phenomenon is: “Well, duh.” Or, as Arthur Laffer and Stephen Moore wrote in the Wall Street Journal earlier this year: “People, investment capital and businesses are mobile: They can leave tax-unfriendly states and move to tax-friendly states.”

Summarizing the findings of a report they wrote for the American Legislative Exchange Council, Laffer and Moore pointed out that between 1998 and 2007, the states without an individual income tax “created 89 percent more jobs and had 32 percent faster personal income growth” than the states with the highest individual income-tax rates. California’s tax and regulatory policies, the report predicts, “will continue to sap its economic vitality,” while Texas’s “pro-growth” policies will help it “maintain its superior economic performance well into the future.” The clear implication is that California should become more like Texas.

At this point, defenders of the high-benefit, high-tax paradigm push back. Remember the other half of Tiebout’s equation, they say. There’s no need for a state to be like Texas if its high taxes and extensive regulations are part of a package deal that yields more and better public goods and an attractive quality of life.

But that, it turns out, is a big “if.” It’s true that many people are less sensitive to taxes and more concerned about public goods, and these consumer-voters will congregate in places with extensive services. But it’s also true, all things being equal, that everyone would rather pay lower than higher taxes. The high-benefit, high-tax model can work, but only if the high taxes actually purchase high benefits—that is, public goods that far surpass the quality of those available to people who pay low taxes.

And here, California is decidedly lacking. The biggest factor accounting for California’s loss of population to the other 49 states, bond ratings that would embarrass Chrysler or GM, and state politics contentious and feckless enough to shame a banana republic, has to be its public sector’s diminishing willingness and capacity to fulfill its promises to taxpayers. “Twenty years ago, you could go to Texas, where they had very low taxes, and you would see the difference between there and California,” Joel Kotkin, executive editor of NewGeography.com and a presidential fellow at Chapman University in Southern California, told the Los Angeles Times this past March. “Today, you go to Texas, the roads are no worse, the public schools are not great but are better than or equal to ours, and their universities are good. The bargain between California’s government and the middle class is constantly being renegotiated to the disadvantage of the middle class.”

Similarly, the CEO of a manufacturing company in suburban Los Angeles told a Times reporter that his business suffered less from California’s high taxes than from its ineffectual services. As a result, the company pays “a fortune” to educate its employees, many of whom graduated from California public schools, “on basic things like writing and math skills.” According to a report issued earlier this year by McKinsey & Company, Texas students “are, on average, one to two years of learning ahead of California students of the same age,” though expenditures per public school student are 12 percent higher in California.

State and local government expenditures as a whole were 46.8 percent higher in California than in Texas in 2005–06—$10,070 per person compared with $6,858. And Texas not only spends its citizens’ dollars more effectively; it emphasizes priorities that are more broadly beneficial. In 2005–06, per-capita spending on transportation was 5.9 percent lower in California than in Texas, and highway expenditures in particular were 9.5 percent lower, a discovery both plausible and infuriating to any Los Angeles commuter losing the will to live while sitting in yet another freeway traffic jam. With tax revenues scarce and voters strongly opposed to surrendering more of their income, Texas officials devote a large share of their expenditures to basic services that benefit the most people. In California, by contrast, more and more spending consists of either transfer payments to government dependents (as in welfare, health, housing, and community development programs) or generous payments to government employees and contractors (reflected in administrative costs, pensions, and general expenditures). Both kinds of spending weaken California’s appeal to consumer-voters, the first because redistributive transfer payments are the least publicly beneficial type of public good, and the second because the dues paid to Club California purchase benefits that, increasingly, are enjoyed by the staff instead of the members.

Californians have the best possible reason to believe that the state’s public sector is not holding up its end of the bargain: clear evidence that it used to do a better job. Bill Watkins, executive director of the Economic Forecast Project at the University of California at Santa Barbara, has calculated that once you adjust for population growth and inflation, the state government spent 26 percent more in 2007–08 than in 1997–98. Back then, “California had teachers. Prisoners were in jail. Health care was provided for those with the least resources.” Today, Watkins asks, “Are the roads 26 percent better? Are schools 26 percent better? What is 26 percent better?”

The steady deterioration of California’s public services hasn’t gone unnoticed. Shortly after his stunning ascension to the governor’s office in 2003, Arnold Schwarzenegger established an advisory commission, the California Performance Review (CPR), to recommend ways to make governance in California smarter, cheaper, and better. The commission labored through 2004 before delivering a doorstop report with more than 1,200 recommendations for streamlining this and consolidating that, along with an assessment that implementing the full list of changes could save California $32 billion over the first five years.

And then . . . nothing, really. The 2,500-page report was “dead on arrival,” according to Bill Whalen of the Hoover Institution, “because it was too complicated for voters to rally behind and legislators didn’t want to see it enacted.” Citizen Schwarzenegger may have assumed that his personal star power and the CPR recommendations’ plodding good sense would make a politically irresistible combination. Such reckoning failed to account for the formidable ability of even the most obscure and otiose governmental body to hunker down, defend its turf, and outlast mere politicians.

The CPR, for example, recommended abolishing dozens of California’s commissions and advisory boards, either outright or by folding their activities into a simpler and more rational organizational structure. Five years later, few of these vestigial organs have been removed. The many that remain include the Commission on Aging, whose lead accomplishment for 2009 is getting the legislature to declare a Fall Prevention Week (which began on the first day of autumn, naturally); the Apprenticeship Council, “which has been in place since the 1930s,” according to the CPR, and “is no longer needed to perform regulatory and advisory responsibilities”; the Board of Barbering and Cosmetology; the Court Reporters Board; and the Hearing Aid Dispensers Bureau.

The point is not that turning a flamethrower on every item in the Museum of Governmental Anachronisms would have saved California a great deal of money. It is, rather, that abolishing these boards and commissions, whose names are talk-radio punch lines, would have been the easy calls, the obvious first steps toward giving California’s taxpayers a decent return on their surrendered dollars. Yet even the low-hanging fruit proved out of reach. The path of least resistance was to do the same old thing, not the sensible thing.

The resistance comes from the blob of interest groups, inside and outside government, that like California’s public sector just fine the way it is and see reform as a threat to their comfortable, lucrative arrangements. It turns out, for example, that all the pointless boards and commissions are bulletproof because they provide golden parachutes to politicians turned out of the state legislature by California’s strict term limits. In the middle of the state’s most recent budget crisis, State Senator Tony Strickland proposed a bill to eliminate salaries paid to members of boards and commissions who, despite holding fewer than two formal hearings or official meetings per month, had received annual compensation in excess of $100,000. The bill died in committee.

James Madison would have to revise—or possibly burn—Federalist No. 10 if he were forced to account for the new phenomenon of the government itself becoming the faction decisively shaping its own policy and conduct. (See “Madison’s Nightmare” in City Journal’s 2009 special issue, “New York’s Tomorrow.”) This faction dominates because it’s playing a much longer game than the politicians who come and go, not to mention the citizens who rarely read the enormous owner’s manual for the Rube Goldberg machine they feed with their dollars. They rarely stay outraged long enough to make a difference.

Take entitlements and public-employee pensions, which are, Watkins says, “the real source of the state’s fiscal distress.” A 2005 study by the Legislative Analyst’s Office (California’s version of the Congressional Budget Office) found that pensions for California’s government employees “surpassed the other states—often significantly—at all retirement ages.” California government workers retiring at age 55 received larger pensions than their counterparts in any other state (leaving aside the many states where retirement as early as 55 isn’t even possible). The California Foundation for Fiscal Responsibility periodically posts a list of retired city managers, state administrators, public university deans, and police chiefs who receive pensions of at least $100,000 per year. The latest report shows 5,115 lucky members in this six-figure club. The state’s annual bill for polishing their gold watches is $610 million.

Again, the most vivid part of the problem is not the most important. California would move only slightly closer to regaining fiscal health if it scraped the gilding off the pensions and health benefits of its most lucratively retired employees. But when even a flagrant example of a government’s serving its workforce better than its citizens is politically unassailable, it’s hard to be hopeful about the mundane reforms needed to change the rest of the economically debilitating public-employee retirement system. The California Performance Review suggested the sensible thing: gradually substituting defined-contribution for defined-benefit pension plans. (According to a report by the Pew Center on the States, just 20 percent of the nation’s private-sector employees are enrolled in a defined-benefit pension plan, compared with 90 percent of public-sector employees.) To no one’s shock, the state legislature has rejected all proposals to curb the state’s financial obligations to its retired and retiring employees.

If California doesn’t want to be Texas, it must find a way to be a better California. The easy thing about being Texas is that the government has a great deal of control over the part of its package deal that attracts consumer-voters—it must merely keep taxes low. California, on the other hand, must deliver on the high benefits promised in its sales pitch. It won’t be enough for its state and local governments to spend a lot of money; they have to spend it efficiently and effectively.

The optimistic assessment is that things are going to get worse in California before they get better. The pessimistic assessment is that they’re going to get worse before they get much worse. As is often the case, hanging around with the pessimists is less fun but more instructive. The current recession has driven California’s state government into what amounts to a five-month budget cycle, according to Dan Walters of the Sacramento Bee. He estimates that the budget deal tortuously wrought in July should start falling apart in October, because it was predicated on pie-in-the-sky revenue estimates and because so many of its spending cuts are being challenged, often successfully, in the courts.

The recession will eventually end and California’s finances will improve, say the optimists. Given the state’s pervasive political bias against efficient and effective public services, however, the question is whether its finances will ever get truly well. States that have grown accustomed to thinking of the engine that drives their economies as an inexhaustible resource—whether it’s Michigan and the auto industry, New York and Wall Street, or California and the vision of the sunlit good life that used to attract new residents—find it tough to compete again for what they thought would be theirs forever, and to plan budgets for lean years that turn into lean decades. Instead, they invest their hopes in a deus ex machina that will rescue them from the hard choices they dread.

For California’s governmental-industrial complex, a new liberal administration and Congress in Washington offer plausible hope for a happy Hollywood ending. Federal aid will replace the dollars that California’s taxpayers, fed up with the state’s lousy benefits and high taxes, refuse to provide. Americans will continue to vote with their feet, either by leaving California or disdaining relocation there, but their votes won’t matter, at least in the short term. Under the coming bailout, the new 49ers—Americans in the other 49 states, that is—will be extended the privilege of paying California’s taxes. At least they won’t have to put up with its public services.

William Voegeli is a contributing editor of The Claremont Review of Books and a visiting scholar at Claremont McKenna College’s Salvatori Center. His book on the American welfare state will be published by Encounter in 2010.

This article is reprinted from The City Journal, Autumn 2009. Copyright The Manhattan Institute

Materialists since Thomas Hobbes have questioned the idea of free will in human agents. Everything has a cause, and the efficient cause, like billiard balls, is what most people think about.

Billiard ball (1) hits Billiard ball (2) and (1) stops or slows down; (2) begins to roll at some angle from (1). You know that, basic mechanics.

The problem is you don’t ask whether that is the only way “things” can happen. There are more ways that things can happen.

“Free will” as a claim (assumption) in human psychology was challenged by Harvard professor B.F. Skinner in the 1950-70s. Skinner was a behaviorist, and perhaps the most extreme one although Karl Marx was not much different, with his materialism theory and his slander about “class” as it would influence ethical conclusions. This is determinism applied to the human mind and the whole idea about individualism.

Free Will Obviously Exists

This is not a claim anyone really needs “to prove.” If you don’t agree, it makes no difference because you were just determined to disagree with me, who (in your view) was just determined to hold an absurd position. Good bye. Have a nice day.

But, aside from trumping the argument, let me offer an example of free will. Poetry is an art form. We have all understood the beauty of some poetry (not all of it!), and we have all tried it – with limited success.

My high school English teacher in 10th grade emphasized that poetry was the art of placing the words, in harmony, rhyme, etc. as well as the choosing of words to make the best use of metaphor and visualization by the reader.

Sandburg writes, “The fog comes on little cat feet.” You know what that means, although the words do not specify it; they suggest it.

Knowledge is an interesting thing, in the human mind, and poetry is evidence that human free will exists. One might get the same, one idea out to others with different words. And some might be as lovely as Sandburg.

To take a single concept or proposition, like fog rolling in, and put it into words could have been done many different ways. The beauty of Sandburg’s formula, however, is unique. I claim it is superior, without claiming some universal super-duper. It is at the top, relatively.

Even to suggest the idea of “relative” good is another example of Free Will in our affairs, and in our minds. People disagree over economic values, and often also we disagree over moral values, like “fairness” or “happiness.” Interesting disagreements like these cannot just be determined like billiard-ball motion.

Neuroscience is an interesting new field of study. I do not expect it to bring us to some Skinner box of determinism. Science will instead bring more evidence of how individual human agency works. Some writers, generalizing, say this is like quantum mechanics with statistics. Free will is randomness. But that would not produce logical deduction or analysis. Most people live fairly successful lives by using practical wisdom, which is systematic because it needs “objective reality” to work. Behaviorism doesn’t answer that, and again, why do they care? Only we, who want to use free choice to decide questions, really want to know different answers.

So, go out tomorrow and make some totally free choice and ask yourself, “why?”

Questioning the Federal Reserve “Church”

I think it is true that the “audit the Fed” issue is just a publicity stunt, as Forbes points out. But it is a useful publicity stunt because it has focused a lot of attention on the Fed and its position in American society.

Until very recently, the Fed was treated as some kind of church. Its pontiffs were treated as spokesmen for the Mystery, and every member of Congress was very shy of criticizing the Fed, except for a few old populists like Henry Gonzalez who would have abolished the Fed and replaced it with the Treasury issuing fiat paper money in order to push interest rates down to zero, etc. William Jennings Bryan exercised pernicious influence back in 1913 to convert what would have been a fairly benign private clearing house that issued banknotes (just as every other National Bank also in those days did) – into a government agency that issued “obligations of the United States.” Thus the Fed was born. Rosemary’s baby.

I say Ron Paul’s bill (HR 1207) is a “useful” publicity stunt, but it could backfire if

(1) the concerns Bernanke highlighted came true, namely that the Fed felt pressured by Congress to inflate; and
(2) some kind of “audit” is conducted and the Fed is whitewashed and the whole issue becomes covered up with a new cloak of pseudo-democratic appearances.

Certainly, if a government is going to enforce a monopoly currency, the monopoly agency should *NOT* be under popular or democratic control. It should focus strictly on maximizing profit. For a monopoly currency that means only sustaining and stabilizing the purchasing power of the monetary unit. If a central bank can do that, it will rule forever in its narrow sphere.

The business side of the Fed is already audited. The current “Tax on Federal Reserve Notes” (so called; not really accurately named), which is a line item in the Fed’s annual income statement, is a 100% tax on the Fed’s nominal monetary profits. The money goes directly to the U.S. Treasury, just as the coinage seigniorage from the Mint also goes. (Of course, the Fed gets “to skim” because it pays its operating expenses before remitting to the Treasury – but that is revealed in the audits already conducted and published.)

The three areas where the Fed is not today audited are all justified, in my view, under the system we have.

• First, transactions with foreign central banks and IMF, Bank for International Settlements, etc. are secret because the foreigners want it done that way. The Fed acts as a fiscal agent for a lot of foreign governments, particularly the smaller ones.
• Second the Federal Open Market Committee and the games it plays under the rubric, “monetary policy,” do have the power to move the stock and bond markets in powerful swings. If anyone had insider knowledge of what the FOMC were doing on any particular day, your profits from day-trading would be gigantic. A hedge fund manager’s dream come true.
• Third, the FOMC operations, buying and selling to impact the Fed Funds rate, would also be an area that should not be allowed to become something of daily, transparent knowledge. The claim that these things should be kept non-political and out of sight of speculators and day traders makes sense to me.

The Monopoly Problem

But, the real issue is WHY should the Fed be a monopoly, and WHY should the United States government even want to use an undefined F.R.A.U.D. monetary system? [Note acronym: "Federal Reserve Accounting Unit Dollar"]

The answer is because the British Neo-Classical School of economics, which developed under the Victorian era regime following Peel’s Act of 1844, had neglected and lost track of the debates among – yes, amateur for the most part – economists from 1800-1844. Lawrence H. White’s book on this history, “Free Banking in Britain,” is very informative. Even Milton Friedman changed his mind after reading about free banking.

The British Economists

The Briish economists after 1844 came to the conclusion that “scientific management” of a monetary monopoly would be superior to whatever crippled market process occurred under a “pseudo-gold-standard” (Milton Friedman’s label).

Yet, of course, the whole appeal of “scientific management” of an economic system ought to have passed away with the fall of the Soviet Union.

The observation that fewer business cycle downturns occurred after 1913 than before the Fed ignores a lot of economic history. First, it ignores the stupid regulations imposed by the National Bank Act of 1863 that forced banks to operated as undercapitalized agencies, because they were forced to buy government bonds in order to issue currency (but not demand deposits). This crippled the banking system and led to many more runs on banks and contractions than would have occurred without such rules.

Comparing the Canadian experience with the U.S. experience shows how much more stable the Canadian system was, with a more pure system of free banking. Canada didn’t create the Bank of Canada until the late 1930s, and by that time it was the mania of every government on earth to have its own central bank – and there was no longer any international gold payments system.

Second, although there was no Federal Reserve prior to 1913, there was the Bank of England, which acted like a global central bank for all the “gold standard” countries. And the Bank of England was very incompetent in running monetary policy, which is one reason the British Neo-Classical School economists were so critical of the classical pseudo-gold-standard. As the Bank of England induced expansion and contractions in the London financial markets, those markets affected all the rest of the world, New York in particular because of America’s close links with the British Empire. See Walter Bagehot, “Lombard Street” (1873) on “the unnatural system of centralization” and the mismanagement of the Bank of England. Bagehot was the editor of The Economist magazine.

Moreover after 1935, monetary policy was deliberately conducted with a bias never to allow a contraction and to promote a mild and gradual inflation. If you look at a graph of monetary expansion since WW2, many of what would have been contractions before 1913 are just flat spots on a rising chart. This is why Milton Friedman emphasized that it is the 2nd derivative (change in the rate of change) in monetary expansion that affects the growth of nominal GDP after a 6-18 month lag.

So, the bottom line is that I much prefer Ron Paul’s bill (HR 2779) to relax legal tender laws. If I could go all the way to utopia, I would urge a law having Congress make appropriations, budgets, and to assess taxes using the gram of gold as the government’s official unit of account, with a floating rate of exchange between the [thereafter] non-legal-tender F.R.A.U.D. units, which would continue to circulate and probably continue to dominate the financial markets. The U.S. national debt could still be payable in “dollars” but at a floating exchange rate with gold grams.

This might be the way to conform with the 14th Amendment, Section 4, and to pay off the national debt (in “dollars,” but not in gold grams).

Optimal Currency Areas

Indeed, in the literature of “optimal currency areas” it is not clear the whole United States should be a single currency area, much less all of Europe under the Euro. Labor markets in particular could operate more efficiently if wages were paid in local currencies. Michigan right now could experience a currency devaluation and that would help with unemployment.

Financial markets would probably operate more efficiently if prices were quoted in a global currency independent of national governments (e.g., gold grams).

And with floating exchange rates among them all.

This essay by the head of the Brookings Institution further shows why there in no JUSTICE in the urgency for suppressing CO2 gas.

As the world community gears up for another round of climate-change talks – and Secretary of State Hillary Clinton arrives in Delhi on Sunday for meetings with Indian Prime Minister Manmohan Singh – a central issue will be how to bring developing countries into a climate-change pact.

Developing countries such as India do not want to pledge to reduce their emissions until industrial countries have first demonstrated not just pledges but actual emissions cuts. Industrial countries, for their part, generally recognize that they should act first. But they want some assurance that their reductions won’t be meaningless in the face of rapidly rising emissions in China and India.

India’s Mr. Singh has become the spokesperson for “equity” in emissions reductions. Mr. Singh has acknowledged that climate change is a problem and has said that India will do its part. Like all developing country leaders, however, he points to the fact that industrial countries have contributed a century’s worth of emissions to the global atmosphere while developing countries have only started to use, in his phrase, their “share of the global atmosphere.” He has pledged that India will never exceed the per capita emissions of industrialized nations. He also said that India will only consider signing on to a climate pact when a common global per capita emissions target has been established.

When it comes to saving the planet, there are strong reasons to consider per capita emissions as part of a burden sharing formula. However, we should be cautious about making this the magic bullet that resolves the dispute between industrial and developing countries. Indeed, the Indians themselves should be cautious. It undermines a core part of their argument.

At some level, Mr. Singh is right. India has not contributed historically to the problem. U.S. per capita emissions are probably 12 times those of India’s. If the U.S. meets the ambitious goal of cutting emissions 83% by 2050 – as stipulated in the recent energy bill passed by the House of Representatives – U.S per capita emissions would drop from 20 tons to three or four tons per person annually.

That per capita standard would still be double India’s current level of two tons per person. Because emissions linger in the atmosphere for 50 years, scientists tell us that all countries must cut their emissions over the next four decades to protect the planet. So if the U.S., the EU, and Japan slash emissions, but China, India and other developing countries continue to emit greenhouse gases unabated, by 2050 the overall global emissions might decrease, but not by enough.

But that’s not the only reason to be concerned about the per capita standard.

First, a per capita emissions standard does not consider population growth. It only looks at the quantity of greenhouse gases each person emits. That standard accepts, in essence, that unmitigated population growth is fine. This undermines a careful consensus developed over a decade ago, with India’s support, at the 1994 United Nations International Conference on Population and Development. After a century of inaction, the world community agreed that population growth needed to be managed. Even under that mandate, China and India together may add almost a billion more people to the world’s population by 2050.

Second, countries like India are using a double standard when they talk about history. In essence, developing nations are arguing that the U.S., the EU and Japan need to act first on climate change. They need to make up for their history of using fossil fuels, even though these nations did not know at the time that they were threatening the climate.

Yet there is also a population-growth history that can’t be ignored. During at least the last half of the 20th century, population growth exploded in developing nations. From 1950 to 2000, world population grew 2.5 billion to six billion – an increase of about 140%. Over that period, India went from 350 million people to over a billion – up 182%, outpacing even China’s increase. By comparison, the U.S. grew from 157 million to 287 million – a rate of increase that is well below the world average.

If developed nations are held responsible for emissions that they historically contributed, oblivious to their impact on climate change, why shouldn’t developing nations take responsibility for producing generations of people who will generate emissions into the future? Put another way, it is unclear whether we should use the population figures of 1950, 2000 or 2050 in judging per capita contributions to climate change.

Fighting climate change is a complex and dynamic undertaking. As with most metrics, the per capita standard is too simple. It doesn’t fully acknowledge the emissions of previous and future generations. When Mrs. Clinton meets with Mr. Singh, she should make it clear that a static per capita metric alone cannot solve the problem of climate change.

Mr. Antholis, who served on the National Security Council during the Kyoto negotiations, is managing director of the Brookings Institution.

Reprinted from The Wall Street Journal, July 18, 2009.

From higher energy bills to lost jobs, the impact of carbon regulations will hurt us far more than CO2 itself ever could.

A few days before this year’s Earth Day, America’s ideological greens received a present they have been desiring for years: The Environmental Protection Agency (EPA) – responding to a 2007 US Supreme Court ruling – officially designated carbon dioxide (CO2) as a pollutant. That spurred Democrats in Congress to push a major climate change bill. In the next 25 years, their massive cap-and-trade scheme would, according to a Heritage Foundation study, inflict gross domestic product losses of $9.4 trillion, raise an average family’s energy bill by $1,241, and destroy some 1,145,000 jobs. Democrats want it passed by July 4.

Get ready for a veritable Pandora’s box of complications.

A generation ago, it was considered great progress against pollution when catalytic converters were added to automobile engines to change poisonous carbon monoxide to benign carbon dioxide. Now, CO2 has been demoted.

The EPA’s characterization of CO2 as a pollutant brings into question the natural order of things. By the EPA’s logic, either God or Mother Nature (whichever creator you believe in) seriously goofed. After all, CO2 is the base of our food chain. “Pollutants” are supposed to be harmful to life, not helpful to it, aren’t they?

Of course, it is true (although environmentalists often ignore it when trying to ban such useful chemicals as pesticides, insecticides, Alar, PCBs, and others) that “the dose makes the poison.” Too much oxygen, for example, poses danger to human life. So what is the “right” concentration of CO2 in our atmosphere? There is no right answer to this question. The concentration of CO2 in Earth’s atmosphere fluctuated greatly long before humans appeared on Earth, and that concentration has fluctuated since then, too.

The current concentration is approximately 385 parts per million. Some scientists maintain that 1,000 parts per million would provide an ideal atmosphere for plant life, accelerating plant growth and multiplying yields, thereby sustaining far more animal and human life than is currently possible. Whatever standard the EPA selects will be arbitrary.

“Forget about the plants,” say the greens. “What we’re trying to control is how warm Earth’s atmosphere gets.” To which I reply, “With all due respect, are you kidding me?”

As with a “right” concentration of CO2, what is the “right” average global temperature? For 7,000 of the past 10,000 years, Earth was cooler than it is now; mankind prospers more in warm climates than cold climates; and the Antarctic icecap was significantly larger during the warmer mid-Holocene period than it is today. Are you sure warmer is bad or wrong?

And how do you propose to regulate Earth’s temperature when as much as three-quarters of the variability is due to variations in solar activity, with the remaining one-quarter due to changes in Earth’s orbit, axis, and albedo (reflectivity)? This truly is “mission impossible.” Mankind can no more regulate Earth’s temperature than it can the tides.

Even if the “greenhouse effect” were greater than it actually is, the EPA and Congress would be powerless to alter it for several reasons:

1. Human activity accounts for less than 4 percent of global CO2 emissions.

2. CO2 itself accounts for only 10 or 20 percent of the greenhouse effect.

This discloses the capricious nature of the EPA’s decision to classify CO2 as a pollutant, for if CO2 is a pollutant because it is a greenhouse gas, then the most common greenhouse gas of all – water vapor, which accounts for more than three-quarters of the atmosphere’s greenhouse effect – should be regulated, too. The EPA isn’t going after water vapor, of course, because then everyone would realize how absurd climate-control regulation really is.

3. Even if Americans were to eliminate their CO2 emissions completely, total human emissions of CO2 would still increase as billions of people around the world continue to develop economically.

Clearly, it is beyond the ken of mortals to answer the metaquestions about the right concentration of CO2, or the optimal global average temperature, or to control CO2 levels in the atmosphere. I feel sorry for the professionals at the EPA who are now expected to come up with answers for these unanswerable questions.

However, I do not feel sorry for the political appointees, like climate czar Carol Browner, because it looks as if they are about to get what they evidently want – the power to increase their power over Americans’ lives and pocketbooks via CO2 emission regulations.

From higher energy bills to lost jobs, the impact of CO2 regulations will hurt us far more than CO2 itself ever could. Let’s nail shut the lid on this Pandora’s box before it swings wide open.

Mark W. Hendrickson is an adjunct faculty member, economist, and contributing scholar with The Center for Vision & Values at Grove City College, where this essay was first published. Also published in the Christian Science Monitor, June 23, 2009

The following is what I think is wrong with the world. It’s a worldwide lack of IDENTITY on the part of the great majority of the earth’s population.

There are three Levels of existence -

(1) the highest Level is who or what you are.

The next lower Level is

(2) what you’re doing or what you have done.

(3) the lowest Level is what you own.

An example of Level (1) is Jesus, who changed the world based on who he was. An example of Level (2) is George Patton, one of the great generals of World War II, whose daring exploits amazed the world. As for Level (3), we have John Rockefeller who possessed fabulous wealth or today we have Bill Gates.

Most people on this earth have no identity, no “self.” As a result, they often pick an identity such as I’m a “Yankee fan” or I’m a “Texan” or I’m a “race-car driver” or I’m a “blood.” To lack an identity means you are mindless fodder in this world, and you’re open to join any group that fascinates you or that fits into your personal fantasy.

People long to have an identity – to belong to something which gives them an identity. People without an identity can be dangerous. When you have an identity you have a self – you are centered, and you can stand as a person with your own strong convictions.

I’ve always been fascinated with the Nazi phenomenon, which I fought against. When Hitler came to power, the German people adored him. They crowded the roadsides as Hitler rode by in his armored Mercedes, and they gave him the Nazi salute as they cheered their hearts out. Some women broke down in tears as their beloved Führer drove by. The German people were proud to be Nazis, and they were mesmerized when Hitler spoke in his hysterical voice.

This was the rebirth of Germany, and their new leader was a God. Hitler’s brain-washed army swore allegiance to their amazing leader as though he was a living god. Hitler could do no wrong, and once again Germany was a land of proud Germans with a new and proud identity.

Hitler’s army did their leaders’ bidding, even if it involved murder on the most colossal scale in all history. The German population, most having no identity, finally found an identity – it was to be a member of the “master race,” a proud conquering Nazi.

You look at what the Nazis did. Burning down village after village in Russia. Murdering millions of Jews, Gypsies, homosexuals, disabled people, Poles, Slavs, and you think – it required thousands of Germans to do this. How could this have happened? It happened because most of the German people (like most people) lacked an identity. They simply followed the orders of their leaders, and the leaders followed the orders of a sadistic madman.

“Why doesn’t this occur in America,” I ask. It’s because Americans have an identity. Their identity, handed down from generation to generation, is “independence and freedom.” The history of tyrants and would-be dictators in the US is that they don’t survive. Huey Long was shot dead. Joseph McCarthy was run out of the Senate. J. Edgar Hoover has become a joke.

This is why I have no use for organized religion or for nationalism. Both provide their followers with an identity – “I’m a Jew, I’m a Catholic, I’m an American, I’m a Frenchman, I’m a Crip.” But without having a personal sense of identity, who the hell are you? Do you know who you really are? If you know yourself, then you probably have an authentic identity.

If you have a real identity, you follow no one without examining their cause. If you have an identity, you are an original, you follow no other person, nor do you accept any specific philosophy or thought process out of hand. Why do men go to war, knowing that they may be killed? Because some “leader” told them that the patriotic thing to do was to take up arms and kill other men. Why do people accept the thinking and orders of some ego-driven mindless leader? It’s because “I’m a Republican, and I follow my party’s lead” or “I’m an American, and I fight for my Country right or wrong.”

We live in a world of the mindless, a world of 4 billion souls who for the most part lack an identity. The ancient Greek aphorism, “Know Thyself” was inscribed in the forecourt of the Temple of Apollo at Delphi. Know thyself – it’s something we should still live by in today’s propaganda-filled modern era.
_________
This essay has been quoted from Russell’s “Dow Theory Letter” of June 4, 2009. All rights reserved by the author. Russell. Mr. Russell is 85 and very wise.

If, on the other hand, we persist in building green bridges to nowhere, we will make things worse, not better. Good intentions aren’t enough. Turned into ineffectual action, they can cost the earth and accelerate its ruin at the same time.

Like medieval priests, today’s carbon brokers will sell you an indulgence that forgives your carbon sins. It will run you about $500 for 5 tons of forgiveness – about how much the typical American needs every year. Or about $2,000 a year for a typical four-person household. Your broker will spend the money on such things as reducing methane emissions from hog farms in Brazil.

But if you really want to make a difference, you must send a check large enough to forgive the carbon emitted by four poor Brazilian households, too – because they’re not going to do it themselves. To cover all five households, then, send $4,000. And you probably forgot to send in a check last year, and you might forget again in the future, so you’d best make it an even $40,000, to take care of a decade right now. If you decline to write your own check while insisting that to save the world we must ditch the carbon, you are just burdening your already sooty soul with another ton of self-righteous hypocrisy. And you can’t possibly afford what it will cost to forgive that.

If making carbon this personal seems rude, then think globally instead. During the presidential race, Barack Obama was heard to remark that he would bankrupt the coal industry. No one can doubt Washington’s power to bankrupt almost anything – in the United States. But China is adding 100 gigawatts of coal-fired electrical capacity a year. That’s another whole United States’ worth of coal consumption added every three years, with no stopping point in sight. Much of the rest of the developing world is on a similar path.

Cut to the chase. We rich people can’t stop the world’s 5 billion poor people from burning the couple of trillion tons of cheap carbon that they have within easy reach. We can’t even make any durable dent in global emissions – because emissions from the developing world are growing too fast, because the other 80 percent of humanity desperately needs cheap energy, and because we and they are now part of the same global economy. What we can do, if we’re foolish enough, is let carbon worries send our jobs and industries to their shores, making them grow even faster, and their carbon emissions faster still.

We don’t control the global supply of carbon.

Ten countries ruled by nasty people control 80 percent of the planet’s oil reserves – about 1 trillion barrels, currently worth about $40 trillion. If $40 trillion worth of gold were located where most of the oil is, one could only scoff at any suggestion that we might somehow persuade the nasty people to leave the wealth buried. They can lift most of their oil at a cost well under $10 a barrel. They will drill. They will pump. And they will find buyers. Oil is all they’ve got.

Poor countries all around the planet are sitting on a second, even bigger source of carbon – almost a trillion tons of cheap, easily accessible coal. They also control most of the planet’s third great carbon reservoir – the rain forests and soil. They will keep squeezing the carbon out of cheap coal, and cheap forest, and cheap soil, because that’s all they’ve got. Unless they can find something even cheaper. But they won’t – not any time in the foreseeable future.

We no longer control the demand for carbon, either. The 5 billion poor – the other 80 percent – are already the main problem, not us. Collectively, they emit 20 percent more greenhouse gas than we do. We burn a lot more carbon individually, but they have a lot more children. Their fecundity has eclipsed our gluttony, and the gap is now widening fast. China, not the United States, is now the planet’s largest emitter. Brazil, India, Indonesia, South Africa, and others are in hot pursuit. And these countries have all made it clear that they aren’t interested in spending what money they have on low-carb diets. It is idle to argue, as some have done, that global warming can be solved – decades hence – at a cost of 1 to 2 percent of the global economy. Eighty percent of the global population hasn’t signed on to pay more than 0 percent.

Accepting this last, self-evident fact, the Kyoto Protocol divides the world into two groups. The roughly 1.2 billion citizens of industrialized countries are expected to reduce their emissions. The other 5 billion – including both China and India, each of which is about as populous as the entire Organisation for Economic Co-operation and Development – aren’t. These numbers alone guarantee that humanity isn’t going to reduce global emissions at any point in the foreseeable future – unless it does it the old-fashioned way, by getting poorer. But the current recession won’t last forever, and the long-term trend is clear. Their populations and per-capita emissions are rising far faster than ours could fall under any remotely plausible carbon-reduction scheme.

Might we simply buy their cooperation? Various plans have circulated for having the rich pay the poor to stop burning down rain forests and to lower greenhouse-gas emissions from primitive agricultural practices. But taking control of what belongs to someone else ultimately means buying it. Over the long term, we would in effect have to buy up a large fraction of all the world’s forests, soil, coal, and oil – and then post guards to make sure that poor people didn’t sneak in and grab all the carbon anyway. Buying off people just doesn’t fly when they outnumber you four to one.

Might we instead manage to give the world something cheaper than carbon? The moon-shot law of economics says yes, of course we can. If we just put our minds to it, it will happen. Atom bomb, moon landing, ultracheap energy – all it takes is a triumph of political will.

Really? For the very poorest, this would mean beating the price of the free rain forest that they burn down to clear land to plant a subsistence crop. For the slightly less poor, it would mean beating the price of coal used to generate electricity at under 3 cents per kilowatt-hour.

And with one important exception, which we will return to shortly, no carbon-free fuel or technology comes remotely close to being able to do that. Fossil fuels are extremely cheap because geological forces happen to have created large deposits of these dense forms of energy in accessible places. Find a mountain of coal, and you can just shovel gargantuan amounts of energy into the boxcars.

Shoveling wind and sun is much, much harder. Windmills are now 50-story skyscrapers. Yet one windmill generates a piddling 2 to 3 megawatts. A jumbo jet needs 100 megawatts to get off the ground; Google is building 100-megawatt server farms. Meeting New York City’s total energy demand would require 13,000 of those skyscrapers spinning at top speed, which would require scattering about 50,000 of them across the state, to make sure that you always hit enough windy spots. To answer the howls of green protest that inevitably greet realistic engineering estimates like these, note that real-world systems must be able to meet peak, not average, demand; that reserve margins are essential; and that converting electric power into liquid or gaseous fuels to power the existing transportation and heating systems would entail substantial losses. What was Mayor Bloomberg thinking when he suggested that he might just tuck windmills into Manhattan? Such thoughts betray a deep ignorance about how difficult it is to get a lot of energy out of sources as thin and dilute as wind and sun.

It’s often suggested that technology improvements and mass production will sharply lower the cost of wind and solar. But engineers have pursued these technologies for decades, and while costs of some components have fallen, there is no serious prospect of costs plummeting and performance soaring as they have in our laptops and cell phones. When you replace conventional with renewable energy, everything gets bigger, not smaller – and bigger costs more, not less. Even if solar cells themselves were free, solar power would remain very expensive because of the huge structures and support systems required to extract large amounts of electricity from a source so weak that it takes hours to deliver a tan.

Nuclear Power

This is why the (few) greens ready to accept engineering and economic reality have suddenly emerged as avid proponents of nuclear power. In the aftermath of the Three Mile Island accident – which didn’t harm anyone, and wouldn’t even have damaged the reactor core if the operators had simply kept their hands off the switches and let the automatic safety systems do their job – ostensibly green antinuclear activists unwittingly boosted U.S. coal consumption by about 400 million tons per year. The United States would be in compliance with the Kyoto Protocol today if we could simply undo their handiwork and conjure back into existence the nuclear plants that were in the pipeline in nuclear power’s heyday. Nuclear power is fantastically compact, and – as America’s nuclear navy, several commercial U.S. operators, France, Japan, and a handful of other countries have convincingly established – it’s both safe and cheap wherever engineers are allowed to get on with it.

But getting on with it briskly is essential, because costs hinge on the huge, up-front capital investment in the power plant. Years of delay between the capital investment and when it starts earning a return are ruinous. Most of the developed world has made nuclear power unaffordable by surrounding it with a regulatory process so sluggish and unpredictable that no one will pour a couple of billion dollars into a new plant, for the good reason that no one knows when (or even if) the investment will be allowed to start making money.

And countries that don’t trust nuclear power on their own soil must hesitate to share the technology with countries where you never know who will be in charge next year, or what he might decide to do with his nuclear toys. So much for the possibility that cheap nuclear power might replace carbon-spewing sources of energy in the developing world. Moreover, even India and China, which have mastered nuclear technologies, are deploying far more new coal capacity.

Remember, finally, that most of the cost of carbon-based energy resides not in the fuels but in the gigantic infrastructure of furnaces, turbines, and engines. Those costs are sunk, which means that carbon-free alternatives – with their own huge, attendant, front-end capital costs – must be cheap enough to beat carbon fuels that already have their infrastructure in place. That won’t happen in our lifetimes.

Another argument commonly advanced is that getting over carbon will, nevertheless, be comparatively cheap, because it will get us over oil, too – which will impoverish our enemies and save us a bundle at the Pentagon and the Department of Homeland Security. But uranium aside, the most economical substitute for oil is, in fact, electricity generated with coal. Cheap coal-fired electricity has been, is, and will continue to be a substitute for oil, or a substitute for natural gas, which can in turn substitute for oil. By sharply boosting the cost of coal electricity, the war on carbon will make us more dependent on oil, not less.

The first place where coal displaces oil is in the electric power plant itself. When oil prices spiked in the early 1980s, U.S. utilities quickly switched to other fuels, with coal leading the pack; the coal-fired plants now being built in China, India, and other developing countries are displacing diesel generators. More power plants burning coal to produce cheap electricity can also mean less natural gas used to generate electricity. And less used for industrial, commercial, and residential heating, welding, and chemical processing, as these users switch to electrically powered alternatives. The gas that’s freed up this way can then substitute for diesel fuel in heavy trucks, delivery vehicles, and buses. And coal-fired electricity will eventually begin displacing gasoline, too, as soon as plug-in hybrid cars start recharging their batteries directly from the grid.

To top it all, using electricity generated in large part by coal to power our passenger cars would lower carbon emissions – even in Indiana, which generates 75 percent of its electricity with coal. Big power plants are so much more efficient than the gasoline engines in our cars that a plug-in hybrid car running on electricity supplied by Indiana’s current grid still ends up more carbon-frugal than comparable cars burning gasoline in a conventional engine under the hood. Old-guard energy types have been saying this for decades. In a major report released last March, the World Wildlife Fund finally concluded that they were right all along.

But true carbon zealots won’t settle for modest reductions in carbon emissions when fat targets beckon. They see coal-fired electricity as the dragon to slay first. Huge, stationary sources can’t run or hide, and the cost of doing without them doesn’t get rung up in plain view at the gas pump. California, Pennsylvania, and other greener-than-thou states have made flatlining electricity consumption the linchpin of their war on carbon. That is the one certain way to halt the displacement of foreign oil by cheap, domestic electricity.

The oil-coal economics come down to this. Per unit of energy delivered, coal costs about one-fifth as much as oil – but contains one-third more carbon. High carbon taxes (or tradable permits, or any other economic equivalent) sharply narrow the price gap between oil and the one fuel that can displace it worldwide, here and now. The oil nasties will celebrate the green war on carbon as enthusiastically as the coal industry celebrated the green war on uranium 30 years ago.

The other 5 billion are too poor to deny these economic realities. For them, the price to beat is 3-cent coal-fired electricity. China and India won’t trade 3-cent coal for 15-cent wind or 30-cent solar. As for us, if we embrace those economically frivolous alternatives on our own, we will certainly end up doing more harm than good.

By pouring money into anything-but-carbon fuels, we will lower demand for carbon, making it even cheaper for the rest of the world to buy and burn. The rest will use cheaper energy to accelerate their own economic growth.

Jobs will go where energy is cheap, just as they go where labor is cheap. Manufacturing and heavy industry require a great deal of energy, and in a global economy, no competitor can survive while paying substantially more for an essential input.

The carbon police acknowledge the problem and talk vaguely of using tariffs and such to address it. But carbon is far too deeply embedded in the global economy, and materials, goods, and services move and intermingle far too freely, for the customs agents to track.

Consider your next Google search. As noted in a recent article in Harper’s, “Google . . . and its rivals now head abroad for cheaper, often dirtier power.” Google itself (the “don’t be evil” company) is looking to set up one of its electrically voracious server farms at a site in Lithuania, “disingenuously described as being near a hydroelectric dam.” But Lithuania’s grid is 0.5 percent hydroelectric and 78 percent nuclear. Perhaps the company’s next huge farm will be “near” the Three Gorges Dam in China, built to generate over three times as much power as our own Grand Coulee Dam in Washington State. China will be happy to play along, while it quietly plugs another coal plant into its grid a few pylons down the line. All the while, of course, Google will maintain its low-energy headquarters in California, a state that often boasts of the wise regulatory policies – centered, one is told, on efficiency and conservation – that have made it such a frugal energy user. But in fact, sky-high prices have played the key role, curbing internal demand and propelling the flight from California of power plants, heavy industries, chip fabs, server farms, and much else (see “California’s Potemkin Environmentalism,” City Journal, Spring 2008).

So the suggestion that we can lift ourselves out of the economic doldrums by spending lavishly on exceptionally expensive new sources of energy is absurd. “Green jobs” means Americans paying other Americans to chase carbon while the rest of the world builds new power plants and factories. And the environmental consequences of outsourcing jobs, industries, and carbon to developing countries are beyond dispute. They use energy far less efficiently than we do, and they remain almost completely oblivious to environmental impacts, just as we were in our own first century of industrialization. A massive transfer of carbon, industry, and jobs from us to them will raise carbon emissions, not lower them.

The grand theory for how the developed world can unilaterally save the planet seems to run like this. We buy time for the planet by rapidly slashing our own emissions. We do so by developing carbon-free alternatives even cheaper than carbon. The rest of the world will then quickly adopt these alternatives, leaving most of its trillion barrels of oil and trillion tons of coal safely buried, most of the rain forests standing, and most of the planet’s carbon-rich soil undisturbed. From end to end, however, this vision strains credulity.

Perhaps it’s the recognition of that inconvenient truth that has made the anti-carbon rhetoric increasingly apocalyptic. Coal trains have been analogized to boxcars headed for Auschwitz. There is talk of the extinction of all humanity. But then, we have heard such things before. It is indeed quite routine, in environmental discourse, to frame choices as involving potentially infinite costs on the green side of the ledger. If they really are infinite, no reasonable person can quibble about spending mere billions, or even trillions, on the dollar side, to dodge the apocalyptic bullet.

Thirty years ago, the case against nuclear power was framed as the “Zero-Infinity Dilemma.” The risks of a meltdown might be vanishingly small, but if it happened, the costs would be infinitely large, so we should forget about uranium. Computer models demonstrated that meltdowns were highly unlikely and that the costs of a meltdown, should one occur, would be manageable – but greens scoffed: huge computer models couldn’t be trusted. So we ended up burning much more coal. The software shoe is on the other foot now; the machines that said nukes wouldn’t melt now say that the ice caps will. Warming skeptics scoff in turn, and can quite plausibly argue that a planet is harder to model than a nuclear reactor. But that’s a detail. From a rhetorical perspective, any claim that the infinite, the apocalypse, or the Almighty supports your side of the argument shuts down all further discussion.

To judge by actions rather than words, however, few people and almost no national governments actually believe in the infinite rewards of exorcising carbon from economic life. Kyoto has hurt the anti-carbon mission far more than carbon zealots seem to grasp. It has proved only that with carbon, governments will say and sign anything – and then do less than nothing. The United States should steer well clear of such treaties because they are unenforceable, routinely ignored, and therefore worthless.

If we’re truly worried about carbon, we must instead approach it as if the emissions originated in an annual eruption of Mount Krakatoa. Don’t try to persuade the volcano to sign a treaty promising to stop. Focus instead on what might be done to protect and promote the planet’s carbon sinks – the systems that suck carbon back out of the air and bury it. Green plants currently pump 15 to 20 times as much carbon out of the atmosphere as humanity releases into it – that’s the pump that put all that carbon underground in the first place, millions of years ago. At present, almost all of that plant-captured carbon is released back into the atmosphere within a year or so by animal consumers. North America, however, is currently sinking almost two-thirds of its carbon emissions back into prairies and forests that were originally leveled in the 1800s but are now recovering. For the next 50 years or so, we should focus on promoting better land use and reforestation worldwide. Beyond that, weather and the oceans naturally sink about one-fifth of total fossil-fuel emissions. We should also investigate large-scale options for accelerating the process of ocean sequestration.

Carbon zealots despise carbon-sinking schemes because, they insist, nobody can be sure that the sunk carbon will stay sunk. Yet everything they propose hinges on the assumption that carbon already sunk by nature in what are now hugely valuable deposits of oil and coal can be kept sunk by treaty and imaginary cheaper-than-carbon alternatives. This, yet again, gets things backward. We certainly know how to improve agriculture to protect soil, and how to grow new trees, and how to maintain existing forests, and we can almost certainly learn how to mummify carbon and bury it back in the earth or the depths of the oceans, in ways that neither man nor nature will disturb. It’s keeping nature’s black gold sequestered from humanity that’s impossible.

If we do need to do something serious about carbon, the sequestration of carbon after it’s burned is the one approach that accepts the growth of carbon emissions as an inescapable fact of the twenty-first century. And it’s the one approach that the rest of the world can embrace, too, here and now, because it begins with improving land use, which can lead directly and quickly to greater prosperity. If, on the other hand, we persist in building green bridges to nowhere, we will make things worse, not better. Good intentions aren’t enough. Turned into ineffectual action, they can cost the earth and accelerate its ruin at the same time.

Peter Huber is a Manhattan Institute senior fellow and the coauthor, most recently, of The Bottomless Well. His article develops arguments that he made in an Intelligence Squared U.S. debate in January. This article appeared in the Manhattan Institute’s City Journal, Spring 2009, vol.19, no.2.

Activists are outraged over President Obama’s raid of Emmalyn’s California Cannabis Clinic in San Francisco, but they should not be surprised.

Obama’s attorney general, Eric Holder, had promised to end federal medical marijuana raids as conducted by the Clinton and Bush administrations, leaving alone dispensaries operating legally under state law. Obama broke the spirit of the promise, but not the letter. The excuse for this last raid was state law violations — supposedly, sales taxes were being evaded. Now the feds will probably prosecute under federal law.

The state government was not agitating for a crackdown. Sacramento was not complaining about sales tax evasion. San Francisco had given a permit to this dispensary.

“It is disturbing that, despite the DEA’s vague claims about violations of state and federal laws,” Aaron Smith from the Marijuana Policy Project noted about the Drug Enforcement Agency, “they apparently made no effort to contact the local authorities who monitor and license medical marijuana providers.”

Furthermore, sales tax violations are rarely handled this way. The California chapter of the National Organization for the Reform of Marijuana Laws points out, “The normal process in such cases is for the Board of Equalization to audit the business in question, not for federal agents to enter like storm troopers and steal all of the business’s inventory.”

This episode should remind liberal pot activists of the potentially despotic power involved in tax collection. The power to tax is the power to destroy. Raids like this are unusual but not unheard of in mere tax cases. Presumably, if California’s marijuana industry were governed only by libertarian law — no violence, no theft, and no fraud — there would be far fewer excuses for the feds to step in.

Short of exempting medical marijuana from sales tax altogether, how can future outrages be prevented? California should go on the offensive. It should legalize marijuana, leave its regulation to the market, and, for now, treat it like any other retail good in terms of tax law.

The state could do so by treating marijuana as a legal medicine, thereby protecting users and distributors from federal sanction, assuming Obama keeps his promise to the letter. California could make medical marijuana completely legal — like aspirin or cough syrup — and allow retailers of all types to sell it without license or prescription.

Marijuana could be sold in grocery stores and pharmacies as an over-the-counter treatment. It could be made available everywhere. This measure would make it much harder for the feds to raid facilities as though they were underground, barely legal operations. It would expose the contradictions in the Drug War.

The Drug War is a total disaster. It has failed to significantly reduce drug abuse while violating personal liberty, serving as an excuse to shred the Bill of Rights, and being the major cause of gang violence, whether in our inner cities or on the border with Mexico.

If America ended drug prohibition, the Mexican border violence that has killed thousands over the past couple of years would end completely. Unfortunately, Obama is moving in the wrong direction, sending more troops to the border. Such state violence has forced the drug market underground, and every successful breakup of a dominant cartel only opens up a vacuum inevitably filled by other smaller groups violently competing over turf. The more the government cracks down, the worse it will get.

On medical marijuana, Obama was supposed to signify a shift in policy. His last DEA raid should put that myth to bed. By legalizing medical marijuana in 1996, California forced the issue over whether federal drug laws should supersede local standards. In terms of public opinion and political pressure, much has been won. It’s time to keep pushing.

In Gonzales v. Raich (2005), the Supreme Court’s five liberals all voted for federal supremacy over California’s medical marijuana laws, so more court cases might not be the answer. California should instead continue to liberalize its drug laws. Doing so will, at least, complicate Obama’s policy of federal raids and further undermine faith in the national government setting drug policy.

Anthony Gregory is is a writer and musician living in Berkeley, California. He earned his bachelor’s degree in history at U.C. Berkeley, where he was president of the Cal Libertarians. He is a research analyst at the Independent Institute (independent.org), a policy advisor for The Future of Freedom Foundation (fff.org), and a columnist for LewRockwell.com. His own website is AnthonyGregory.com.

The Wall Street Journal, Opinion & Outlook, March 27, 2009

Praise Mitt Romney. Three years ago, the former Massachusetts Governor had the inadvertent good sense to create the “universal” health-care program that the White House and Congress now want to inflict on the entire country. It is proving to be instructive, as Mr. Romney’s foresight previews what President Obama, Max Baucus, Ted Kennedy and Pete Stark are cooking up for everyone else.

In Massachusetts’s latest crisis, Governor Deval Patrick and his Democratic colleagues are starting to move down the path that government health plans always follow when spending collides with reality -i.e., price controls. As costs continue to rise, the inevitable results are coverage restrictions and waiting periods. It was only a matter of time.

They’re trying to manage the huge costs of the subsidized middle-class insurance program that is gradually swallowing the state budget. The program provides low- or no-cost coverage to about 165,000 residents, or three-fifths of the newly insured, and is budgeted at $880 million for 2010, a 7.3% single-year increase that is likely to be optimistic. The state’s overall costs on health programs have increased by 42% (!) since 2006.

Like gamblers doubling down on their losses, Democrats have already hiked the fines for people who don’t obtain insurance under the “individual mandate,” already increased business penalties, taxed insurers and hospitals, raised premiums, and pumped up the state tobacco levy. That’s still not enough money.

So earlier this year, Mr. Patrick appointed a state commission to figure out how to control costs and preserve “this grand experiment.” One objective is to change the incentives for preventative care and treatments for chronic disease, but everyone says that. It sometimes results in better health but always more spending. So-called “pay for performance” financing models, on the other hand, would do away with fee for service – but they also tend to reward process, not the better results implied.

What are the alternatives? If health planners won’t accept the prices set by the marketplace – thus putting themselves out of work – the only other choice is limiting care via politics, much as Canada and most of Europe do today. The Patrick panel is considering one option to “exclude coverage of services of low priority/low value.” Another would “limit coverage to services that produce the highest value when considering both clinical effectiveness and cost.” (Guess who would determine what is high or low value? Not patients or doctors.) Yet another is “a limitation on the total amount of money available for health care services,” i.e., an overall spending cap.

The Institute for America’s Future – which is providing the intellectual horsepower (we use the term loosely) for reforms like those in Massachusetts – argues that the cost overruns prove the state must cap how much insurers are allowed to charge consumers and regulate their profits. If Mr. Patrick doesn’t get there first, that is. He reportedly told insurers and hospitals at a closed meeting this month that if they didn’t take steps to hold down the rate of medical inflation, he would.

Even the single-payer cheerleaders at the New York Times have caught on to this rolling catastrophe. In a page-one story this month, the paper reported on the “expedient choice” that Mr. Romney and Democrats made to defer “until another day any serious effort to control the state’s runaway health costs. . . . Those who led the 2006 effort said it would not have been feasible to enact universal coverage if the legislation had required heavy cost controls. The very stakeholders who were coaxed into the tent – doctors, hospitals, insurers and consumer groups – would probably have been driven into opposition by efforts to reduce their revenues and constrain their medical practices, they said.”

Now they tell us. What really whipped along RomneyCare were claims that health care would be less expensive if everyone were covered. But reducing costs while increasing access are irreconcilable issues. Mr. Romney should have known better before signing on to this not-so-grand experiment, especially since the state’s “free market” reforms that he boasts about have proven to be irrelevant when not fictional. Only 21,000 people have used the “connector” that was supposed to link individuals to private insurers.

Which brings us to Washington, where Mr. Obama and Congressional Democrats are about to try their own Bay State bait and switch: First create vast new entitlements that can never be repealed, then later take the less popular step of rationing care when it’s their last hope to save the federal fisc.

The consequences of that deception will be far worse than those in Massachusetts, however, given that prior to 2006 the state already had a far smaller percentage of its population uninsured than the national average. The real lesson of Massachusetts is that reform proponents won’t tell Americans the truth about what “universal” coverage really means: Runaway costs followed by price controls and bureaucratic rationing.