Coffin Ships, Deregulation, and Al Gore

Samuel Plimsoll was born in Bristol, England, on February 10, 1824. He became a businessman, but of the sort who cared about his fellow humans. In his business, the coal trade, there was a dark secret. Ship owners found they could maximize their profits on their oldest vessels by stopping maintenance, overloading them with goods, using fewer sailors than was safe, and over-insuring them. A ship that made its voyage was profitable. A ship that sank was profitable too, because of the insurance payment. Never mind the dead sailors. Such ships were known as coffin or death ships. Plimsoll pleaded with the British Parliament to outlaw these practices. Parliament did nothing. Plimsoll ran for and was seated in Parliament in 1868. It took him until 1876 to get his Merchant Shipping Act passed. He is known to history as "the sailor's friend."

Regulation good, de-regulation bad? Democrats good, Republicans bad? Not so fast.

Regulations can be bad, often depending on your point of view. The devil is in the details, and the details, all too often in modern times, are written by corporate lawyers. Laws and regulations about business practices are yet more grist for the gruel of law.

Regulations can make people safer, but they can also kill beneficial industries by failing to take into account that a degree of danger is inherent when any human wakes up in the morning, and to some extent even when they sleep at night. Many regulations, however, are not about safety, but about some other government set goal. Regulating fishing, for instance, is (supposed to be) about preserving enough breeding fish each year so that fishing will be just as good next year, or ten years from now. Thus they should benefit business and workers alike.

Laws and regulations, like cholesterol, tend to accumulate and choke the life out of things at times, even if they are well-intentioned. As a public school board member in California I saw this effect. Over the decades whenever something went wrong at a public school the state legislature, or the office of education, or even the Federal government, wrote a law (usually added to the Education Code) in response. Often, to ensure compliance, some paperwork was added: an annual certification that the school complied with the regulation. Over the decades, to ensure compliance, which is necessary to get funding, the ratio of administrative support staff to teachers grew.

I have no problem with the idea of periodically purging unnecessary regulations. The problem is, who picks? Too often, business lobbyists choose to leave in regulations that help them fend off ruinous competition, while getting rid of regulations that protect workers, consumers, and the environment.

Which brings us to Al Gore, former Vice-president of the United States of America, now known as a flaming liberal because of his anti-global warming posturing. For no particular reason I started reading Alexander Cockburn and Jeffrey St. Clair's Al Gore: A User's Manual, printed back in 2000. The section I am in is how Gore led the deregulators when he was vice-president. He pushed the Clinton administration for REGO, his reinventing government program. It would please any Tea Party activist or corporate Republican. It was sold to the public as a waste-eliminator, but in fact opened the doors of government to business predators, while gutting departments that did useful public service [pages 172-187]. Gore topped this with his attack on the federal welfare system [pages 188-209]. Gore's ability to completely alienate any Democratic Party politician or voter who still believed in the New Deal or Great Society was the reason he lost his campaign to become President in 2000.

But people have short memories. Particularly, apparently, do voters. And journalists. So raise a glass to Samuel Plimsoll, one of the rare good politicians.

Remember, too, the glory that was Imperialist America, but don't expect the paychecks to be as good during our post-imperial decline and fall.

Ruinous Competition: Doctors and Healthcare

According the free-market theorists, the best of all possible economic worlds is one in which there is no government regulation. First developed coherently in Adam Smith's Wealth of Nations, this theory was based on practical observations of a society, England, that had been high regulated by a monarchical government working with feudal institutions that tried to determine most people's occupation by their status at birth.

Business men and trade-guilds that had done quite well for themselves in the past found it hard to make a profit, or even a living, once anyone could compete with them. In a free market, if a profit can be made in a certain occupation, new people will enter that occupation until competition for customers results in profit levels becoming unattractive. We call that ruinous competition.

Certain industries require quite a bit of capital to enter, so even back at the dawn of this new era, around the time of the American Revolution, profits could be made in those industries without the help of government restrictions on entering the business. Just as a beggar cannot enter the farming business without the price of at least a down-payment on a piece of land, so a laborer or small merchant would not have the capital to set up an iron-mill or buy a coal mine. So even under the growing free market system, larger enterprises had some shelter from ruinous competition.

The United States of America began as a sort of natural free-market area, and people generally benefited from that (neglecting here the use of slave labor and violent capture of Native American Indian real estate) for some time.

In the course of the 1800's, however, mainly at the level of individual states, those who did not want to be exposed to ruinous competition developed a strategy. Aside from the practice of the law, which was always limited by the government, it was argued that professions having a direct impact on the health and safety of the public needed to be vetted by the government. For instance, it was argued that not anyone could simply declare themselves to be a medical doctor. And again, there was some truth to it, although in the 1800's it appears that trained medical doctors were so ignorant of basic biology that many were just as dangerous to the public as the so called fake doctors, or charlatan (originally, sellers of Roman Catholic indulgences, but a term that came to be applied to untrained healers).

Allowing only doctors licensed under the authority of the government, and making sure there was always a shortage of such licensed doctors, would allow the group to charge more than the free market value of their medical services. In short, to overcharge the sick. This was the purpose of the American Medical Association, formed in 1847. The AMA did some good things, which don't concern us here. What they did on the economic front was require that medical practitioners be licensed (and they set up boards of their own members to decide who would qualify for a license) and they also licensed medical schools. In licensing such schools they carefully studied the demand for doctors and made sure that not enough doctors were graduated to meet the demand.

Now of course practically every profession, from cutters of hair to real estate agents to accountants and carpenters, requires a license. Some professions have not been as successful at keeping their numbers small and profits high as the doctors have done, but the general idea is there. Barriers to entry, no free market, no ruinous competition. Those who work without license are sucked dry by the fees of those who are licensed to work.

Those doctors who scream for free markets and against "socialist" government health care plans should take a good look at themselves and their ill-got millions. Because of the government preventing the operation of free markets in doctoring, in the 1950's and 1960's the term millionaire-doctor was synonymous with doctor.

If doctors don't want socialized medicine, we should open up doctoring to anyone who feels they can heal. Pharmacists should be able to make diagnoses and sell basic drugs without a doctor's prescription. For that matter doctors should be able to sell drugs in their offices, rather than having to write a prescription. People should be able to self-diagnose, if they wish to take that risk, and get any legal drug without a prescription.

If someone puts out a shingle and causes harm, they could be sued for malpractice. If they claim to have graduated from a medical school, but did not, they could be charged with fraud. If the government wants to certify people, or the AMA wants to identify their members, that is fine, but there should be no rule that you have to go to the AMA men or government men.

What do you say, Republicans and Tea-Party people? Are you really ready to give free markets a chance? I'm certainly ready to hang out a shingle, if the Republican run government is willing to let me. I'll start a medical insurance company too, a coop that benefits the members. That should put some pressure on Anthem et. al.

Note: many doctors have come out for Universal Health Care. For instance see Physicians for a National Health Care Program.

Capitalists Announce Five Year Plan

The new capitalist five year plan for the economy of the United States of America (including its empire of affiliated nations) was announced August 26, 2009, in a secret underground bunker in Manhattan. The plan covers the years 2010 through 2014.

The usual report on the prior five year plan was handed out in advance. Although there were some minor glitches in 2008 and 2009, the plan was deemed to be highly successful. The political baton was successfully handed off between the two parties without any real change in policy. Large numbers of workers were impoverished, which will ensure their loyalty and hard work during the coming years, if they are rehired. Almost all value was squeezed out of the economy and into a much smaller number of individual capitalists and banking institutions than had been necessary in the past. The heroin supply from Afghanistan was assured, military spending increased, and China and India got in lockstep with the plan for global development.

The key components of the new five year plan can be summarized as: maintain a stable trajectory. Military spending is to grow, but not so much as to jeopardize other segments of the economy. Unemployment is to recover, as its primary purpose of indebting large numbers of people and insuring their future loyalty has been largely accomplished. Stock market and housing price booms are designed in towards the end of the plan, to be facilitated by easy credit from the Federal Reserve. New regulations are planned to minimize competition, and new loopholes have already been worked into them that can be used to advantage only by the largest corporations.

The health care system in the United States is to remain mainly as it is, with only the most minor of reforms. Sick people are an economic liability once their wallets have been drained, but using tax dollars extracted from workers, high prices for drugs, insurance, and doctor services will be maintained.

The view on global warming has changed since the last five year plan. Super profits will be made by reluctantly accepting government and private dollars for "clean energy" projects. Meanwhile, heavy equipment manufacturing plans will be laid for the vast system of dikes that will be needed to protect sea coasts from flooding.

"Above all," said Michael Milkem, this year's chairperson, "we must remember to not try to micromanage the situation. Our strength is in sticking to fundamentals. Don't sweat the small stuff. Control the politicians, interest rates, and bank lending policies and the small stuff will take care of itself."