Re: Cost benefit analysis
Does anyone know how often CBA is actually used in making policy? What percent of the federal budget (or state or local) has been determined by CBA?Cyril Morong I'm sure it's used frequently. It's probablyapplied something like this: "what's the minimum amount of taxpayer-funded benefits that I need to dispense to guarantee my re-election?" ~Alypius
Re: Median Voter, Welfare State and World Power
Bullshit or not? Assumption 1: There is a trade off between welfare state spending and military spending. Assumption 2: The more you spend on military, the more a gov't can project power abroad. Assumption 3: The Median European voter prefers more welfare state than Americans, who prefer more military spending. Conclusion 1: Americans per capita get more military than Europeans. Conclusion 2: Americans per capita are more able to project their millitary across the globe. Conclusion 3: Preferences for welfare state drives the power imbalance between Europe and America. Fabio Probably not bullshit, but I think it is an oversimplification. In addition to the points raised by the other posters, I would also add that the conclusion seems to assume a conflict between American and European foreign policy. Notwithstanding the EU, different European states can have different national interests in foreign affairs, and probably would not often be able to project a unified military power in foreign affairs. Thus, one cannot often speak of a European foreign policy. Europe would rarely be unified enough to match America in the projection of power. But if Europe were a unitary state, it's geographical proximity to Africa and much of Asia might give it an edge over America, and probably at lower cost. Yet more to the point, I really think Europe's preference for a welfare state over superpower status is a minor element in our disparity of force. Japan could easily be the world's number 2 superpower if it so desired, and it's welfare state is smaller than ours in the US. However, both Japanese (especially) and also European foreign policies tend to be policies of national self-interest, and self-interest does not always require the imperial projection of force. The Swiss would not necessarily be better off if they sought to dominate militarily as many other countries as possible, and we in the US are not necessarily better off either. But US foreign policy for the last century has tended to be a messianic policy motivated by the visionary ambitions of our foreign policy elites, and with the necessary sacrifices of the American taxpayers and soldiers and their families viewed as a form of noblesse oblige. Much of this messianic foreign policy ultimately derives from the original Puritan cultural heritage of the American northeast, which dominates the rest of the country in semi-imperial fashion (which is why one rarely if ever hears northeasterners talk of secession, unless of course they are speaking of preventing some other state's or region's potential secession; nor can one imagine any other region of America seeking to stop the northeast if it decided to secede! Many would say, Good riddance.). Whether the sacrifices US citizens make for the alleged good of the world are really appreciated or even desired by the rest of humanity is another question. I think many of them, especially outside western Europe, tend to feel toward the United States much the way that American Southerners feel toward northeasterners. But most of my fellow Americans seem to have difficulty understanding why the bulk of the human race does not appreciate our sacrifices on their behalf. Why do they hate us? they ask. After all, virtually everyone in the world would really like to be an American. All those millions of thirdworlders aren't lined up to get into the US just because they want to make money after all. It's because they want to share in our superior American values and culture. But since we don't quite have room for all of them in America, we can do the next best thing and bring Americanism to them, like we did in Germany and Japan and are now doing in Haiti, Yugoslavia, and Afghanistan. And Iraq is the next nation we aim to liberate and modernize. That's what nation-building is all about. What we're about to do to them is for their own good, and they should be grateful, or at least the survivors should. After all, it is well known that America is a benevolent nation which has nothing but the best interest of all the world at heart. Where would the world be if we returned to being like all those other narrow, money-grubbing countries that think of nothing but their own welfare? Enough sarcasm. Debating matters raised in the above paragraph is pointless, since one's conclusions ultimately depend on one's values--national greatness or national self-interest? In both American political parties, the national greatness school has outmaneuvered and largely banished (especially among Republicans) the national self-interest school. But now I wish to raise some questions that can be discussed on a practical rather than value system basis. Now that we have decided to substitute a policy of conquest and direct control for diplomacy and influence, for how many years, decades, or centuries will we have to occupy these lands? What will it eventually cost us? What is our ultimate goal? To acquire
RE: Fw: why Iraq? here's one theory
Bill says the whole (too long) report is nonsense. I mostly agree, BUT with a caveat. If switching to petro Euros has no affect on foreign investment into the US, then I'd agree the report is useless. However, if the switch to Euros, or the war in Iraq, or a feeling that US assets are overpriced, or it's the anniversary of the internet bubble bursting ... or for any reason, a significant amount of current foreign investment dries up, there could, indeed, be significant US econ impacts. I note, for example, the huge number of advertisements to refinance your home; converting home equity into debt. What happens if there is house price bubble pop and a 10-20% drop in home asset values? Please educate me Bill, how big a decrease in foreign investment would there have to be before it was, in your view, a significant problem? Thanks, Tom Grey PS. I wish there had been a link posted, and just a few quotes from the article. Here are a couple I extracted: start Otherwise, the effect of an OPEC switch to the euro would be that oil-consuming nations would have to flush dollars out of their (central bank) reserve funds and replace these with euros. The dollar would crash anywhere from 20-40% in value and the consequences would be those one could expect from any currency collapse and massive inflation (think Argentina currency crisis, for example). You'd have foreign funds stream out of the U.S. stock markets and dollar denominated assets, there'd surely be a run on the banks much like the 1930s, the current account deficit would become unserviceable, the budget deficit would go into default, and so on. Your basic 3rd world economic crisis scenario. ... By definition, dollar reserves must be invested in US assets, creating a capital-accounts surplus for the US economy. Even after a year of sharp correction, US stock valuation is still at a 25-year high and trading at a 56 percent premium compared with emerging markets. The US capital-account surplus in turn finances the US trade deficit. Moreover, any asset, regardless of location, that is denominated in dollars is a US asset in essence. When oil is denominated in dollars through US state action and the dollar is a fiat currency, the US essentially owns the world's oil for free. And the more the US prints greenbacks, the higher the price of US assets will rise. Thus a strong-dollar policy gives the US a double win. end of exerts So, mostly hysterical leftist anti-war hodge-podge (dollar denomination does NOT make it a US asset!); but I do think the capital account surplus finances the US trade deficit. And the Mid East money might be looking elsewhere. -Original Message- From: William Dickens [mailto:[EMAIL PROTECTED]] Utter and complete nonsense. The reason the press doesn't discuss the issue is because it is a non-issue. The only necessary harm done to the US by the Euro becoming the world's primary reserve currency (or sharing the status with the Euro) is a loss of a few hundred million in revenue for the Fed. Should OPEC set oil prices in Euros and hold their cash reserves in Euros what would be the real consequences for the US? 1. A tiny increase in risk wrt oil prices (we know its tiny because the cost of currency hedging is minimal). 2. A tiny loss of income for the Fed from being able to print cash and create reserves as cash is repatriated and foreign banks accounts in dollars are reduced. 3. Some tendency for the dollar to depreciate which can be completely offset by slower money growth (this and 2 are really the same thing). Perhaps slightly more foreign exchange risk for companies doing business with countries that cease to peg to the dollar. - - Bill Dickens
RE: Cost benefit analysis
In defense you can say that almost all of the weapons related spending (Procurement and RDTE budget almost half of the budget when you consider the spare purchases) is accomplished having gone through some CBA in the process of deciding the approach to develop, procure, and then maintain the equipment. An Analysis of Alternative is required along with estimates (actually by several layers of organizations). The other source to look at would be the Federal Acquisition Regulations (FAR). This policy drives use of CBA for certain purchases. So you could estimate off of this policy! jdd John D Driessnack, PMP, CCE/A Professor, Defense Acquisition University PMT-250/352, DAU Risk/Tools Subject Matter Expert DAWIA PM, Acq Logi, FM Level III NE-Capital Campus, Faculty Department Program Management and Leadership 9820 Belvoir Rd, Building 205, Room 115B Ft Belvoir, VA 22060-5565 703-805-4655 (DSN-655) [EMAIL PROTECTED] FAX 703-805-3728 -Original Message- From: [EMAIL PROTECTED] [mailto:[EMAIL PROTECTED]] Sent: Tuesday, February 11, 2003 11:16 PM To: [EMAIL PROTECTED] Subject: Cost benefit analysis Does anyone know how often CBA is actually used in making policy? What percent of the federal budget (or state or local) has been determined by CBA? Cyril Morong
A visiting Slovak in April May
Hi folks, hope some of you can help me. My friend and colleague, Jan Oravec from Slovakia, has received an Eisenhower Fellowship for a couple months, end of March to end of May. These fellowships allow bright young guys to network in the US. He's the President of the F.A. Hayek Foundation (Nadacia -- NFAH) in Slovakia, a fine think tank with which I'm associated. (Less than I'd like.) http://www.hayek.sk/ You can see some of the things done, including sponsoring the Mt. Pelerin Society meeting in 2001 There were also excellent seminars on pension reform and the flat rate tax. Both of these reforms are actively being discussed, proposed, and likely to be passed, in some form, in Slovakia. (After fine 2002 elections.) Help request: Who should he meet to increase the effectiveness of his fund raising efforts? Are any of you available to offer advice, a few contacts, your own pet theory of the most important next reform needed? Writing directly to him, or the foundation, or me, might be best, although Libertarian think tank fundraising issues seems quite appropriate for armchairs, too. Thanks for any help, ideas, suggestions, contacts -- phone numbers of people willing to meet. Tom Grey [EMAIL PROTECTED] [EMAIL PROTECTED] [EMAIL PROTECTED]
RE: Cost benefit analysis
Oneproblem with applying CBA to policy formulation isensuring reliability and objectivity.Too often, CBA is manipulatedforpredetermined policy positions.EPA once produceda Regulatory Impact Analysis that contended that benefits fromthe phaseout of CFCsare $8 trillion to $32 trillion. In such cases, CBA does more to confound, rather than illuminate, rational policy formulation. Is there a practical way for policy makers to assess the reliability and objectivity of CBA? Walt Warnick -Original Message-From: Driessnack, John [mailto:[EMAIL PROTECTED]]Sent: Thursday, February 13, 2003 9:56 AMTo: [EMAIL PROTECTED]Cc: [EMAIL PROTECTED]Subject: RE: Cost benefit analysis In defense you can say that almost all of the weapons related spending (Procurement and RDTE budget almost half of the budget when you consider the spare purchases) is accomplished having gone through some CBA in the process of deciding the approach to develop, procure, and then maintain the equipment. An Analysis of Alternative is required along with estimates (actually by several layers of organizations). The other source to look at would be the Federal Acquisition Regulations (FAR). This policy drives use of CBA for certain purchases. So you could estimate off of this policy! jdd John D Driessnack, PMP, CCE/A Professor, Defense Acquisition University PMT-250/352, DAU Risk/Tools Subject Matter Expert DAWIA PM, Acq Logi, FM Level III NE-Capital Campus, Faculty Department Program Management and Leadership 9820 Belvoir Rd, Building 205, Room 115B Ft Belvoir, VA 22060-5565 703-805-4655 (DSN-655) [EMAIL PROTECTED] FAX 703-805-3728 -Original Message-From: [EMAIL PROTECTED] [mailto:[EMAIL PROTECTED]] Sent: Tuesday, February 11, 2003 11:16 PMTo: [EMAIL PROTECTED]Subject: Cost benefit analysis Does anyone know how often CBA is actually used in making policy? What percent of the federal budget (or state or local) has been determined by CBA?Cyril Morong
re: lott
please disregard the previous message, it was not written by me Patrick McCann
Re: Cost benefit analysis
If I were teaching intermediate micro, I think I would begin by asking students why they consume less of x when its price rises. Presumably most would say that they would switch to other products. Then I would ask them to consider a world with only ONE good. Obviously with only one good, price does not work via substitution. Why then does consumption decline in the latter case? Because higher prices make you poorer, making you tend to buy less overall. Then I'd explain that as the number of goods rises, the latter income effect tends to matter less and less. I probably wouldn't go through the whole textbook discussion (unless the students were largely going to grad school), but I think the point is worth half a class. -- Prof. Bryan Caplan Department of Economics George Mason University http://www.bcaplan.com [EMAIL PROTECTED] He wrote a letter, but did not post it because he felt that no one would have understood what he wanted to say, and besides it was not necessary that anyone but himself should understand it. Leo Tolstoy, *The Cossacks*
RE: Cost benefit analysis
On Thu, 13 Feb 2003 15:52:43 -0500, William Dickens [EMAIL PROTECTED] said: Any CBA is better than no CBA - - even a badly skewed one. Its the same argument for formalizing theory in economics. It makes clear what your assumptions and logic are and makes it easy to identify areas of agreement and disagreements between opponents on an issue. - - Bill Dickens Did I just read what I think I read? So here is the scenario - a *badly skewed* CBA is used by misguided (do-gooder) policy makers to influence legislation by defeating a more reasonable (logical) argument. This CBA had more traction (the bad science environmentalists had a well funded propaganda campaign) and the resultant legislation ended up killing millions of people (refrigerators in third world countries no longer able to keep food cold or pesticides no longer available to kill mosquitos which carried disease). I find it hard to agree that any CBA is better than no CBA. -Fred Childress [EMAIL PROTECTED] 02/13/03 01:57PM One problem with applying CBA to policy formulation is ensuring reliability and objectivity. Too often, CBA is manipulated for predetermined policy positions. EPA once produced a Regulatory Impact Analysis that contended that benefits from the phaseout of CFCs are $8 trillion to $32 trillion. In such cases, CBA does more to confound, rather than illuminate, rational policy formulation. Is there a practical way for policy makers to assess the reliability and objectivity of CBA? Walt Warnick -Original Message- From: Driessnack, John [mailto:[EMAIL PROTECTED]] Sent: Thursday, February 13, 2003 9:56 AM To: [EMAIL PROTECTED] Cc: [EMAIL PROTECTED] Subject: RE: Cost benefit analysis In defense you can say that almost all of the weapons related spending (Procurement and RDTE budget - almost half of the budget when you consider the spare purchases) is accomplished having gone through some CBA in the process of deciding the approach to develop, procure, and then maintain the equipment. An Analysis of Alternative is required along with estimates (actually by several layers of organizations). The other source to look at would be the Federal Acquisition Regulations (FAR). This policy drives use of CBA for certain purchases. So you could estimate off of this policy! jdd John D Driessnack, PMP, CCE/A Professor, Defense Acquisition University PMT-250/352, DAU Risk/Tools Subject Matter Expert DAWIA PM, Acq Logi, FM Level III NE-Capital Campus, Faculty Department Program Management and Leadership 9820 Belvoir Rd, Building 205, Room 115B Ft Belvoir, VA 22060-5565 703-805-4655 (DSN-655) [EMAIL PROTECTED] FAX 703-805-3728 -Original Message- From: [EMAIL PROTECTED] [mailto:[EMAIL PROTECTED]] Sent: Tuesday, February 11, 2003 11:16 PM To: [EMAIL PROTECTED] Subject: Cost benefit analysis Does anyone know how often CBA is actually used in making policy? What percent of the federal budget (or state or local) has been determined by CBA? Cyril Morong Yours in Liberty, Fred Childress LNC Region 5 Alt Representative - http://www.LP.org Even if you're on the right track, you'll get run over if you just sit there. -Will Rogers
RE: Cost benefit analysis
Fred, You completely misunderstand my point. If a cost benefit analysis is presented it makes very clear what the assumptions are that lead to the policy conclusions. Thus any debate of the question is going to be much better informed and much more closely focused on the issues that matter. Its going to be more logical. I am not saying that a bad CBA trumps a good verbal argument in deciding an issue. I'm saying that as a starting point for a debate a bad CBA is still a good point of departure because it spells out the assumptions and logic that the person presenting it is making. - - Bill Dickens [EMAIL PROTECTED] 02/13/03 05:37PM On Thu, 13 Feb 2003 15:52:43 -0500, William Dickens [EMAIL PROTECTED] said: Any CBA is better than no CBA - - even a badly skewed one. Its the same argument for formalizing theory in economics. It makes clear what your assumptions and logic are and makes it easy to identify areas of agreement and disagreements between opponents on an issue. - - Bill Dickens Did I just read what I think I read? So here is the scenario - a *badly skewed* CBA is used by misguided (do-gooder) policy makers to influence legislation by defeating a more reasonable (logical) argument. This CBA had more traction (the bad science environmentalists had a well funded propaganda campaign) and the resultant legislation ended up killing millions of people (refrigerators in third world countries no longer able to keep food cold or pesticides no longer available to kill mosquitos which carried disease). I find it hard to agree that any CBA is better than no CBA. -Fred Childress [EMAIL PROTECTED] 02/13/03 01:57PM One problem with applying CBA to policy formulation is ensuring reliability and objectivity. Too often, CBA is manipulated for predetermined policy positions. EPA once produced a Regulatory Impact Analysis that contended that benefits from the phaseout of CFCs are $8 trillion to $32 trillion. In such cases, CBA does more to confound, rather than illuminate, rational policy formulation. Is there a practical way for policy makers to assess the reliability and objectivity of CBA? Walt Warnick -Original Message- From: Driessnack, John [mailto:[EMAIL PROTECTED]] Sent: Thursday, February 13, 2003 9:56 AM To: [EMAIL PROTECTED] Cc: [EMAIL PROTECTED] Subject: RE: Cost benefit analysis In defense you can say that almost all of the weapons related spending (Procurement and RDTE budget - almost half of the budget when you consider the spare purchases) is accomplished having gone through some CBA in the process of deciding the approach to develop, procure, and then maintain the equipment. An Analysis of Alternative is required along with estimates (actually by several layers of organizations). The other source to look at would be the Federal Acquisition Regulations (FAR). This policy drives use of CBA for certain purchases. So you could estimate off of this policy! jdd John D Driessnack, PMP, CCE/A Professor, Defense Acquisition University PMT-250/352, DAU Risk/Tools Subject Matter Expert DAWIA PM, Acq Logi, FM Level III NE-Capital Campus, Faculty Department Program Management and Leadership 9820 Belvoir Rd, Building 205, Room 115B Ft Belvoir, VA 22060-5565 703-805-4655 (DSN-655) [EMAIL PROTECTED] FAX 703-805-3728 -Original Message- From: [EMAIL PROTECTED] [mailto:[EMAIL PROTECTED]] Sent: Tuesday, February 11, 2003 11:16 PM To: [EMAIL PROTECTED] Subject: Cost benefit analysis Does anyone know how often CBA is actually used in making policy? What percent of the federal budget (or state or local) has been determined by CBA? Cyril Morong Yours in Liberty, Fred Childress LNC Region 5 Alt Representative - http://www.LP.org Even if you're on the right track, you'll get run over if you just sit there. -Will Rogers
Re: Cost benefit analysis
From: William Dickens Fred, You completely misunderstand my point. If a cost benefit analysis is presented it makes very clear what the assumptions are that lead to the policy conclusions. Bill, I don't think I completely misunderstood. I do apologize, however, as I allow myself to gravitate from your purely academic response back into the real world. Your point is well taken, but my mind was on the earlier question. Is there a practical way for policy makers to assess the reliability and objectivity of CBA? I thought this was an excellent question. How many policy makers do you know that are actually able to understand the necessary variables to arrive at a meaningful assumption in order to evaluate the analysis? I work in government. CBA is seldom used. I would like to see it used more often, but data are relatively sparse due to the disjointed accounting systems and other road blocks (E.g. - collective bargaining agreements). Seldom does a cost center actually represent the work being performed. -Fred Childress - Original Message - From: William Dickens [EMAIL PROTECTED] To: [EMAIL PROTECTED] Sent: Thursday, February 13, 2003 9:33 PM Subject: RE: Cost benefit analysis Fred, You completely misunderstand my point. If a cost benefit analysis is presented it makes very clear what the assumptions are that lead to the policy conclusions. Thus any debate of the question is going to be much better informed and much more closely focused on the issues that matter. Its going to be more logical. I am not saying that a bad CBA trumps a good verbal argument in deciding an issue. I'm saying that as a starting point for a debate a bad CBA is still a good point of departure because it spells out the assumptions and logic that the person presenting it is making. - - Bill Dickens [EMAIL PROTECTED] 02/13/03 05:37PM On Thu, 13 Feb 2003 15:52:43 -0500, William Dickens [EMAIL PROTECTED] said: Any CBA is better than no CBA - - even a badly skewed one. Its the same argument for formalizing theory in economics. It makes clear what your assumptions and logic are and makes it easy to identify areas of agreement and disagreements between opponents on an issue. - - Bill Dickens Did I just read what I think I read? So here is the scenario - a *badly skewed* CBA is used by misguided (do-gooder) policy makers to influence legislation by defeating a more reasonable (logical) argument. This CBA had more traction (the bad science environmentalists had a well funded propaganda campaign) and the resultant legislation ended up killing millions of people (refrigerators in third world countries no longer able to keep food cold or pesticides no longer available to kill mosquitos which carried disease). I find it hard to agree that any CBA is better than no CBA. -Fred Childress [EMAIL PROTECTED] 02/13/03 01:57PM One problem with applying CBA to policy formulation is ensuring reliability and objectivity. Too often, CBA is manipulated for predetermined policy positions. EPA once produced a Regulatory Impact Analysis that contended that benefits from the phaseout of CFCs are $8 trillion to $32 trillion. In such cases, CBA does more to confound, rather than illuminate, rational policy formulation. Is there a practical way for policy makers to assess the reliability and objectivity of CBA? Walt Warnick -Original Message- From: Driessnack, John [mailto:[EMAIL PROTECTED]] Sent: Thursday, February 13, 2003 9:56 AM To: [EMAIL PROTECTED] Cc: [EMAIL PROTECTED] Subject: RE: Cost benefit analysis In defense you can say that almost all of the weapons related spending (Procurement and RDTE budget - almost half of the budget when you consider the spare purchases) is accomplished having gone through some CBA in the process of deciding the approach to develop, procure, and then maintain the equipment. An Analysis of Alternative is required along with estimates (actually by several layers of organizations). The other source to look at would be the Federal Acquisition Regulations (FAR). This policy drives use of CBA for certain purchases. So you could estimate off of this policy! jdd John D Driessnack, PMP, CCE/A Professor, Defense Acquisition University PMT-250/352, DAU Risk/Tools Subject Matter Expert DAWIA PM, Acq Logi, FM Level III NE-Capital Campus, Faculty Department Program Management and Leadership 9820 Belvoir Rd, Building 205, Room 115B Ft Belvoir, VA 22060-5565 703-805-4655 (DSN-655) [EMAIL PROTECTED] FAX 703-805-3728 -Original Message- From: [EMAIL PROTECTED] [mailto:[EMAIL PROTECTED]] Sent: Tuesday, February 11, 2003 11:16 PM To: [EMAIL PROTECTED] Subject: Cost benefit analysis Does anyone know how often CBA is actually used in making policy? What percent of the
