Archive for February, 2010

Common sense

Sunday, February 28th, 2010

There is a basic amount of shared experience that most people in this country have that is often referred to as common sense. People know how to go to the store and buy food, how to put gas in your car and how to get dressed in the morning to go to school or work. Then, there are people who seem to have missed out on some of these shared experiences. One of them is learning what car insurance does. When I was young and poor and a college student, I had an old car and did not have insurance. I probably drove a little more carefully but there was no law that said I had to have it and I was making a choice between insurance and eating.

Our president was presiding over a summit meeting on health insurance this week, but began with a story from his early experience with auto insurance. There is video at the link.

When I was young, just got out of college, I had to buy auto insurance. I had a beat-up old car. And I won’t name the name of the insurance company, but there was a company — let’s call it Acme Insurance in Illinois. And I was paying my premiums every month. After about six months I got rear-ended and I called up Acme and said, I’d like to see if I can get my car repaired, and they laughed at me over the phone because really this was set up not to actually provide insurance; what it was set up was to meet the legal requirements. But it really wasn’t serious insurance.

Now, it’s one thing if you’ve got an old beat-up car that you can’t get fixed. It’s another thing if your kid is sick, or you’ve got breast cancer.

It’s one thing to tell a story and another thing to know what the hell you are talking about !

When you are “rear ended,” the other driver is responsible for fixing your car ! You don’t call your own insurance company; you call the other driver’s insurance company !

OK, so let’s say the other driver doesn’t have insurance. Did he pay the premium for uninsured driver coverage ? Or did he just pay the minimum for liability coverage ? If he didn’t pay for uninsured driver coverage, why is that the insurance company’s fault ?

Some of us choose to buy high deductible health insurance because it is cheaper, we are healthy and we choose to pay for routine care out of pocket. Obama is planning to take away that choice. We will all have to buy Cadillac coverage and, if we can’t afford it, the government will subsidize it. Why is that better ?

How would he know if he doesn’t even know how car insurance works ?

I still wonder who was guiding this guy through life when he was young. It sounds to me like he would starve to death if left to his own devices.

San Diego Tea Party Photos

Sunday, February 28th, 2010

By Bradley J. Fikes

I attended the Tea Party rally in downtown San Diego Saturday and took photos and videos. You can read a more detailed account by local Tea Party leader Dawn Wildman, who spoke at the rally.

I’m guessing about 300 people showed up at the rally, which had intermittent rain.

As usual, what I post here does not necessarily reflect the opinion of my employer, the North County Times.

Here are some videos, followed by photos:

Tea Party Leader Dawn Wildman speaks

Richard Rider speaks, part 1

Richard Rider speaks, part two

Richard Rider speaks, part 3

Roger Hedgecock speaks

Don't Tread On Me flags were prominent at the event.

Don't Tread On Me flags were prominent at the event.

Ouch!

Ouch!

COUNTERDEMONSTRATION: All the Tea Party talk of "socialism" was of course complete nonsense.

COUNTERDEMONSTRATION: All the Tea Party talk of "socialism" was of course complete nonsense.

Peasant with a pitchfork!

Peasant with a pitchfork!

Not a likely member of Greenpeace

Not a likely member of Greenpeace

Richard Rider, the grand old man of local Libertarians and tax-reduction advocates.

Richard Rider, the grand old man of local Libertarians and tax-reduction advocates.

"Clean House And The Senate in 2010", reads the bumper sticker, held by talk show host Roger Hedgecock, a keynote speaker.

"Clean House And The Senate in 2010", reads the bumper sticker, held by talk show host Roger Hedgecock, a keynote speaker.

More to come ….

Lies about malpractice reform

Friday, February 26th, 2010

I looked at Washington Monthly today, as I usually do to see what the far left is thinking. They were, as usual, obsessing about the health “reform” legislation and yesterday’s summit. I noticed a link to another article about malpractice reform.

First, from Wash Monthly,

John McCain recommended malpractice reform modeled on California and Texas.

There’s two examples right now of medical malpractice reform that is working. One is called California and the other is called Texas. I won’t talk about California because we Arizonians hate California because they’ve stolen our water.

“But the fact is that Texas has established a $750,000 cap for non-economic damages; caps doctors at $250,000; hospitals at $250,000; and any additional institution, $250,000; and patients harm to a finding of medical malpractice are not subject to any limitations on recoveries for economic losses. And I hope you’ll examine it.”

Wash Monthly comes back with a response that is based on lies.

I hope policymakers will examine it, too, because the results of the experiments in California and Texas offer some important lessons.

McCain preferred to ignore California’s experience, not because of water rights, but because the caps haven’t worked the way conservatives would have liked.

This is a lie. The “source” he links to is Jamie Court who is a really far left anti-insurance zealot and part of the phony Prop 103 auto insurance “rollback” that passed a decade ago and screwed up California’s auto insurance for a while. Here is what Court says:

Data from the National Assn. of Insurance Commissioners show that doctors’ malpractice premiums nearly tripled in the first dozen years after the 1975 California law. Premiums fell sharply and stabilized only after Californians passed insurance reform Proposition 103 in 1988.

Under 103, $135 million was refunded by malpractice insurers. The insurance measure also created an elected insurance commissioner who imposed a rate freeze for his entire first term, implemented stringent regulation and ended price fixing.

This is just a lie. I was practicing surgery in California the entire time he refers to. I began my private practice in 1972. My malpractice premium was $3500 per year. In 1974, following the stock market decline which devastated insurance company investments, my malpractice carrier raised my (and my partner’s) premium to $35,000 per year, but we learned that the company was insolvent. For a while, there was no insurance available except at stratospheric rates we could not afford. Thousands of California doctors practiced without insurance for several years. In 1974, there was a statewide doctor’s strike. Many doctors refused to treat any but emergency cases until the state did something about medical malpractice. Governor Jerry Brown called an emergency special session of the state legislature in January 1975. They passed a very good law called AB1XX, named for the special session. Since that time, it has been called MICRA, The Medical Injury Compensation Reform Act.

It has been attacked many times by the trial lawyers, with whom Court is affiliated. Eventually, the State Supreme Court upheld the reform act, in spite of furious attacks by the medical malpractice bar. It has resisted further attacks every few years for the past 25 years.

Court claims that premiums tripled and that Prop 103 affected the rates. Both are lies. My partner and I practiced without insurance for three years. In 1978, when we added another surgeon to our practice, we decided to start buying insurance again and we joined a company called CAP/MPT. That stands for Cooperative of American Physicians/ Medical Protection Trust. It is a non-profit cooperative of doctors who are self insuring. We each deposited $20,000 into a trust fund. We were than assessed an amount each year according to our specialty. Surgery is higher risk than General Practice, for example. My assessment remained at about $6,000 per year for the next 20 years.

I was sued several times although most were nuisance suits. For example, when we did apply to CAP/MPT, I learned that I had eight wrongful death suits filed against me. When we investigated, we found that these were ER patients, mostly trauma cases, that had died. Some, I had not even been involved with their care. I wrote letters to each law firm asking them to dismiss the suits or be subject to a suit by me for malicious prosecution. All were quickly dismissed. I was threatened with suits a couple of times by disgruntled patients. One woman kept coming back complaining because she had a tiny scar from a varicose vein injection. I couldn’t see it from ten feet away. I finally (a mistake) asked her why she was so obsessed with this scar that no one else could see. She had been warned that these injections can cause scars. I even asked her if she was having personal problems, with her husband, for example. That was a big mistake. She threatened to sue me but she could never find a lawyer to take her case.

Ironically, she had originally come to me because I had saved her mother’s life. Her mother, a smoker, had been in California to help her daughter with a new baby. While here, she had a catastrophic vascular accident that resulted in her entire small intestine dying. I put together her duodenum and colon but did not expect her to live. She had no remaining bowel that could absorb nutrients. Also, the connection of the bowel was tenuous because of the poor blood flow. Amazingly, it healed but she had no way to absorb food. We put her on total parental nutrition and she did well but there was no known way to keep the catheter from getting infected. They had never been used for a chronic IV nutrition situation.

I had been to the American College of Surgeons meeting a couple of months before and had seen a new catheter that was intended for long term IV use. It was still experimental. I called Belding Scribner, who had invented the first shunt that allowed chronic dialysis for renal failure. He was the one at the meeting who was showing the new catheter. He told me the name of the small company that was making them and they agreed to send me one. They are now commonly used for chemotherapy but this was probably the first use for a patient who lost her entire small bowel. It worked and she went home to Bethesda, Maryland after we taught her husband how to care for it. I called the National Institutes of Health to find someone who could help the husband with the care and she did well for several years, finally dying of a heart attack. Ten years later, her daughter sued me for a 2 mm scar.

I had a couple of other suits, one of which went to trial and I was exonerated, including being awarded the court costs. In 1994, after a major back operation for an old injury, I retired. A couple of years later, my $20,000 trust fund contribution was refunded. Court is lying about the malpractice situation in California and trying to puff up the role of his anti-insurance Prop 103. There was no refund until I retired and that had nothing to do with Court and his Naderite pals.

The fact that the left has to lie to support their position is excellent evidence that they have nothing else on their side.

Now, about that insurance premium spike…

Tuesday, February 23rd, 2010

One of my favorite health blogs is written by a retired cardiologist who calls himself Dr Rich. Cardiologists have a thing about that. One of the cardiologists in Irvine, a few years ago as stent and angioplasty technology took off, said his life’s ambition was to drive a Mercedes and to see cardiac surgeons driving Chevys. Anyway, Dr Rich has many excellent insights into health care reform, although he expresses them in a facetious way many times. Here is what he has to say about the current state of health reform.

DrRich is pleased to note that events have so quickly confirmed the explanation he gave, in his last post, regarding what the health insurance companies are up to by choosing to massively increase insurance premiums at this critical juncture. The insurance companies, to repeat, are willfully embracing their assigned role as “villain,” in order to get apparently stalled healthcare reforms back on track.

A mere few hours after DrRich had posted, Kathleen Sibelius issued a press release angrily documenting several additional requests for large rate increases by health insurance companies all across the land, and pointedly reminding us regular folks that healthcare reform would prevent these greedy companies from committing such abusive and harmful acts. And thus has the administration now officially established runaway health insurance premiums as the crisis of the moment.

The health insurance companies are firmly behind the Obama “reform” bill as the mandate and the administration’s plan to make them public utilities, is their own ambition.

So, dear readers, once again the health insurance industry has handed reformers a fine new crisis, just when they needed it, in order to get faltering healthcare reform back on track.

He doesn’t think much of Republicans but then I have my doubts, as well.

Republicans (who are certifiably clueless) must be wondering why their stalwart allies in the health insurance industry are once again stabbing them in the back. Of course, Republicans have not understood the health insurance industry for several years now. They certainly don’t understand that the insurance industry absolutely relies on healthcare reform to bail them out of their failed business model.

In fact, DrRich suspects that (despite this latest evidence) these unfortunate Republicans are heading into President Obama’s Health Care Summit on Thursday with the very same plan they’ve had all along – to set things up so that health insurance companies can compete with each other more robustly (across state lines, &c.), since, don’t you know, such competition will create the efficiencies we need to bring down the cost of healthcare.

This is truly a crazy idea.

Competition is the last thing health insurance companies want. Now comes a story that I had not heard before.

Consider, for those who have forgotten, the sad experience of Mr. Jim Clark, one of the founders of WebMD. Clark, widely acknowledged in the 1990s as one of the first Internet visionaries (having started – and sold – both Silicon Graphics and Netscape), originally envisioned WebMD as an electronic clearing house that would streamline various complex transactions within the healthcare system. Companies would sign up for WebMD’s transactional processing services and save millions; WebMD would take their cut; everybody would be happy.

The first big target for WebMD was to be health insurance claims processing.

Clark’s proposition to the health insurance companies seemed solid. In fact, it was obviously too good to pass up. Whereas processing a typical claim costs an insurance company $7.00, WebMD offered to do it for only $0.70 – a savings of 90%. Since the big insurers process multiple millions of claims each month, their potential savings would be colossal. This business model seemed compelling, and indeed, it was this very proposition that attracted most of the original investment capital that got WebMD started in the late 1990s.

But by early 2000, it became obvious that the insurance companies simply refused to play with WebMD, despite the astounding savings they stood to gain. WebMD – which for a long time refused to believe that actual businesspersons would act in a way so obviously counterproductive to their own interests – was eventually compelled to move on to different (far less lucrative) pastures. And to this day, the handling of insurance claims transactions remains, well, inefficient.

I have known for a long time that health insurance companies prefer the role of “administrative service organizations.” That means they process claims for self funding employers. They would be happy to play that role for a government funded health plan. The insurance model for health care, meaning collecting premiums and paying claims out of premium investment earnings, has not worked for years. What we have evolved in this country is a prepaid model for health care, not an insurance model. The only way the insurance model can work is to go back to insurable events, like heart attacks and strokes and cancer, as the basis of claims and pay routine care costs out of pocket. That is the HSA model. It suffers right now from the inflation of fees that are then discounted by insurance companies and Medicare. The cash purchaser of health care is at a tremendous disadvantage and doctors and hospitals can be punished, or even prosecuted, for giving cash discounts.

Read the rest of Dr Rich’s essay. I don’t know that I agree with him on delay in paying claims as a major part of the business model but he is correct about much of the story.

George Will’s speech at CPAC

Monday, February 22nd, 2010

George Will is an eloquent spokesman for the conservative cause and has never been more riveting than he was in this speech. I recommend everyone watch it.

He is diplomatic when he points out how much Bush anticipated the policies of Obama and the Democrats.

More steps to a UAV air force

Sunday, February 21st, 2010

UPDATE: Here is more on recent developments in UAVs and the Air Force’s plan for future developments until 2047.

I have previously posted about the development of unmanned aircraft in the US, Now Israel has unveiled a huge (the size of a 737 airliner) UAV that is a potential bomber with a very long range and loiter time over a target zone.

Israel’s air force has introduced a fleet of large unmanned planes that it says can fly as far as Iran. Air force officials say the Heron TP drones have a wingspan of 86 feet (26 meters), making them the size of passenger jets, which can fly 20 consecutive hours, and are primarily used for surveillance and carrying payloads. (AP Photo/Ariel Schalit)

It looks something like the US Global Hawk.

Although the Global Hawk looks a bit huskier and may have a larger payload. The Predator, however, is quite similar although not as large as the Israeli UAV. The Predator is prop driven with the Global Hawk is a jet.

The future of warplanes is going in this direction more and more. If I were an Iranian military man concerned with air defense, I would be very concerned. These aircraft can fly very high, maybe higher than disclosed, and for very long periods, Global Hawks have been aloft without refueling for over 24 hours. The pilot is sitting in a chair at Davis Monthan AFB in Tucson, perhaps, or back in Israel. No pilot fatigue on these aircraft. The US Navy has a big UAV that will be making carrier takeoffs and landings next year.

Gerald R. North Attacks Bloggers At Panel On Global Warming Research

Friday, February 19th, 2010

(Crossposted)

By Bradley J. Fikes

The leak of Climategate emails is part of a campaign of “vilification” waged by skeptical bloggers against climate science, influential climate researcher Gerald R. North said Friday.Slide from Gerald R. North's presentation

Slide from Gerald North’s presentation at Friday AAAS panel

North, of Texas A&M University, was part of a panel on Climategate and the proper conduct of scientific research at the American Association for the Advancement of Science’s annual convention, held this year in San Diego.

North said skeptical bloggers have harassed climate scientists with demands for data, assisted in their efforts at times by “energy-friendly members of Congress”.
But despite blogger harassment and potential misuse of data, North said scientists should be open and share their data, even with nonscientists, as part of good scientific practice and building public trust.
North defended global warming research as by and large accurate, repeating highlights of a report from the National Academy of Sciences, produced by a team chaired by North. Condensed copies of the report, “Surface Temperature Reconstructions for the Last 2,000 Years,” were distributed at the panel discussion.
North said global temperatures in the last few decades are the highest they’ve been in 700 years and that it is “plausible” that the warmth exceeded that of any time in the last 1,000 years.
But these scientists have been troubled by unfair attacks and repeated demands for data from various blogger skeptics, North said, whom he did not name.
The “hacked emails” that triggered Climategate and the investigations of climate scientists Phil Jones of the University of East Anglia in Britain and Michael Mann of Penn State University are “phase 2″ of the “vilification” according to a slide North showed.
North said climate scientists face an “asymmetry” in responding to attacks from blogger skeptics, because the attacks were outside the norms of scientific criticism, including demands that the global warming researchers commit suicide.
“That is a big challenge for us,” North said, because researchers are uncertain of how to respond to blogger requests and challenges.
“Sometime you answer, and you think you’re being helpful to someone, and they turn right around and do harm,” North said. “Should we share data with persons … who might misuse the data? I’m inclined to make everything available.”
Other panelists were noted evolutionary biologist Francisco J. Ayala, Sheila Jasanoff, a professor of science and technology studies at Harvard, and Philip A. Sharp, a Nobel prize-winning geneticist.
Jasanoff devoted most of her talk to describing the context of science in society, and how that relationship has changed.
While once scientists could reasonably demand to be left alone, massive public funding of science makes that no longer an option, she said.
Jasonoff only touched lightly over the Climategate emails, which cover a 13-year span up to November, 2009.
“We know they’re 10 years old,” Jasanoff said. “How do you make use of 10-year-old stuff?”
The statement about the emails’ age parallels similarly incorrect statements made by former Democratic vice president Al Gore.
The panel did not include any global warming skeptics.

UPDATE: Chris Mooney has a blog post on the discussion. As an AGW believer who says we “stand to get fried” if we don’t act, Mooney’s opinion is quite different from mine. I think AGW science need to be re-studied and errors and bias need to be removed. Some of it may be true, but as we have seen in the last few months, AGW activists have made major claims that turn out to be ungrounded.
In particular, the fad of blaming every climate trend on CO2 is distorting science. In some of the most spectacular examples of the supposed effects of AGW, CO2 is at best a minor player. The main culprits are local, not global.
Mooney writes: “I get the sense that scientists and their institutions are so concerned over what has occurred in the past few months that there are going to be very real changes made, so as to ensure that better defenses of science are mounted in the future.”


I hope these “better defenses” emphasize openness and transparency, and promptly admitting and correcting errors with humility and without anger or defensiveness. If they are just more politicized advocacy efforts that don’t take skeptical views seriously, the efforts will fail.

Let’s have a mature discussion of differences of opinion on global warming science, and leave out the politicized attacks and name-calling.

The perfect storm.

Friday, February 19th, 2010

There is an excellent paper available today from CATO institute on how the financial crisis got to be so bad. It fits well with the theory in Nicole Gelinas’ book, After the Fall, which I reviewed here.

This paragraph is critical.

Given the large number of contributory factors — the Fed’s low interest rates, the Community Reinvestment Act, Fannie and Freddie’s actions, Basel I, the Recourse Rule, and Basel II — it has been said that the financial crisis was a perfect storm of regulatory error. But the factors I have just named do not even begin to complete the list. First, Peter Wallison has noted the prevalence of “no-recourse” laws in many states, which relieved mortgagors of financial liability if they simply walked away from a house on which they defaulted. This reassured people in financial straits that they could take on a possibly unaffordable mortgage with virtually no risk. Second, Richard Rahn has pointed out that the tax code discourages partnerships in banking (and other industries). Partnerships encourage prudence because each partner has a lot at stake if the firm goes under. Rahn’s point has wider implications, for scholars such as Amar Bhidé and Jonathan Macey have underscored aspects of tax and securities law that encourage publicly held corporations such as commercial banks — as opposed to partnerships or other privately held companies — to encourage their employees to generate the short-term profits adored by equities investors. One way to generate short-term profits is to buy into an asset bubble. Third, the Basel Accords treat monies set aside against unexpected loan losses as part of banks’ “Tier 2″ capital, which is capped in relation to “Tier 1″ capital — equity capital raised by selling shares of stock. But Bert Ely has shown in the Cato Journal that the tax code makes equity capital unnecessarily expensive. Thus banks are doubly discouraged from maintaining the capital cushion that the Basel Accords are trying to make them maintain. This litany is not exhaustive.

Banks were allowed to use Mortgage Backed Securities as capital assets and were encouraged to do so by regulations.

In 1988, financial regulators from the G-10 agreed on the Basel (I) Accords. Basel I was an attempt to standardize the world’s bank-capital regulations, and it succeeded, spreading far beyond the G-10 countries. It differentiated among the risks presented by different types of assets. For instance, a commercial bank did not have to devote any capital to its holdings of government bonds, cash, or gold — the safest assets, in the regulators’ judgment. But it had to allot 4 percent capital to each mortgage that it issued, and 8 percent to commercial loans and corporate bonds.

When MBS vehicles were devised, they were rated as AAA.

The United States implemented it in 1991, with several different capital cushions; a 10 percent cushion was required for “well-capitalized” commercial banks, a designation that carries privileges that most banks want. Ten years later, however, came what proved in retrospect to be the pivotal event. The FDIC, the Fed, the Comptroller of the Currency, and the Office of Thrift Supervision issued an amendment to Basel I, the Recourse Rule, that extended the accord’s risk differentiations to asset-backed securities (ABS): bonds backed by credit card debt, or car loans — or mortgages — required a mere 2 percent capital cushion, as long as these bonds were rated AA or AAA or were issued by a government-sponsored enterprise (GSE), such as Fannie or Freddie. Thus, where a well-capitalized commercial bank needed to devote $10 of capital to $100 worth of commercial loans or corporate bonds, or $5 to $100 worth of mortgages, it needed to spend only $2 of capital on a mortgage-backed security (MBS) worth $100. A bank interested in reducing its capital cushion — also known as “leveraging up” — would gain a 60 percent benefit from trading its mortgages for MBSs and an 80 percent benefit for trading its commercial loans and corporate securities for MBSs.

This is why the crash is a failure of regulation and not just a result of “greed.”

North Korea and Cuba: Scientists’ Paradise?

Friday, February 19th, 2010

By Bradley J. Fikes

(Cross-Posted)

I’m at the American Association for the Advancement of Science’s annual convention, held this year in sunny San Diego.

Below are some remarkable observations about North Korea and Cuba made by Peter Agre, AAAS president, in his Thursday night speech to the AAAS convention.
This is what Agre said about North Korea, which he visited as part of a delegation last December:
“North Korea has been very isolated from the rest of the world for the last 60 years. They have a sense of self-reliance,” Agre said, narrating a slide show. He showed a slide of the Juche Monument, explaining that juche is their word for self-reliance.
“They live under fear they will be attacked because of adversarial nations. Science goes on in North Korea, with some limitations due to lack of resources,” Agre said, showing more slides, including a plant biotechnology center. Nevertheless, Agre said his group “had a very warm-hearted reception,” by the Korean scientists.
Agre showed a slide of one of the scientists, nothing that the scientist is wearing a pin. “This pin shows a picture of their Great Leader, Kim Il-Sung. For the people in this country, Kim Il-Sung is the equivalent of George Washington, Thomas Jefferson and Abraham Lincoln all together. He’s the founder of their country, he’s much beloved . . . He also has left a spirit of service to the state.”
Agre showed a picture showing of a scientist hold a “well-thumbed” copy of Science magazine.
“So they’re very interested in science, and I think we have a great opportunity,” Agre said. He followed with the familiar observation that “crisis” in Chinese means dangerous opportunity, and that scientists can bridge gaps between nations.
Agre described his visit to Cuba in November as part of a delegation that went “with the idea that we could make contact and create bonds with Cuban scientific officials.”
“There’s still evidence in Cuba, even though the revolution occured 50 years ago, that this is very much alive,” Agre said, displaying a slide of a mural with a quotation from Che Guevara.
Agre described Cubans as, like North Koreans, also committed to science, but suffering under the U.S. embargo, describing visits to institutes such as a vaccine factory.
The younger Cuban scientists are much like young American scientists, Agre said, “they’re not involved in politics and this embargo. They want to do science. They’d like to partner with us. I think this is an opportunity.”
From what Agre said, it appears life can be pretty good in North Korea and Cuba — at least if you’re a scientist and obey your rulers.

The Greeks forecast the future

Thursday, February 18th, 2010

Victor Davis Hansen writes excellent essays on many topics but he outdid himself today on the Greek crisis in the EU.

Greece is the canary in the mine of the impending crack-up of the modern welfare state. It is a great gift to us all, this example. A year ago, the socialists, even as they were juggling and falsifying their books, were bragging that the Wall Street meltdown was a referendum — and capitalism was doomed. Now, the entire socialist dream is exposed and even the most ardent statist knows that there is no longer enough “others” to pay the tab.

The poor EU learned that the Greek siesta, the 10PM Athenian dinners, the state power company vans at the beaches in the workday afternoons, the kafenions full of 50-year-old men at 11AM, the angry students perpetually in the streets at each hinted reform, and the moonlighting telephone employees all came at the expense of far harder-working Scandinavian and German socialists, who apparently now realize a nice two weeks each year on Santorini or Crete aren’t worth billions of their own Euros in rescue bailouts.

The Greeks are the most extreme example. I wondered about their society as I watched the unfinished Olympic stadium two months before the Summer Games began in 2004. They scrambled and got it finished but I wondered about the cost at the time. Greece is a lovely theme park for tourists but, as a modern country, it has always been a bit ridiculous. The extreme socialists, like Andreas Papandreou, took Greece far left after a right wing dictatorship was displaced. His son, George, now presides over the inevitable collapse of the Socialist state his father constructed. He was also president of the Socialist International. Of course, he has a Harvard degree and was born in Minnesota, both excellent Socialist credentials.

Here in California we see the symptoms of the same Greek malady as we go from one budget shortfall to the next — dream-like borrowing, raising taxes, and furloughing, in lieu of the tough medicine of cutting government payrolls, changing pension payouts, and freezing the pay of state-workers until their compensation mirror images those in the private sector.

Postmodern Western society will soon witness a real showdown, analogous to the teenager who rebels and either accepts that he is still dependent on his parents and therefore subject to the rules of the house, or runs away and implodes in a sea of drugs and street-life.

In short, how will an entitled society react when the money runs out and it learns that it must change or wither away — and all the whining rhetoric about “social justice” and “a green future” and “spread the wealth” and “redistributive change” won’t bring another barrel of oil or bushel of wheat or Douglas fir 2” x 4”?

I should interject here that another of my daughter’s partying friends died yesterday of a presumed overdose. Fortunately, she is sober in all respects, a blessing for a parent.

California is probably doomed. It was a beautiful place when I moved here for college in 1956. Pat Brown was the last Democrat governor who had a positive effect on the state. His son, Jerry, began the decline with his election in 1975 as Governor. Now, ironically, he is the Democrat candidate this year and will probably be elected again as I don’t think the California voters are aware of how close the collapse is. The conservative voters have been leaving the state for ten years, being replaced by illegal aliens and their children, who are reliable Democrat votes. There was a warning in 1991 when Pete Wilson, a Republican, raised taxes in a recession and the state was the last to emerge from the slowdown. He was also the last Republican governor (I don’t count Schwartzenegger). One reason why he was the last was Prop 187, a ballot initiative that would have stopped many services for illegal aliens and required police to check immigration status of arrestees. It passed with 60% of the vote, even a plurality in Hispanic areas, but was invalidated by the state Supreme Court.

Bottom line: I don’t see how the state or federal government can up taxes much more and still find wealth-producing, law-abiding, motivated job creators.

On the other hand, as the money runs out, will state workers, pensioners, and entitlement recipients accept that there are too few wealth-creators to fund their pay-outs, or, as in Greece, hit the streets in protest, teenager style, each time some adjustments are necessary?

So if we can’t raise taxes and we can’t cut expenditures what is left? There is no Germany to bail us out? Cut defense? Keep borrowing from the Chinese and Japanese?

The Chinese are already dumping some of our debt, to the Japanese this week.

Where did all the wealth go? Modern Western society is in some sense becoming drone-like, its entitled sensitive citizens assuming ceremonial roles and attitudes about the very landscape they inherited from their industrious predecessors.

Here in California we idle farmland, though we have the water, expertise, and soil to produce far more food than we do. We put vast swaths of both land and sea off limits to gas and oil production, though we could produce far more petroleum and natural gas than we do. We snub nuclear power, though our population steadily increases and its desire for electronic appurtenance grows, not shrinks. We like “wilderness areas” (who doesn’t?) where we build no roads, harvest no timber, and build no damns. We strangle Silicon Valley with all sorts of labor and business regulations until it fabricates and outsources abroad. In other words, we are creating no real new sources of concrete wealth as we nuance the shrinking capital we inherited.

California is becoming a theme park like Greece. It produces nothing and tourists cannot afford to pay for the state’s budget. The lotus eaters, as California was once called, are awakening.

Suddenly in our media and politics the people are stupid, full of ingratitude, often racist, the system broken, the Congress bankrupt, all of us undeserving of our one chance in a lifetime state agenda. Yes, the petulant liberal attitude in 12 months went from “We, the People” to “You stupid idiots” — and all because some Democratic congresspeople discovered that the more they went out on the limb on Obama stimulus, health care, cap and trade, higher taxes, bigger government, bailouts and endless deficits, the more they were going to get sawed off in November by the ungrateful people. So naturally instead blame the filibuster, the people, the clingers — anything other than the self-preservation instincts of the political class of your own party.

We will see what happens this fall. It may be our last chance to avoid default. People do survive bankruptcy, even national bankruptcy. Argentina had largest gold reserves in the world in 1939. It was a rich country. That may be our future. The productive class emigrates or hides its money in Switzerland, the hoi polloi riot in the streets. We will see.