Daily Read - 3/2/10

Nicholas Kristof had an interesting column in Sunday's NY Times about the growing role of religious conservatives in humanitarian efforts.  "Some liberals are pushing to end the longtime practice (it’s a myth that this started with President George W. Bush) of channeling American aid through faith-based organizations. That change would be a catastrophe.  In Haiti, more than half of food distributions go through religious groups like World Vision that have indispensable networks on the ground."  In a follow-up post on his blog, he adds: "The United States is doing far more for Africa today than a decade ago largely because evangelicals became a strong constituency for the Pepfar AIDS program and the PMI malaria program."

However, help for Africa isn't a popular story.  In 1998, President George W. Bush toured Africa with Bob Geldof to increase awareness of American humanitarian efforts there.  In a Time article, Geldof asks "why doesn't America know about this?"  Bush responded ""I tried to tell them. But the press weren't much interested."

Also in the NY Times, a February 10 article talks about how food stamps are becoming easier to get, have less stigma attached to them than cash welfare, and how states are increasing their efforts to market food stamp programs.  In New York, the city wants the programs to “help New York farmers, grocers, and businesses.”  States also have an incentive to use food stamps instead of other forms of assistance because it's not their money.  “This is all federal money — it drives dollars to local economies,” said Russell Sykes, a senior program official.

Personally, I'd prefer private assistance in the form of food banks.  I noted last month that Feeding America, the national network of food banks, raised 51% more money in 2009 than in 2008.  Google "food bank" or "food pantry" and you can find lots of ways to help without dealing with a massive government bureaucracy.

Thomas Sowell is baffled by ObamaCare. "One of the biggest reasons for higher medical costs is that somebody else is paying those costs, whether an insurance company or the government. What is the politicians' answer? To have more costs paid by insurance companies and the government." He argues any projections of the costs of ObamaCare will be too low, because "they are based on how much medical care people use when they are paying for it themselves. But having someone else pay for medical care virtually guarantees that a lot more of it will be used."  Just like the food stamps example above, if someone else is paying for it, why not spend more?

Pundits, politicians, and news stories often refer to the $700 billion TARP program as if all of that money went down the drain.  They also over-emphasize the impact of the banks, while de-emphasizing Fannie, Freddie, and the auto companies.  An article in today's Wall Street Journal says estimates on TARP losses are being revised down from about $341 billion to about $117 billion.  The "unlikely stars of the bailouts are U.S. banks", who collectively have paid back about 70% of the government's investments.  The auto companies still owe $28 billion, AIG owes $48 billion, while Fannie and Freddie are still asking for more assistance.  The CBO has a separate estimate for losses of $99 billion, $47 billion of that from the auto companies.

The government's reaction?  To demonize Toyota, and to keep pushing for bank punishment.  It's politically better to attack banks, who paid back TARP, than auto companies and government quasi-agencies who haven't.  My guess is that years from now, most Americans will still think TARP only bailed out irresponsible bankers and that the government knows best.