Should We Care About the Decline in Savings?

Jeremy Rifkin is concerned about the decline in the U.S. savings rate that began in the middle of the 1990s. From saving 8% of income eight years ago, Americans are now saving less than .2% of their income. To Rifkin this can mean only one thing — record economic growth is being bought on credit and is bound to crash and burn (he compares our current situation to that just prior to the Great Depression).

Rifkin’s on the wrong track (as usual). While he’s correct that the number of bankruptcies in the United States has increased from 1994-1999, he forgets to mention that a) it’s ridiculously easy to declare bankruptcy in the United States, and b) part of that acceleration is driven by people afraid that Congress is going to change the law to make it more difficult to declare bankruptcy, as they almost did earlier in the year.

Second, Rifkin ignores capital gains. If you include capital gains in savings, the period of 1995-1998 actually saw the most savings for any four year period in American history. A study by the Brooking’s Institute that factored in capital gains put the saving rate at 15.8 percent. This doesn’t take a rocket scientist or even a biotech critic to figure out — if you’re getting 8 percent return from your bank and 15 percent from your mutual fund, you shift the money from the bank to the mutual fund.

As for consumer credit, it is hard to reconcile Rifkin’s claim that American middle class families are squandering their future on credit when according to the Federal Reserve the median net worth of families rose by almost 18 percent from 1995-1998 (besides which it always amazes me when Leftist complain that the middle class and even the poor often have access to the sort of credit devices that in the past would have been available only to the wealthy).

If Rifkin and others want to ensure middle class families save more the solutions are pretty obvious — change tax incentives which discourage savings by doing things like increasing the amount of money that can be put into an IRA or similar plan (the U.S. House of Representatives recently passed a bill to just do that, but the Clinton administration opposes it and so it will likely die).

Source:

Another Wolf At Our Door. Jeremy Rifkin, The Guardian of London, October 24, 2000.

Camille Paglia on the Libertarian Party

For the most part, I hold the same view of Camille Paglia that she holds of the Libertarian Party — I wish she’d just shut up because she’s very annoying. On the other hand, she did come up with a pretty good idea for the party in her latest Salon.Com column,

Speaking of preachy thought police, I’m getting fed up with members of the Libertarian Party who think they own the word “libertarian.” Get off my back, please, and focus your attention on the failures of your party to fine-tune and convey its philosophy credibly to the national electorate. In prior columns, I’ve indicated that the Libertarian Party, which once invited me to submit my name for its presidential nomination, is too conservative for my thinking and also too drearily removed from cultural issues. If and when the Libertarian Party nominates someone like the brilliantly analytical Virginia Postrel, I’ll reconsider my support for the Green Party, whose current brand of socialism is indeed excessive.

Postrel’s probably too smart to want to run for President, but I think she’d do a much better job of articulating the issues in a way that would appeal beyond the libertarian faithful than Harry Browne does (am I the only libertarian who finds Browne even duller than Gore?)

Feed on the Problem of Visualizing Proteins

Feed’s Clay Shirk wrote an excellent article on the problems of visualizing proteins, Seven Ways of Looking at a Protein, and the role that increasing computer power is playing in revolutionizing approaches to the problem.

It’s amazing how important proteins are to life and yet how little understood they are. As research gives us more information about how proteins function the medical discoveries that will flow from this will be astounding.

Polling Data

Tracking polls fascinate me and Delan McCullagh’s got a nice feature at Wired on Keeping Track of Tracking Polls. I knew for instance that most polling companies aside from Rasmussen will work for candidates, but I didn’t realize Gallup pushes undecided voters to choose between candidates.

Based on McCullagh’s analysis, the most accurate tracking data seems to be at Rasmussen’s Portrait of America website, and it’s very bad news for Al Gore and Ralph Nader. Gore because he’s losing by 7 points — which isn’t that big given the margin of error but translates into a huge loss in the electoral college. Nader because he’s well below the 5 percent threshold the Green Party needs to get federal matching funds in 2004.

I Want to Download Software

The first time I paid for software online and downloaded the program to my hard drive rather than go to a store or wait for it to arrive via UPS, I thought it was an interesting novelty. Today I pretty much consider it a necessity.

I ran across a program today that I really wanted and was all set to pony up $60 for, only to realize I’d have to pay an additional shipping and handling fee and wait several days. Yuck. I hate waiting. I hate waiting so much that I left the company’s web site without placing an order.

There is some software that I need so badly I’ll put up with waiting for it to arrive by snail mail (or, as with some games, the file size is simply too large to accomodate downloading), but if it’s something I want but could probably live without, having to wait for UPS or whatever is typically a deal breaker.

Single Women and In Vitro Fertilization

Back in August I wrote about an Australia court’s ruling that overturned laws in some Australian states banning single women from having in vitro fertilization (|Australia Prime Minister Wants to Ban In Vitro Fertlization for Single Women|). In that case a law passed by the state of Victoria was overturned on the grounds that it violated Australia’s Sex Discrimination Act which, among other things, makes it illegal to discriminate based on marital status.

Last week, the Australian Supreme Court announced it would hear an appeal on behalf of Australia’s Catholic bishops to have that court ruling overturned, and the Australian prime minister is apparently continuing his efforts to have the sex discrimination act amended in such a way as to make the ban on in vitro fertilization for single women pass muster.

The case here is complicated somewhat because apparently the Australian government subsidizes such infertility treatments through its health care system. The state shouldn’t discriminate between single and married women as far preventing in vitro fertilization, but on the other hand it shouldn’t be in the business of subsidizing such treatment for either single or married women.

Some commentators such as Leslie Cannold (Woman’s Quest for Solo Parenthood Ignites Debate) are being a bit hypocritical when they portray any opposition as aimed at undercutting women’s independence since apparently the woman in this case is more than happy to be dependent on the state to provide her for her fertilization treatments.

Women certainly should have access to in vitro fertilization, but definitely not a right for taxpayers to pick up the costs of the expensive procedure.

Source:

Woman’s Quest for Solo Parenthood Ignites Debate. Leslie Cannold, WomensENews.Org, October 25, 2000.