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  • Is Despair Deflating Unemployment Numbers?

    Is despair deflating the unemployment numbers?

    Spoiler Alert: The answer is not much.

    In my previous post, I talked about how the unemployment for July decreased from 9.5% to 9.4% mainly on the merits of people leaving the labor force altogether. Basically, the number of people employed dropped, but the number of people who are unemployed dropped too (and dropped faster). So… if the unemployed people didn\’t move into the \”employed\” column, where did they go?

    Some people have suggested they are giving up in despair. Let me explain:

    A person is \”unemployed\” for the purpose of labor statistics only if they have looked for work in the last four weeks. If they stop looking, they\’re simply not in the labor force anymore. So, in theory, if people are at home sobbing uncontrollably because they can\’t find a job, they\’re not unemployed, they\’re just not in the labor force.

    Fortunately, I discovered that the Bureau or Labor Statistics has been gathering a very useful statistic for the last 15 years called \”Persons Who Currently Want a Job\”. This is basically a count of people who have given up looking, but would still like to have a job. I suppose you could call this either the \”despair index\” or the \”laziness index\” depending on how cynical you are.

    Here\’s  a graph of the \”Want a Job\” number over the last 5 years.

    \"WantAJob5years\"

    So the number of people who wish they had a job but have stopped looking has increased dramatically this year, which is somewhat reducing the unemployment rate.

    The number of people who aren\’t looking for a job but still want one has increased about 1,000,000 in the last year, representing by far the largest increase in since we started tracking the data.

    HOWEVER!

    If you look at the unemployment rate with and without the \”Wants a Job\” crowd, they look pretty much the same. In other words, there\’s not really that much hiding in the numbers here. There\’s maybe a .3-.4% increase in the unemployment rate that can be attributed to despair. Or at least, attributed to new found despair, since we normally have between 4.5 million and 5.0 million people in this category anyway.

    What is really weird is that it looks like a lot of people are just up and leaving the work force, either through retirement or due to going back to school. Only a quarter of the decrease in the work force over the last couple months is attributable to an increase in the \”Wants a Job\” demographic. Even if you added them back into the labor force… the labor force is STILL decreasing.

    So… while there is a case to be made for the \”despair thesis\” (as I\’m now calling it), it looks like we\’re also just seeing a good number of people who don\’t much care for work anymore, thank you.

  • What The July Unemployement Rate Means (And Doesn\’t Mean)

    Today the unemployment rate for July 2009 was released by the Bureau of Labor Statistics. The rate dropped from 9.5% in June to 9.4% in July.

    Before I explain why this might not be as awesome as it looks, let me just say \”hooray!\” for what seems like a slowing in the rise of the unemployment rate. I am ecstatic to see that the economy is not accelerating downward.

    Stupid Moralizing (skip if you don\’t care)

    Some people seem to almost be cheering the decline of the economy for political purposes. Before last November, those people were mostly liberals. After January, those people were mostly conservatives. It is an activity I find creepy and slimy.

    The decline of the economy means people losing their jobs, losing businesses that they\’ve spent years trying to painstakingly build. This can be devastating on every level, personal and professional. The pain it brings is almost unspeakable. When someone cheers or hopes for a decline in the economy simply so that their political team can come out ahead, they reveal themselves to be without the basic human emotion of sympathy.

    I don\’t give a crap who is in office… I prefer to have a reduction in human misery if possible.

    End of Stupid Moralizing

    So… now that I\’ve gotten all self-righteous and morally irritating, let\’s talk about the numbers. (If you get bored by this discussion, feel free to skip to \”The Point\” at the bottom)

    The unemployment rate is… well, it\’s exactly what it says it is: a rate, a percentage based on two numbers. Your average non-economic American might think that the two numbers are as simple as \”people employed vs. people unemployed\”. Under this definition, you might think that a lower unemployment rate means that there are more jobs.

    Sadly, you would be wrong.

    The numbers actually start with the US population*. From that number, we take out children under 16, prisoners, those in mental institutions, those who require nursing care and the military and we get the \”civilian non-institutional population\”. From that number, we take out those who, for whatever reason have not tried to find work for 4 weeks. This is important because you don\’t want to count housewives and high school seniors in the unemployment numbers. Remember that, because it\’s going to be important in a second.

    That brings us to the \”civilian labor force\”, which consists of the employed and the unemployed. It is from the civilian labor force that we calculate the unemployment rate. Therefore, there is a good way and a bad way to reduce the unemployment rate.

    1. Increase the employment number (good)
    2. Decrease the number of people in the labor force (bad)

    The reason decreasing the number of people in the labor force is bad is that it means that people are extracting themselves from the labor force by:

    1. getting arrested in alarmingly huge numbers (unlikely)
    2. joining the army in alarmingly huge numbers (unlikely)
    3. getting younger in alarmingly huge numbers (that would be awesome)
    4. deciding that they\’re just not going to look for a job anymore

    And among the people in section 4, there are several options:

    1. deciding to stay home due to a lifestyle change (staying home with the kids)
    2. going to school to train for a new job
    3. retirement
    4. despair

    So, let\’s cut to the chase. We\’re not seeing new jobs. The employment number in July continued to decline (though at a much slower rate than it did in June). What we saw instead was a decrease in the labor force. More and more people are just not looking for jobs anymore.

    The Point

    On the surface the unemployment rate going down seems good, but when you dig into the numbers, we can see that it has nothing to do with an increase in the number of jobs and everything to do with the fact that the labor force is shrinking.

    Is this good or bad? I tend to think bad, but the economy also tends to be really complex, so I could be misreading something or I could be just plain old ignorant. I\’m not an economist, so I won\’t make a pronouncement on that issue. All I can do is show the numbers and wonder what the hell is going on.

    IMPORTANT UPDATE:

    @D_B_Inman on Twitter pointed out that I was looking at the unadjusted numbers in my analysis and that the unemployment rate is based on the adjusted numbers. When taking that into account, my charts and extra analysis are strikingly ignorant. This is actually comforting, because it means things aren\’t as out-of-whack as I thought they were. I\’ve adjusted my \”Point\” accordingly.

    * The Bureau of Labor Statistics lays this all out in more detail, if you want to check it out for yourself.

    ** There is something a little weird in this because the historical data at BLS doesn\’t match up with their current press releases. According to their historical data, we saw an increase in the labor force in the last couple months. But according to their historical data, the current unemployment rate is 9.7%, which is not the number being currently reported. I took the numbers from their current press release and I substituted them into the historical data, since I\’m assuming that their current press release is more accurate. If you think I\’m wrong, please let me know why.

  • What The July Unemployement Rate Means (And Doesn\’t Mean)

    Today the unemployment rate for July 2009 was released by the Bureau of Labor Statistics. The rate dropped from 9.5% in June to 9.4% in July.

    Before I explain why this might not be as awesome as it looks, let me just say \”hooray!\” for what seems like a slowing in the rise of the unemployment rate. I am ecstatic to see that the economy is not accelerating downward.

    Stupid Moralizing (skip if you don\’t care)

    Some people seem to almost be cheering the decline of the economy for political purposes. Before last November, those people were mostly liberals. After January, those people were mostly conservatives. It is an activity I find creepy and slimy.

    The decline of the economy means people losing their jobs, losing businesses that they\’ve spent years trying to painstakingly build. This can be devastating on every level, personal and professional. The pain it brings is almost unspeakable. When someone cheers or hopes for a decline in the economy simply so that their political team can come out ahead, they reveal themselves to be without the basic human emotion of sympathy.

    I don\’t give a crap who is in office… I prefer to have a reduction in human misery if possible.

    End of Stupid Moralizing

    So… now that I\’ve gotten all self-righteous and morally irritating, let\’s talk about the numbers. (If you get bored by this discussion, feel free to skip to \”The Point\” at the bottom)

    The unemployment rate is… well, it\’s exactly what it says it is: a rate, a percentage based on two numbers. Your average non-economic American might think that the two numbers are as simple as \”people employed vs. people unemployed\”. Under this definition, you might think that a lower unemployment rate means that there are more jobs.

    Sadly, you would be wrong.

    The numbers actually start with the US population*. From that number, we take out children under 16, prisoners, those in mental institutions, those who require nursing care and the military and we get the \”civilian non-institutional population\”. From that number, we take out those who, for whatever reason have not tried to find work for 4 weeks. This is important because you don\’t want to count housewives and high school seniors in the unemployment numbers. Remember that, because it\’s going to be important in a second.

    That brings us to the \”civilian labor force\”, which consists of the employed and the unemployed. It is from the civilian labor force that we calculate the unemployment rate. Therefore, there is a good way and a bad way to reduce the unemployment rate.

    1. Increase the employment number (good)
    2. Decrease the number of people in the labor force (bad)

    The reason decreasing the number of people in the labor force is bad is that it means that people are extracting themselves from the labor force by:

    1. getting arrested in alarmingly huge numbers (unlikely)
    2. joining the army in alarmingly huge numbers (unlikely)
    3. getting younger in alarmingly huge numbers (that would be awesome)
    4. deciding that they\’re just not going to look for a job anymore

    And among the people in section 4, there are several options:

    1. deciding to stay home due to a lifestyle change (staying home with the kids)
    2. going to school to train for a new job
    3. retirement
    4. despair

    So, let\’s cut to the chase. We\’re not seeing new jobs. The employment number in July continued to decline (though at a much slower rate than it did in June). What we saw instead was a decrease in the labor force. More and more people are just not looking for jobs anymore.

    The Point

    On the surface the unemployment rate going down seems good, but when you dig into the numbers, we can see that it has nothing to do with an increase in the number of jobs and everything to do with the fact that the labor force is shrinking.

    Is this good or bad? I tend to think bad, but the economy also tends to be really complex, so I could be misreading something or I could be just plain old ignorant. I\’m not an economist, so I won\’t make a pronouncement on that issue. All I can do is show the numbers and wonder what the hell is going on.

    IMPORTANT UPDATE:

    @D_B_Inman on Twitter pointed out that I was looking at the unadjusted numbers in my analysis and that the unemployment rate is based on the adjusted numbers. When taking that into account, my charts and extra analysis are strikingly ignorant. This is actually comforting, because it means things aren\’t as out-of-whack as I thought they were. I\’ve adjusted my \”Point\” accordingly.

    * The Bureau of Labor Statistics lays this all out in more detail, if you want to check it out for yourself.

    ** There is something a little weird in this because the historical data at BLS doesn\’t match up with their current press releases. According to their historical data, we saw an increase in the labor force in the last couple months. But according to their historical data, the current unemployment rate is 9.7%, which is not the number being currently reported. I took the numbers from their current press release and I substituted them into the historical data, since I\’m assuming that their current press release is more accurate. If you think I\’m wrong, please let me know why.

  • What The July Unemployement Rate Means (And Doesn\’t Mean)

    Today the unemployment rate for July 2009 was released by the Bureau of Labor Statistics. The rate dropped from 9.5% in June to 9.4% in July.

    Before I explain why this might not be as awesome as it looks, let me just say \”hooray!\” for what seems like a slowing in the rise of the unemployment rate. I am ecstatic to see that the economy is not accelerating downward.

    Stupid Moralizing (skip if you don\’t care)

    Some people seem to almost be cheering the decline of the economy for political purposes. Before last November, those people were mostly liberals. After January, those people were mostly conservatives. It is an activity I find creepy and slimy.

    The decline of the economy means people losing their jobs, losing businesses that they\’ve spent years trying to painstakingly build. This can be devastating on every level, personal and professional. The pain it brings is almost unspeakable. When someone cheers or hopes for a decline in the economy simply so that their political team can come out ahead, they reveal themselves to be without the basic human emotion of sympathy.

    I don\’t give a crap who is in office… I prefer to have a reduction in human misery if possible.

    End of Stupid Moralizing

    So… now that I\’ve gotten all self-righteous and morally irritating, let\’s talk about the numbers. (If you get bored by this discussion, feel free to skip to \”The Point\” at the bottom)

    The unemployment rate is… well, it\’s exactly what it says it is: a rate, a percentage based on two numbers. Your average non-economic American might think that the two numbers are as simple as \”people employed vs. people unemployed\”. Under this definition, you might think that a lower unemployment rate means that there are more jobs.

    Sadly, you would be wrong.

    The numbers actually start with the US population*. From that number, we take out children under 16, prisoners, those in mental institutions, those who require nursing care and the military and we get the \”civilian non-institutional population\”. From that number, we take out those who, for whatever reason have not tried to find work for 4 weeks. This is important because you don\’t want to count housewives and high school seniors in the unemployment numbers. Remember that, because it\’s going to be important in a second.

    That brings us to the \”civilian labor force\”, which consists of the employed and the unemployed. It is from the civilian labor force that we calculate the unemployment rate. Therefore, there is a good way and a bad way to reduce the unemployment rate.

    1. Increase the employment number (good)
    2. Decrease the number of people in the labor force (bad)

    The reason decreasing the number of people in the labor force is bad is that it means that people are extracting themselves from the labor force by:

    1. getting arrested in alarmingly huge numbers (unlikely)
    2. joining the army in alarmingly huge numbers (unlikely)
    3. getting younger in alarmingly huge numbers (that would be awesome)
    4. deciding that they\’re just not going to look for a job anymore

    And among the people in section 4, there are several options:

    1. deciding to stay home due to a lifestyle change (staying home with the kids)
    2. going to school to train for a new job
    3. retirement
    4. despair

    So, let\’s cut to the chase. We\’re not seeing new jobs. The employment number in July continued to decline (though at a much slower rate than it did in June). What we saw instead was a decrease in the labor force. More and more people are just not looking for jobs anymore.

    The Point

    On the surface the unemployment rate going down seems good, but when you dig into the numbers, we can see that it has nothing to do with an increase in the number of jobs and everything to do with the fact that the labor force is shrinking.

    Is this good or bad? I tend to think bad, but the economy also tends to be really complex, so I could be misreading something or I could be just plain old ignorant. I\’m not an economist, so I won\’t make a pronouncement on that issue. All I can do is show the numbers and wonder what the hell is going on.

    IMPORTANT UPDATE:

    @D_B_Inman on Twitter pointed out that I was looking at the unadjusted numbers in my analysis and that the unemployment rate is based on the adjusted numbers. When taking that into account, my charts and extra analysis are strikingly ignorant. This is actually comforting, because it means things aren\’t as out-of-whack as I thought they were. I\’ve adjusted my \”Point\” accordingly.

    * The Bureau of Labor Statistics lays this all out in more detail, if you want to check it out for yourself.

    ** There is something a little weird in this because the historical data at BLS doesn\’t match up with their current press releases. According to their historical data, we saw an increase in the labor force in the last couple months. But according to their historical data, the current unemployment rate is 9.7%, which is not the number being currently reported. I took the numbers from their current press release and I substituted them into the historical data, since I\’m assuming that their current press release is more accurate. If you think I\’m wrong, please let me know why.

  • What The July Unemployement Rate Means (And Doesn't Mean)

    Today the unemployment rate for July 2009 was released by the Bureau of Labor Statistics. The rate dropped from 9.5% in June to 9.4% in July.

    Before I explain why this might not be as awesome as it looks, let me just say \”hooray!\” for what seems like a slowing in the rise of the unemployment rate. I am ecstatic to see that the economy is not accelerating downward.

    Stupid Moralizing (skip if you don\’t care)

    Some people seem to almost be cheering the decline of the economy for political purposes. Before last November, those people were mostly liberals. After January, those people were mostly conservatives. It is an activity I find creepy and slimy.

    The decline of the economy means people losing their jobs, losing businesses that they\’ve spent years trying to painstakingly build. This can be devastating on every level, personal and professional. The pain it brings is almost unspeakable. When someone cheers or hopes for a decline in the economy simply so that their political team can come out ahead, they reveal themselves to be without the basic human emotion of sympathy.

    I don\’t give a crap who is in office… I prefer to have a reduction in human misery if possible.

    End of Stupid Moralizing

    So… now that I\’ve gotten all self-righteous and morally irritating, let\’s talk about the numbers. (If you get bored by this discussion, feel free to skip to \”The Point\” at the bottom)

    The unemployment rate is… well, it\’s exactly what it says it is: a rate, a percentage based on two numbers. Your average non-economic American might think that the two numbers are as simple as \”people employed vs. people unemployed\”. Under this definition, you might think that a lower unemployment rate means that there are more jobs.

    Sadly, you would be wrong.

    The numbers actually start with the US population*. From that number, we take out children under 16, prisoners, those in mental institutions, those who require nursing care and the military and we get the \”civilian non-institutional population\”. From that number, we take out those who, for whatever reason have not tried to find work for 4 weeks. This is important because you don\’t want to count housewives and high school seniors in the unemployment numbers. Remember that, because it\’s going to be important in a second.

    That brings us to the \”civilian labor force\”, which consists of the employed and the unemployed. It is from the civilian labor force that we calculate the unemployment rate. Therefore, there is a good way and a bad way to reduce the unemployment rate.

    1. Increase the employment number (good)
    2. Decrease the number of people in the labor force (bad)

    The reason decreasing the number of people in the labor force is bad is that it means that people are extracting themselves from the labor force by:

    1. getting arrested in alarmingly huge numbers (unlikely)
    2. joining the army in alarmingly huge numbers (unlikely)
    3. getting younger in alarmingly huge numbers (that would be awesome)
    4. deciding that they\’re just not going to look for a job anymore

    And among the people in section 4, there are several options:

    1. deciding to stay home due to a lifestyle change (staying home with the kids)
    2. going to school to train for a new job
    3. retirement
    4. despair

    So, let\’s cut to the chase. We\’re not seeing new jobs. The employment number in July continued to decline (though at a much slower rate than it did in June). What we saw instead was a decrease in the labor force. More and more people are just not looking for jobs anymore.

    The Point

    On the surface the unemployment rate going down seems good, but when you dig into the numbers, we can see that it has nothing to do with an increase in the number of jobs and everything to do with the fact that the labor force is shrinking.

    Is this good or bad? I tend to think bad, but the economy also tends to be really complex, so I could be misreading something or I could be just plain old ignorant. I\’m not an economist, so I won\’t make a pronouncement on that issue. All I can do is show the numbers and wonder what the hell is going on.

    IMPORTANT UPDATE:

    @D_B_Inman on Twitter pointed out that I was looking at the unadjusted numbers in my analysis and that the unemployment rate is based on the adjusted numbers. When taking that into account, my charts and extra analysis are strikingly ignorant. This is actually comforting, because it means things aren\’t as out-of-whack as I thought they were. I\’ve adjusted my \”Point\” accordingly.

    * The Bureau of Labor Statistics lays this all out in more detail, if you want to check it out for yourself.

    ** There is something a little weird in this because the historical data at BLS doesn\’t match up with their current press releases. According to their historical data, we saw an increase in the labor force in the last couple months. But according to their historical data, the current unemployment rate is 9.7%, which is not the number being currently reported. I took the numbers from their current press release and I substituted them into the historical data, since I\’m assuming that their current press release is more accurate. If you think I\’m wrong, please let me know why.

  • I\’ll Be Speaking at Drive the Discussion

    I\’ll be speaking at the Florida GOP\’s \”Drive the Discussion\” event in Orlando, Florida in a couple weeks. The event is August 22 at the Gaylord Palms Resort and among the speakers will be (according to the website) \”Olympic Gold Medalist, motivational speaker, and television personality Bruce Jenner, Former Miss California and Miss USA first runner up Carrie Prejean, author and political commentator Jonathan Krohn and Washington Times columnist and political blogger Amanda Carpenter.\”

    The event is free, but you do need to sign up at the link above. I\’m not listed as a speaker… probably because I don\’t have a Wikipedia page. Or, more likely, because I\’m neither super hot nor some kind of child genius.

    I\’ve got a basic presentation put together, but I\’d love to hear what my readers are interested in and use that to… well… drive the discussion. So… how about it? More interested in talking about videos? Talking about understanding numbers? Talking about \”new media\”? Talking about Carrie Prejean? Let me know and I\’ll use your input as I put together my talk.

    Also, if you\’re a reader or Twitter follower, let me know and we\’ll \”tweet-up\” (which is the somewhat bizarre terminology for meeting twitter followers in real life).

  • I\’ll Be Speaking at Drive the Discussion

    I\’ll be speaking at the Florida GOP\’s \”Drive the Discussion\” event in Orlando, Florida in a couple weeks. The event is August 22 at the Gaylord Palms Resort and among the speakers will be (according to the website) \”Olympic Gold Medalist, motivational speaker, and television personality Bruce Jenner, Former Miss California and Miss USA first runner up Carrie Prejean, author and political commentator Jonathan Krohn and Washington Times columnist and political blogger Amanda Carpenter.\”

    The event is free, but you do need to sign up at the link above. I\’m not listed as a speaker… probably because I don\’t have a Wikipedia page. Or, more likely, because I\’m neither super hot nor some kind of child genius.

    I\’ve got a basic presentation put together, but I\’d love to hear what my readers are interested in and use that to… well… drive the discussion. So… how about it? More interested in talking about videos? Talking about understanding numbers? Talking about \”new media\”? Talking about Carrie Prejean? Let me know and I\’ll use your input as I put together my talk.

    Also, if you\’re a reader or Twitter follower, let me know and we\’ll \”tweet-up\” (which is the somewhat bizarre terminology for meeting twitter followers in real life).

  • I\’ll Be Speaking at Drive the Discussion

    I\’ll be speaking at the Florida GOP\’s \”Drive the Discussion\” event in Orlando, Florida in a couple weeks. The event is August 22 at the Gaylord Palms Resort and among the speakers will be (according to the website) \”Olympic Gold Medalist, motivational speaker, and television personality Bruce Jenner, Former Miss California and Miss USA first runner up Carrie Prejean, author and political commentator Jonathan Krohn and Washington Times columnist and political blogger Amanda Carpenter.\”

    The event is free, but you do need to sign up at the link above. I\’m not listed as a speaker… probably because I don\’t have a Wikipedia page. Or, more likely, because I\’m neither super hot nor some kind of child genius.

    I\’ve got a basic presentation put together, but I\’d love to hear what my readers are interested in and use that to… well… drive the discussion. So… how about it? More interested in talking about videos? Talking about understanding numbers? Talking about \”new media\”? Talking about Carrie Prejean? Let me know and I\’ll use your input as I put together my talk.

    Also, if you\’re a reader or Twitter follower, let me know and we\’ll \”tweet-up\” (which is the somewhat bizarre terminology for meeting twitter followers in real life).

  • I'll Be Speaking at Drive the Discussion

    I\’ll be speaking at the Florida GOP\’s \”Drive the Discussion\” event in Orlando, Florida in a couple weeks. The event is August 22 at the Gaylord Palms Resort and among the speakers will be (according to the website) \”Olympic Gold Medalist, motivational speaker, and television personality Bruce Jenner, Former Miss California and Miss USA first runner up Carrie Prejean, author and political commentator Jonathan Krohn and Washington Times columnist and political blogger Amanda Carpenter.\”

    The event is free, but you do need to sign up at the link above. I\’m not listed as a speaker… probably because I don\’t have a Wikipedia page. Or, more likely, because I\’m neither super hot nor some kind of child genius.

    I\’ve got a basic presentation put together, but I\’d love to hear what my readers are interested in and use that to… well… drive the discussion. So… how about it? More interested in talking about videos? Talking about understanding numbers? Talking about \”new media\”? Talking about Carrie Prejean? Let me know and I\’ll use your input as I put together my talk.

    Also, if you\’re a reader or Twitter follower, let me know and we\’ll \”tweet-up\” (which is the somewhat bizarre terminology for meeting twitter followers in real life).

  • What Was Wrong With My Last Video

    After I posted my last video on wait times for getting a doctor\’s appointment in Atlanta, Georgia vs. wait times in Boston, Massachusetts despite the fact that insurance premiums are drastically more expensive in Boston, I received a more mixed response than to any of my other videos.

    Fortunately, I have commenters who are much smarter than I am. So I want to take the time to make note of what was wrong with that video.

    Things that were wrong:

    • While I didn\’t say this, I left the impression that the universal health coverage program in Mass was solely responsible for the expensive premiums. That is not the case. In the study I referenced, premiums were extremely high in Mass, but that was done before universal health coverage (UHC) was implemented. There has not (to my knowledge) been a similarly comprehensive study done since the implementation of UHC, so I cannot say that UHC inevitably leads to higher premiums.
    • Instead of comparing Boston to all the places that don\’t have UHC, I picked one place that I liked (I used to live in Atlanta). Atlanta is particularly good on wait times, but it isn\’t average. It would have been far better to compare Boston to the rest of the country as a whole.

    Things that weren\’t wrong, but that people complained about anyway:

    • \”The cost of living is higher in Boston. That is what drives the insurance premiums higher\”

      This statement was done by people who haven\’t actually run the numbers. No one has yet explained to me how a 14% increase in cost of living between Atlanta and Boston explains a 300% increase in health insurance premiums. More importantly, no one has pointed out that doctors in Boston make significantly more than doctors in Atlanta (which would be a far more important data point for investigation).

      Also, it doesn\’t explain the difference between Boston and Los Angeles. The Los Angeles cost of living is 22% higher than Boston, but they still have cheaper insurance. And they still have wait times that are half of Boston\’s.

    To me, the most important point of all of this is the fact that we may not have enough data to say that UHC has actually caused Boston to get a lot worse than it already was, but we do have enough data to say that it certainly hasn\’t made things better.

    Some people would point out such statistics as \”Well, nearly everyone in Massachusetts has health insurance now! It\’s been a success!\” (In fact, that\’s exactly what Mitt Romney does when he says we should, like, totally copy the Massachusetts model.)

    But this isn\’t a single variable issue, it\’s a trade-off issue. If we gave everyone in the country health insurance, but it cost $1 trillion per year, everyone would be against it because the benefit outweighs the cost. Similarly, if we provided everyone with health insurance and kept the cost the same as before, but it took five times as long to get a treatment, most people would still be against it.

    It is not self-evident to me that 100% health insurance coverage is a good thing because it depends so heavily on the trade-offs. You could have \”100% health insurance coverage\” as a matter of statistics, but if that means that it takes three years on a waiting list to get a hip replacement, I\’ll stick with the 85% we have today.

    And I\’ve only mentioned three variables here (cost, insurance coverage and wait times). There is a balance between hundreds of variables that has to be maintained. If you ever listen to the President\’s speeches on this issue, you come away with the impression that there will be no trade offs and that it will be cheap premiums, universal coverage and no wait times! And the government will make drugs cheaper.

    Also, there will be rainbows and ponies.

    Call me a cynic, but that kind of thinking about in the UHC plan strikes me as somewhat naive.

    What I would like to see is a comprehensive study of the effects on the Massachusetts plan on the health care system. I don\’t know that there are really that many positive effects other than \”Look, everyone has health insurance!\”