Friday, December 14, 2007

Yay for free trade

I came across this nifty analysis paper today.

"Trading Up: How Expanding Trade Has Delivered Better Jobs and Higher Living Standards for American Workers"
http://freetrade.org/node/782

The author does a nice job of analyzing how middle class income has changed over the last 40 years or so, and what impact trade has had on both employment and wages. It fairly well demolishes the standard protectionist arguments that free trade is hurting our manufacturing sector, taking our jobs, and lowering our wages.

Key points:
  • The manufacturing sector is actually doing very well, with record revenue and record profits. It employs fewer people because of efficiency gains through technology.
  • Trade has had no discernible, negative effect on the number of jobs in the U.S. economy. Our economy today is at full employment, with 16.5 million more people working than a decade ago.
  • Trade accounts for only about 3 percent of dislocated workers.Technology and other domestic factors displace far more workers than does trade.
  • Average real compensation per hour paid to American workers, which includes benefits as well as wages, has increased by 22 percent in the past decade.
  • Median household income in the United States is 6 percent higher in real dollars than it was a decade ago at a comparable point in the previous business cycle. Middle-class households have been moving up the income ladder, not down.
  • The net loss of 3.3 million manufacturing jobs in the past decade has been overwhelmed by a net gain of 11.6 million jobs in sectors where the average wage is higher than in manufacturing. Two-thirds of the net new jobs created since 1997 are in sectors where workers earn more than in manufacturing.
  • The median net worth of U.S. households jumped by almost one-third between 1995 and 2004, from $70,800 to $93,100.
  • The large majority of Americans, including the typical middle-class family, is measurably better off today after a decade of healthy trade expansion.

Wednesday, December 5, 2007

A boring proposal (for congressional election reform)

People often wonder why we can’t seem to clean up Washington politics. Term limits, campaign finance reform, and lobbying rules have failed to significantly reduce the effects of corruption, greed, and special interests in our capitol. In large part, the problem is that our method of selecting and electing our representatives in Congress creates a set of perverse incentives. In order to win a seat in the senate or the house, our legislators must pimp themselves out in order to raise enough cash to run a successful campaign. Then once in office, their greatest incentive is the desire to stay in office, and to do so they must continue the pimping. By accepting large donations from special interests, they become beholden to these minority groups. An enormous amount of their time is spent on fundraising and campaigning to stay in office, which is time not spent doing their real jobs. And far too often, they promote and support positions that they think are popular, regardless of whether they think they are right, because they don’t want to be accused of being “soft on drugs” or “weak on defense”, for example, even when they may privately believe that the war on drugs and the war on terrorism are headed the wrong way.


What’s the solution? To fix the problem, we need to realign our representatives' incentives. I think one large and necessary step in the right direction is to change the way some of them are elected. Here is my proposal:


  1. We would start the reform with just one half of Congress, most likely the House of Representatives. Or we could experiment with this in state legislatures before attempting reform at the Federal level.
  2. Rather than electing a specific candidate to a seat in the House, we would elect an elector. The electors would campaign and be chosen in much the same way as a representative is today, based on their values and ideologies.
  3. The winning elector would select a pool of the most qualified candidates which represent the values and ideologies upon which he was elected. The pool would contain something like 10 - 20 candidates.
  4. One of these candidates is selected at random as the “winner.”
  5. At the next election, we go through the same process. The incumbent may be chosen by an elector as a candidate in the next selection pool, or may run as an elector himself, but cannot be directly re-elected to the same office.
  6. The legislators should be well paid, with salaries comparable to what they can or have earned in the private sector.

The advantages of this system are:


  1. Because we are not voting for an individual, and the ultimate winner is selected at random from a pool, it is pointless for the candidates to campaign. No campaigning means no fundraising, no pimping, and lobbyists have no power over them.
  2. We still get to vote for a set of values and ideologies that we support, even if we are not voting for an individual.
  3. Because they are not constantly living in fear of the next election, legislators will be freer to make “politically dangerous” decisions, such as ending the drug war.
  4. Quite often, the people who want to be politicians are not the people who are the most qualified and can make the best decisions. Under this system, we might actually get smarter politicians who can make better decisions. If I were an elector in this system, I would select CEOs and economists to fill my pool of candidates, because they have the best understanding of how to manage large organizations and how political decisions impact our economy. However, CEOs and economists rarely run for office, probably because they can make more money elsewhere and are repelled by Washington politics.
  5. Because they are well paid in office, they will be more immune to corruption; they will not be so tempted to seek donations/bribes from lobbyists for personal expenses, and will not be so reluctant to leave their often lucrative private sector jobs to enter the legislature.

The problems I see with this plan are:


  1. Since representatives cannot be directly re-elected, there will be a high turnover rate, and few or no people with long-term experience in office. However, I am only suggesting that we apply this to one-half of Congress, so hopefully the other half can continue to benefit (or suffer) from whatever wisdom and connections career politicians tend to accumulate.
  2. Since there is an element of randomness, we can never be sure exactly who we’re electing. However, I don’t think that it will really be any worse than what we have today, which is politicians who regularly change their minds and renege on campaign pledges.
  3. Electors might tend to select "cronies" to fill the candidate pool rather than those who are most qualified. A possible solution to this is to prohibit them from selecting relatives and those with whom they have business relationships.

What do you think? I’d love to get some feedback.

Friday, November 30, 2007

I wish Apple would design gas pumps

As a close observer and student of user interface design, I am nearly overcome by rage and revulsion every time I have to buy gas. Not because of the price (I think gas is too cheap), but by the pump. It's as though the pumps were designed in the 1960s Soviet Union by retarded sadists. No though whatsoever is given to user-friendliness, only to crude functionality.

First, I stick my credit card in the slot, usually the wrong way. There are four possible ways to put the card in, and it's not obvious which is the correct way. If the slot were horizontal instead of vertical, most people would assume that you put the card in face up, which reduces the number of possibilities to two. Putting a read head on both sides of the slot would allow it to read the card either way.

Next, I have to select credit or debit. I hunt around the keypad for the right button. They keypad is cluttered with useless and redundant buttons such as "Yes" and "Ok" and "Enter", or "No" and "Cancel", often leaving me guessing as to which one to use. Some buttons are different colors, but the color coding is only more confusing, not helpful.

Now the machine starts making horrible screeching sounds, presumably because it wants my attention. It's got it already. The shrieks are not helpful. It wants me to enter my zip code on that horrible membrane keypad. There is no tactile feedback, and sometimes you have to press each button fairly hard. It's not immediately obvious when the button press has registered, since there is a slight lag between pressing the button and the number appearing on the screen. Sometimes it makes a horrible shriek after each button press, but there's a lag with that too so the feedback only confuses and irritates me rather than helping me. After entering my zip code, I have to press enter. This is an unnecessary step. The machine knows that your zip code is 5 digits, so it should proceed after the 5th digit.

The screen is usually small, dim, and difficult to read. It refreshes slowly, so visual feedback is not instantaneous. This leaves you wondering if it's doing the right thing for a moment every time you push a button.

Next I have to select the type of gas. The gas selector buttons are in different places on different pumps, and often they are easily confused with stickers indicating the octane rating, so I often end up pressing the wrong sticker or else pressing everthing in sight. Often, there is no tactile feedback from this button either, and the ear-piercing shriek which acknowledges my selection does not come for a second or so, leaving me wondering if I did the right thing.

Now it beeps a few more times, and tells me to start pumping. But it's just teasing, really, because when I pull the trigger nothing happens. I have to wait another 5 seconds or so before it's really ready to start.

Most irritating of all are the new pumps which have video screens that blast advertising at me while I'm pumping my gas. I don't want to be assaulted with this crap! Where's the off button?


Here's how Apple's gas pump would work:

The large, bright touchscreen prompts you to swipe your credit card by showing a graphic of a card going into the horizontal slot, and pointing to the slot, which is right below the screen. It doesn't matter which way you put the card in, because it can read it both ways.

After the card is read, the screen instantly displays large "credit" and "debit" buttons. Since it's a touchscreen, you just touch the correct button. Feedback is instantaneous; there is no perceptible lag between touching and the screen changing. When you touch the screen, you hear a friendly, happy sounding bleep which gives you audible feedback. Again, this feeback is instantaneous - you hear the sound before your finger leaves the screen.

You enter your zip code, again using the touch screen. After the 5th digit, the screen instantly changes, and prompts you to select the type of gas to pump. Again, it's a touchscreen so you just touch the right button on the screen. You dont even have to press hard. While you select the type of gas, it's authorizing your credit card in the background, so you don't have to wait for it.

Now it's time to pump. Ideally, the pump should start up instantly. If there is some good reason why this is impossible, then the screen should show a countdown clock counting down the seconds until the gas is ready to flow. You are never in doubt about what the machine is doing or how long it will take.

While it is pumping, there may be a button on the screen that you can touch to turn on the audiovisual advertising/entertainment assult, just in case you are a desperately bored loser with ADD.

When the pump stops, you are prompted with a cheerful sound, and if you want a receipt you can touch a button on the screen to print one out.


I recently encountered a self-service ordering kiosk at a Carl's Jr. It worked much like the Apple gas pump I just described. Fast, friendly, and intuitive, it was a joy to use. Now why can't gas stations do the same thing? It seems to me like friendly gas pumps would be a competitive advantage.

Friday, November 23, 2007

What the republicans don’t get.

As promised, my rant on republicans. (Disclaimer: I am a libertarian)

1. The middle-eastern terrorists hate us because of what we do, not because of who we are.

It seems that a majority of republicans believe that the terrorists hate us because we are a wealthy, (relatively) free society, and that our existence is offensive to fundamentalist Islamists, who therefore want to destroy us. This is nonsense. Certainly, Islamic fundamentalists have pointed to our liberalism and used it to fan the flames of rage against us, but the root cause of that rage is the fact that the US has been meddling in the politics middle east for decades.

We have overthrown governments, installed and supported brutal dictators, sold weapons, financed rebellions, and installed military bases since the 1950s. In the process, we have managed to piss off nearly every country, tribe, and leader in the region. If they were doing it to us, we would be outraged, and we would fight back. Why shouldn’t they?

Ron Paul is the only Republican presidential candidate who gets this. Even the leading democrats don’t come out and say it very clearly.

2. We will never stop terrorism with aggression and force.

Aggression and military occupation of Islamic countries will only provoke more terrorist actions.

The only way to stop terrorism is to withdraw completely from the middle east. Close the military bases, stop all military aid and weapons sales, and stop supporting Israel. Leave them all alone, and they will leave us alone.

3. Those who would trade liberty for security deserve neither, and shall lose both.

Ben Franklin said that, or something like it. By giving up our civil liberties in the war on terrorism, we are giving up who we are, and we are losing the war.

The democrats have a problem with this one as well, but in their case they wish to trade economic liberty for economic security. The result is often just as bad.

4. Keep your religious views out of government

Abortion, the right to die, stem cell research… all of these issues hinge on your view of what life is and what life means. Many people’s understanding of these issues comes from their religious background and teachings. Therefore, government should stay out of these issues and let people decide for themselves what life means to them. To do otherwise is to impose your religious beliefs on others, which is wrong.

Personally, I do no think that an unconscious lump of cells is deserving of any rights. The greater consciousness/sentience/awareness a being has, the more rights and respect it deserves. I think it hypocritical to eat cows and then condemn people for aborting one month old fetuses.

Additionally, each individual must have complete autonomy over his own life. If someone makes a carefully considered, informed and deliberate decision to end his life, nobody else has a right to object or to prevent him from ending it.

5. The war on drugs is a disaster and should be stopped immediately.

The drug war does more harm than good. It costs a fortune, and fills up our prisons. People have the right to make informed decisions about what to put into their own bodies.

We should legalize marijuana completely, legalize possession of all substances, and legalize sale of substances with some sort of regulation, perhaps a prescription system to ensure that users are making careful, informed decisions and are not becoming addicted and suffering adverse consequences.

Wednesday, November 14, 2007

What the democrats don't get

I just watched another democratic presidential candidate debate, and again found myself shouting at the TV in frustration and disgust. I don't like any of them. (Disclaimer: I am a libertarian. I have just as many rants about the republicans, and I will write about them later.)

1. Incentives matter.

If you want to change people's behavior, the most effective way to do that is with financial reward/punishment. Appealing to their conscience/guilt/higher self is ineffective. If you want blue apples, you can pass a law that mandates blue apples, but that won't get you any blue apples. You can tell people that blue apples are good for you and red apples cause cancer, but you still won't get any. However, if you put a $5 tax on non-blue apples, or a $5 subsidy on blue apples, you will soon have blue apples coming out of your ears.

Many democrats seem to think that people will conserve energy for the good of the environment, for the good of the country, etc. But that's ridiculous. People will conserve energy if it pays for them to, and right now energy is so cheap that there is often little incentive to conserve it. Mandating more fuel efficient cars, mandating electric cars, and forcing other conservation measures down peoples throats is absolutely the wrong approach. Taxing carbon emissions to raise the price of pollution and raise the price of oil will be far more effective.

2. Business don't pay taxes.

Most democrats seem to think that they can stick it to businesses without hurting the little guy. But guess what. Businesses will directly pass on any taxes to the consumer in the form of higher prices for goods and services. So taxing businesses only increases costs for consumers and makes our businesses less competitive with foreign ones.

3. The federal government should not be involved in either education or health care.

The constitution clearly delineates what the federal government is responsible for, and leaves the rest to the states. Education and health care are clearly, clearly state matters. If you want to change that, amend the constitution.

5. Competition is essential to efficiency and innovation.

Democrats frequently seem to have tremendous faith in government, and believe that it can be efficient and innovative. It cannot, because it has no competition. The private sector can do almost anything better, cheaper, and more creatively than government. Government will invariably be bloated, beaurocratic, costly, and ineffective, because it has no incentive to be otherwise. Therefore, it's better to leave as much as possible to the private sector. Defense is an obvious exception.

Just one example: the state of California spends about $11,000 per student per year for primary education, while private schools provide equal or better education for about $4500 per year. Public education costs nearly 3 times as much because most of the money goes to the massive beaurocracy. Private schools, by necessity, are leaner and more efficient, but are just as effective.

6. The wealthy already pay most of the taxes, and the middle class pay almost none.

Democrats always, always, always insinuate that the wealthy do not pay their fair share of taxes, that they get unfair tax cuts, and that the middle class shoulder the burden. This table shows that that is simply not true. Study it for a minute and you will be shocked and amazed, as I first was.
http://www.taxfoundation.org/news/show/250.html (Table 1)

The top 10% of taxpayers pay 70% of the taxes! The top 50% pay 97% of the taxes!! The bottom 50% pay only 3%!!!

The wealthy pay a greater percentage of their income in taxes. This is not what the democrats want you to believe! Any tax cut will, by definition, go to the people who are paying the taxes, which are the wealthy. You cannot give tax cuts to the poor, because they do not pay any significant amount of taxes.

You can argue about whether this is as it should be or not, and you can argue that raising or lowering taxes on the wealthy is good or bad, but you cannot argue that the wealthy do not already pay the majority of taxes.

7. Spending more money (and raising taxes) is not the solution to every problem.

Tax and spend... how unimaginative. Hillary has said she has a million good ideas but America cannot afford them all. That's for damn sure! Spending money is fun and easy, and makes you popular. But with a little more effort and creativity, we can often find better ways to solve our problems. Typically, this means allowing or incentivising the private sector to solve them for us. Working smarter, not harder. Removing barriers and beaurocracy, not creating more.

8. The law of unintended consequences.

Lawmakers with the best intentions often try to regulate this or legislate that, but every government action has unintended consequences which are often worse than the problem they were trying to solve. Very often, it is better to let the market solve a problem than to try to legislate a solution which may not work as intended.

Case in point: corn ethanol subsidies slow the development of better, more efficient biofuels, and raise the cost of food. Rent control results in higher rents, not lower. Federal aid for college students raises the cost of tuition. Raising minimum wage increases unemployment. Urban planning results in increased traffic and congestion.

Government can often serve us best by leaving us alone.

Thursday, September 20, 2007

Complete Liberty

www.completeliberty.com

I highly recommend reading this free book (or listening to the audio version podcast... just search for "complete liberty" in iTunes).

It's a bit extreme in promoting anarcho-capitalism, but I think it makes an excellent case against the fundamental flaws and injustices in our current form of government, and sketches a somewhat plausible alternative way of living in which our fundamental right to control our own lives, provided that we don't infringe on others rights, are paramount, voluntary transactions and trade are sacrosanct, and the initiation of force against others (even by government) is not tolerated.

It leaves open many "but what about..." questions and hasn't convinced me that it's completely workable, but I think it presents a brilliantly idealistic vision of the future, a clear goal which we can work toward.

Tuesday, June 19, 2007

Why I am opposed to universal healthcare

SiCKO presents a dramatic portrait of what's wrong with America's healthcare system… and clearly there is a lot wrong. But it is by no means a fair or balanced documentary. It says nothing of the problems endemic in socialized medicine. It doesn't mention the people who die waiting in line for treatment in Canada or England, or who come to the US because they can't the treatment they need in their country. It doesn't mention that the US is the leading innovator in medicine, and we have the best healthcare in the world for those who can afford it. It doesn't mention the fact that healthcare is rationed in other countries, and that it may take months to get an appointment or a treatment. It doesn't mention the cripplingly high taxes required to pay for these systems, which drag down the economies of these countries.

The US system has many problems, and desperately needs reform. We need very badly to increase the number of people who are insured, both for their benefit as well as for the benefit of the presently insured, who often pay for the emergency care of the uninsured indirectly. We need to make changes to the insurance system as well. Health policy should focus on making health care of ever-increasing quality available to an ever-increasing number of people.

However, I am strongly opposed to the idea of federal government provided, single-payer universal healthcare. Here’s why:

1. To achieve “universal coverage” would require either having the government provide health insurance to everyone or forcing everyone to buy it. Government provision is undesirable, because government does a poor job of improving quality or efficiency. Forcing people to get insurance would lead to a worse health-care system for everyone, because it would necessitate so much more government intervention. Government is bad at just about everything. It is inefficient, slow, and incompetent because it has no competition. I really do not want the people who run the DMV or the IRS to be in charge of my healthcare. I do not want beaurocrats making decisions about what services I should receive. I do not want more of my hard earned money being stolen from me through taxes. As a libertarian, more often than not I see government as part of the problem, rather than the solution to our problems. Any government beaurocracy will only become larger, more powerful, more bloated and inefficient, and more costly over time. The examples are so obvious I don’t need to name any.

2. In a free country, people should have the right to refuse health insurance. If they do, they should reap the benefits or suffer the consequences of their choices.

3. If governments must subsidize those who cannot afford medical care, they should be free to experiment with different types of subsidies (cash, vouchers, insurance, public clinics & hospitals, uncompensated care payments, etc.) and tax exemptions, rather than be forced by a policy of “universal coverage” to subsidize people via “insurance.” This is best done at the state level. The constitution does not give the federal government the authority to manage healthcare. Letting the states try experiment with different policies and systems will allow us to discover the best solution far more quickly than if we impose a single policy on the entire nation at the federal level.

Here is what I think we should do instead:

1. Subsidize healthcare for the very poor and children of poor families (we already to this through Medicaid… the system may need some tweaking). These are the people who truly cannot afford to buy their own insurance or healthcare.

2. Everyone else who can afford to buy their own insurance should be strongly encouraged do to so, but not forced to.

3. Get employers out of the business of providing health insurance. It makes no sense. We are the only country in the world where employers are expected to provide health insurance. Why should they? The system is a relic of the WWII era when the government imposed caps on wages, so employers found other ways to attract and retain the best employees. In order to change this, we need to fix the tax code so that there is no longer a tax incentive for insurance to be provided by employers. The best way to do this is to make medical expenses and the cost of buying your own insurance tax deductible. Then your employer could simply give you the money they currently spend on insurance as an increase in pay, and you could decide how to spend it for yourself.

4. Make insurance more portable, so that if you lose or change your job your insurance is not affected. This requires getting employers out of the healthcare business.

5. Convert our paper-based medical records system to a digital system. This will improve efficiency and reduce errors, saving both money and lives.

6. Reform the legal tort system so that fear of malpractice lawsuits and the cost of malpractice insurance no longer drives up the cost of healthcare. Bringing down the cost will enable more people to buy their own insurance.

7. Change the way most Americans think about health insurance. Insurance, in the true meaning of the word, is intended to cover major unforeseen expenses, not small regular ones. Yet in the past few decades, we have seen the system evolve to the point where we expect our health insurance to fully cover the cost of every runny nose and checkup. The problem with this is that people have no incentive to shop around, turn down services, or minimize the cost of their healthcare. When somebody else is paying the bill, why are you going to say no to anything? This is a big reason why healthcare costs keep going up. If you have insurance that only covers the major, unforeseen expenses, you will make much better decisions about what services to get and what services you don’t really need. You will also be more inclined to shop around for less expensive treatments or medication. This will lead to tremendous savings.

Look at this another way. Your car insurance doesn' t cover the cost of oil changes, and your homeowner's insurance doesn't cover the cost of fixing a leaky faucet. If they did, it would drive up the cost of these forms of insurance as well. People would go to the most expensive mechanic or hire plumbers to do all kinds of unnecessary work, since they wouldn't be paying the bills. Our system has evolved from healthcare insurance to healthcare cost insulation, and that is one reason it's so expensive.

8. Studies show that many treatments provided today are a complete waste of money, either because they are ineffective or completely unnecessary. Doctors today have an incentive to provide ineffective and unnecessary treatments for two reasons: a) to cover their asses so they don’t get sued if something unexpected happens, and b) because they make more money by providing more treatments. In order to reduce the number and cost of unnecessary treatments, we need to give patients the means and the incentive to become involved in these decisions.

When you go shopping, do you let the shopkeepers decide what you're going to buy, and then just whip out your credit card every time they ask you to buy something? Of course not! So why do that with doctors?

9. In order to make #7 and #8 work, we need to make information about the cost and effectiveness of various treatments more readily available to healthcare consumers, so they can make informed decisions. This can be done be forming an organization whose purpose it is to impartially evaluate and rate the benefits, risks, and costs of various treatments and publish that information on a web site. This will help people decide what treatments to spend THEIR money on and what treatments aren’t worth it.

10. Come to grips with the fact that as technology advances, companies will develop treatments for more and more diseases. Eventually, it may be possible to cure nearly anything, and to keep someone alive indefinitely, for a cost. In some cases that cost will be extremely high. Research is expensive, and some diseases are rare. We cannot and should not expect society as a whole to pay an unlimited amount of money to keep someone alive. What would happen if any illness could be cured for $10M? Would we expect insurance to pay $10M every time someone gets old and develops one of the inevitable diseases of old age? Clearly that is unworkable. Therefore, in the coming decades we will have to wrestle with the unpleasant decision of how much we are willing to spend on each person’s healthcare when technologically, the sky’s the limit. I, for one, do not want the government to make that decision. I think it is best left up to each individual to decide how much to spend on their healthcare.

For further reading, I recommend these:
http://www.weeklystandard.com/Content/Public/Articles/000/000/013/760hoavn.asp
http://www.amazon.com/Crisis-Abundance-Rethinking-Health-Care/dp/1930865899/ref=pd_bbs_sr_1/102-1542867-4157759?ie=UTF8&s=books&qid=1183572929&sr=8-1
http://www.amazon.com/Healthy-Competition-Whats-Holding-Health/dp/1930865813/ref=pd_sim_b_1/102-1542867-4157759?ie=UTF8&qid=1183572929&sr=8-1

Jury nullificaition: a juror's right to judge the law, not just the defendant

Most people have never heard of it. Most jurors are deliberately kept in the dark about it by judges and attorneys. But jury nullification is a powerful tool that every prospective juror (every US citizen) should be aware of. If you are called on to act as a juror in a trial, and you feel that the law being used to prosecute the defendant is unjust, you can (and should) return a verdict of not guilty, even if the defendant is clearly guilty of violating that law.

Many judges and attorneys hate it, and refuse to inform jurors of their right to nullify unjust laws, or even acknowledge it in court, because it diminishes their power over the jury and the defendant. But this power is important because it is, in effect, a safety valve which can prevent the powerful from victimizing the weak through unfair, immoral, or unjust laws.

I think drug laws a perfect example of of why we need jury nullification. Tell all your friends about it!

en.wikipedia.org/wiki/Jury_nullification

Sunday, May 27, 2007

Bottled water is one of the biggest scams ever perpetrated in America.

Over the last 20 years, an $8 billion industry has been created by convincing people that tap water is unhealthy and tastes bad.

People constantly discuss and complain about the price of gasoline, but I've never heard anyone complain about the price of bottled water. The fact is that at a typical price of $0.99 for a 1L bottle of water ($4.00 per gallon), bottled water costs more than premium gasoline. How absurd! Especially when you consider that tap water costs about $0.001 per gallon (that's 4000 times less!). Unlike gasoline, which is very expensive to produce, bottled water costs virtually nothing to produce. Bottling and transportation cost a few cents per bottle, but the real reason it's so expensive it that suckers are willing to pay for it. All that money goes back into the company's marketing budget, or comes out as profit.

Drink bottled water because you think it's healthier? Think again. Many reports have shown that bottled water often contains as much gunk as tap water, plus chemicals from the plastic bottle. www.organicconsumers.org/foods...3.cfm. In most cities, the very small amounts of chemicals in tap water have no ill effects. If you're concerned about health, you'd be better off saving the money you spend on bottled water and spending it on better food, a gym membership, or a relaxing vacation.

Drink bottled water because you think it tastes better? Think again. In blind tastings, most people can't tell the difference, or rate tap water's taste as good or better than most bottled waters. The fact is, people taste what they expect to taste. If you buy a fancy bottle of expensive water and expect it to taste great, it will! If you think tap water is yucky, it will taste yucky to you. Try this yourself - buy several brands of bottled water, fill identical, numbered cups with each brand, plus one with tap water, and have a friend set up a blind tasting for you. Be sure to leave the cups of water out for a while so they are all at the same temperature, and be sure that your friend does not know which one you're tasting if he watches you, to avoid subtle hints or influence you might pick up from him. I've tried this on a few people and they are always very surprised by the results. Of course, if you have bad plumbing or live in a city with really bad tap water, your mileage may vary. But if you don't like the taste of your tap water, get a filter!

A lot of people who drink bottled water consider themselves to be environmentally conscious. But how environmentally conscious is it to schlep water (which is very heavy) half way around the world, when we have perfectly good water right here? And how enviornmentally consicious is it to use up billions of plastic bottles every year? Even if you recycle them, a tremendous amount of energy is consumed in manufacturing, transporting, and recycling them.

For the biggest suckers, there are "ultra premium" bottled waters that are super purified and/or processed with some sort of voodoo that's supposed to improve it. One example is Penta water: www.pentawater.com/. This crap claims to be processed in a way that creates pentagonal molecular clusters of water molecules, which increase hydration. This is pure fiction with no real scientific basis, intended to con suckers who lack the scientific background to realize that these people are lying.

America has some of the safest and best tasting tap water in the world. Don't fall for the marketing hype and health hysteria perpetrated by the bottled water companies. Get a filter if you have bad tap water, but don't waste your money on bottled water.