From today’s Milwaukee Journal Sentinel:
Raymond Raab of Menomonee Falls was watching the playoff game against Atlanta two weeks ago and was feeling ill. His concerned wife, Louise, wanted to call 911.
“He said, ‘No, no, no, I want to watch the Packer game,’ ” Louise said. “Finally, when they were ahead by so much, he said, ‘OK, you can call 911 now.’ ”
Ray Raab died nine days later.
Posted in Uncategorized
My colleague Brian McGraw skewers the ethanol lobby in this video he made. Warning: contains a bit of adult language.
Posted in Economics, Spending, Uncategorized
One of the problems with current immigration laws is that they raise the price of immigrating legally. Basic economics tells us that when something costs more, people consume less of it.
That’s why so many of America’s immigrants are turning to dangerous but cheap immigration black markets to enter the country. This is a problem with an obvious solution. In today’s American Spectator, Alex Nowrasteh and I make the case that lowering the cost of legal immigration through liberalization will reduce the amount of illegal immigration, and shrink cruel black markets.
Basic economics wins again.
The Chicago Tribune has a jaw-dropping story of regulators gone wild:
Department of Health inspectors seized, slashed open and poured bleach over thousands of dollars of local peaches, pears, raspberry and plum purees owned by pastry chef Flora Lazar… Inspectors cited no health problems with any of the food.
And that’s just the beginning. Read the whole thing. This is a scandal. Ms. Lazar is out of business for six months and has lost about $6,000. There is no evidence of harm. This is no way to treat a small business. Especially during a recession.
(Hat tip: the ever-resourceful Brian McGraw)
I recently finished reading Swedish economist Johan Norberg‘s book about the financial crisis, aptly titled Financial Fiasco. It’s both short and informative. Six chapters and 155 pages, all of them worth reading.
The first two chapters are about the two big regulatory causes of the recession. One, monetary policy that was too easy for too long. The price system works. When the Fed messes with that price system, prices send out the wrong signals. People behave accordingly. Two, a decades-long drive to raise homeownership rates caused a lot of people to take out loans they couldn’t afford. It was only a matter of time before the consequences would come to bear.
Chapters 3 and 4 are about how the private sector reacted to the incentives regulators gave them. Let’s just say they acted badly. If people can game the system, they often will. Norberg’s criticism of overly-complicated securitized mortgage packages is both shocking and infuriating.
Chapter 5 is about how the government and private sector reacted to the crisis once the housing bubble popped. The $700 billion bailout program to reward bad behavior comes under fire.
Norberg is in top form in Chapter 6. Having looked at the causes and consequences of the crisis, now he offers a way out. One lesson is that politicians will always behave badly. “Politicians who distribute pork they cannot afford are reelected; butcher shops that sell pork they cannot afford go bankrupt. (p. 150)” Politicians are just like you and me. They go wherever their incentives lead them. We need to approach them accordingly.
The way to a full recovery is not bailouts. It is letting bad companies fail. And just as important, letting good ones prosper. “Government support for companies is thus not a way to save jobs, as politicians try to make us believe. It is a way to move jobs from good companies to bad companies.” (p. 151) In the long run, bailouts keep the economy down by keeping jobs and resources away from where they would do the most good.
Financial Fiasco has echoes of Tocqueville; a foreigner is trying to figure out how America works. Norberg, like Alexis de Tocqueville, is uncommonly perceptive. His experience living under an economy more thoroughly mixed than America’s allows him to see things that have escaped American commentators. This is extremely valuable. The fact that his book is concise, well written, and accessible to those of us who don’t have economics Ph.Ds makes it even moreso.
This month’s issue of Info Tech & Telecom News contains an article by yours truly on certain states’ attempts to collect sales taxes from out-of-state businesses. Key point:
Economists have known for a long time that when you tax something, you get less of it. Apparently some state legislators want less commerce in their states.
Posted in Economics, Publications, Taxation, Uncategorized
Tagged amazon, amazon tax, sales tax, sales taxes, taxes
If you’re planning on hunting migratory birds this year, be sure to read all 14 subparts and 61 sections in Title 50 of the Code of Federal Regulations pertaining to migratory bird hunting. Lots of rules to follow.
You should also read pages 41,008-41,031 of the 2009 Federal Register for the latest changes.
Posted in Regulation of the Day, Uncategorized
On Monday, postage rates will go up from 42 to 44 cents. Thanks to the forever stamp, most of us won’t have to bother with those infernal 2-cent stamps this time around.
As so often happens, this convenience has a trade-off. Lowering the transaction costs associated with rate increases means there will be more of them, at least in theory. Sure enough, for the first time in history, rates have gone up four years in a row.
Forever stamps make price hikes so painless that many people probably won’t even notice for months to come. Monday’s increase has barely made a dent in the news.
The forever stamp is a great idea. But frequent rate increases are a serious drawback. This is especially dangerous given the monopoly status USPS enjoys; competition is the only reliable form of price control. Unfortunately, an anti-trust investigation remains less than likely.
(Cross-posted at Open Market)
Posted in Uncategorized
The economist Hernando de Soto, writing about his native Peru in 1989, makes a point that holds true twenty years later and a continent away. Echoes of F.A. Hayek:
“Those who expect things to change simply because rulers with greater determination and executive skills are elected are guilty of a tremendous conceptual error.”
-The Other Path, p. 237.
Posted in Executive Power, Great Thinkers, International, Political Animals, Uncategorized
Tagged hernando de soto
