Category Archives: Economics

Universities and Climate Change

Posted on March 8, 2008 | Comments Off on Universities and Climate Change

George Mason University, where I am currently studying economics, “will be taking steps to ultimately eliminate or offset CO2 emissions from all sources associated with university operations including electricity, heating, commuting, and air travel.”

In a student survey where we can raise questions or concerns, I asked: “Will the benefits be higher than the costs? Will it raise fees and tuition? Are there other uses of Mason’s limited resources that would do more good? The University should have answers to those questions before it proceeds.”

All I’m saying is look before you leap.

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Posted in Economics, The New Religion

Keeping Health Care Costs High

Posted on March 8, 2008 | Comments Off on Keeping Health Care Costs High

The House recently passed the Mental Health Parity Act, which would require group health insurance plans to cover mental health expenses.

The bill still has a ways to go before it becomes law. Those of us who care about health care costs should hope it doesn’t get that far.

By requiring insurers to incur higher costs, the bill will make health insurance more expensive; companies pass on their costs. This could price some people out of affording health insurance.

People who want mental health coverage in their insurance plans should be able to buy it, obviously. But those who don’t need it – or can’t afford it – should not be required by law to pay for something they do not want.

Legislators should take a step back and ask if, maybe, they are one of the reasons health care prices are so high.

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Posted in Economics, Health Care

Yankees Cite Unfair Trade Practices

Posted on March 5, 2008 | Comments Off on Yankees Cite Unfair Trade Practices

Here is a clever bit of satire over at the Cato blog.

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Posted in Economics, General Foolishness, Sports, Trade

Campaign Oddities

Posted on March 1, 2008 | Comments Off on Campaign Oddities

“Steelworkers press Obama, Clinton to tackle China,” says a recent article in The Hill.

Taken literally, this is a very strange headline.

Those steelworkers must really not want to have any competitors to deal with.

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Posted in Economics, General Foolishness, Political Animals, Trade

Clinton, Obama, and NAFTA

Posted on February 26, 2008 | Comments Off on Clinton, Obama, and NAFTA

In tonight’s debate, both candidates opposed NAFTA. Very strange. Sen. Clinton said it kills jobs. But it hasn’t; net employment grew by 2 million jobs per year for the first ten years of the agreement. The trend has continued; we’re talking about 26 million more jobs on net since NAFTA.

Both candidates want tougher labor and environmental standards added to the agreement. This is largely aimed at Mexico. Now, everyone wants workers to have higher pay, and everyone wants a cleaner environment. But those things cost money, which Mexico just doesn’t have much of. They need to grow before they can afford the standards the candidates favor. If we make them adopt them now, that growth will happen more slowly.

Then there’s the general nature of trade agreements. They’re basically agreements to lower tariffs. It’s like saying, “I’ll stop shooting myself in the foot, but only if you do the same.” Better to stop the shooting altogether and do away with protective tariffs, period.

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Posted in Economics, Elections, Political Animals, Trade

An Upside to Obesity

Posted on February 15, 2008 | Comments Off on An Upside to Obesity

“Pacific islands are in the midst of a crisis of obesity and its associated dangers of diabetes, strokes and heart disease,” says a recent news article.

This rise in obesity is accompanied by a sharp rise in related health problems. Fortunately, a much larger health issue, one that has plagued humanity for most of its history, seems to have finally been wiped off the face of these islands.

That problem is starvation.

Sometimes a bit of perspective is helpful. If you’re going to have a problem, too much food is a better one to have than too little.

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Posted in Economics, Health Care, Nanny State

Ethanol Adds to Global Warming?

Posted on February 8, 2008 | Comments Off on Ethanol Adds to Global Warming?

A new study getting a lot of press says that ethanol is actually worse for the environment than gasoline. A lot of experts have been saying just that for years.

Seems a lot of people get sucked into an “anything but oil” mentality. I too look forward to the day when we have a cleaner, cheaper energy source. But we’ve known for years that ethanol isn’t it. It only has 2/3 the btu’s of gasoline, so it only gives 2/3 the mileage. Emissions are roughly the same. Now we know that the manufacturing process causes more emissions than oil’s. Oh, and it’s more expensive, too. Not a good deal.

Strange that ethanol still commands widespread support. I can think of two reasons: politics (farm state politicians courting votes), and the anything-but-oil mindset.

I’ve sensed the tide turning against ethanol in the last year or so, ever since it started making food prices go up. This study only adds to the trend. Maybe soon companies can pour their R&D resources toward a more useful end.

Seems a lot of people get sucked into an “anything but oil” mentality. I too look forward to the day when we have a cleaner, cheaper energy source. But we’ve known for years that ethanol isn’t it. It only has 2/3 the btu’s of gasoline, so it only gives 2/3 the mileage. Emissions are roughly the same. Now we know that the manufacturing process causes more emissions than oil’s. Oh, and it’s more expensive, too. Not a good deal.

Strange that ethanol still commands widespread support. I can think of two reasons: politics (farm state politicians courting votes), and the anything-but-oil mindset.

I’ve sensed the tide turning against ethanol in the last year or so, ever since it started making food prices go up. This study only adds to the trend. Maybe soon companies can pour their R&D resources toward a more useful end.

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Posted in Economics, The New Religion

Transferring Wealth vs. Creating Wealth

Posted on February 3, 2008 | Comments Off on Transferring Wealth vs. Creating Wealth

Jesse Holland, AP Labor writer, asks, “Will more jobless benefits aid economy?”

The article is less than clear, but here’s my short answer: no.

Unemployment benefits are not new wealth. They are a transfer of already existing wealth from some people to others. To get the economy back on track, new wealth needs to be created. Which unemployment benefits cannot do.

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Posted in Economics, Spending

The Costs of Farm Subsidies

Posted on January 31, 2008 | Comments Off on The Costs of Farm Subsidies

Reuters reports that “Thousands of Mexican farmers, some herding cows, flooded into the capital on Thursday and set a tractor on fire to demand government protection against cheap U.S. farm imports.”

They’re on to something, you know.

Those U.S. imports are cheap — and hard to compete against — because they’re heavily subsidized by the U.S. government. I’ve always opposed those subsidies because, as a taxpayer, they come out of my pocket.

There are other, more human costs. American subsidies to rich American farmers price their poorer competitors out of their livelihood.

The protesters are right about the problem they face. I don’t think they’re on to the right solution, though. Rather than have Mexico raise protections for Mexican farmers, it would be better for the U.S. to drop its protections. Better to have everyone on a level playing field.

Whoever is better at farming will reap the rewards. And, speaking selfishly as a consumer, so will consumers.

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Posted in Economics, Trade

Election 2008

Posted on January 31, 2008 | Comments Off on Election 2008

I don’t vote. Sometimes people ask me why. My answer changes from year to year. I try to make it as short as possible. For example, in 2004, I gave two reasons: George Bush and John Kerry.

There’s a lot more to it than that, of course. Opportunity costs. My vote would only affect the result if it was a tie breaker, which is unlikely. I’d be risking (gasp!) jury duty. If I genuinely like a third party candidate, they will lose even with my vote. And so on.

But simply saying the candidates’ names is usually enough to get my point across.

My answer is a bit longer this year, since the nominees aren’t yet settled. But I’ll be back down to two short reasons soon enough. Maybe even after Super Tuesday.

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Posted in Economics, Elections, Political Animals, Public Choice