Reclaiming Free Speech

Posted on February 16, 2008 | Comments Off on Reclaiming Free Speech

Some people involved with the speechnow.org free speech lawsuit have a piece in today’s Washington Post:

Most Americans probably assume that they can gather with friends and neighbors to say whatever they want about politics to whoever is willing to listen. They presume that the First Amendment protects their right to get together and buy yard signs, publish newsletters or pay for radio or television ads urging people to vote for or against a candidate — and to do so free of government interference.Unfortunately, most Americans would be wrong… the presumption in favor of free speech rooted in the First Amendment has largely given way to a presumption of regulation.

Worth reading.

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Posted in Free Speech

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

The Uses of Distraction

Posted on February 3, 2008 | Comments Off on The Uses of Distraction

The art of argument has a lot of tools. One of them I loathe: the personal attack. Paul Krugman, a partisan Democrat, is a master of the ad hominem. I’ve taken issue with him before.

I’m reading a book of his, 1994’s Peddling Prosperity, for a class right now. Early on (p.23), there is a textbook use of personal attack to distract the reader from the matter at hand. Here, Krugman accuses someone of racism to discredit their main point, which has nothing to do with race:

In 1981 Senator Daniel Patrick Moynihan uttered a startling pronouncement: “The Republicans,” he declared, “are now the party of ideas.” Moynihan was and is a moderate Democrat. He once served in the Nixon administration, and he earned the ire of many 1960s liberals both by his willingness to talk about the disintegration of black families and by his authorship of a leaked memo suggesting that the race issue be treated with “benign neglect.”

Moynihan’s “benign neglect” memo is despicable. But it has nothing to do with whether or not the GOP had creative ideas in the early 1980s.

Sadly, the average reader won’t see past that. They will take Moynihan’s wrongness on racial issues to mean he is automatically wrong on anything else he says.

Ah, distraction. When you don’t feel like constructing a strong argument, simply distract the reader. Maybe they won’t notice.

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Posted in Argumentation, Philosophy, The Partisan Mind

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

A Thought on GDP

Posted on January 31, 2008 | Comments Off on A Thought on GDP

Ah, Gross Domestic Product. Is there anything more exciting?

Yes.

Even so, it’s important to know about. GDP is the best proxy we have for measuring wealth. Where GDP is low, people starve. Where it is high, even the poor are fat. If you’re going to have problems, which would you rather have? Making GDP grow is one of the central issues of the 21st century.

GDP is also flawed. Suppose I buy a wristwatch for $50; GDP goes up by $50. But I really like the watch. I value it at $200, four times what I paid. My personal wealth increases by $150, but GDP only counts a fraction of that. GDP systematically understates true wealth. It is inaccurate.

This doesn’t just affect my watch purchase. Remember, people won’t buy anything unless they value it more than the dollars it costs them. With every transaction, GDP systematically understates true wealth.

The problem with GDP is that it is measured in currency, which is only a proxy for wealth. True wealth, of course, is impossible to quantify.

Whoever comes up with a way around that has a Nobel with their name on it.

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Posted in Economics, Monetary Theory

Government, Technology, and Growth

Posted on January 29, 2008 | Comments Off on Government, Technology, and Growth

I’m reading Bill Easterly’s The Elusive Quest for Growth for a class right now. It asks and answers the question of how to make poor countries rich. It’s a good read. I find I disagree with many details, but the core message is simple and true: people respond to incentives.

As I said, there are parts that I don’t buy into. Here’s an example:

Brazil moved more slowly into the computer revolution than necessary because of a government ban on PC imports, a misguided attempt to promote the domestic PC industry, a classic attempt by vested interests to hijack technological progress. (p. 186)

What does he conclude from this experience? “The government should subsidize technological imitation.” (ibid)

He ignores his own advice that incentives matter. As Brazil showed us, government’s incentives often hurt growth. Ask any public choice theorist.

Quibbles aside, it’s a good book. I recommend it.

And if any of my classmates read this, I’m interested in your thoughts.

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Posted in Development Economics, Economics, Public Choice, Technology

Charity and Government

Posted on January 22, 2008 | Comments Off on Charity and Government

An editorial in today’s new York Times, entitled “Charity Begins in Washington,” calls for greater government involvement in charity:

Critics of government spending argue that America’s private sector does a better job making socially necessary investments. But it doesn’t. Public spending is allocated democratically among competing demands.

Allocated democratically among competing demands? Government does not work that way.

Public sector charity is allocated by politicians making political calculations. Yes, the private sector is imperfect. But it doesn’t have half the systemic problems that government charity has. Inefficiency, politicization, rent-seeking, corruption, people gaming the system, you name it. All the good intentions in the world can’t change that.

Charity does not, and should not begin in Washington. It begins with you, me, and everyone else who wants to help our fellow man.

Some things are too important to be left to government. Charity is one of them.

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Posted in Economics, Political Animals, Public Choice