I was looking over the latest Reason-Rupe poll and found something strange: 87 percent of people think a federal broccoli mandate would be unconstitutional, while 62 percent think a health insurance mandate would be unconstitutional. That’s a 25 percent difference even though the basic principle is exactly the same. These two mandates were compared during this week’s Supreme Court oral arguments on the health care bill.
Over at the Daily Caller, I go over some possible explanations for the different results and conclude:
Public opinion has precisely nothing to do with whether a policy is a good idea or not; anyone who thinks otherwise would do well to read Shirley Jackson’s short story “The Lottery.” But since I think that government should not have the power to mandate that people buy certain products — think of the lobbying and rent-seeking by companies that stand to benefit! — it is heartening that the majority of Americans think the same way as I do about broccoli. And, to a lesser extent, health insurance.
More importantly, we’ll soon find out how the Supreme Court polls on the broccoli mandate issue. Er, health insurance mandate. Same principle.
Read the whole thing here.
Posted in Economics, Health Care, Publications
Tagged broccoli mandate, daily caller, health care bill, health care reform, health insurance mandate, insurance mandate, reason-rupe poll, scotus, supreme court
Today, the Department of Justice sued to stop the proposed AT&T-T-Mobile merger. They claim to know in advance how the merger will affect the mobile market for years to come. It’s an example of F.A. Hayek’s fatal conceit. Of course, most people haven’t read Hayek. So over in the Daily Caller, I use a better known thinker to make the same point:
The philosopher Yogi Berra once said that “It’s tough to make predictions, especially about the future.” Let’s apply his lesson to the proposed $39 billion AT&T-T-Mobile merger…
Competitors are also surprisingly confident in their ability to predict the future. A Sprint spokeswoman said that “Sprint applauds the DOJ for conducting a careful and thorough review and for reaching a just decision … Today’s action will preserve American jobs, strengthen the American economy, and encourage innovation.”
This translates roughly to “We think the merger would make the market more competitive. We were scared that we’d have to work harder to innovate and cut costs to keep our customers happy. Whew.”
Most mergers fail. Nobody knows if a merged AT&T and T-Mobile would offer a better, cheaper product line. The only way to find out is trial and, often, error. The Justice Department’s astounding claim that it knows the merger’s effects in advance is either proof of its superior enlightenment, or else the height of hubris. I’m guessing the latter.
Read the whole thing here.
Posted in Antitrust, Economics
Tagged Antitrust, at&t, at&t merger, at&t-t-mobilr merger, competition, daily caller, doj, fatal conceit, hayek, justice department, t-mobile, yogi berra
The proposed AT&T/T-Mobile merger is drawing the usual antitrust scrutiny. Fearful competitors say the $39 billion deal will make the market less competitive. Or so they say. Over at the Daily Caller, I point out that actions speak louder than words:
[I]f Sprint is willing to devote resources to fighting the AT&T/T-Mobile merger, then it probably thinks the new post-merger company will be more competitive, not less. That cuts directly against their main argument – that the merger reduces competition.
Put yourself in Sprint’s shoes for a minute. If your competitors are making what you think is a foolish business decision, you’re not going to try to stop them. If anything, you’ll actively encourage them.
Instead, Sprint’s opposition is proof positive that it thinks the competition is about to get more formidable, not less.
Antitrust authorities, blind to that obvious fact, stand a real risk of stunting the competitive process. They should ignore competitors’ pleas for special government favors and let the merger succeed — or fail — on its own terms. Real competition happens in the market. Not in Washington.
Read the whole article here.
Here is a hilarious short video accusing ATMs of killing jobs, loitering on street corners late at night, and even dispensing money to terrorists. It’s good. I couldn’t figure out how to embed it on this site, so you’ll have to click the link to watch it.
Trade is going to be a hot issue this summer. Pending free trade agreements with Panama, Colombia, and South Korea might finally pass. Opponents of liberalization are already on the attack.
My colleague Jacque Otto already covered the creative destruction defense of trade today. Over at the Daily Caller, I look at employment data and find out that the labor force has grown by 23 million people since NAFTA passed. Doesn’t sound like a job-killer, does it?
Just as trade doesn’t kill jobs on net, neither does it create them on net. The real advantage of trade is that it allows people to specialize and become more productive. That is how economic growth happens:
When governments lower trade barriers, they allow more people to exchange and to work together. In economics jargon, the size of the relevant market gets bigger. And the bigger the relevant market, the more people can specialize.
Readers familiar with Adam Smith will recognize this as his division of labor. Everyone knows that specialized workers are more productive than jacks of all trades. That’s why Henry Ford’s assembly lines were so much more productive than his competitors’. The same number of people could suddenly produce more cars in less time, because they had a more specialized division of labor.
Workers didn’t have to waste time switching from one task to another. They got very good at their tasks. And because they knew their jobs so well, they were better able to come up with new, better ways of doing them. Rising productivity is how an economy grows. Prosperity doesn’t depend on the number of jobs. It depends on how much stuff workers can create.
Posted in Economics, Publications, Trade
Tagged bafta, daily caller, free trade, free trade agreements, fta, korea fta, panama fta, south korea fta, Trade
The GOP has been bragging that its budget deal that passed the House today will save $38 billion. The CBO took a closer look, and it turns out the actual figure is $353 million, or 0.02 percent of this year’s budget deficit.
In The Daily Caller, I point out that this is one more example of the iron law of politics — inertia always wins.
Tragedy struck Japan this morning. It will be some time before we know just how many lives the tsunami took, and how much damage was done. But pundits are already saying dumb things.
Larry Summers, who should know better, committed the economists’ cardinal sin this morning: he fell for the broken window fallacy. The sunny side of the destruction is that it will boost the economy. Just think of all the jobs that will be created by the rebuilding process!
Over at the Daily Caller, I gently correct Summers. Natural disasters are bad for the economy. All the rebuilding activity in the next few years will only get Japan back to where it was. If the tsunami had never happened, all that energy could be put to creating new wealth. Disasters are just that: disasters.
Posted in Economics, International, Publications, Stimulus
Tagged bastiat, bastiat broken window fallacy, broken window fallacy, cnbc, daily caller, earthquake, economic growth, japan, japan earthquake, japan tsunami, larry summers, lawrence summers, natural disaster, Stimulus, tsunami
People complain that the level of political discourse in America is lower than ever. That isn’t actually true if you look at the historical record. But the ratio of heat to light is still far too high.
Over at the Daily Caller, I share a bit of wisdom from the economist Joseph Schumpeter about how people can have a more constructive dialogue about the direction of the country.
Protests in Wisconsin over public sector compensation cuts have been the big story this week. Over at the Daily Caller, I explain why some of the tactics that union members and supporters are using are actually backfiring.
The teacher sickout is classic bad PR. The parents who have to find and pay for last-minute daycare are now less likely to side with teachers’ unions, not more.
The nationwide saturation coverage is actually doing far more damage. Millions of people are learning about the sweetheart salary and benefit deals that many public sector union members get. Even if Gov. Walker’s cuts pass, the protesting workers will still be much better paid than their non-union counterparts. Both are better compensated in turn than most private sector workers.
Read the whole thing here.