Gene Callahan breaks down social thought through the ages.
The auto industry’s success story since Obama’s union vote-buying bailout.
Debt: the first 500 pages. An economist from Australia reviews David Graeber.
Daniel Larison laments the terms of debate in regards to US foreign policy this election.
The arrest of international banker Dominique Strauss Kahn on several charges amounting to sexual assault has occasioned more discussion of sex on the airwaves than I have heard for many years. Some of the statements I hear are absurd or annoying. Others are downright dishonest. I am trying to sort out the most salient points.
Warning: If you are prudish, don’t read what follows. If you are under fifteen, read at the risk of undermining your healthy sexual development.
First things first: A couple of days ago, the Spanish minister of economy and finance, I think, was one of many female commentators committing a deeply immoral amalgam. One the one hand, she said, there is the presumption of innocence, on the other hand, the charges are so serious, so awful. It’s common thinking in academia among bureaucrats in charge of hunting down sexual harassment, sex discrimination, and in the end, sex differences.
Here is a reminder, girls: The seriousness of an alleged crime, whatever great, has no influence on innocence. Those are separate things completely. Get this: Continue reading
Economist Mark Perry has a great take on the current sluggishness of the jobs rate over at Carpe Diem. He brings our attention to the following graph:
His observations:
Most of the weakness in the U.S. labor market, the stubbornly high unemployment rate, and the slow rate of overall job creation can be traced to the ongoing decreases in government jobs, see chart above, especially at the local level […] Perhaps the significant downsizing of government at the state and local level is a positive development for the future growth of the U.S. economy, and one benefit of the Great Recession. But we should also pay some attention to the fact that one of the reasons for the disappointing monthly employment reports is the persistent weakness in the public sector employment, which is offsetting the relatively healthy increases in private sector hiring.
This is a damn good point: unemployment rates have remained high because of losses in the public sector, not the private sector (which has been steadily growing). As Dr. Perry observes, this is good for long-run growth, but I can’t help but lament the fact that cuts in government spending have not been deeper and more robust. Imagine what the economy would look like if if deep cuts had been made six years ago.
As always, it is important to look at what the graph does not tell us. The graph explains that government jobs have been decreasing, but tells us nothing about expenses for current and retired government employees. Federal and state employees have gained notoriety for their lavish retirement packages (especially in California!), and none of this is covered in the graph. Public sector pension reform is still a vital issue that needs to be solved.
One other lament that I feel I must make pertains to the bank and auto bailouts of 2008-09. Although the bailouts don’t have any casual correlation to the graph I reproduced, I don’t think it is hard to image, again, what the economy would look like today if there had been a rigorous separation between business and state.
Co-blogger Jacques Delacroix writes the following (in 1995!):
Organizational ecology is the other major open system school of thought. Organizational ecology (sometimes called “population ecology”) is built around the concept of structural inertia. In the ecological view, organizations in general have little latitude for effective structural change. Indeed, accoriding to some ecologists, important structural forms are often recipes for disaster and more likely lead to organizational demise than to organizational adaptation, as assumed by managerial schools of thought […] Continue reading
Political scientist Jacob Levy shares his thoughts on unions
Social liberalism and the drug war, in which Bill Clinton and the Left gets taken to task for its hypocrisy
I offer an essay written by a student in a beginning college English class. I was moved by the story she had to tell of how the drug warriors inflicted so much suffering on her terminally ill boyfriend and on her. Her manner is reserved but it the anguish comes through loud and clear.
These days the documentaries and media reports are hard to miss. Opiate and opioid abuse has become epidemic in many of our poorer states. In an attempt to get high, people have begun illegally buying prescription pain medications such as Oxycontin, and creating new and unusual ways to snort, shoot and shove in to places it was never intended to go. According to the media the drug dealers are no longer the creeps on the street corner pushing to kids, but rather the pharmaceutical companies, patient advocacy groups and doctors who have managed to improve on and promote what many are convinced is a curse on society.I guess you can’t blame the media for telling a good story complete with tragedy, multibillion dollar villains, and clever names such as “hillbilly heroine” for this country’s current drug of choice. What bothers me is how one sided these stories have become. Rarely do you see the people who are in so much chronic physical or emotional pain that these types of drugs can be life sustaining despite the physical addiction that comes with it. I guess the media does not find these people sensational enough to focus on, but when the dust settles they will likely be the ones who end up losing the most from this “epidemic”. Thanks to our fears and the media that plays on them the majority of Americans have been convinced that all drug addiction is bad, and should be avoided at all cost even when it can ease the severe pain of some. I have seen the good that these strong pain relievers can offer the right people and would like to explain the other side to the opiate’s story.
The source of our modern day opiates is the opium poppy, a plant whose existence and use actually predates written history. Often called, “God’s own medicine” ever since people discovered that it was more than just a pretty face; mankind has had a love-hate relationship with the opium poppy. Similar to the way our endorphins work the active ingredients in opium trigger the opioid receptors in the brain, central nervous system and throughout the body. This creates not only pain relief, but also a strong sense of pleasure, and well being. For many who are in severe pain these results can bring life to a person who otherwise would be forced to live in a world without relief. Several years ago I knew little about opiates, and like most people I believed their use was only for those who simply no longer cared. It was not until I met my boyfriend that I understood what a positive effect it could have for some.
My boyfriend Dave lived with chronic pain. His doctor had put him on a regular supply of Vicodin which helped to not only relieve that pain, but also gave him energy, so he no longer had to spend all his time in bed. Unfortunately when opiates are taken regularly the body will build up a tolerance, and physical addiction will develop. A good doctor will understand that their patient will eventually need an increase in their dosage, and no patient should ever be put in a position where they are forced to withdraw abruptly from their medication without professional help. Well that is the way it is supposed to work isn’t it? Dave’s doctor either was not aware of how addictions can form, or more likely was simply afraid to increase the dose due to the scrutiny put on doctors who are thought to be too generous with the pain medications they prescribe. When we finally accepted that his doctor hands were tied we went looking for an alternative.
I will never forget the first time we went to buy Vicodin off the street. There were actually people who had walked straight out of the hospital still attached to IV poles selling their prescription drugs. Heroin addicts hung out on the corners trying to fund their habits by helping newbies like us connect with the right people. Sometimes they were very helpful most of the time not, but Dave always tipped them anyway knowing that the pain from withdrawal is still the same regardless of how you get there. This was an end station for many. With the risk of arrest, or assault running high, most of the people there had nothing left to lose. The fact that my boyfriend had to spend the final years of his life going through so much to get some relief will always anger me. It nearly ruined him financially, and the stress alone likely took time off his already short life. Dave was a person who believed you should always work hard to get ahead, and play by the rules. He did what he could to help others, but when the time came there was no one there willing, or able to help him.
I would never underestimate the power of opium, and the drugs it has produced. Call it what you wish: “hillbilly heroine” or “God’s own medicine” — this is a drug that can give life just as fast as it can take it away. I am sure that some will argue, where is the line drawn? If our laws were to allow easier access to opiates wouldn’t most of the addicts simply claim that their use is medical? I guess if we lived in a perfect world a well-informed adult would be allowed to decide for themselves what substances they put inside their body, and accept responsibility for the choices they have made. We clearly do not live in such a world, so the next best thing is to make sure that the people who have a legitimate reason to take these drugs will still have access to them.
My ultimate fear is that with so much controversy surrounding them, opiates will eventually be made illegal. People like my boyfriend have enough challenges without having to spend all of their time and finances chasing down a drug that they should have legal access to. Maybe it’s time to turn the typical Oxycontin story on its head, and shine a light on the other side. If people can learn to stop thinking in black and white maybe then our medical community will finally be able to do their job, and start offering the support and resources that these people are entitled to.
Economist Steve Horwitz has a great lead-off in this month’s Cato Unbound. It’s all about the Austrian School of economics and its various detractors and factions. Some highlights:
Rather than being anti-empirical, modern Austrian economists are trying to open up the box of what counts as “empirical evidence” to include forms normally dismissed out of hand by the rest of the profession. Arguably, then, modern Austrians might well be more empirical than other economists, at least as judged by their professional work […]
Good economics for Austrians means sound arguments, not just valid ones. Too much of modern economics consists of valid reasoning from false premises about human action. The accuracy of those premises matter greatly for Austrians.
That is one reason why subjectivism is more important than praxeology for understanding Austrian applied research. Economics is radically subjectivist in the sense that human action depends upon the perceptions of the world held by the actor […]
Subjectivism also explains Austrian skepticism about statistical correlation being the privileged form of empirical evidence. It only provides correlation, and to provide causation requires a theoretical explanation. If such explanations must start with actors’ perceptions of the world, then forms of empirical evidence that capture such perceptions would be at least as useful. Austrians therefore frequently turn to primary source material and interview and survey work as well as quantitative data to tell a complete story of how a particular economic phenomenon came to be and functioned. How did actors perceive their options and constraints and what sorts of consequences emerged from their choices?
Dr. Horwitz goes on to give readers a brief list of introductory readings for those who are interested in the academic side of the Austrian School, rather than just the political and popular side. Highly recommended. You read the whole thing here.
Update: Longtime reader (and admin of NOL’s Facebook page) Hank points us to a rebuttal over at the Mises Institute’s blog. I didn’t find it convincing, but it’s still worth a look.
Thus Hayek’s 1940 contribution to the “Socialist Calculation” debate debunked the then-fashionable notion that master planners could achieve the economic nirvana of running a centralized economy in which they obtain whatever distribution of income they choose while simultaneously making sound allocations of both labor and capital, just like in Soviet Russia.
Hayek exposed this fool’s mission by stressing how no given individual or group could obtain and organize the needed information about supply and demand conditions throughout the economy. The virtue of the price system was its use of a common unit of measurement—money—to allow various actors to compete for a given resource without having to lay bare why they need any particular good or service. The seller need only accept the highest bid, without nosing around in other people’s business. The interaction between buyers and sellers allows for constant incremental adjustments of both price and quantity. Old information gets updated in a quick and reliable way, thereby eluding the administrative gauntlet of the socialist state.
This essay, which y’all should read, was sparked by the attacks on Rep. Paul Ryan’s supposed intellectual influences F.A. Hayek and Ayn Rand.
Over at the Real-World Economics blog, economist Edward Fullbrook presents a graph of labor’s demise in the United States as well as an article from Al-Jazeera English titled America in Denial that promotes Fullbrook’s new book.
Fullbrook brings it to the attention of work-weary Americans that they work far too many hours per year compared to other rich societies in the West (there are, of course, no rich societies outside of the West, but that’s a different blog for a different day).
Behold! The cold, hard facts informing American workers of their own oppression! Continue reading
This morning’s Wall Street Journal had an op ed piece (may be gated) by one Alan Colmes whose book “Thank the Liberals for Saving America” is just now coming out. It’s a paean to the “liberal” policies of Lyndon Johnson and his successors, featuring a big photo of LBJ and Lady Bird under a “great society” banner. I had to turn the page quickly as I was in the middle of breakfast, but have now reopened and read the whole thing. Since the chances of the Journal publishing a rebuttal from me are essentially nil, I decided to inflict my response on my readership. Both of you.
The piece brought back memories of the visceral disgust I used to feel at the sight of LBJ when he was in office even though I wasn’t much attuned to politics in those days. I would be hard pressed to say who’s worse, Obama or Johnson.
To begin with, Johnson was a blatant criminal. He and his wife got rich by manipulating radio and television licenses in Texas. He stole the primary election in 1948 which got him into the Senate. He may have been complicit in stealing Texas electoral votes in 1960.
But what of the article? Most of it is a recitation of the accomplishments of “liberal” programs including food stamps, health care, bailouts, marriage equality, and women’s rights. In essence, he tells us that the beneficiaries of “liberal” welfare programs benefited from them, and they’re not all lazy bums.
Well, duh. This is the sort of shallow thinking that characterizes “liberal” discourse. No recognition of short-term or long-term consequences. No acknowledgement of public-choice insights into the perverse incentives of welfare administrators whose primary motive is to retain and expand their empires.
An overlooked consequence: the erosion of incentives to take responsibility for one’s own life; instead these programs have instilled a world-owes-me-a-living attitude which by now spans multiple generations of welfare recipients.
An overlooked consequence: the massive buildup of debt.
An overlooked consequence: the loss of personal freedom that must follow the loss of economic freedom as Hayek so eloquently showed in “The Road to Serfdom.”
An overlooked consequence: the insight of Mises that interventions invariably lead to outcomes contrary to the intentions of the intervenors, who then call for yet more interventions. In our mixed economy, a blend of free markets and government force, markets take the blame for every problem. And so the market takes the blame for everything. As Jeff Hummel says, market failures are to be cured by more government; government failures are to be cured by more government.
Thanks to the “liberals” and the conservatives who have failed to mount a principled opposition in domestic affairs, and thanks to both parties who have launched disastrous foreign wars, we are hurtling toward an American brand of fascist dictatorship.
I know the last thing everybody wants to hear is another political rant, but I’m going to give it to you anyway.
Has anybody noticed the recent slew of “fact-checking” sheets and reports that have come out since Paul Ryan’s VP speech at the GOP convention*?
Does it really come as a shock to people to find out that politicians lie? I can’t wait to see the other side come out with the same kinds of reports after Joe Biden and the current demagogue-in-chief give their speeches.
Politicians lie? Really? Who would’ve thunk…
Here’s my two cents: Democrats lie more often than Republicans. Hands down. There are always exceptions to the rules, and being more honest than the Democratic Party is not exactly a milestone achievement.
Many people said this race might be the most interesting in a while (thanks to the protection of free speech that Citizens United upheld), but Continue reading
Thinking all the time about this country’s situation puts me in a blue funk. Here is a story to cheer me and you up. It’s one of my best.
I reached that mid-size Bolivian city in the lower Andes, on a research trip, the day before Bastille Day. I was an old undergraduate at Stanford at the time and still a French citizen. I reported my presence to the French consul, as required by law, as technically a member of the French Navy reserve. The consul was a Bolivian doctor who had studied in France and subsequently married, and then, divorced, a French woman. Bolivia being a landlocked country (bitterly so), the consul was not overwhelmed with naval business. He was glad to see me nevertheless and very cordial. He pressed me to attend the party he would give the next day on the occasion of the French national day.
It was a pleasant but schizoid event, starting with good French Champagne and ending with chicha, the soupy, local artisan corn beer. (Bolivians say that the fermentation of really good chicha starts with the spit of virgins. Just to make sure, they ask tiny girls to spit in the brew.) There was the usual mix of French expatriates and of Francophiles, most of the latter, probably silly unconditional Francophiles, plus some smart freeloaders.
The French expatriates often land in a particular town of a particular country at a particular time for no particular reason. They may have been heading somewhere else and gotten stuck along the way. They always include wives and former wives of natives who may have divorced them, or died. Coming from different epochs (such as before and after WWII), they form historical strata, each remembering a different France, and they entertain disparate and often incompatible visions of the fatherland. They have developed new habits in the country where they live and, without knowing it, they have drifted far from their culture of origin. That culture of origin, meanwhile, is itself changing, but in a different direction. Many expatriates disseminate more or less innocently patently false notions about the country where they were raised. Their French self is forever a young person, or even a child. Their own children are simply natives of their land of residence with a smattering of the French language and no real curiosity, forever strangers to their parents. Continue reading
The concept of economic reproduction is emphasized in the Marxian school of economic thought. In Marxist theory, the conditions for production are continuously re-created as a circular flow. The concept of the circular flow of both goods and of factor-inputs was first developed by the French economists of the 1700s, who called their theory of natural economic laws “Physiocracy.” The factors or categories of inputs are land, labor, and capital goods.
From co-editor Fred Foldvary. Do read the whole fascinating article. Many conservatives in the US (as well as libertarians) don’t give Karl Marx the time of day he deserves in order for thoughtful, polite discourse to take place. Many on the Right decry (and rightly so) the various strawmen that Leftists erect when attacking the proponents of private property, personal wealth and international trade, but are we any better when it comes to debunking Leftist arguments? Continue reading
These recent developments in labor relations show how changed market conditions offer welcome correctives to the New Deal approach. It is just these changes that are at risk under an Obama administration whose main agenda tracks Roosevelt’s early one: Vilify the rich as unproductive ciphers of society and work toward a progressive tax rate structure; be hostile toward the growth of international trade by denouncing firms that outsource jobs as the enemies of domestic labor; continue to work in favor of extensive agricultural subsidies for ethanol and other farm crops, no matter how great of a disruption these impose on domestic and foreign food markets; and insist upon a rich set of unsustainable healthcare benefits through Medicare and Medicaid.
This is from Richard Epstein. Okay, so Obama is a demagogue, a thief and a murderer. Is Mitt Romney really any better? Really?
I’m voting for Gary Johnson (if I vote at all).
Texas and other states have passed laws requiring voters to present valid ID at their polling place. How could this be controversial? These days we have to present ID to get on Amtrak, pick up mail at the post office, transact with a bank teller, etc., etc. Is proper ID any less important for voting? But a court recently struck down the Texas law saying it impacts minorities disproportionately. Hummph. If laws against aggravated assault affect minorities disproportionately should those be overturned also?
But why bother about this issue? There surely is some voter fraud happening, but how much does it matter? The real problem with democracy is simply the results. The worst get on top, as Hayek put it, Exhibit A being, of course, the Sewer Rat in the White House. As the electorate has broadened, starting with white male landowners at the Founding all the way down to today’s situation where anyone with a pulse who is at least 18 and claims to be a citizen can vote, and with direct election of senators in between, the quality of elected officials has gone steadily downhill. Barack Obama! Harry Reid! Mike Huckabee! Nancy Pelosi! Compare this crew with George Washington, James Madison, Thomas Jefferson. Are you sick at your stomach yet?
Herewith a modest reform proposal:
Let’s now consider objections one by one:
Objection: people would feel disenfranchised. People who lost their vote would be bummed, no doubt, but they would still have the prospect of earning a vote to aspire to. Voting would be seen as a privilege to be earned, and the quality of votes cast would skyrocket as would the quality of campaign rhetoric.
So as not to cause too much upset, the voting age could be raised gradually and the poll tax raised in steps.
Objection: corruption. It might be worthwhile for special interests to track down individual voters and offer them bribes or intimidation. But if the voter roles were shrunk by a factor of a thousand, for the sake of argument, that would still leave a hundred thousand or so voters nationwide. That leaves quite a bit of effort for lobbyists and other crooks to track them all down.
Besides, corruption is proportional to the amount of power that resides with government. Regulation of lobbyists, campaign reform and all that will never mean anything as long as so much money and power are at the disposal of politicians. My voter reform proposal will lead to a drastic shrinkage of government and thus drastically reduced rent-seeking opportunities and incentives.
Furthermore, as things stand with campaign promises. How much worse would outright cash bribes be?
Objection: bias. Outcomes would be skewed toward the viewpoints of the eligible voters, which would not be representative of the general population. Exactly! The whole point is to restrict voting to an elite who can think and act rationally and not be swayed by the sort of demagogic appeals we hear from the aforementioned politicians and their ilk.
Is this idea likely to gain traction? Not any time soon, but it’s fun to speculate. An interesting alternative is Fred Foldvary’s “cellular democracy.” Perhaps he’ll be moved to post that idea here.
Notes On Liberty 