Year: 2017

Joaquim Nabuco, a Brazilian visionary in Washington

Bruno Gonçalves Rosi History, Liberty , , , , , , , ,

During most of the 19th century Brazil and the United States showed little mutual interest. Brazilian foreign policy was initially directed to Europe (mainly England) and then to border problems in South America (particularly with Argentina and Paraguay). Meanwhile, the US was concerned about its expansion to the west and its internal tensions between north and south. With little convergence in these priorities, the two countries basically ignored each other.

However, this picture began to change at the end of the century, especially because Brazilian coffee found in the USA an excellent consumer market. The definitive change occurred in the first decade of the 20th century, when Barão do Rio Branco, Brazil’s foreign minister for 10 years (1902-1912) decided that the country should privilege relations with the US in its foreign policy. The Baron understood that after Africa and Asia, South America (especially the unprotected Amazon) would be the target of European imperialism. Without an army and a navy that could deal with Europeans, Brazil needed US protection.

Fortuitously, this was also the period in which Theodore Roosevelt gave his corollary to the Monroe Doctrine. Roosevelt had already made clear his intention to keep Europeans away from the American continent, particularly in his intervention to build the Panama Canal. An unwritten alliance was formed between the two countries: the convergence of interests caused Brazil and the United States to experience an unprecedented approach in history. To consolidate the new paradigm of foreign policy the Baron elevated the Brazilian diplomatic representation in Washington to the level of embassy. In the diplomatic gesture of the time this was a clear indication of the preference that the country gave to the USA. The Baron chose Joaquim Nabuco to be Brazil’s first ambassador to Washington.

Nabuco is a well-known personage to the scholars of Brazilian history. When he became ambassador to Washington he was already famous for his struggle against slavery in Brazil and for his work as a historian. Like the Baron, Nabuco believed that Brazil would be the target of European imperialism, and that it needed US help to protect itself. Unlike the Baron, however, Nabuco saw an opportunity at the time to do something more: to turn America into a zone of peace, a continent with international relations essentially different from those of Europe.

The Baron saw international relations only as a zero-sum game. He also did diplomacy thinking in terms of a balance of power. Nabuco was not unaware of these aspects, but he believed that through regular international conferences and open trade, America could avoid the wars that were so characteristic of Europe. But for that the US leadership was essential, and should be supported by all. The Baron sought the US punctually: he wanted the protection of a stronger country while Brazil was not able to protect itself. Nabuco wanted a permanent alliance. In his foreign policy the Baron was a kind of conservative: changes do not occur easily. The story simply repeats itself. The 20th century would simply repeat the 19th. Nabuco believed that change is possible. He believed in universal principles linked to classical liberalism.

Nabuco passed away in 1910, only five years after assuming the position of ambassador. Perhaps if he had been more successful in his foreign policy we would have had a very different twentieth century. The United States would not have become involved in Europe, as it did in World War I. America would be a continent of peace, contrasting with the Old World. America would lead by example, not intervention. And many problems we face today, the fruits of American interventionism, would be avoided.

A non-argument against immigration

Vincent Geloso Culture, Current Events , , , , ,

I often encounter the argument that immigrants, especially Muslims, are so different from the populations of their host countries that they threaten the institutional foundations of these societies. As a result, the logic goes, we must restrict immigration.

I do not accept that argument as valid nor do I accept it as sufficient (in the case I am wrong) to make the case in favor of further restrictions on immigration.

First of all, the “social distance” between immigrants and the hosts society is very subjective. The caricature below offers a glimpse into how “unsuited” were Catholic immigrants to the US in the eyes of 19th century American natives. Back then, Catholics were the papist hordes invading America and threatening the very foundations of US civilization. Somehow, that threat did not materialize (if it ever existed).  This means that many misconceptions will tend to circulate which are very far from the truth. One good example of these misconceptions is illustrated by William Easterly and Sanford Ikeda on the odds of a terrorist being a muslim and the odds of a muslim being a terrorist. Similar tales (especially given the propensity of Italian immigrants to be radical anarchists) were told about Catholics back then. So let’s just minimize the value of this argument regarding going to hell in a hand basket.

nast1

But let us ignore the point made above – just for the sake of argument. Is this a sufficient argument against more immigration? Not really. If the claim is that they hinder “our” institutions, then let them come but don’t let them participate in our institutions. For example, the right to vote could be restricted to individuals who are born in the host country or who have been in the country for more than X-number of years. In fact, restrictions on citizenship are frequent. In Switzerland, there are such restrictions related to “blood” or “length of stay”. I am not a fan of this compromise measure (elsewhere I have advocated the Gary Becker self-selection mechanism through pricing immigration as a compromise position).*

The point is that if you make the argument that immigrants are different than their host societies, you have not made the case against immigration, you have made the case for restrictions against civic participation.

* Another “solution” on this front is to impose user fees on the use of public services. For example, in my native country of Canada, provincial governments could modify the public healthcare insurance card to indicate that the person is an immigrant and must pay a X $ user fee for visiting the hospital. Same thing would apply for vehicle licencing or other policies. Now, I am not a fan of such measures as I believe that restrictions on citizenship (but offering legal status as residents) and curtailements of the welfare state are sufficient to deal with 99% of the “problem”. 

A Bad Teenager

Jacques Delacroix Liberty

Below is an excerpt from my book I Used to Be French: an Immature Autobiography. You can buy it on amazon here.

…..I repeated my senior year in a high school closer to home that was not nearly as good as the first. I don’t know why I did that. I was like a sheep walking insouciantly and sure-footed to the slaughterhouse. There was no reason to think I would do better the second time than the first. I had not failed from bad luck, or because I did “not test well,” in the mealy-mouthed gobbledygook of today. Rather, it was because vast blank, empty steppes overlaid my mind. I doubt one year would have been long enough to fill up the blanks even if I had tried. At any rate, my heart wasn’t in it. Someone should have yanked me out and sent me to work full-time. I could have learned something useful, like the basics of charcuterie, for example. Perhaps everyone around me got caught short and no one had an alternative plan. At this distance in time, I have trouble evaluating to what extent my parents would have thought such a pragmatic solution to my aimlessness socially unacceptable. I went back to high school as the default solution. I performed just as badly the second time around. That second senior year would have been a total waste except that it changed radically the trajectory of my life. I was the beneficiary of a positive injustice. (I went to California a first time, on a scholarship.)

When (Where and Why) Women Were More Literate than Men

Vincent Geloso History , , , ,

For most of history, men tended to be more literate than women. In essence, illiteracy was widespread but even more so for women. There is one exception: the French-Canadians. For most of the 19th century, literacy rates were greater for French-Canadian women than French-Canadian men.

literacy

This is a fascinating piece of economic history and somewhat of a puzzle (given that it is an oddity). It also shows how important institutions are to determining paths of development. In a 1999 article in the Journal of Economic History, Gillian Hamilton indicates that the more “liberal” institution of marriage contracts for the French-Canadians probably induced this result :

Quebec’s unique legal institutions offered the opportunity to draw up a prenuptial contract to couples who could benefit from a different property structure than the law provided. Not surprisingly, a prenuptial contract was unnecessary for most couples. Within this transaction cost-competitive marriage market framework, contracts generally were desirable only in cases of mismatch, either due to an exceptional woman or a relatively productive husband whose job did not entail a significant component of family participation. Their contracting decisions are consistent with terms that would have provided them with more appropriate incentives for work and the production of jointly produced goods, and at least the potential for greater utility and wealth than they otherwise would have accumulated. The use of contracts likely provided Quebec with higher overall wealth and a wider income distribution than it would have experienced without contracts (because the skilled disproportionately signed agreements).

 

US Immigration: a Primer

Jacques Delacroix Liberty , , , ,

President Trump was elected for a variety of reasons but any observant person knows that the general topic of immigration played a significant role. Mr Trump appears unfamiliar with the current American immigration system and he is ignorant of the economic benefits of immigration, or he downplays them. Below I address modest parts of both topics. I aim for sensationalism rather than for completeness.

First a little bit about the American immigration system such as it is in January 2017. There are two main bizarre ideas among Trump supporters about the real system: One regards who is allowed to come into this country (legally, I mean); the other strange misconception has to do with how aliens become US citizens.

The system by which the US admits immigrants is a little complicated and its description relies on a specialized legal jargon. In my considerable experience, few people have the patience to sit through a lecture on American immigration policy. So, let me cut to the chase:

THE NON-EXISTENT ORDERLY QUEUE

There is no way, zero way, the average married Mexican can legally immigrate into this country.

This is worth mentioning because many are under the impression that illegal immigrants are cheats who cut through the line instead of patiently waiting their turn.

The “average Mexican” does not have American-born children, children who are US citizens by birth. Mexicans who do have such children and the children are minors go to the head of the line. There is no (zero) line for those who don’t have close relatives who are Americans or legal immigrants. This example illustrates the US immigration policy that accounts for most legal immigrants in most years: Family re-unification.  

Sophisticated people noticed long ago that there is an instantaneous way to acquire an American relative. It’s to marry an American. Doing so for the purpose of gaining admission to the US is illegal for both parties involved. I don’t know if anyone ever goes to jail for it but it’s ground for immediate deportation. Nevertheless, I am told by some of my immigrant friends that there is a thriving little cottage industry of visa brides and grooms for a fee in some parts of the country. I cannot verify this rumor but I believe it.

Similarly, there is only one way the average married Irish man or woman may immigrate into this country: Winning a lottery. (You read this right: a lottery which one may play as often as one wishes; it has not entry fee.) In 2015, only about 49,000 people, all from Europe and Africa, gained admission on the basis of winning that lottery.

Some legal immigrants gain admission under the broad category of “employment related reasons.”  This category includes high-level programmers as well as farriers. (Look it up.) It’s a small number. In 2015 they made up about 15% of all one million-plus legal admissions. Our average Mexican and our average Irishman does not qualify here either.

You may have heard of an “investor’s visa” accorded to foreigners who will create employment in the US. That’s always a tiny number, about 10,000 in 2015.  It’s not always open. Congress decides about if every so often.

There is a third main, amorphous way by which foreigners are admitted, “asylum” broadly defined. I call it “amorphous” because the definition of who is a refugee or an asylum seeker can be changed by Congress in a very short time. The President decides how many can be admitted in either category. The number admitted under this category is accordingly highly variable. It was about 150,000 in 2015. It could have become 500,000 in 2016 because of a new crisis anywhere in the world. (It didn’t.) The current, Trump figure of  50,000 seems just about normal historically. Yet, there is wide variation about the average.

There is thus no orderly queue that Felipe or Ahmed could join on their own if they wanted to avoid becoming illegal aliens.

That’s it, folks. If you want to know more about the raw numbers, study the relevant pages in the Statistical Abstract of the US.

So, contrary to what I suspect is a widespread idea among conservatives, it is not the case that there is an orderly, wide-open legal way to immigrate into this country that illegal immigrants perversely ignore. Illegal immigrants are not rudely jumping to the head of the line; they come in through a side-door the US does not seem able to close.

One more thing, a programmatic idea: Instead of the present admission policies (plural)  based on viciously absurd selection we have, we could take a page from the Australian and from the Canadian playbooks. That is, we could coolly decide what kind of immigrants we want and try and tailor a door to those precise dimensions. Presently, we are doing very little of this, however unbelievable it may sound. Such a rational procedure would not not need to eliminate refugee and asylum seekers admissions.

I am personally in favor of such a reform . I also think special policies  should apply  to our proximate neighbors to the north and to the south. I developed this idea with Sergey Nikiforov in an article [pdf] published in the Independent Review several years ago.

Incidentally, I am a product of a rational immigration policy myself. I was admitted on merit alone. I rest my case! Thank you for asking. OK, truth be told, I tried to come in as a spouse of an American citizen but she dumped me.

GAINING CITIZENSHIP

On to the next misconstrued idea. I keep hearing (on talk radio, I confess) irate citizens affirming that foreigners who don’t want to take American citizenship should not be admitted. The case hardly arises.

In fact, in reality, to be allowed to become a US citizen, to take American citizenship, requires several years of residence in this country after being legally admitted. (See above.)

Hence, personal preference plays little role in determining which immigrant does not become a US citizen. I don’t have the numbers but I am sure that, as a rule, the vast majority of legal immigrants adopt American citizenship shortly after they are legally empowered to do so. It is true that, in theory, some hesitation or some problems may arise in connection with some countries of origin who do not wish to recognize dual citizenship. In practice, depriving anyone of his passport is low on the list of priorities of most countries from which new US citizens originate. (India may be an exception – a curious exception – as if the country were facing an unbearable burden of immigrants of all sorts.)

The consequence of this scenario is that, contrary to what I think is a widespread notion, there is no horde of legal immigrants living in this country and peevishly and disloyally refusing to take American citizenship. It also follows that there is no mass of illegal immigrants who obstinately refuse American citizenship. It’s not available to them, period.

I think it’s legitimate to be opposed to illegal immigration and even to legal immigration but it’s best to do on the basis of correct information.

On Minimum Wages, Health Code Violations and Proper Assessment

Vincent Geloso Economics , ,

A few days ago, Tyler Curtis at the Freeman (the Foundation for Economic Education’s flagship publication) posted a short piece on the minimum wage and health code violations in restaurants. Curtis based on a paper (unavailable in full) by Srikant Devaraj who asserted that increases in minimum wages in Seattle had led to increases in health code violations by restaurants (heavily affected by the increases).

Devaraj used a standard difference-in-difference econometric approach. The problem underlined by some was the choice of benchmark for the method : New York City. New York City and Seattle are two very different cities with different health codes. It is hard to make this claim stick even if the uncontrolled results (before statistical tests) show an increase in health code violations. Nonetheless, I have been able to find one other study that shows – based on Californian data – that there was a very small deterioration in health code violations (especially by the top restaurants) following increases.

Now, I am not convinced by the econometric design of both, but I am axiomatically convinced. This is where I think economists have made the error of relying too much on empirical methods. While, as an economic historian, I always favor more data, I also am trained to be skeptical about data does not say.

In the case of the minimum wage, the debate has raged between economists over the employment effects (i.e. the demand for labor). But this is a fraction of everything involved with the production of goods in industries affected by minimum wages. For an employer, a cost is a cost regardless of the form it takes. If an employer is forced to pay somebody above what they produce in value, then something has to give. For a 5% increase in the minimum wage, it is doubtful that an employer with three employees will be willing to sack one third of his workforce (and roughly one third of his output). So, he can cut costs differently. He may ask employees to buy their uniforms, he may refuse to provide them with free lunches, he may also even decide to cut on quality of his service – as is the case with the two studies outlined above.

The problem is that no study of the minimum wage has attempted to measure all these effects at once!  There is no study that looks simultaneously at hours worked, people employed, type of people employed (substitution effects), prices for consumers, quality and marginal benefits (uniforms, free lunch, insurance, etc.) on both the short and long-terms levels and trends (they also rarely adjust the minimum wages for regional purchasing power parities and the under-reporting of tips)

The health code violations papers show how many channels employers can use to adapt – channels which some fail to account for when they proclaim that we can raise the minimum wage without adverse consequences. Maybe its time that we, as economists, try to be more cautious when we make claims about the minimum wage’s minimal effects.

The New Colossus

Brandon Christensen Liberty , , , , ,
Not like the brazen giant of Greek fame,
With conquering limbs astride from land to land;
Here at our sea-washed, sunset gates shall stand
A mighty woman with a torch, whose flame
Is the imprisoned lightning, and her name
Mother of Exiles. From her beacon-hand
Glows world-wide welcome; her mild eyes command
The air-bridged harbor that twin cities frame.
“Keep, ancient lands, your storied pomp!” cries she
With silent lips. “Give me your tired, your poor,
Your huddled masses yearning to breathe free,
The wretched refuse of your teeming shore.
Send these, the homeless, tempest-tost to me,
I lift my lamp beside the golden door!”
— poem by Emma Lazarus, 1883

How much has Cuban productivity increased since 1960?

Vincent Geloso History , , ,

Is it possible for two equally rich countries (on a per capita basis) to have different level of output per worker? The answer is obviously yes, and it matters in the case of measuring growth in Cuba since the revolution.

A country with a very young population will tend to have fewer workers than one with an older (but not too old) population. Let’s say that countries A and B have a median age of 22.5 in year one.  However, in year ten, country A has a median age of 35 but country B has seen a more modest increase to a median age of 25. This will bias any estimates of growth comparison between both country. The increase in the median age suggests that there are more and more workers in country A (people of prime age) than in country B. As a result of that, output per capita will increase faster in country A than in country B even if both countries have equal rates of growth in output per worker.

Well, countries A and B are basically Cuba and most of the rest of Latin America. Since the 1950s, Cuba’s population has aged rapidly but birth rates have plummeted so fast that families shrunk. With fewer kids in the population, it means that the share of the Cuban population that are of prime working age increased rapidly. This is what biases the comparison of Cuban living standards with other Latin American countries.

In the figure below, I took the GDP (the Maddison data) of Cuba since 1950 (indexed at 1960 to see the arrival of Castro) and divided it by the total population, the population above 15 years of age and the population between 15 and 64.

cubagdp

As one can see, with the GDP per capita series, Cubans saw a 50% increase in their incomes between 1960 and 2005 (the Maddison data stops at 2008). However, when you look at GDP per working age adult in order to capture the growth in productive capacity, you get moderately different results whereby the cumulative increase is three-fifths to half as small.

In light of this, it seems like Cuba’s living standards are less and less impressive.

Angry? Learn economics!

Rick Weber Culture, Economics, Liberty , ,

The election didn’t go your way (and if it did, just think about past elections… at least some of those didn’t go your way) and now you’re itching to do something about it. You’re angry and motivated, and at risk of making things worse. 

Economics isn’t just about money. In fact, it’s barely about money. It’s mostly about cooperation between strangers. But economists also study competition. Most importantly, we study decision making which is essential to understand if you want people to make different decisions!

More importantly, economics helps us understand how to navigate costs and benefits wisely. It turns out wise decision making isn’t as straight forward as we’d hope. So if you care enough to work hard to make the world better, economics is worth your time.

Still here? You really want to make the world a better place! Let me suggest that you study social science. Something I’ve learned during my first decade of studying economics (Jan. 2018 will by my 10 year mark) is that thinking clearly about something as complex as society requires mental tools that we aren’t born with. Our intuitions will lead us astray. The good news: economics mostly boils down to common sense rigorously applied.

Economics doesn’t have a monopoly on the truth (if we did, this post would be shorter but you’d have to pay to read it). But I think econ is the best place to start in an intellectual exploration of society. It will help you build a robust and modular framework for understanding the world. Economics is the ultimate modular social science; you can plug-and-play with insights from anywhere.

So why econ? Because at the end of the day, economics deals with the most important aspect of life: how to live life well. It boils down to this: every choice comes at the cost of a foregone alternative. Opportunity cost. All (good) economics comes down to this profound truth. Whether your goal is to reduce poverty, pollution, or parenting woes, learning to think of cost in these terms will serve you well.

Let’s take that concept for a test drive… would banning plastic bags reduce environmental harm? The benefit is that you’ll eliminate the problems associated with these bags (litter, use of oil, etc.). But we need to understand the costs before we know if we’re helping or hurting the environment. Notice that link starts with the question “paper or plastic” and goes on to say nothing about paper bags; it’s looking at the silver lining without acknowledging any possibility of a storm cloud. That lack of economic thinking opens us up to new problems: making heavy paper bags also creates pollution and could very well create more.

In other words, this simple concept showed us that it’s possible to do harm by doing something that sounds good (the road to hell is paved with good intentions!).

It’s easy to miss the forest for the trees: economists specialize in researching very specific areas–foreign exchange markets, agricultural futures, political change, pirates–and it’s easy to get bogged down in the details. Studying economics in school means studying under specialists. But once you’ve got the basics of the economic way of thinking down, you’ll see that those specializations are really just applications of the same general concepts and the same basic way of thinking. It’s easier to understand once you speak our language, but there are lots of great resources. Two places I would start:

Now get to it! Start making things better!

The culture that is Argentina

Federico Sosa Valle Culture

In Argentina, lawyers take vacations in January and physicians in February.

Those months are the hottest of the Summer in the Southern Hemisphere and, thus, are of the lowest productivity. Moreover, every agreement you reach with somebody during January and February goes void in March!

Cheers!

On Gentrification, Inequality and Zoning

Vincent Geloso Current Events, Economics, Law , , , , ,

On the CityLab blog, Richard Florida posted a piece pointing out that gentrification has virtually no effects on homeowners. I can buy that result, especially since I wrote a policy piece for a think tank back in the summer of 2016 on the issue. The important point that Florida underlines (by citing a paper by Martin and Beck in Urban Affairs Review) is that homeowners are not being displaced, but renters are more likely to be. This will probably fuel some people who are concerned about inequality. I disagree.

I want to point out that my interest in the issue is entirely related to the issue of inequality which some individuals have tried to tie to gentrification (sometimes without understanding that causality can run both ways). If you want to tie the two issues together, then you must realize that there are four “types” of gentrification. First of all, gentrification always appear in an area that is poor and it is always a result of a shift in demand for land in that area. However, that area can be largely unoccupied or heavily inhabited. It can also be in a district where zoning is lax or burdensome. In each of these situations, you will different effects with different interpretations for inequality.

  • Scenario 1 (largely vacant, lax zoning laws): in this situation, demand shifts right but there is slack in the local housing market and in any case, supply can adjust easily. In that case, the effects on rents will be minimal and will probably be smaller than the economic gains in terms of local economic activity. In this situation, there is little displacement and there is in fact a reduction in inequality.
  • Scenario 2 (largely vacant, heavy zoning laws): same happens, except that the restrictions on construction and building conversions put a ceiling on the capacity of a local area to adapt. The effect on rents is ambiguous and depends largely on the relative quantity changes (how many people relative to empty units). There are probably small to moderate gains in the area. There are ambiguous effects on inequality.
  • Scenario 3 (heavily occupied, lax zoning laws): in this situation, the influx of individuals creates a temporary surge in rents. This is because, in the short-term, housing supply is inelastic. In the long-run, the supply is more elastic and new units can be added to counterbalance the price effects. So, there is a long-term benefit that comes after a small bump. More individuals will be displaced than in scenario 1. Overall, a reduction in inequality might occur.
  • Scenario 4 (heavily occupied, heavy zoning laws): in this situation, the influx happens in a market where the supply is highly inelastic (short and long-run). In that case, the shift in demand creates a substantial increase in rents. This is where gentrification can hurt and be tied to inequality.

These four scenarios are important because they show something important that some people have to understand. Gentrification can increase inequality. However, that depends on the context and the institutions (zoning) surrounding the area in which it happens. In all cases, gentrification is a normal process that can’t really be stopped but turns sour because of zoning laws. Thus, if you really want to tie gentrification to inequality, it should twice removed since the first parents are zoning laws and construction limits.

On Sugary Drinks, Taxes and Demand Curves

Vincent Geloso Economics, Liberty , , , , ,

A few days ago, I discovered a blog post on the website of Jayson Lusk (a very good agricultural economist whose work has often guided some of my own economic history research given that most economic history is also agricultural history). The post relates to a study of the implementation of a sugary drink tax in Berkeley to fight obesity.

Obviously, a tax will reduce the consumption of any good. That is pretty axiomatic and all that we need to know is how much. In other words, how elastic is demand. If all things are held constant, the quantity consumed relative to the price change will give you that measure.* However, the study that Lusk pointed too basically shows that we often do not hold everything constant.

The authors of the study point out that when tax is passed, there is generally a debate that occurs beforehand. This generates publicity about the issue. This alters the behavior of consumers because they face more information. This is an effect that must be isolated from that of the tax itself.  That is what the authors do in their papers and they find that a reduction of soft drinks consumption did occur during the campaign and after the tax was adopted but before it was implemented (they rely on on-campus sales of soft drinks at a “major university” which we can assume is UC-Berkeley). Thus, the reduction in consumption preceded the price change. Lusk himself found something similar in a case related to animal welfare. Using a Californian electoral proposition regarding animal welfare in the production of eggs, he found that the publicity surrounding the proposition changed consumer behavior.

Lusk, rightly in my opinion, points out this suggests that information-based policies are probably more efficient than heavy-handed measures like taxes.

But I think there is a deeper point to make. When you inform consumers, you don’t only change the location of the demand, you also change the slope of the curve. If a consumer is made aware of the costs (and benefits) of his consumption that he had not previously considered, he may become more sensitive to the price. Informing people about the ill-effects of sweet drinks might make them more sensitive to the price they pay. Imagine that the information campaign during the Berkeley vote on the tax caused consumption to become more elastic. That means that the tax’s effects is being amplified by the information effect from the publicity. Had the tax been imposed as a surprise, the effect would have been smaller. Basically, Lusk’s presentation of the argument is understating the effects of information-based policies.

* On a tangential point, I would like to remind that people can reduce their consumption of soft drinks without changing their total calorific intake. Indeed, if I am taxed when I consume a soft drink, I can switch to coffee with cream. Thus, pundits often confuse a reduction in soft drinks consumption after a tax as a step in favor of reducing obesity.

Anarchism

Jacques Delacroix Liberty , ,

Below is an excerpt from my book I Used to Be French: an Immature Autobiography. You can buy it on amazon here.

I had my first revolutionary encounter at another Cub Scout camp near a different lake. We were organized in squads of six, as I said, each with its appointed leader. One day, my squad leader gave me an order I did not like. Or maybe, I just did not like his tone. I said “No.” He insisted. Our voices rose. His authority contested publicly, he shoved me lightly. I shoved back and I called him out formally. We repaired out of sight to the lakeside. It was not the Clash of the Titans because I must have been nine and he, eleven. The leader must have lacked faith in his own charisma, or else, I got lucky because I gave him a bloody nose. This stopped the fight in accordance with the ancient dueling rule of “first blood drawn.” He washed off the blood in the lake. We walked back to our tent separately. It was sunset; everyone went to bed. Nothing more was said.

I remember the fight clearly and I remember well that the squad leader was the furthest thing from a bully. He was not a bad guy and I did not even dislike him. I just did not like hierarchies. I was a natural anarchist in the true, etymological sense of the term: I did not want to have a chief, or a leader, or whatever you call them these days. This trait never changed. I am just the same as I was at nine in this respect. I have never had any desire to exercise power over others either. Most exercises of power repel me viscerally. I suspect many or most are unnecessary. Moreover, I now think coercion is the worst way to obtain the orderliness that is necessary to a good society. I am pretty sure coercion causes more disorder overall than it eliminates or avoids. Its costs are usually too high.

“Growing up” did not help me in that department either. I never “learned through experience;” life did not “beat it into me.” In this respect, as in many others, I keep marveling at the constancy of individual characters from childhood, perhaps from infancy. I don’t know why there isn’t more mention of this constancy except that it contradicts the namby-pamby liberal faith in environmental determinism. If you believe religiously that societal influences – such as poverty, emotional abuse, being deprived of cookies, being fed the cookies of the wrong color – decide what the adult’s character will be, it’s hard to notice that much of the character was already in the child, or even in the toddler. It’s difficult to even imagine that it was possibly already in the zygote. This possibility was an academic taboo subject for the best part of forty years. Hardly anyone felt free to study it.

On Tax Resistance, Censuses and the Cliometrician’s Craft

Vincent Geloso History , ,

In the process of finalizing another research article (under revise and resubmit for Agricultural History), I found a small case of tax resistance in Canada East (modern day Quebec) in 1851  that is interesting.

The district of Grenville, northwest of Montreal, was an ethnically mixed district (25% French, the rest were English-Canadians) operating under the British freehold tenure system (as opposed to most of the rest of the province that operated under French seigneurial tenure). During the 1851 census, the enumerator complained that the population of roughly 2,000 inhabitants refused to report statistical information.

Basically, the enumerator pointed out that the majority supposed the information they were giving was “the precursor of a general tax for schools which they are strongly opposed to”.

tax-resistance-in-the-censuses

I find this to be interesting because it is a nice little case of how hard to master the craft of an economic historian. As a cliometrician, my task is to find the best data possible to answer historical questions with strong economic theory (while enriching theory with historical evidence). The data for that area would be biased downwards as peasants would understate their incomes to avoid being heavily taxed. Any statistical test to assert the applicability of a theory to historical questions of Canada (or Quebec) would be altered by this reaction on the part of peasants.

True, for some broad questions (like measuring GDP), this would not be too dramatic an issue. However, for more specific questions like “what was the role of tenure systems in explaining Quebec’s relative poverty”, the issue would be more problematic.

How much do the little things matter, right?

Trump Is Right!

Edwin van de Haar Current Events, Politics , , , ,

It is easy to emphasize all that is bad about the new American President. For sure, I think he is a clown who will do a few bad things to the US and the world at large. His protectionist agenda is of course a libertarian nightmare, which will also make the people who elected him worse off. Still, the US President is not a dictator, so some trust in the institutions and the actors that fill them still seems appropriate.

Trump is also plainly right on a number of issues. Foremost, his plea (also in yesterday’s inaugural address) for the partners of the USA, especially in NATO, to contribute in equal measure. This is not new, all recent American Presidents have pointed this out to their European allies. It is simply outrageous to let Mrs Jones from North Dakota pay for the defense of other rich countries, such as my home country of The Netherlands. The Europeans got away with major free riding. Only recently did they start to get their act a little bit together, as the Russian threat is looming again. The defense budgets in almost all European NATO members have decreased drastically since the early nineties, which is plainly immoral if you are in the world’s most important security organization together. So hopefully Trump will pressure them to the max.

He is also right in pointing out that many US foreign interventions have been a disaster. And it is good that he wants some closer scrutiny from now onwards. I am not a great fan of military intervention, although I also do not want to rule them out them perennially (as opposed to many others in the liberal tradition). Many of the interventions over the past few decades have lead to nothing though, and created their own follow-up problems. So it’s pretty good if that same Mrs Jones is not likely to lose her son or daughter at the battlefield in some faraway country.

And of course Trump is right in asserting that the government is not ruling the citizens, but is just a service provider on behalf of the people, and fully accountable to them. Sure this is bit more complicated in practise, but it is the only proper principle.

So in these three respects: hail to the new chief! Hopefully he sticks to them and does not screw up too dramatically at all other policy fields.