Current Events

Could there be a college bubble?

Rick Weber Current Events, Economics , , , ,

The essence of a bubble is that you can flip an asset one more time before the bubble bursts. Most people know it will burst, but as long as prices are still rising, we might be able to fleece one more sucker. But we have to get the timing right or we might be that sucker.

But what about college? I can’t sell my degree (and there are other things that Jon Lajoie can’t do with it, but that’s neither here nor there), so I can’t flip it. But I can get rents on it. I give up $100,000 to get a degree with a present value of $300,000, and I feel peachy-keen. That’s a recipe for increased demand leading to higher tuition, sure, but could there be a bubble?

Let’s start with equilibrium so we have a counterfactual. Basic supply and demand here: higher incomes for college grads increase demand, and increased demand increases prices. In equilibrium the marginal student’s value of the degree will be equal to or greater than the opportunity cost of getting the degree.The student’s value is the benefit of cool college parties, mind/horizon expansion, reduced expected unemployment in the future, and higher expected income. Their opportunity cost is tuition, loan interest, stress from doing homework, and time not spent working. The question of going to school is different for different students; some will enjoy college more, will get more out of it, will have an easier time of it, etc. And the financial return isn’t the only relevant variable. At this point I’m thinking that maybe the current market is actually pretty sensible… we can ask questions about the sustainability of subsidies, but given everything, it’s likely that the students going to school are making the right choice, as are the ones who don’t go. Mistakes will be made, but it isn’t necessarily the case that there are systemic, wide-spread mistakes.

Now let’s think about what it might mean for the bubble to burst. First off, there would have to be a bubble: too many people paying too much to be in school; too little incentive for any individual to change their behavior. Then all at once, there is a flood away from the market, and recent grads are left holding the bag. During the bubble, I can get financing for my degree and I can reasonably expect (even if I see that there’s a bubble) that I will come out ahead, as long as I jump ship soon enough. Let’s say that during the bubble, I pay $10k to get a degree and I earn an extra $1k per year (and lets also assume, for simplicity’s sake, that we don’t have to worry about discounted values… a bird in the hand is worth one in the bush). My behavior is rational as long as I expect to keep getting that extra grand for the next 10+ years. So our bubble has a weirder time dimension than, for example, a beanie baby bubble where I can buy and sell rapidly.

Also, our bubble requires that my income is inflated compared to it’s post-bubble level. That would certainly be the case for me as an academic; if that bubble bursts, my income will drop. Will that be true of someone getting a business degree? American employers are keen to hire people with degrees, and so there’s a de facto licensure system. The assumption is that if you don’t have a degree there must be something wrong with you. As long as everyone holds this assumption then all would/could-be students will have to get a degree. But if no degree means ‘idiot’, that doesn’t mean that degree means ‘genius.’ Employers could well figure out a better vetting procedure, and students could get sick of undergoing the opportunity cost of attending school. But if this is a gradual change, then ‘bubble’ doesn’t seem like the right word. Even if the change in hiring practices is instant, the change in the labor market won’t be. If every 30 year old has a degree and suddenly degrees become unimportant, companies won’t rush out to replace them with 20 year-olds. The supply of lightly-experienced, qualified workers won’t change in the short run unless there’s a reserve army of qualified but un-credentialed labor currently in limbo as baristas.

So is there a bubble? It certainly seems like enrollments don’t reflect underlying realities. It also seems like there are profit opportunities for entrepreneurs able to improve hiring procedures; placement services could vouch for a candidate’s abilities, employers could accept non-college interns and hire from that pool, would-be students could become self-employed. I think the market is far away from equilibrium. But I’m doubtful that re-equilibration will happen rapidly. There isn’t room to “burst” a bubble, so much as there is room to avoid wasting a lot of 18-24 year-olds’ time.

Plebiscito: la solución para los problemas de Nicolás Maduro

Guillermo Pineda Current Events, Politics , , , , , , , , , , , , , ,
Foto: Reuters

El día de ayer el presidente de Venezuela, Nicolás Maduro, envió  un duro mensaje a los opositores que desde hace mes y medio fueron a las calles a exigir cambios en el gobierno y los culpó de la crisis social que sufre el país. “Fascistas, uno por uno los voy a capturar, uno por uno voy por ustedes”, sentenció Maduro, y afirmó que todos estos grupos “le verán la cara a la ley”.

Pero en realidad no hay nada de “fascismo” en las ideas y reclamos de los líderes y en los cientos de opositores al gobierno bolivariano que hasta el día de hoy continúan protestando. El fascismo es una ideología política que busca instaurar el corporativismo estatal totalitario y una economía dirigista que regule la vida de los ciudadanos. El fascismo es también una ideología que propone la sumisión del individuo ante un ferviente interés nacionalista y universalista en el que no hay divisiones ideológicas y políticas de izquierda, derecha, etcetera y que condena a todos aquellos que se oponen al mismo. Pero, nada de lo anterior es parte de lo que han dicho en la televisión los manifestaste que aún están en las calles venezolanas.  Es más, ¿acaso la República Bolivariana de Venezuela no es todo lo anterior según lo han demostrado sus violentas acciones represivas?

Desde mi visión minarquista liberal sí lo es.  El interés individual de los ciudadanos venezolanos ha sido puesto en sumisión al interés bolivariano de la república que fundó el ya fallecido Hugo Chávez.  Además, el gobierno bolivariano de Chávez y de Maduro en repetidas ocasiones ha negado tener una posición específica en el espectro político de izquierda y derecha, y ha volcado esta discusión al espectro de la lucha constante que debe sufrir el nacionalismo bolivariano ante la amenaza imperialista de los Estados Unidos de América y de sus títeres en otros gobiernos latinoamericanos.  Maduro ha insistido que esta manifestación es producto de una campaña imperialista de parte de los Estados Unidos en contra de su gobierno democrático.

¿Cómo es entonces que Nicolás Maduro acusa de fascistas a los opositores del mismo sistema e ideología que me parece él y su partido han establecido en Venezuela?  y  ¿qué podría el liderazgo manifestante aprovechar de la postura del Presidente Maduro?

Al llamar a la oposición “fascista”, Maduro implica que su gobierno es el antónimo del fascismo y el antónimo del fascismo es la democracia.

Sin duda, el gobierno de Maduro fue electo con mecanismos democráticos y este mecanismo legitimó su gobierno. Sí, su gobierno fue electo mediante una democracia representativa nos guste o no.  Punto y final.

Pero también es uno de los principios de cualquier gobierno democrático y representativo que, en ocasiones, los mismos pueden ser criticados cuando los los líderes han estado en el poder por mucho tiempo.  Existen mecanismos democráticos para resolver estos problemas y Maduro insiste en ignorarlos mientras pone en riesgo la vida de los ciudadanos a quienes prometió defender cuando ganó las elecciones.  Maduro olvida o ignora que una característica que suele acompañar a las democracias es el derecho de sus ciudadanos a opinar distinto y sin temor de ser enviado a prisión por sus ideas.  Cuando un grupo amplio de la sociedad insiste en que es necesario confirmar la legitimidad de un gobierno se pueden tomar muchas acciones que no son necesariamente la represión y la amenaza del uso de la fuerza policial.  Así, una decisión consistente con la democracia de un líder democrático debería de ser utilizar uno de los mecanismos de la Democracia.  El mecanismo idóneo para esta situación de inestabilidad se llama Plebiscito o más específico, un referéndum consultivo.  Al realizar un referéndum, el Presidente Maduro podrá consultar a los venezolanos que lo eligieron si están de acuerdo con que el continúe gobernando y fortalecerá la legitimidad de su gobierno con el pueblo venezolano.

Al inicio de las manifestaciones que ya han costado la vida de varios ciudadanos venezolanos, los reclamos eran la escasez de productos básicos, los altos índices de criminalidad y los reportes de violaciones a los derechos humanos que han manchado el gobierno de Nicolás Maduro. El Presidente Maduro es la única persona con el poder de evitar que una sola gota más de sangre inocente sea derramada.

Si el Presidente Maduro es en realidad un líder democrático permitirá que cualquier opinión, por muy débil o pequeña que sea,  sea considerada no una amenaza fascista sino un sentimiento de inconformidad válido de discutir.  En las manos del Presidente Maduro está que su gobierno sea recordado como  el de un absolutista del corte “L’État, c’est moi” o como un demócrata forjador de la Libertad y la Democracia en imitación del gran líder Nelson Mandela. Ojalá y la palabra referéndum empiece a sonar más y más en las próximas semanas para que la paz regrese al vecino país sudamericano.

Thoughts on climate change

Rick Weber Current Events, Economics, Politics , , , , , , , , , ,

Last week I heard a sermon on climate change (no, it was an actual sermon). I’m roughly agnostic on the existence and degree of climate change, but I err on the side of assuming it is a large problem of externalities with no obvious property rights solution and will have costs. And I think that under those assumptions there is an important moral element to it. With that in mind, below are some of my thoughts on the weak points of the sermon:

1) Authority is only a starting point; we cannot defer ultimate responsibility to authority. If an expert or someone I trust tells me something about X, and I don’t have any prior knowledge about X, then I believe them. In the case of global warming there are two basic sorts of information you will get from information: a) diagnosis (temperatures could rise X degrees in the coming century), and b) prescription.

The climatology involved in a) is well above my pay grade, and so rather than undergo the costs of informing myself on the existence or importance of climate change, I just figure the truth is somewhere in the middle of what reasonably informed people say and instead focus my effort on my areas of comparative advantage. Now the actions in b) are typically about reducing waste and that’s well within the realm of economic thinking, so I’ll comment on that!

1b) Blindly deferring to authority to assuage your guilt is wrong and bad. Someone says you should drive an electric care to save the environment? Don’t do it before thinking through the matter, this is a big decision for most people. Where’s the energy coming from to power that car? (Coal. That is burned hundreds of miles away from your car… that’s like having a car with a hundred mile long drive shaft.) How much energy and material does it take to make the car? (Hint: look at prices.)

2) It’s called climate change, not climate universal and uniform worsening. If climate change means a warmer climate for Canada and Russia, that will come with extended growing seasons and savings on winter heating costs. Burma? It’s probably going to suffer a lot. Climate change will surely have the biggest impact on the poorest people in the world, and this is where I see the real moral issue because…

3) We can respond to climate change in a way to reduce suffering. Specifically, we can open borders. First off, that would increase human well being, with an enormous benefit to the world’s poorest people. Second, the effects of climate change won’t harm the poor as much as they could. Is climate change still a bad thing if we do this? Sure, but if a building is burning, why not help people get out?

Loose ends:

Should I recycle everything? Only if it will actually help. Recycled aluminum is chemically identical to virgin aluminum and uses fewer resources to produce (which is why it’s cheaper!). Recycling paper creates a lower quality product, uses a lot of energy and creates pollution.

Paper bags are brown, that’s good, right? Plastic bags are almost ethereal; they use a fraction of the material per unit of carrying capacity resulting in big savings. Yes, there are offsetting costs to using plastic, but it isn’t as simple as “this brown, it must be natural and therefore good!” And while we’re on the topic, brown M&Ms are stupid. There’s a layer of white sugar between that brown outer layer and the actually brown chocolate. Brown M&Ms are as unnatural as any of the other colors.

Should I buy local? Maybe if you live in California, but not if you live in Massachusetts. The biggest environmental impact of food is growing it; plowing fields, planting, watering (outside where the water could just evaporate!), and harvesting use a lot more energy than transportation. So if you live in a place with poor growing conditions, then buying local only does more harm. That said, fresh food tastes better, so by all means pay the cost if you value the flavor, just don’t delude yourself into thinking you’re reducing energy usage by doing so.

Consider opportunity cost and present value! So you’ve got a solar panel and now electricity is free for the next 20-30 years! Or you’ve installed new modern insulation for your home. Or you bought a car that costs less to run (and you’ve promised not to increase your usage). But at what cost? If your solar panel used 40 years worth of energy to build and install, then you’ve done more harm than good. And you’ve done that harm upfront. Even if one of these investments has a positive return (it saves more resources than it uses), you should still consider whether it’s a good investment. We don’t have unlimited resources, and that means that if you spend $10,000 on insulation that will give you a 0.4% ROI then you’ve given up the chance to invest that money into something that will generate more good.

Another example of double-speak: This is what happens when Time Warner Cable is forced to compete

Adam Magoon Current Events, Economics, Law, Liberty , , , , , , , , ,

This is what happens when Time Warner Cable is forced to compete

Such a laughable headline when government regulations are what caused the cable/telecom monopolies in the first place.

“This report admits that in the days when cable was challenging airwave broadcasters, regulators “did not hesitate to grant exclusive franchises to cable operators”4. It speaks specifically of a long history of successful regulatory lobbying by the cable industry. This report claims that lobbying of regulators resulted in a variety of tactics to deter competition (p. 35). It claims that regulators protected and favored cable incumbents for years. Licensing policies have directly or effectively barred competition in many local markets (p. 44). Such practices are no longer official, but cable companies still succeed in enlisting the help of regulators to bar direct competition (p. 44). Incumbent cable companies have also gotten regulators to use “level playing field laws” to increase the costs of entering the cable market (p. 45). Cable companies have also saddled new competitors with disproportionate shares of subsidies for public education and government programming (p. 45). The cable industry has also succeeded in getting the FCC to quash new competitors with prices for leased access no competitor “could pay and remain commercially viable” (p. 47).”

Much like the drug law argument I talked about last week this is another example of people lauding governments for solving problems that the government itself is responsible for.  We need to look beyond the double-speak and identify the underlying issues at hand.  In this case government privilege granted to favored corporations.

Small Town Exhibitionism

Jacques Delacroix Current Events , , , ,

I have had plenty of nasty things to say about the People’s Green Socialist Republic of Santa Cruz where I live. (I remain here for two reasons. First, its superb ocean sites, second I like to stay close to the enemy where I can keep an eye on it.) There are also some nice things to say about the town.

First, street musicians abound here, on weekends but also on any warm evening. I always give them money, sometimes if only so they may take music lessons. Incidentally, this is also a town with an immensely rich musical life after dark. I am mostly asleep at that time but I sleep pleasantly in the knowledge.

Second, there are many murals about. I hate a few of them but they are not the ones that show People’s Heroes in the 1920′s Bolshevik style, as you might expect. They are the ones done in simplistic fake-childish style, according to an old-man’s cliché-filled unimagination about childhood. I won’t name him because I can’t afford the lawsuit right now against a man who is successful enough to be becoming rich on my local businesses stubborn bad taste. (I am still awaiting the fat oil company check promised to me because I “deny” global warming!)

Third, this is a town with not one, not two, but three bookstores. Everyone can buy his books on Amazon after I am gone, as far as I am concerned. In the meantime, I want the eye candy of rows after rows of new books. I do my small share by agreeably paying the couple of dollars more per book the privilege costs me.

Fourthly this is a university town with many restaurants although I would call few of them very good: It’s hard to maintain high culinary standards where your average cook is a Mexican who has not idea of what the food he prepares is supposed to taste like and the average diner is 23 and has never tasted anything beyond burgers and pizza.

Fifthly, there is much arresting street spectacle on nice days. A couple of days ago, on a sunny morning, a young man is walking up the main drag with his skateboard in one hand, his laptop in the other, and his plastic cup of coffee in his teeth. Dynamism, athleticism, intellectualism, and resourcefulness all rolled into one person, a sight that makes you smile.

Then, two teenage girls also walk by. One, the busty one, is wearing a tight white t-shirt with yellow bananas printed and the word “bananas” in black in several places. She is carrying her purse against her chest in a futile attempt to cover up. I am guessing she was feeling very brave this morning in her room, choosing her daring-vulgar clothes. Then, she walked on Pacific Avenue, crossing paths with dozens of guys, eye rapists each and everyone of them. I wonder if she is thinking that Mom is right, some of the time.

By the way, how I am longing for a no holds-barred debate between women on relentless female exhibitionism! It would go a long way toward countering the pernicious feminist simplification that has dominated our culture for two decades. I wouldn’t get involved in such a debate, I am too smart for this. I wonder though why it is that at the gym, all men who wear shorts were long shorts while all women who wear shorts wear short shorts. Go figure!

A taste of local flavor: Remington Outdoor Company to announce major expansion to Huntsville

Adam Magoon Current Events, Liberty, Politics , , , , , ,

Remington Outdoor Company to announce major expansion to Huntsville

“The site will rank with ROC’s largest facilities. Ilion, N.Y., is home to the largest facility at more than 1 million square feet, followed by other sites such as its ammunition plant in Lonoke, Ark., and its factory in Mayfield, Ky.

Sources say manufacturing operations in Ilion will not be affected by the expansion and there are no plans to move manufacturing from that site, where Remington has been building firearms for nearly 200 years.”

I have to wonder how much Governor Cuomo’s anti-gun policies contributed to this decision.  We will see if Remington holds true to their word but this author is predicting the Ilion factory to be gone in the next five years.

I would also like to suggest that any New Yorkers check out this page for information on anti-gun restriction protests happening this spring.  While they are not a libertarian organization there is some semblance of solidarity.

Around the Web

Brandon Christensen Current Events, Links, Philosophy , , , , , , , ,
  1. Missing from President’s Day: The People They Enslaved
  2. The Left Still Harbors a Soft Spot For Communism from Cathy Young at Reason
  3. Tyler Cowen on practical gradualism vs. moral absolutism, for immigration and revolution; see also Dr Delacroix’s very relevant “If Mexicans and Americans Could Cross the Border Freely” article [pdf] in the Independent Review
  4. Writing in the Wall Street Journal, James Freeman reviews the results of Obama’s stimulus package five years on
  5. Theologian and philosopher Eric Hall on Confusing Confucianism with Collectivism

Thousands of Connecticut Gun Owners ‘Flout’ New Registration Law

Adam Magoon Current Events, Liberty, Politics , , , , ,

THOUSANDS OF CONNECTICUT GUN OWNERS ‘FLOUT’ NEW REGISTRATION LAW

The most prescient point from State Senator Tony Guglielmo is “I honestly thought from my own standpoint that the vast majority would register.” He then added, “If you pass laws that people have no respect for and they don’t follow them, then you have a real problem.”

It seems that in many cases the average person is more libertarian than they realize.  Or to use the phrase provided by pseudo-libertarian author Robert Heinlein:

“I am free, no matter what rules surround me. If I find them tolerable, I tolerate them; if I find them too obnoxious, I break them. I am free because I know that I alone am morally responsible for everything I do.”

Italy overturns ‘absurd’ drug law equating marijuana and hard drugs

Adam Magoon Current Events, Liberty, Philosophy , , , , , , , ,

Italy overturns ‘absurd’ drug law equating marijuana and hard drugs

The title really gives all of the details. Libertarians are usually quick to celebrate these kinds of liberalizations of government authority but I always take these times to reiterate and oft forgotten fact.  Italy has not “given more rights to drug users”.  I hear this so often and strangely enough almost universally from more “left” policies such as gay marriage “Massachusetts has given the right to marry to homosexuals.”  This is a blatant misrepresentation of the truth.  The right of self-ownership is universal and each and every person already has the right to consume any drugs they please or to marry whomever they choose.  Government action has taken away those rights and them removing that restriction is not the same as giving away rights.  Rights cannot be granted, they are innate and inalienable.  Rights can only be removed by force.  Two forces in this world deny rights to others.  Criminals and the Government.  Most libertarians do not make a distinction between the two.

What’s up with decentralization (“Administrative Unit Proliferation”) in Uganda these days?

Brandon Christensen Current Events , , , , , , , , , ,

I just came across a fascinating new article on decentralization by two political scientists. Here is the abstract:

Numerous developing countries have substantially increased their number of sub-national administrative units in recent years. The literature on this phenomenon is, nonetheless, small and suffers from several theoretical and methodological shortcomings; in particular, a unit of analysis problem that causes past studies to mistakenly de-emphasize the importance of local actors. We posit that administrative unit proliferation occurs where and when there is a confluence of interests between the national executive and local citizens and elites from areas that are politically, economically and ethnically marginalized. We argue further that although the proliferation of administrative units often accompanies or follows far-reaching decentralization reforms, it likely results in a recentralization of power; the proliferation of new local governments fragments existing units into smaller ones with lower relative intergovernmental bargaining power and administrative capacity. We find support for these arguments using original data from Uganda.

The article is by Guy Grossman & Janet Lewis and it’s fascinating. Read the whole thing. I found one especially interesting argument that I’d like to mull over (the piece also produced a couple of off-topic questions in my mind). Grossman and Lewis argue that the process of decentralization first undertaken by rebels-turned-politicians has actually led to a recentralization of power in Uganda. From page 33:

Turning to political dependence, in recent years local government officials are increasingly appointed by the center, rather then [sic] being elected. Most dramatically, a 2008 amendment to the Local Government Act stripped from the directly elected District Chairperson the power to appoint the Chief Administrative Officer (CAO) and other senior level administrators. Instead the central government’s Public Service Commission was granted the power to appoint senior level administrators, who are assigned to districts by the Ministry of Local Government. The 2008 amendment has, in effect, put the entire technocratic arm of the district under the purview of the central government rather than the district’s elected political leadership.

So what is happening in Uganda (and, according to authors, elsewhere in the developing world) is that more and more administrative units (think counties or states in a US context) are being produced, but that this is actually making the executive branch stronger rather than weaker. Does this make sense? If not, you know where the comments section is.

I find this process of decentralization fascinating, largely because I think it is more conducive to freedom (in the broadest possible sense) and as a result produces more economic prosperity (see my pieces on secession within the US, EU). What I had not accounted for was the fact that decentralization could actually make it easier for a tyrant to control a swath of territory. So naturally I had to ask why this recentralization has come about.

The answer, I think, is on page 35 of the same article:

Since the late 1980s, key players in the international development community—such as the World Bank and USAID—have encouraged developing countries to implement far reaching decentralization reforms.

So foreign aid is probably the cause of loss of local power, but also the catalyst for such decentralization in the first place (by bribing post-colonial governments to decentralize; but what about ideology? From what I can tell, the rebels who set up Uganda’s new government were committed to decentralization in order to maintain peace between tribes and limit power of the center, rather than to get money from Western lending institutions).

Let me try again. Decentralization became all the buzz in development circles after the collapse of the Berlin Wall. Western lending institutions began paying governments when they decentralized. However, there may have been an indigenous drive for devolution that is overlooked here, and this drive may have been overpowered by the bribes given to governments by Western aid donors. This clash – between Western donors and indigenous attempts to assert sovereignty while integrating into the world economy – is what I think would be worth exploring further.

There is also the issue of economic prosperity. While decentralization may have led to a recentralization of power in the post-colonial world (I am not convinced that decentralization is to blame; I think foreign aid is largely responsible for the inability of developing states to fully decentralize), I am inclined to argue that decentralization has also led to a dramatic decline in poverty levels.

I mentioned the halving of global poverty a couple of days ago, and this decline, coupled with the increase in decentralization, suggests that the libertarian impulse to decentralize power structures does lead to wealthier, healthier societies. So with the dramatic increase of world prosperity in mind, I have to ask if the recentralization efforts of governments are given too much weight in the Grossman & Lewis paper.

I am sure that decentralization has not been perfect. I am sure that decentralization has left many people who supported it deeply unsatisfied. What I am less sure about is that supporting the status quo (that is to say, prohibiting decentralization by any means necessary) would have been a better option than the one post-colonial states have been pursuing for the last twenty years. It seems to me like the process of decentralization has been a good one, all things considered.

So, now that I have made it known that I think foreign aid is to blame for the (perceived) recentralization of power in Uganda, and now that I have made it known that I think decentralization has been more good than bad for people, what do I think needs to be done to address the problem of recentralization that Grossman & Lewis argue is occurring?

My quick, lazy answers are 1) create a Senate, and 2) keep liberalizing the economy.

There are other, supplemental prescriptions (such as ensuring property rights protections are strong; this is probably best handled by integrating indigenous property laws with generally agreed upon rules governing world trade; in this respect, African states that were a part of the British Empire generally do a great job, and the failures of these states can largely be attributed to protectionist policies after decolonization), but I think my lazy answers are more straightforward, and would get better results (at least in the context former British colonies). (h/t Joshua Keating)

The Republican Proposal on Illegal Immigrants and, the French Are Coming

Jacques Delacroix Current Events, Politics , , , , , ,

I am responding to a Republican radio and TV ad about illegal immigration. It’s presented as the Republican counter-proposal or response to Pres. Obama demand for “comprehensive immigration legislation.” It displays involuntarily some of the main fallacies Republicans commonly entertain in connection with illegal immigration and other topics. It demonstrates disturbing collective ignorance in my camp. (I am a registered Republican.) Here are four major fallacies in that short ad:

1 The ad continues to be based on the false notion that there exists an alternative to illegal immigration in the form of some orderly visa queue. In this perspective, illegal immigrants are rude, unprincipled line jumpers. Everyone hates such people.

In fact, there is no such queue. The average unmarried Mexican has no way (zero) way to come live in the US legally. (An unmarried Mexican can try to marry a US national or legal immigrant to gain a quick visa. Some do. This is hardly a more principled way to immigrate into this country than overstaying a tourist visa, for instance.)

2 The Republican proposal demands “no amnesty.” The Republican proposal contains an amnesty: amnesty for those who entered the country illegally. It rewards those who took the matter into their own hands against other foreigners who would like to move to the US but do not wish to violate laws to do so. Again, illegal immigration is the only way to enter the US and stay for almost everyone in the world.

There is no way to regularize the status of current illegals living in this country without an amnesty of some kind. I predict that neither the federal government nor the individual states will ever engage in the massive police action that would be required to hunt down illegal aliens in their homes, places of work, churches, and schools (including kindergartens). Everyone else also knows this to be true. Republican leaders have yet to acknowledge this simple fact of life.

3 The Republican proposal would require illegal aliens to “learn English” as a condition of their legalization. This is ill-informed as well as downright stupid.

First, illegal aliens are very busy learning English. They are all aware of the fact that knowing the main local language is a condition of real economic success in this country. To say otherwise is to make a tremendously xenophobic statement by implicitly calling immigrants stupid. That’s in addition to ignoring the facts on the ground.

Second: What are we going to do with Juan if he flunks his English midterm? Throw him over the border? How about Mr Lee, who has been here (illegally) for fifteen year and who owns a restaurant employing six people? Do we ship him back to Canton if he gets two C- in a row on his English grammar test?

Plus, what is the federal government going to do when some ill-intentioned academic reveals that a significant percentage of American-born US citizens also flunked the midterm, the same midterm?

Is this “obligation” to learn English, specifically, even constitutional? The last time I checked, the US had no official language. Why not Navajo?

This all smacks of the insane dreams of comfortably monolingual individuals who believe they would master Spanish if they could only clear a dozen Saturday mornings. Do these people take advice from anyone? Do they read anything?

4 “Securing the border” has become a mindless Republican incantation. It’s increasingly irrelevant for the purpose of immigration control, at least closing the southern border is. Several relevant points. At them same time as we were having our endless economic crisis killing thousands of jobs, the Mexican economy was doing better than before. And, Mexican population growth has almost ceased. The huge hordes of hungry Mexicans massed at the border to jump in and take over everything American have evaporated. Mexicans have almost stopped coming. Those who do use a student visa or a tourist visa and just don’t go home until they are good and ready.

Securing the border may serve a purpose in the context of a drug war. If that’s the issue, Republicans should have the coraje (same as “cojones” but more polite) to tell the truth.

And now, what the Republican leadership is not doing or not doing enough: Shout to the rooftops that legalizing illegals and awarding them citizenship are only artificially linked (by artful Democrats seeking free votes for generation). European countries have established successfully for many years the fact that citizens of another country can live in forever without acquiring political rights at all. (A recent well publicized Swiss vote on immigration does not deal with this matter.) Fellow immigrant Nikiforov and I explored this idea in depth in connection with the US and Mexico in our article “If Mexicans and Americans Could Cross the Border Freely” featured in the libertarian journal Independent Review.

Here is a real immigration issue the Republican leadership is not attending to: Tens of thousands of younger French people want to move to this country. The issue is so serious that there is a brand new French cabinet post dedicated to stemming the flow. Many of the would-be French migrants possess to a high degree the kind of training Silicon Valley companies say they can’t find. Many of the same well-educated French citizens who wouldn’t dream of opening a lollipop stand under French conditions discover that they possess a big entrepreneurial gene a couple of years after landing here. Let me also point out that the quality of food improves automatically after a surge of knowledgeable and demanding French customers. (Yes, some stereotypes are well founded.)

At this point, there is no legal way to bring in these high quality immigrants. Our immigration system is forcing into illegal immigration the most determined and least law-abiding segment among exactly the kind of immigrants we want.

Wait, what?!

Rick Weber Current Events , ,

There won’t be a MotoGP race at Laguna Seca this year and here’s why…

Unlike COTA and IMS, which are both privately owned, Laguna Seca is a non-profit operated by the Sports Car Racing Association of the Monterey Peninsula (SCRAMP), on property owned by the Monterey County parks department. This unique status disqualifies the facility from accepting large government subsidies available to tracks like COTA and IMS–the latter which reportedly received $100 million in state grants this year for track and facility upgrades to secure major events like MotoGP. “We can’t compete with that,” Campbell told the Herald. “Here, there are no tax credits or state subsidies.”

Hasta La Vista, Laguna Seca, Motorcyclist, January 2014

So the non-profit on public property isn’t eligible for subsidies but private tracks are?!

Из американских школ – в российские

Evgenii Grigorev Current Events ,

Привет, друзья! Сегодня расскажу вам про одно событие, которое произошло в Москве на прошлой неделе, и которое достаточно сильно освещалось в новостях. Я думаю вы не найдете в нем ничего экстраординарного, но для русского человека это нонсенс. Речь пойдет о стрельбе в московской школе, которую устроил один из учеников. Он принес в школу ружье, застрелил учителя географии и взял в заложники учеников. Потом застрелил одного из приехавших полицейских и тяжело ранил другого. Через некоторое время, после того как район был оцеплен и к месту происшествия приехал отец стрелка, бандит сдался.

Я знаю, что подобные ужасные события довольно часто происходят в США. Обусловлено это в первую очередь более доступным оружием, а во вторую, и наиболее интересную для меня очередь – менталитетом американцев. Точнее даже не американцев, а “не русских”, так как подобные расстрелы случаются не только в Америке, но и в других странах. В России же это первое подобное происшествие на моей памяти.

Не будем рассуждать об оружейном лобби, о “сложных подростках” и переходном возрасте, о высокой школьной нагрузке накануне поступления в высшие учебные заведения, а также о том, каким образом подросток смог достать оружие (по информации из средств массовой информации, он сумел раздобыть ключи от сейфа, где его отец хранил огнестрельное оружие). Вопрос сейчас в другом. Кстати, чтобы вы примерно представляли ситуацию с личным огнестрельным оружием, приведу пример: мне почти 27 лет, и за свою жизнь я держал в руках настоящее боевое оружие, которое может убить, только один раз – и то на охоте. Ни у кого из моих многочисленных друзей и знакомых нет пистолетов и ружей. При этом я не учитываю пневматическое, газовое и прочее “не смертельное” оружие, хотя для его приобретения необходимо собрать большое количество справок и документов. Так что можете понять – огнестрельное оружие у населения России – это скорее “исключение из правил”, чем “факт”.

С древних времен, в силу исторического развития и особенностей менталитета, русский человек привык терпеть. Таторо-монгольское Иго, несколько столетий терроризировавшее Русь, блокада Ленинграда во Вторую Мировую Войну, и всякие другие исторические события. Терпеливость эта обусловлена не слабоволием, а наоборот силой характера, которая в совокупности с ленью, которая к сожалению характерна для нас, приводит к тому, что русскому человеку проще перетерпеть негативный момент в жизни, чем попытаться его как-то решить. Отсюда и получаются всевозможные неврозы, кстати… Большое влияние на формирование этой терпеливости оказывает и христианская религия, которая вменяет долготерпение и непротивление в достоинства личности. Думаю многие знают, что я по натуре своей атеист, так что мои размышления о религии в общем не стоит воспринимать как “истину в последней инстанции”. У меня свое мнение, у верующих – свое.

Дополнительно накладывается и миролюбивость русских, которая в совокупности с тем, о чем я рассказал выше, приводит к неожиданным результатам. К слову, под миролюбивостью я имею в виду именно нежелание решать конфликты силовым методом. Видимо тоже влияет северный нордический характер… Однако это не мешает миролюбивым русским быть зачастую неприветливыми с незнакомцами. Это совершенно другой вопрос.

Зачастую, как и всем остальным, нам нужно выплескивать свои эмоции. Однако “миролюбивость” – это сдерживающий фактор. Не желая причинять зло окружающим, русский человек идет по пути саморазрушения: алкоголизм, наркомания, суицид. Хотя в большинстве случаев сила характера позволяет нам выпутаться из морального лабиринта не причинив себе вреда.

И я не понимаю, что должно было измениться в мире, чтобы русский ребенок взялся за оружие и пошел убивать людей, будучи не в состоянии самостоятельно решить свои проблемы.

Obama: “I can do what I want”

Adam Magoon Current Events, History, Law, Liberty, Politics ,

Obama: “I can do what I want”

Let us contrast this to the president that the founding fathers of America intended.   As Alexis de Tocqueville put it in the early 19th century, the president “has but little power, little wealth, and little glory to share among his friends; and his influence in the state is too small for the success or ruin of a faction to depend upon his elevation to power.”

How far we have come…

California’s Environmental Mal-Litigation

Fred Foldvary Current Events, Economics, Law , , , , , ,

The worst intervention by governments, aside from aggressive war, is excessive litigation. Taxes are burdensome, but they are predictable. The reason that enterprises are not entirely crushed by taxation is that much of the tax burden is at the expense of land rent, so it ends up destroying the economy’s surplus, but not totally wreaking the economy. Regulations act as a tax to impose costs on enterprise, and much of the cost is passed on to workers and the public, so they make us poorer but don’t totally stifle the economy. Subsidies create distortions that generate inequality and the boom-bust cycle, but subsidies is what politics is all about. The worst intervention, that does the most to crush enterprise and employment, is vicious litigation.

A prime example of litigative intervention is the California Environmental Quality Act. CEQA is codified at the Public Resources Code Section 21000 et seq. As California’s web site for CEQA states, “Most proposals for physical development in California are subject to the provisions of CEQA.” The “frequently asked questions” web section explains that “CEQA is a self-executing statute.” That means that “its provisions are enforced, as necessary, by the public through litigation and the threat thereof.” Past court cases can be seen on the web site of the California Natural Resources Agency.

As described by a “Schumpeter” blog article in the 25 January 2014 Economist, “The not so Golden State,” this law “has mutated into a monster.” Anybody in California may file a CEQA lawsuit against any project using environmental protection as an excuse. The plaintiffs win half the cases. If someone sues a company and loses, the defendant still has to cover his legal expenses. Many of the lawsuits under CEQA are also against governmental development projects and against permits by local governments to enable private development.

Suppose a developer seeks to build an industrial park. If he hires non-union workers, the union attacks with a CEQA lawsuit. So the builder hires expensive union labor. Suppose someone owns a gasoline station, and a competitor wants to set up a station nearby. The station owner stops the potential competitor by filing a CEQA case. In 2011, there were 254 “California disinvestment events,” in which companies employing more than one hundred workers either left the state or expanded in another state rather than in California. This is estimated to have gotten worse in 2012 and 2013.

The litigations and regulations of California fall hardest on manufacturing. California’s high sales tax and low property tax also induces cities to favor retail stores over manufacturing. Hostile policies in California are largely responsible for the flight of manufacturing to other states and to foreign countries. As noted by the Economist article, electronic devices are designed in “Silicon Valley,” the region from San Francisco to San Jose, but manufactured in Asia. Some environmentalists realize that CEQA does little to protect the environment, but attempts to reform the law have stalled. The frivolous lawsuits reward lawyers, unions, companies seeking to stifle competition, and “not in my backyard” opponents of development.

Litigation is the worst way to handle social problems. Lawsuits impose unpredictable and expensive costs on enterprise. Such laws let opportunists exploit legitimate job-creating industries. Excessive litigation is further rewarded by making the winning defendants of lawsuits have to pay their legal costs. We then get excessive malpractice suits that force doctors to buy expensive insurance. Federal and state laws that enable litigation for job and housing discrimination and environmental protection end up enriching lawyers who get much of the gains.

The best ways to handle environmental destruction is with covenants and easements, along with a liability rule for damages. If some development harms the natural environment, then the government assesses the damage, and the polluter pays for the damage, either as a one-time charge or as periodic payments for on-going pollution. Developers know in advance that they are liable for damage, and so they would have the incentive to prevent the payment by doing their own environmental assessment. The issue would be between the developer and the state, without involving attorneys and court costs.

Economic theory has recognized for the past hundred years that the optimal policy for pollution is a charge paid by the polluters, passed on to the customers, fully compensating society for the damage. That can be done by a pollution tax.

English common law traditionally provided law-suit protection against potential negative effects and damages to one’s property. Litigation can be a useful enforcement and restitution tool, but it has to be within a sensible legal system. In the English tort system, if a plaintiff loses a law suit, the loser has to pay the legal costs of the winner. So if a company sues another firm just to stifle competition, using the environment as an excuse, and that company loses the lawsuit, then that company has to pay the legal costs of the winning competitor. That would stop frivolous or phony law suits. And that is why the lawyer lobby will stop such a legal reform in the USA.