Dr. Delacroix recently e-mailed me the following chain. I thought I’d reproduce it here since most of my e-mail contacts are from school and I use it get laid rather than to argue about politics. I don’t agree with everything Buffet says, of course, but when somebody says something smart or thoughtful, I’ll take it into consideration no matter which quadrant of the political section it comes from. The chain is below the fold. Continue reading
Politics
States and Secession: Lamenting the Failure of the Euro Zone
The Guardian has a so-so map on secessionist movements in Africa that’s worth checking out. I say it’s only so-so because it doesn’t really cover all the secessionist movements in the region, just the violent ones or the ones favored by Western diplomats.
I’m interested in secessionist movements because of the effects that they have on nationalism, one of the most dangerous ideologies to haunt mankind since the industrial revolution. Nationalism is probably worse than racism, or at least on par with it, when it comes to ideas gone horribly wrong.
That’s why I support free trade between states, and the deeper the better. The true tragedy of the EuroZone crisis is not the inevitable and predictable collapse of the euro but the fact that anti-liberal policies like the central bank and more political integration between states (and away from the people) are being misconstrued as liberal, in the classical sense.
The smaller the states the better, and the freer the trade the better. Mexicans should be able to travel and live in the US and Canada the same way that Nevadans are able to travel and live in California. The EuroZone could have been beautiful, but the pressure for a central bank and more control from a center, in Brussels, has probably ended it. It’s a good primer on how beautiful ideas often don’t pan out the way people would like them to.
Here’s how to fix the EuroZone crisis:
- Eliminate the monopoly of the central bank on creating money and credit.
- Open up the EuroZone market to more goods from the rest of the world (especially agricultural products from developing states).
I also think it’d be a good idea to keep Brussels as limited as it is. Doing so will not only allow more room for local policies to be experimented with and tested against other policies, but it will continue to erode the nation-state as well. What we were seeing prior to the crisis in the EuroZone is more calls for autonomy from state capitals throughout the EuroZone, and a powerlessness on the part of states to do anything about it.
So instead of France and Spain, two states, the world may have seen up to five or six states in their stead, all interacting with each other economically while retaining nominal political independence from each other.
What a shame.
US Military Spending
Over at Democracy in America, Roger McShane wonders aloud:
But I say the situation may be worse on the left, because if Democrats do not make the case for seriously cutting back military spending, who will?
He is speaking of course, of the so-called “cuts” to spending undertaken by the Obama administration. I put “cuts” in quotes because, well:
The cuts Barack Obama has pushed (outside of sequestration) are meager, despite what you may hear from Republicans. They are cuts to a ten-year plan that assumed annual increases. As Christopher Preble of the Cato Institute notes, “Over the next decade, the Pentagon’s annual base budget (which excludes most war costs) will average $517 billion in constant 2012 dollars, 11 percent higher than what Americans spent during the George W. Bush years.”
Jacques Delacroix seems to believe otherwise. In March of this year, he wrote:
In connection with Pres. Obama’s then-recent speech on cutting the US military budget, Paul also said clearly that those are cuts in increases to military expenditures, not absolute cuts. As one who has been reading the Wall Street Journal for the past thirty years and also for the past thirty days, I tell you that this is not true. I think it sounded good at the time so, the Congressman just said it, irresponsibly.
Dr. Delacroix is a numbers man (that’s how he earned his infamy), but with his track record on foreign policy I’d take his argument with a grain of salt.
At any rate, it’s nice to see the non-interventionists on both the Left and the Right get a shout out from the Economist (a supporter of the Second Gulf War), too:
And while the Republicans at least humour the Ron Paul-wing of their party, the Dennis Kucinich-wing of the Democratic Party has no voice in Charlotte.
Imperialism: the bane of free trade and individual liberty. Is it any wonder that Washington has so many enemies these days?
Sex: Real Dopes
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
The Economic Recovery: Jobs Edition
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.
Friedrich Hayek: Champion of Liberty
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.
The Oppression of American Labor
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
Breakfast Spoiled by “Liberal” Paean
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.
Fact-Checking Politicians
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
Class Warfare, Then and Now
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).
Election Reform: a Modest Proposal
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:
- Raise the voting age to 30
- Disqualify all government employees and all recipients of any government entitlement: social security, medicare, etc.
- Adopt a stiff qualification exam, to be re-taken every five years
- Mandate a poll tax sufficient to cover election expenses
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.
Ron Paul’s Legacy
Ron Paul will not get to speak at the GOP convention, but his legacy will hard to miss over the next decade of American politics. His son is now a Senator in Kentucky, and his Audit the Fed bills have lots of bi-partisan support (in the House anyway; Senators, for some strange reason, seem to like the Federal Reserve an awful lot).
His foreign policy, which initially attracted me to libertarian ideas, is the most important legacy, however. I can tell because the GOP loathes it so much that they won’t give Congressman Paul the time of day they know they need for his support.
From Foreign Policy: Continue reading
From the Comments: Keynesian Economics and the Stimulus Bill
A recent brouhaha has erupted in the comments thread of Dr. Delacroix’s post on Obama’s bad economic policies. Now, to be sure, the bad economy cannot be put on Obama’s shoulders alone. All he did was sign the stimulus act into law, after all, and I doubt John McCain would have vetoed it.
Let us also not forget about the two foreign wars that George W. Bush charged to the republic’s credit card, either. With that being said, I thought another economic chart would do readers of this blog a favor. From AEI’s blog comes this:
Ta-dah! Utter economic failure.
Obama’s Economic Policies: What’s Wrong, in a Nutshell
People are overwhelmed by the avalanche of bad news, and of news in general. It’s difficult to stop long enough to summarize objections to the new economic policies fostered by Presidents Obama and Pelosi. Besides, if you tried, you might just strangle with horror and indignation. I made the effort. Here it is:
Pres Obama wants to re-distribute wealth when the amount of wealth available to re-distribute is dwindling. It’s never happened, I think, in any democratic, market-oriented country before. Normally, you wait for a period when wealth is growing.
Pres Obama insists on an expensive stimulus package that will do, and has done little to stimulate the economy. Keynesian economics is largely wrong. This is Keynesian economics at its worst. It’s not even defensible by Keynesian standards.
Pres Obama choses a severe economic downturn to force us as a nation to try and do things we don’t know how to do. This includes switching from proven energy technologies such as coal and petroleum-based technologies to unproven ones such as air and wind technologies. It includes also constructing a satisfactory national health system, something no country has done. Normally, whenever you try something new, you make mistakes. You need a margin of error. You need to be reasonably rich. You don’t want to do it on a tight budget or when you are close to poverty.
Pres Obama is not evil. He has something I have seen hundreds of times in academia: He knows what he thinks he knows and he does not know anything else. He is narrow-minded and dogmatic. The more intelligent the person, the more stubborn in his narrow-mindedness and in his dogmatism. A less intelligent person would have the virtue of self-doubt, “Wait a minute, am I doing the right thing?”
Perplexing: There is an international media consensus to the effect that the current global economic crisis was made in America. Yet, I detect no rise in anti–Americanism abroad. This would be a good time to be pissed off at us but, I don’t see it anywhere.
I wrote on this blog about “European Anti-Americanism.” I suggested it was mainly based on envy. Perhaps, I was right: Others like us better when we are down and hurting. What do you think?
Recently, I mentioned the sentencing of a 75-year old woman to a whipping, in Saudi Arabia. I promised that I would check for indignant reactions on the part of Muslims. I have seen nothing on the website of the American Muslim Council and nothing of the website of the Islamic Society of North America. I haven’t found anything either on French Muslim sites.
Of course, it’s disturbing. I would like it if someone told me that I am wrong and that I searched in the wrong places. I know I have Muslim readers. Get on your feet and do what’s right.
[Editor’s note: this essay first appeared on Dr. Delacroix’s blog, Bay Watch, on March 26th 2009]
Don’t Vote?
Philosopher Jason Brennan gives us a thought exercise concerning voting:
Imagine 12 people are serving on a jury in a murder case. The prosecution and defense present evidence and call witnesses. The court asks the jury to reach a verdict. They find the defendant guilty.
Suppose four of the jurors paid no attention during the trial. When asked to deliberate, they were ignorant of the details of the case. They decided more or less at random.
Suppose four of the jurors paid some attention to the evidence. However, they found the defendant guilty not on the basis of the evidence, but on wishful thinking and on bizarre conspiracy theories they happen to believe.
Suppose four of the jurors paid attention to the evidence. However, they found the defendant guilty because he is an atheist, while they are Christians. Like many Americans, the jurors trust atheists no more than they trust rapists.
Do read the whole thing to find out why voting in a mass democracy is not necessarily something that should be automatically assumed to be good (or to go to war over, for that matter).
Co-blogger Warren Gibson has a great take on voting as well.
Notes On Liberty 