Tabarrok on “Bernanke vs. Friedman”

Alex Tabarrok has a very flattering post at Marginal Revolution about my 2011 article,  “Ben Bernanke versus Milton Friedman: The Federal Reserve’s Emergence as the U.S. Economy’s Central Planner.” It seems that the President of the Richmond Fed has independently just made a similar argument.

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Gun control: Centralized vs. Dispersed

Hayek made the point that the debate of whether to have central planning was not over whether or not there would be planning, but over who would plan for whom. This point has an analog in the debate over gun control. The option is not between reason and chaos, but between centralized (and therefore bureaucratic) control and decentralized control.

Just because you (i.e. your ideals as embodied in the Democratic National Convention) aren’t in control, doesn’t mean that nobody is. A decentralized gun control regime is one where individual gun owners are responsible for securing their weapons and criminals are responsible for crimes they commit. Will mistakes be made? In the imperfect world we live in that’s almost a certainty. Will the results be worse than one with government gun control? That’s an empirical question. Political gun control will raise the cost of getting guns, but it will also raise the relative criminal effectiveness of guns. It will save some lives but will also cost some. There will probably be fewer accidental deaths and suicides, maybe fewer crime-of-passion murders, but likely more “kill the witness” murders. If the penalty for using a gun in a crime is high, then the relative cost of killing a witness is low (for example, adding a life sentence for murder on top of a 30 year sentence for armed robbery is like getting a 30-year off coupon on that life sentence).

With 3D printed guns on the horizon (to say nothing of the “dangerous” lack of regulation of machining tools!) an effective political gun control regime would have to expand to all manner of regulation. This regulation would cost a lot! But, one might object, mere money is not worth as much as the lives that might be saved. But it’s not embossed portraits of dead white men that’s at stake. I don’t think we should let economists play God, but I think there is something to economists’ activity of considering what we might be willing to give up for a life.

Money is a medium of exchange; it’s not the end, just a tool we use to make life easier. The cost of regulation is real human well-being, time, and effort foregone. Taking someone’s money prevents them from spending it on what they otherwise would have. It also discourages them from investing further effort into producing something valued by others. Regulation also takes people’s (irreplaceable!) time; saving someone’s (irreplaceable) life provides some moral justification for this, but the cost must be acknowledged.

If (if!) there is a benefit to political gun control (that is if we judge the lives lost under a decentralized regime as morally superior to those lost under a political regime), then we should still consider the cost. In any case, we should all stop using the term “gun control” when we mean “political gun control.” A problem defined is a problem half solved, and the blanket term “gun control” mis-defines the problem.

Around the Web: Nobel Prize Edition

I just got three of them.

  1. Why we need to separate the central bank from the monetary authority.
  2. “Market Design”
  3. Noble Matching.

Maybe one of our in-house economists can share their thoughts on the award this year as well…

A Few Good Debates

I have often thought that debating other people is just as good (if not better) for learning about other how other people think (and imagine things) as reading a book on a subject.  In this spirit, I thought it’d be cool to point out some of the great debates I’ve had a pleasure of being a part of either though participation or simply as an observer.

Cato Unbound is by far the best place to go if you want to get a good, scholarly, but still colloquial, debate on a topic.  This month’s lead essay is on ‘Bleeding Heart Libertarianism’ and features responses from a number of prominent academics.  I highly recommend taking some time to read through the whole symposium.

Over at the blog Coordination Problem, economist Steve Horwitz takes a grad student (Daniel Kuehn) out for a beating in the proverbial woodshed in the ‘comments’ section.

Again in the ‘comments’ section, I take Jacques Delacroix to school on matters of foreign policy and the law.

And at MarginalRevolution, co-bloggers Tyler Cowen and Alex Tabarrok go at it on banking institutions.  Here is Part 1 (by TC), Part 2 (AT), Part 3 (TC), and Part 4 (AT).

All of these are tough reads with lots of top scholars debating big ideas (save for me, though Jacques is a world-renowned scholar on international trade and development), so you might want to come back to this post and click around a little bit at a time.  All of the debates are highly, highly recommended.

Oh, and the Mises Institute has their new blog up and running (it’s very good): The Circle Bastiat