"Reason" and "Division of Labour"

There is an interesting back and forth brewing between Reason and Division of Labour. Check it out here.

The Sub-Prime Issue in Everyday Terms

HT: Greg Mankiw

What You Can Get Me For Christmas

Classic.

To Protect, Serve, and Paint Big Bullseyes

Fark Headline: "In an effort to reduce crime, police are placing yellow tags on cars in shopping centers that have visible packages inside. Now potential thieves no longer have to look in every car - just the ones tagged by police"

How True . . .

Recent Fark Headline: "Congress prepares to take on credit card company practices because if there's anyone who's an expert on sound fiscal practices, it's Congress"

There's Always a Better Way to Waste Money

The EU has managed to, once again, demonstrate its unrivaled prowess in exercises of governmental stupidity: it is handing out money to lobbying groups so that those groups are on an equal footing with corporations - in terms of lobbying. That's right, the EU is giving the lobbyists the money with which the lobbyists lobby the EU. Stunning.

One note - apparently, Greenpeace was the only group that refused the money.

Enemies of Ethanol Round-Up

The Wall Street Journal has a nice round-up of all of the shots that are being fired across the bow of the Ethanol gravy boat. Worth the read, if you're interested in the issue.

First Amendment vs. First Amendment

Reason has an interesting post posing the question: Does the Freedom of Assembly Limit Freedom of Speech?

Economic Quiz

Greg Mankiw has posted this great video on his blog. I think it bears repeating:

This One's For You, Entrapping Innocent People in What Isn't Actually a Crime Police Guy

More darn fine police work, Lou:

"At first, an epidemic of absent-mindedness seemed to have broken out.

"One purse was found just sitting on a display shelf in the shoe department at Macy’s. Another one turned up downstairs, in Macy’s Cellar. Yet another rested on a chair in a Midtown McDonald’s, left by a woman who had stepped into the restroom.

"In fact, all three items had been planted by police officers in plainclothes during the previous six weeks. And the three people who picked them up were arrested, and now face indictment on charges that could land them in state prison.

"Nine months ago, a similar police decoy program called Operation Lucky Bag was effectively shut down by prosecutors and judges who were concerned that it was sweeping up the civic-minded alongside those bent on larceny. Shopping bags, backpacks and purses were left around the subway system, then stealthily watched by undercover officers. They arrested anyone who took the items and walked past a police officer in uniform without reporting the discovery.

"Now, a new version of the operation has started to catch people in public places outside the subways, and at much higher stakes, Criminal Court records show.

"Unlike the initial program, in which the props were worth at most a few hundred dollars, the bags are now salted with real American Express cards, issued under pseudonyms to the Police Department.

"Because the theft of a credit card is grand larceny, a Class E felony, those convicted could face sentences of up to four years. The charges in the first round of Operation Lucky Bag were nearly all petty larceny, a misdemeanor, with a maximum penalty of one year in jail.

...

"In dismissing one case, a Brooklyn judge noted that the law gives people 10 days to turn in property they find, and suggested the city had enough real crime for the police to fight without any need to provide fresh temptations. The penal law also does not require that found items be turned over to a police officer. The Manhattan District Attorney’s Office began to dismiss Lucky Bag charges."

Emphasis Added.

So, just to recap:

1. The NYPD comes up with a way to entrap people for petty crimes.
2. Program gets shut down both prosectuers and judges.
3. NYPD waits 6 months, then reinstates the program under a different name but with the extra added bonus that they're obtaining real credit cards using psuedonyms so that they can charge people with felonies.

Can someone remind me why I should vacation in New York again?

HT: Fark Headline

Business Models

TechDirt, which routinely has excellent articles about various business-related subjects (mostly dealing with the software, technology infrastructure, and music industries), has another gem regarding CEOs and business models. A summary would not do it justice, so it is reproduced here in entirety:

Of all the major record labels out there, it's been Universal Music, the largest record label out there, that has been the most vocal about its contempt for changes in the market place. In the past, we've mentioned that Universal Music CEO Doug Morris appears to be focused on squeezing every immediate dime out of anyone he can, even if it means destroying the company's long-term prospects. From an outsider's perspective, it really appeared as though he believed that giving up a dollar today was bad business, even if it meant the ability to get $100 in the future. However, it turns out that's not just the outsider's perspective. That's Doug Morris' own perspective as well.

In a stunning interview that should have any stockholders of Universal Music demanding a CEO change, Doug Morris happily reveals his ignorance of all things having to do with business, business models, strategy, economics and technology. It's hard to know where to start. When asked about giving up money now to be able to make more later, Morris tells the interviewer that if you do that, then "someone, somewhere, is taking advantage of you." This is the guy in charge of charting Universal Music's future? To further underscore his inability to think long term, Morris gets angry when discussing the fact that his job isn't easy any more, discussing how great it was when he could just sit back, not do anything strategic and just let he money pour in from high-margin CDs. Sure, that must have been nice, but your job as a CEO is to be able to see those changes ahead of time and set a course for the company to navigate them.

Not so, according to Morris. When asked why the recording industry was unable to see the change, Morris says that there was nothing he or anyone could have done (!!!):

"There's no one in the record company that's a technologist," Morris explains. "That's a misconception writers make all the time, that the record industry missed this. They didn't. They just didn't know what to do. It's like if you were suddenly asked to operate on your dog to remove his kidney. What would you do?"

Personally, I would hire a vet. But to Morris, even that wasn't an option. "We didn't know who to hire," he says, becoming more agitated. "I wouldn't be able to recognize a good technology person -- anyone with a good bullshit story would have gotten past me." Morris' almost willful cluelessness is telling. "He wasn't prepared for a business that was going to be so totally disrupted by technology," says a longtime industry insider who has worked with Morris. "He just doesn't have that kind of mind."

So why is it that Universal's shareholders would allow a CEO who gleefully admits he doesn't like to think strategically about the long-term, doesn't understand the forces that are changing the fundamental business he's in and doesn't even know enough to hire people who can help tell him what's going on?

To make matters even worse, Morris is so clueless that he chooses the worst possible analogy to explain his position. Lots of entertainment industry execs have thrown up their hands and ignorantly stated that "you can't make money from free." That's wrong, of course, but Morris takes it one step further up the ridiculous scale, with the following example: "If you had Coca-Cola coming through the faucet in your kitchen, how much would you be willing to pay for Coca-Cola? There you go. That's what happened to the record business." Hmm... and what is coming out of your faucet in your kitchen? That's right... water. And how much are people willing to pay for water? That's right, billions. In fact, it's a larger market than (oops) recorded music. Can someone please explain how Morris keeps his job?

Envinronmentalists

Heehee:

Uniquely Unqualified

As coercive monopolies that spend other people's money taken by force, governments are uniquely unqualified to solve problems. They are riddled by ignorance, perverse incentives, incompetence and self-serving.

From John Stossel's latest column, this time on global warming. Regardless of what you think about global warming, it is important to remember that if the government gets involved things will become significantly worse that they otherwise would be. This is an important distinction to make when talking to those who are commonly classified as "left wing": just because you oppose government intervention to solve a problem does not mean you don't think it is a problem.

For instance, when I suggest that the Public School System should be dismantled with the same enthusiasm shown by Canadians for clubbing baby seals, I am often met with some variation of the sentiment "But don't you care about children's education?" This is a false dichotomy. I believe that Public Schools help our nation's children far less than they harm. The fact that I do hate children is irrelevant. Far too often, libertarian objections to grandiose government schemes are dismissed with the retort that we don't care about children/whales/rainforests/working-class mothers/starving corn farmers, while the central-planner has his priorities straight and should, therefore, be trusted.

Some people view government as some kind of benevolent force that can counteract the self-serving interests of corporations and the free market. They think that because government is not accountable to market forces, it is above self interest. This is among the most dangerous ideas still widely accepted (the idea that burning children alive will ensure a rich harvest is currently out of favor). A government is made up of people, just like any organization. Those people work for their own betterment and interests just like anyone else. The fact that governments do not produce anything of their own and survive by taking from others is not a virtue, and it certainly does not ensure virtue in those who are employed by government.

When a corporation puts its resources behind a project it stands to lose those resources, and will do what it takes to protect them from being misused. A government, since it just spends other peoples money, will always through good money after bad, claiming that with a little more budget everything will work.

Ethanol - A Cute Picture

I saw this linked to by Fark a little while ago. I kinda like it:

"Economic Sclerosis"

Cato has an excellent post entitled "Treating Successful Taxpayers Like Pinatas" in which the author quotes another piece dealing with the inherent problem of a society wherein a large portion of the electorate does not pay taxes. I highly recommend reading it and even following up by reading the several pieces to which it refers.

Runaway Cows

I just don't know which way to go with this one. Should I make the "Cows With Guns" reference or the "Eat More Chiken" reference. Decisions, decisions . . . . .

Wilmington is Jealous of LA

Remember that post about the First Amendment in LA? Yeah, read this one about Wilmington. It's "better" :-)

HT: Fark

Those Poor, Poor Students Who Need Uncle Sam to Buy Their Condoms

I don't think commentary is really necessary on this one. It's pretty obvious what we here think of this kind of thing.

HT: Fark

Cotton Subsidies

The BBC has an article about US cotton subsidies in which the stupidity of government intervention in economic matters shines through pretty clearly:

"John Negroponte was defending ongonig subsidies on US cotton growers during a visit to Burkina Faso, in west Africa.

"The country is Africa's leading cotton grower, although it produces just 6% of the amount of cotton the US does.

"The region's small farmers complain that they must compete against highly mechanised, well-subsidised US rivals."

Now, just as an aside, I would like to point out that the complaint that the farmers of Burkina Faso not being able to compete against mechanized US firms is, well, stupid. Granted, they have a legitimate complain when it comes to subsidies, but with regard to mechanization (unless this wouldn't have happened without subsidies) is just dumb.

Anyway! The article continues:

"He said the US had worked to promote cotton farming in Burkina Faso by providing aid funds to finance increased production and marketing."

So, unless I'm missing something, first the government uses tax money to subsidize an industry (offense #1) then takes more tax money and sends it to the competitors of the people it subsidized with the first batch of tax money so that they can be more competitive. Brilliant! Simply Brilliant!

The Unadulterated Socialism of Warren Buffet

Read about it here.

S-CHIP: It's for the Children!

Next time you hear an annoying piece of rhetoric about how anyone opposed to S-CHIP doesn't want kids to have health care, remember these interesting tidbits that Cato was kind enough to dig up:

"Currently, 12 states currently use S-CHIP funds to provide taxpayer-funded insurance for adults. According to data released by the Department of Health and Human Services in July, Wisconsin covers almost twice as many adults as children — and spends 75 percent of its S-CHIP funds on them. Minnesota spends 63 percent of its S-CHIP funds on adults. In New Jersey, it’s 43 percent."

Income Inequality

TCS Daily has a nice little article about income inequality. While I recommend reading the whole thing (it isn't very long), here is a summary of the points made:

• Those who advocate leaving things up to markets are not necessarily believing in market forces with blind faith. Rather, while we recognize that markets fail and that government intervention is another option, we believe that government fails much more frequently than markets do.
• Income inequality is a poor measure of prosperity. That is, who cares what one's position is relative to someone else's? What really matters is how well off one is in more absolute terms.

When X Is Outlawed, Only Outlaws Will Have X

Apparently when something that lots of people want is banned by authorities, an "underground" or "black" market is created. Shocking, I know. This is the harrowing story of two parents confronted with evidence that their son was dealing in contraband at his school:

Billy and his parents had been at odds. The junior at Boulder’s Fairview High School, whose identity has been changed for this story, had been letting his hair grow and was routinely getting it styled. He was buying things without any visible means of income. A few weeks into the 2007 fall semester, he had a brand new iPod. He had new boots, new clothes and was talking about a new car.

“He had no friggin’ job,” his mother, Sue Anne, told Boulder Weekly. “His dad and I won’t let him have a job. We want him focused on school. We want him at Stanford after he graduates, so we don’t need him distracted by a job and all that comes with it. We don’t want him buying videogames and iPods.”

As money became less of an obstacle for Billy, the boy’s parents became more concerned. It had become common to see him with a one- to two-inch-thick wad of cash. They became certain he was dealing drugs. They confronted him.

Indeed, the boy was a dealer, selling "treats" to his fellow students. And by treats, I mean candy. Sweets. Sugar.

“Hey, suddenly it all made sense,” William said. “At this point, we believed that drugs were not a part of it. It was just a bunch of candy. Instead of fearing visits to drug rehab, we had to worry about a dental visit. We went home and laughed about it. We were just so relieved. We were actually kind of proud of him for finding a niche, filling it and making a profit.”

Because schools are trying to enforce the latest health fad/scare by banning anything that might contain flavor, the market for candy has taken on aspects of the drug trade. This kid was marking up candy he had bought at Costco by 900% and making a killing. At least his parents were cool about it. Some might have reported him (to, um, someone) for being an enabler.

Read the whole thing here, for and this picture →

and more great lines like "a candy ban in public schools turned Austin High School into an underground candy market that resembles 'Willy-Wonka-meets-Casablanca',”

HT Reason

Largest Private Companies

Forbes has an interesting list of the largest private US companies.

HT: Club for Growth

Vanity Plates in Virginia

Virginia accounts for 10% of all vanity plates in the country, with 16% of registered plates being personalized. That surprises me not in the least.

The Internet

I love Fark headlines sometimes:

"Other countries want the US to give up control of the Internet Tubes it created. It's always funny when the mice vote to bell the cat"

The Right to Free Speech is Apparently Restricted by Political Correctness

In LA, anyway.

Alcohol Round-Up

Two interesting developments on the battle to eliminate alcohol from society.

First, the Marines (celebrating 232 years of kicking ass) are trying to allow members of the Corps to drink on base. Obviously, MADD is, well, mad. Good luck fighting the marines, Mom.

Second, a follow-up to this post about a mom arrested for serving alcohol to her son at his birthday party. The prosecutor who charged her has failed in his re-election bid.

Now here's where I'm supposed to kowtow to the moral bullies and signal my agreement that underage drinking is some kind of horrible offense. Well, forget it. I'm not recommending excessive drinking (though I confess to doing it, shall we just say, on more than one occasion) for anybody. However, the United States is the only country that imposes alcohol prohibition on people until age 21. Germany, France, Italy and the Netherlands, among others, put that limit at age 16 and they don't seem to be falling apart as societies. I think it's high time to lower the U.S. drinking age.

In any case, Camblos' attempt at moral grandstanding turned out to be bad politics. Good riddance to him.

What, Me Worry?

Mark J. Perry of Carpe Diem on why we are not about to enter a recession. Some very nice comparisons to the S&L meltdown of the 80's bring a new angle to an old debate.

The Good Lie

Reason has a post about claims by anti-smoking activists that spending 30 minutes in a room with a smoker raises your risk of death to the same levels as someone who smokes. This claim is what we in political blogging call a "lie." But that's ok, since we need to "simplify the facts" for those who are too stupid to draw the conclusions we want them too.

I recomend you read the whole Reason post, but the original article in New Scientist is behind a paywall. There is a link to the author's blog, however, which contains a nice summary, as well as a lot of interesting stuff from the War on Tobacco. I highly recomend giving it a read, especially if you are interested in smoking policy.

Tax Competition: Once More With Feeling!

Two recent articles highlight the new consensus about tax competition growing among economists on tax competition.

In the first, Kenneth Rogoff, former chief economist for the IMF, has an article in the Daily Star (via Cato-at-liberty) where he muses on the nature of the very wealthy. This is the money quote:

Many super-earners are also super-creative and bring enormous value. Places like the United Kingdom actively court wealthy foreign nationals through extraordinary preferential treatment of their investment income. The ultra-rich are an ultra-mobile group, too. If you are earning $540,000 an hour, it does not take too long to save up to buy an apartment, even in London.

The second, also from Cato, is about British race car driver Lewis Hamilton, who has moved to Switzerland. He claims that he wants solitude, but the Mirror notes that he will save about $8 million per year in taxes. As the rich flee high tax jurisdictions, those jurisdictions will continue to complain about the "unfair taxation" that is stealing their God-given tax base.

Markets Pessimistic on Iraq

The New York Times has an article showing that the international bond market is not considering the war to be going well. The market has not responded positively to the surge, or anything else. Apparently, bond markets are one of the best predictors of a failing government.

$39 Billion Tax Writeoff for GM

General Motors has just announces that it will take a huge tax break this year, totaling $39,000,000,000. So that's a good thing for them, right? Wrong. Accountants are now talking bankruptcy. For the best examination of this rather complicated story, read this post from Mises.org's blog.

Prohibition Returns!

Reason Magazine's cover story this month is about the new prohibitionary movement gaining momentum across the US. They lead off with a story about a woman who was pulled over in DC after having a single glass of wine. Her BAC was .03, or less than half of the level of intoxication. She was arrested and ordered to attend a 12 week alcohol counseling course. When she refused, her license was suspended. Then the tale of a man in Pennsylvania who had his license taken after he told his doctor that he drank a six pack of beer a day. "State law requires doctors to report any of a patient's physical or mental impairments if the doctors think it could compromise his ability to drive safely" He had no convictions, his work attendance record was good, he had exhibited no history of anti-social behavior except drinking. From the article:

Neoprohibitionists aim to muddle the distinction between drunk diving and driving after drinking any amount of alcohol. Sen. Barbara Boxer (D-Calif.) endorsed the idea at a Senate Environment and Public Committee hearing way back in 1997, contending that we "may wind up in this country going to zero tolerance, period." Former MADD President Katherine Prescott concurred, in a letter to the Chicago Tribune, where she stated "there is no safe blood alcohol, and for that reason responsible drinking means no drinking and driving."

I highly recommend reading the whole thing, especially the part about police in Fairfax county VA asking a woman in a restaurant who had just finished dinner and was enjoying her first drink to come outside and take a sobriety test.

I can only stress that as our government takes over our decision making process and becomes responsible for more of our lives, they will only continue to become more meddlesome. Already people justify these kinds of actions by saying that "we" pay for the hospital bills of people injured in accidents, so "we" have a responsibility help prevent drunk driving. As the state assumes new duties, it will use them to justify new powers.

EU vs US Revisited

In the past we have pointed to studies that rank EU nations against individual States in terms of Gross Domestic Product (GDP) adjusted for Purchasing Power Parity (PPP). Normally the EU nations come off poorly by comparison, ranking on average near Alabama or West Virginia.

Now Political Calculations has published an interactive, sortable, table of this data.

Fun Fact: Italy has about half the GDP per capita as Wyoming.

HT Carpe Diem

Is The Ban on Internet Taxes a Subsidy?

Economist Dean Baker has written an article claiming that Amazon owes its success to government subsidies.

Amazon reported higher than expected third quarter profits and a 41 percent increase in revenue, a good enough showing to push its stock price back to tech bubble peaks. One item missing from the accounts of Amazon's good news is the continuing subsidy that it gets from taxpayers.

While most stores must charge customers state sales tax, Amazon and other Internet retailers enjoy a special subsidy. They need not charge sales tax except in the states where they have a physical presence. (I believe that list is Washington and Utah.) That's great news for Amazon, if we assume that state sales taxes would average 4 percent on annual sales of $15 billion a year, then taxpayers are subsidizing Amazon to the tune of $600 million a year, more than its annual profits.

Rather than try to come up with something intelligible to say to this nonsense, I will merely quote TechDirt, which has published a nice response.

Some states don't have sales taxes at all, but no one would consider that a taxpayer subsidy. My local Wal-Mart benefits from a variety of state and local government services here in the St. Louis area, such as police and fire protection, and roads and other infrastructure. At least in part, sales taxes go to cover the costs of providing those services. Amazon uses few if any services from state or local governments in Missouri, so it's hard to see anything unfair about the fact that it doesn't have to collect sales taxes here.

On the other side of the ledger, sales tax collection would be far more burdensome to Internet-based businesses than to their brick-and-mortar competitors. A mom-and-pop retail store only has to learn about the tax rules in one jurisdiction. Most likely, there's just one tax rate, one set of rules about which goods are taxable at that rate, and one set of reporting requirements. In contrast, a small e-commerce site would have to familiarize itself with the rules in thousands of different jurisdictions. The state of Missouri, for example, allows municipal governments to tack a variety of local taxes onto the state sales tax. As a result, the tax rate varies from city to city. Even worse, different states have different rules about which goods and services are taxable. Missouri, for example, exempts custom software (but not boxed software), farm equipment, and medical grade oxygen, among other things. Colorado has exemptions for bingo equipment, cigarettes, food, fuel and oil, machinery and machine tools, newsprint, precious metal bullion and coins, and more. Each of the other 40-some states with sales taxes have their own lists of what's taxable. Many states exempt food and clothing from taxes, but the precise definitions of "food" and "clothing" varies from state to state. For example, in Wyoming, bagels are considered tax-exempt food unless they're sold with cream cheese and a knife, in which case they become taxable "prepared foods."

Inefficient Public Schools

We all know that the Public School System is a well practiced money waster. Cape Diem, however, has run some numbers on just how much money they waste and produced a series of posts on the subject.

Here he points out that spending per student in constant dollars has grown by 10x since 1929. But this post shows where that money is being spent. Quoting Cato's Saving Money and Improving Education, he notes:

Student enrollment in public schools grew by 13% between 1979 and 2000. During the same period the total number of school employees grew by 61%, and the number of teachers grew by 35%. Nationally, public schools now have about 1 employee for every 8.1 students, and teachers make up only 40% of total school employees

As a side note, my favorite part of the post is the comparisons he makes at the end.

1. The Chicago Board of Education, which has 3,300 employees, is larger than the entire Japanese Ministry of Education.
2. The New York City public schools system has 250 times as many administrators as the New York Catholic school system (6,000 administrators in public school system versus 24 in Catholic school system), even though New York public schools have only four times as many students as the Catholic schools.

In this final post, he shows that because Public Schools have so many more administrators than teachers, they cost much more per pupil than their private counterparts. In contrast to the common perception that private schools are elite organizations awash with old money to trow at their privileged students, they operate with budgets of, on average, 1/3 to 1/2 the size per student.

Average private school tuition ($6,600) was about 1/3 less than the spending per pupil in public schools ($9,620) in 2003-2004 (the most recent year available), and average Catholic school tuition ($4,254) was less than half of public school spending per student.

Not only was the average private school tuition between 1/3 and 1/2 less than the cost per public school student, the private schools had on average 18% more teachers per 1000 students (72.25 in private schools vs. 61 in public schools) in 2003-2004.

Yet our money continues to be funneled into the Public Schools, reinforcing their failure with increased spending. If parents were free to spend that money on the school of their choice they could procure a better education for their children while saving the taxpayer a whole lot of money.

Shock of the Week: Low Tax Nations Have More Money

The Business has a great article pointing out that of the top 20 richest nations, most of them are enclaves of low taxes.

What are the three richest countries in the world? You might be tempted to answer America, maybe Switzerland, or perhaps even Ireland. The right answer, however, is Luxembourg, Bermuda and Jersey in that order.

The Top 20 also includes: Equatorial Guinea, Guernsey, Ireland, the Cayman Islands, Andorra, Hong Kong, the British Virgin Islands, the Isle of Man, San Marino and Switzerland.

The wealth of some of those territories is striking. Luxembourg and Bermuda have a GDP per capita of $71,400 (£35,072, E50,250) and $69,000 respectively. By contrast, America, the wealthiest of the mainstream industrial economies, has a GDP per capita of $44,000. Even the worst-off low-tax nation, Switzerland, has a GDP per capita of $33,000. And Britain, despite the endless boasting from Gordon Brown about the brilliance of its economic record, ranks only 28th in the world, at $31,800.

Seems like there could be a lesson here.
HT Cato-at-liberty

And The New Largest Corporation In The World Is:

Cape Diem has created this chart to show just how big the Chinese national oil company is. Summary: huge.

Usury?

Reason on why loans with 80% interest are a great thing. Thank you School of Salamanca!

Yet Another Country Which Is Not The USA Cuts Corporate Taxes

From Canadian Financial Post:

The Conservative government delivered a mini-budget yesterday that lowered the Goods and Services Tax for a second time and reduced corporate taxes by one-third over the next five years as part of a $60-billion multi-year package of tax cuts.

The plan was contained in Finance Minister Jim Flaherty's fall update, which was a budget in all but name given the myriad tax relief measures introduced. The minority government's political opponents issued fierce denunciations of the plan, but Liberal leader Stéphane Dion said his party would not oppose the measures, ensuring they receive Parliamentary approval as early as today.

When Liberal Canadians are not opposing corporate tax cuts, it makes you wonder what kind of world we live in, and why our rates are still so high.

HT Cato

I Don't Care Who He Is, My Mind Is Made Up!

From the WSJ, via Luskin:

Pollster Scott Rasmussen notes that when he surveys head-to-head matchups between Hillary Clinton and any of the eight potential GOP candidates, Mrs. Clinton scores between 46% and 49% against all of them.

"When we polled her against Rep. Ron Paul, a non-mainstream libertarian, she got 48% of the vote. When we polled on Ron Paul among people who knew who Ron Paul is, she got 48% of the vote. When we polled among people who didn't know who Ron Paul is, she got 48% of the vote," he says.

It apparently doesn't matter who runs against Hillary, the outcome will be the same.

Campaign Finance by Colbert

HT: Club for Growth

Social Security Poll

During a Kudlow & Company debate (video available here at Club for Growth), the issue of a recent poll saying most Americans favor maintaining Social Security benefit levels and raising taxes, this gem of a quote came up:

"This poll is ridiculous. You're asking people who make, on average, $40,000 a year whether they think people making $100,000 a year should subsidize their future Social Security benefits. That's like asking three wolves and sheep to vote on who's for dinner."

Economic Ignorance

CNN is reporting that 46% of Americans believe the US is in the midst of a recession. Be sure to check out the comments to the article, including:

"I don't care what people think about the economy. The bottom line is the economy can me measured by GDP, real income, employment, etc. The actual poll question should be: How many people are duped into thinking the economy is bad?"(emphasis added)

"Wow!! The mainstream media machine should be quite proud of keeping 46% of Americans that ignorant. We've had incredible economic growth in the last 3 or 4 years in spite of record oil prices and the sub-prime mortgage debacle and yet the left-wing media salivates at every opportunity to tell Americans how miserable our lives are. You can say what you want, but I choose not to take part in your "recession" - I know better."

"Where are the poll numbers for the "Pelosi Do Nothing Congress"? 11% approval rating I beleive. The lowest in history.This recession talk just goes to show that if you tell a lie long enough people will beleive it."

"While many people may believe that the U.S. is in a recession, the fact remains that we are not.

This just shows the lack of economic education of the geberal public and the ability of the major media to capitalize on this ignorance for their own purposes.

This story is an attempt to create a story instead of reporting.

I wonder why the story has not corrected the public opinion with the facts?"

"It is stunning how people could possibly think we are in a recession. This poll shows the danger of the negative economic focus of the mainstream news outlets that has clearly misled the public into this false belief. I know people have to also be responsible for their own ignorance, but when their sources of information are misleading it is hard to fault the fools of this poll."

"This story is ridiculous, at the very least a good journalist should include in here that we are definitely NOT in a recession, that the economny has been growing for something like18 straight quarters."

etc.

I read over half of all the comments posted as of my reading of the article. I skimmed the rest. I didn't see one favorable comment. That's at least one good thing :-)

Nerd

Japanese Post Office

From BBC Article:

"Japan has started the privatisation of its postal service, forming the world's largest commercial bank in the process.

"Under a 10-year plan, Japan Post is being split into four firms to run its banking and insurance operations, mail deliveries and post offices.

"Japan Post's banking unit has 400 million accounts and assets of 349.8 trillion yen ($3 trillion; £1.5 trillion), the world's largest.

"The banking and insurance units should float on the stock exchange by 2010."

Business Extinction

MSNBC has an article about 10 industries that are "facing extinction" in the next ten years. While I think the article is worth reading if you have three minutes, I think the author needs to check the definition of "industry." Here's the list:

• Record Stores
• Camera Film Manufacturing
• Crop Dusters
• Gay Bars
• Newspapers
• Pay Phones
• Used Book Stores
• Piggy Banks
• Telemarketing
• Coin Operated Arcades

Philadelphia Property Taxes

This is . . . . . oh, I give up, I don't know what it is:

"Earlier this month, when Mayor Street announced an aggressive new city plan to go after tax scofflaws, he warned: "We will spare no one."

"He could have started by looking in the mirror.

"Until last week, Street was $4,798.99 in arrears on his property-tax bills for two North Philadelphia properties. He paid up Thursday, shortly after a Daily News reporter asked him about the debt.

"Street spokesman Joe Grace said yesterday that Street did not know taxes were owed on the properties.

"'The mayor did not receive any notices. He did immediately satisfy the bill when it was brought to his attention,' Grace said.

Neither of the properties is Street's primary residence."

...

"Grace said the mayor's experience raised the concern that owners of more than one property could be in arrears and not know it if delinquency notices aren't sent to the primary address.

"He urged owners of more than one property to contact the Department of Revenue at 215-686-6442 or revenue@phila.gov to ensure that notices are sent to the correct address.

"When Street announced the stepped-up delinquent-tax collection program earlier this month, he predicted it would generate $235 million over the next five years, to be split between the city and the school district.

"About 25 staffers will be added to the city Law Department to manage the program."

...

"Grace said he was 'reasonably confident' that the collection firm or the Law Department would have sent a letter to Street's primary residence before the properties were seized." (Emphasis added)

HT: Fark Headline

Lead Toys and the Regulators Who Need More Money to Stop Them

MSNBC has an infuriating article about how the Consumer Product Safety Commission has told Congress it needs more money to ensure that lead tainted toys don't make it into the country:

"Leaders of the agency responsible for protecting consumers from faulty products said Wednesday that Congress should increase their budget and power in the wake of huge recalls of lead-contaminated toys.

...

"One of the agency's commissioners said 'we are all to blame' for a system that allowed children to be exposed to lead-tainted toys. That includes 'those who stood by and quietly acquiesced while the commission was being reduced to a weakened regulator,' said Thomas H. Moore, in the first of two days of hearings before a House Energy and Commerce subcommittee.

...

"'Our small agency has been ignored by the Congress and the public for way too long,' said the acting chairman, Nancy A. Nord. 'Our laboratory desperately needs to be modernized.'

...

"Nord noted that the recalls, mainly of toys manufactured in China, have had the intended purpose of goading the entire toy industry into changing practices to prevent such violations in the future.

"It has also inspired the introduction of several bills to increase the authority and budget of the CPSC and better monitor imports from China."

So, in other words, the agency thinks that we should not leave such issues to market forces (even though it acknowledges that such forces are working to correct the problem) but rather that the agency should ensure safety - even though it supposedly doesn't have laboratory equipment sufficient to test for lead and apparently never thought "gee wiz, if we're the one's supposed to be doing this and we can't, maybe we should raise a red flag to someone else in the bureaucracy."

The problem is not that the agency doesn't have enough money or power. Rather the problem is that a) there is no reasonable way that a centralized agency could possible test every batch of every product imported into the country (not to mention those originating inside the country) for every known harmful substance; and b) not only is the agency ill conceived to begin with, it is apparently run and staffed by a bunch of completely incompetent bureaucrats whose solution to their agency failing to perform perhaps the most basic of all of its supposed functions is, of course, more money and more power.

Finally, I would like to point out that the entire article was apparently written by an author who can't think critically about anything. The entire thing is a puff piece about how the agency needs more money. The only salient point is that of the last sentence which states: "Several lawmakers said Mattel blocked committee staff members from visiting the company's plants in China and talking to the Hong Kong executives who oversee those facilities," which, if true, is a big deal. But, regardless of the importance of this point, the author doesn't see fit to pursue
the merits of the claim nor its implications.

Are Product Definitions a Proper Function of Government?

This article regarding the fact that Mars Inc. says that using a certain amount of vegetable oil in place of cocoa butter - even if such a change were allowable under the official definition of chocolate - would be a mistake made me start thinking about the fact that we have a government dictated definition of certain products.

It seems to me that the purpose of having government set definitions of certain products is so that consumers can be confident that, when they buy a chocolate bar, they are actually getting a certain product, namely, chocolate, as opposed to some soft brown stuff on which a company has slapped a label reading "chocolate." I expect that the problem, the argument would go, is that consumers would not be able to tell the difference between chocolate made with only 95% cocoa butter as opposed to 100% and, thus, would be exploited.

It seems to me, however, that having the government define certain products in terms of percentages of ingredients is trying to solve the same problem with two different solutions - after all, there are already penalties for false advertising / inaccurate labeling. If consumers are concerned about the percentage of cocoa butter in something labeled chocolate, companies using higher levels of cocoa butter would certainly want to put that prominently on their packaging. Companies not using high amounts of cocoa butter would probably just put nothing to that effect on the packaging. Thus, consumers would just have to check the packaging. Anything inaccurate in that regard would be discouraged by the aforementioned penalties for false advertising.

This setup, though, would probably be accused of placing a "burden" on consumers. The obvious response to that would be "Oh, come on." One argument in favor of it would be that it would be one less thing that government is involved in. On the other hand, this seems to be an awfully trivial matter in the grand scheme of things and, thus, is it that big of a deal (other than on principle) that government is involved?

Also, it seems to me that, if the government were to change the definition of chocolate to allow a certain percentage of vegetable oil, certain companies are going to be putting their cocoa butter content on their packaging anyway - because it will be a competitive advantage for them. Thus, it seems that, unless government definitions involve 100% purity (of whatever critical ingredient of whatever product we're talking about), then a government definition is redundant anyway. Also, in cases where there are multiple critical ingredients (and, thus, no one can have a 100% value without the exclusion of the others), e.g., certain types of wine, there is almost (if not) always a range of tastes such that defining a certain proportion of percentages would be to chose one group's taste over another's. Thus, again, it would seem that packaging would be informative in this regard in any event.

Thus, whether a certain product involves one or more critical ingredients, a government definition seems redundant because companies are going to have an incentive to include ingredient information on their packaging as a selling point anyway. Again, assuming that it is redundant and the only disadvantage to government definition is that, when the government does set the percentage of the critical ingredient to 100% (since, again, when it is something else, companies are going to put this information on the packaging anyway), consumers don't have to read the packaging, it is a valid use of government?

Indiana Police - Take Two

More excellent police work in the State's quest to best Illinois.

Judicial System +1

I'm pleased to read a ruling that I find well reasoned.

Constitution Day

Today is Constitution Day and The Heritage Foundation has a nice article regarding the formation of the constitution. Worth the read if you are already familiar with the historical narrative of that convention (of which this is a brief refresher). If you are not, I recommend becoming so.

Indiana Police

Indiana, apparently jealous of Illinois' fine police work, produces some of its own. Be sure to watch the "RAW VIDEO: David Snyder taken down, arrested during Roseland council meeting" clip.

HT: Fark

CEO Pay

Townhall has a good, one page article entitled "In Defense of CEO Compensation" in which the author presents a nice, concise overview of the defense of high CEO pay. Money quote:

"It's sad that this is the level of economic literacy among the media. If the press ignored advances in other scientific fields as much as they do in economics, we'd see weathermen advising readers to offer sacrifices to the rain gods."

Also, as an extra added bonus, the author takes an off-the-cuff shot at unintended consequences of government regulation vis-a-vis corporate raiders.

Farm Lobby Civil War?

This might be the only time I hope someone in the farm lobby gets heard in Congress.

Secret Economic Force in Currency Exchange Market: Japanese Housewives

If you have five minutes today, read this article from the New York Times about the trend of Japanese housewives investing some of the country's huge amounts of savings in foreign currency exchange.

Ethanol Strikes - Vol. IX

The latest victim: wheat (and everything made from it)

Chicago Police

That's some darn fine police work there, Lou.

HT: Fark

#1: The French, #2: Rapidly Becoming The Canadians

The Premier of Ontario apparently needs the intervention of a clue-by-four:

"Ontario Liberal Leader Dalton McGuinty said Wednesday that he does not want to see the provinces' schools resort to installing metal detectors and having uniformed security officers patrol the halls in the wake of Tuesday's fatal stabbing at a Toronto high school.

"Such a move, he said, would amount to the Americanization of schools in Ontario.

"'I see that as an absolute last resort,' Mr. McGuinty told reporters during an election campaign stop.

"Instead, he said, Ontario needs to distinguish itself from the United States by imposing an outright ban on hand guns.

"'Let's ban handguns in Ontario,' he said. 'Let's ban handguns across the country. Let's declare war against handguns.'"

I don't even know where to begin. Should I begin with the most obvious point that a ban on handguns (even if it were effective - which it wouldn't be) wouldn't stop people from stabbing each other? What about the absurd premise that the solution to the problem (assuming that there is an underlying problem other than that society includes people who are willing to kill other people using whatever means they can obtain) has to be Un-American first and effective second? Once I decide where to begin, though, what next? Should I mention how later in the article the inevitable funding issue comes up?

I think I'll just stop here before I give myself an ulcer.

HT: Fark

We Should Just Stop Ordering So Much Health Care

Robin Hanson has written a fascinating essay at Cato Unbound in which he claims that Americans are not really being ripped off by anyone when they over-spend on health care, but that they are simply demanding too much of it.

Car inspections and repairs take a small fraction of our total spending on cars, gas, roads, and parking. But imagine that we were so terrified of accidents due to faulty cars that we spent most of our automotive budget having our cars inspected and adjusted every week by Ph.D. car experts. Obsessed by the fear of not finding a defect that might cause an accident, imagine we made sure inspections were heavily regulated and subsidized by government. To feed this obsession, imagine we skimped on spending to make safer roads, cars, and driving patterns, and our constant disassembling and reassembling of cars introduced nearly as many defects as it eliminated.

This is something like our relation to medicine today. Our public today is like a king of old whose military advisors spent most of their time and budget reading omens and making sacrifices, to gain the gods' favor, instead of hiring soldiers and talking battle strategy. These advisors knew omens and sacrifices mattered little, but they saw the king was comforted, and feared losing favor by talking of battle strategy. A truly loyal advisor would have told the king what he did not want to hear: "You are obsessing about the wrong thing."

I have said before that the main cause of our "health care crisis" is that we expect "insurance" to cover all health care costs. Car insurance only kicks in when we manage to inflict more damage on our cars than the deductible will cover. Most people go years between making an insurance claim on their cars, but use their health insurance many times a year. Hanson is claiming that demand for health care has increased to absurd levels, and that the best way to reduce costs is to simply cut back on how much of it we buy. He sites a number of studies that show that most medical spending results in no significant difference in actual health, and in many cases can cause adverse effects. I recommend reading the whole thing, even though it is rather long and detailed. No, in fact I recommend reading the whole thing because it is long and detailed.

Society has been placing more emphasis on health lately, insisting on healthy eating, healthy kitchen appliances, healthy exercise, healthy soda. All this has apparently changed our priorities enough that we now spend one sixth of our income on health.

Personally, I prefer to spend my money on things that don't involve pills and needles.

UPDATE: EconLog is saying that Hanson is more mainstream than one might think.

Corporate Taxes

Here is a video on corporate taxes that I consider a must see for anyone not entirely acquainted with the issue. HT: Club for Growth.

NAR and Spin

The Motley Fool has a fun little article on how the NAR has been spinning the decline in housing sales.

OECD on BioFuels

Reuters reports that the OECD has stated that biofuels may

"offer a cure that is worse than the disease they seek to heal."

"The current push to expand the use of biofuels is creating unsustainable tensions that will disrupt markets without generating significant environmental benefits.

"When acidification, fertilizer use, biodiversity loss and toxicity of agricultural pesticides are taken into account, the overall environmental impacts of ethanol and biodiesel can very easily exceed those of petrol and mineral diesel."

"The OECD said tax incentives put in place in many regions, including the European Union and the United States, to encourage biofuel output could hide other objectives. 'Biofuel policies may appear to be an easy way to support domestic agriculture against the backdrop of international negotiations to liberalize agricultural trade,' it said." (Emphasis added)

"Instead it encouraged members of the World Trade Organization to step efforts to lower barriers to biofuel imports to allow developing countries that have ecological and climate systems more suited to biomass production.

...

"The OECD, which said in July that it saw biofuels keeping prices at high levels into the next decade, said it would lead to an unavoidable 'food-versus-fuel' debate.

"'Any diversion of land from food or feed production to production of energy biomass will influence food prices from the start, as both compete for the same input,' it said."

Zoned: NFF-1

LA is considering putting a moratorium on fast food restaurants in South LA - a portion of the city with a disproportionate number of fast food establishments per capita, as well as more obesity per capita.

"'The people don't want them, but when they don't have any other options, they may gravitate to what's there,' said Councilwoman Jan Perry, who proposed the ordinance in June, and whose district includes portions of South L.A. that would be affected by the plan."

So, apparently, people don't want to eat at fast food joints, but they do because there aren't other options . . . right.

"'While limiting fast-food restaurants isn't a solution in itself, it's an important piece of the puzzle,' said Mark Vallianatos, director of the Center for Food and Justice at Occidental College."

"This is 'bringing health policy and environmental policy together with land-use planning,' he said. 'I think that's smart, and it's the wave of the future.'"

As Fark would say, "This should end well."

"Fast-food restaurants haven't missed the cue: From their menus, diners can choose salads over burgers, yogurts over shakes and grilled over fried these days. And many food manufacturers have reconfigured their recipes to eliminate trans fats, the most unhealthful unsaturated fats made of partially hydrogenated oils."

So, do people choose those options when they are presented with them or do they keep buying the worse-for-you burgers and fries? If the answer is the later, guess what will happen when they are presented with establishments that sell nothing but better-for-you food.

"The state enacted legislation last year to increase the purchase of fruits and vegetables to be sold in corner stores in lower-income communities.

Rep. Mary Bono (R-Palm Springs) introduced a bill in Congress in June that, among other things, would try to increase the availability of nutritious foods in economically depressed areas."

So, when these don't actually end up doing any good, will the problem be lack of funding?

The Welfare State (Not) At Work

1 in 5 people in the UK have no reported income other than government handouts.

Link

Debt to Society?

MSNBC has an interesting article regarding the ruling of a South Korean appeals court that the CEO of Hyundai Motor Corp. should not serve a three year prison term for being found guilt of embezzling $100 million into a lush fund because he is too important to the country's economy:

"South Korea - An appeals court suspended a three-year prison sentence for Hyundai Motor Co. Chairman Chung Mong-koo on Thursday, saying the tycoon is too important to South Korea’s economy to go to jail for embezzlement.

...

"Presiding Judge Lee Jae-hong told the packed courtroom that Hyundai Motor has great influence over the nation’s economy and Chung, its hands-on leader, is the symbol of the company.

"'I am also a citizen of the Republic of Korea,' Lee said. 'I was unwilling to engage in a gamble that would put the nation’s economy at risk.'

...

"But Park Wan-gi, an activist with the Citizens’ Coalition for Economic Justice, denounced the ruling, saying it reinforced the perception that the rich can avoid jail.

"In a similar case, the Seoul High Court in 2005 suspended a three-year prison term for accounting irregularities handed to Chey Tae-won, CEO and chairman of South Korea’s leading oil refiner, SK Corp., now SK Energy."

Hyundai is currently the world's sixth largest car manufacturer and, combined with Kia, constituted 72% of automobiles exports, which, as a whole, represent 13% of total national exports.

The larger question here seems to be whether it is a valid principle (abstracting from particular South Korean law, etc.) that persons who are extremely important to a society (let's take for granted that he is) in one way or another (economically, culturally, diplomatically, etc.) should be spared jail time for a crime of which they were found guilty assuming that such a sentence would be detrimental to the common good of the nation.

I suppose it would depend on how one looks at punishment. If the goal of punishment is to reform the person for his own good, then the decision would be that between the private good and the common good. If punishment aims at retribution, then such a decision would be unjust by definition. If punishment aims at fulfilling a debt to society incurred by means of the crime, then it seems as if the question would be between which will provide society at large with a larger "pay off" - jail for the offender or the various benefits that they would otherwise be able to generate for society.

Missing from that paragraph is the corresponding cost of commuting a sentence even if there are substantial gains to be had for society, e.g., moral outrage or discouragement on the part of common people at the unequal way justice handles citizens.

Thoughts? Comments?

Ethanol Strikes - Vol. VIII

While this is an old story, I can't resist. Today's victim: popcorn.

Economics and Property Rights

Townhall has a short article entitled "Economics and Property Rights" in which the author briefly outlines how such things as property rights and various regulations affect how the laws of economics manifest themselves. Short and sweet - worth the read, though the author could have fleshed out the issue more, e.g., by mentioning the principle of the Tragedy of the Commons.

We Are Now Media . . . And There Was Much Rejoicing

The FEC has ruled that blogs dealing with politics are media for election law purposes. In the words of TechCrunch, "Essentially it reaffirmed the right of American bloggers to exercise their free speech rights without being subject to US electoral law, in the same way that media organizations are able to."

If Our Prisons Were a Corporation, It Would Be Bigger Than Detroit and Wal Mart

From a Reason Post:

We have a corrections sector that employs more Americans than the combined work forces of General Motors, Ford, and Wal-Mart, the three largest corporate employers in the country, and we are spending some $200 billion annually on law enforcement and corrections at all levels of government, a fourfold increase (in constant dollars) over the past quarter century

I am stunned. I just never thought about the shear numbers of people we have to pay to keep dangerous stock traders and dope smokers off the streets.

Great article on the housing bubble

From The Motely Fool, comes this headline (and article): "Desperate Realtors Applaud Bailout" with the gem of a subtitle: "The National Association of Realtors likes the idea of a subprime bailout. Big surreise."

Cyber War

Techdirt makes an interesting point about alleged attacks from China on foreign computer systems: such attacks probably inhibit Chinese tech firms selling their products abroad (for fear that there will be back doors built in, etc.). Thus, are such attacks actually counter-productive to the nation as a whole?

Speaking of Zimbabwe . . . .

China is apparently ending all economic assistance to Zimbabwe except humanitarian aid.

British Cancer Survival Rates

Apparently, while I was gone, some fun figures came out about British health care. This is the best summary I have seen in my collection of feeds, and it contains some nice links to other stuff. From the Telegraph:

Cancer survival rates in Britain are among the lowest in Europe, according to the most comprehensive analysis of the issue yet produced.

England is on a par with Poland despite the NHS spending three times more on health care.

Survival rates are based on the number of patients who are alive five years after diagnosis and researchers found that, for women, England was the fifth worst in a league of 22 countries. Scotland came bottom. Cancer experts blamed late diagnosis and long waiting lists.

In total, 52.7pc of women survived for five years after being diagnosed between 2000 and 2002. Only Ireland, Northern Ireland, Scotland, the Czech Republic and Poland did worse. Just 44.8pc of men survived, putting England in the bottom seven countries.

And soon our government will be bringing the same quality care to our shores. Hooray!

Update: Just found a report that most senior NHS doctors have private insurance, thus avoiding themselves what their patients must undergo.

Ethanol Issue Analysis - Vol. III

From Rolling Stone, comes the latest in a series of overarching looks at the ethanol issue entitled "The Ethanol Scam: One of America's Biggest Political Boondoggles". Definitely worth reading all the way through. Apologies for posting this soooo late.

HT: Fark

For posts regarding the first two "holistic" analyses of the Ethanol issue, see here and here.

And You Thought The Post Office Overcharged

From Bloomberg:

A small South Carolina parts supplier collected about $20.5 million over six years from the Pentagon for fraudulent shipping costs, including $998,798 for sending two 19-cent washers to an Army base in Texas, U.S. officials said.

The company also billed and was paid $455,009 to ship three machine screws costing $1.31 each to Marines in Habbaniyah, Iraq, and $293,451 to ship an 89-cent split washer to Patrick Air Force Base in Cape Canaveral, Florida, Pentagon records show.
...
The scheme unraveled in September after a purchasing agent noticed a bill for shipping two more 19-cent washers: $969,000. That order was rejected and a review turned up the $998,798 payment earlier that month for shipping two 19-cent washers to Fort Bliss, Texas, Stroot said.

HT Cato

More From Zimbabwe

Some of you may remember that Zimbabwe is experiencing hyperinflation. Now, in order to combat this, the government of Zimbabwe is outlawing pay raises. From the NYTimes:

Zimbabwe’s government slapped a six-month freeze on wages, rents and service fees on Friday, the latest step in what some analysts call an increasingly desperate campaign to sustain an economy gutted by hyperinflation.

Even as President Robert G. Mugabe declared the freeze, however, Zimbabwean newspapers suggested that the government’s two-month-old drive against inflation had backfired by drying up tax revenues needed to run the government.

This is only the latest in a long line of great ideas from the government.

The freeze follows a decree issued in late June that forced merchants and wholesalers to reduce all prices by at least 50 percent. Shoppers stripped store shelves of clothes, meat and other basic goods after that decree, and producers have largely failed to ship new stock because goods now sell for less than it costs to make them.

Most commodities are now available only on the black market, where prices have continued to skyrocket. Moreover, as the last remaining stocks of goods trickle out of factory warehouses and onto the market, Zimbabwe could soon see the start of an inflationary spiral that would make today’s prices seem cheap, John Robertson, a Harare economist, said in an interview.

Unfortunately for Zimbabwe, politicians never learn that they cannot control an economy by passing silly laws. A national economy is one of the most complex systems of human interaction mankind has ever developed. For a few politicians and bureaucrats to think they are going to manage the sum total of free transactions for a nation by defining what can and cannot be charged for any good or service, while at the same time violating every fundamental principle of the nature of money by printing it to pay its expenses, is not only stupid and dangerous, but typical.

As If We Need Another Reason To Hate Canada

Carpe Diem has a post, inspired by this article, about the average wait times for an MRI in Canada vs the US, along with a scary story as anecdotal evidence.

. . . Lindsay McCreith, who was told in 2006 that he probably had a brain tumor. His case was an emergency and he needed an MRI fast, but the wait time for a "free" MRI was 4.5 months in Ontario, and it's illegal to purchase a private MRI in Ontario. So he was told to get to the end of the MRI line with his suspected brain tumor and wait 135 days for his free MRI.

What to do? Lindsay contacted Timely Medical in Vancouver, a three-year old private medical broker in Canada, which got him an MRI the next day across the border in Buffalo, NY. Result? As suspected, he did indeed have a brain tumor the size of a golf ball. McCreith then was able to schedule brain surgery within a week in the U.S., surgery that would have taken eight months in Canada -- if Lindsay had still been alive.

Mandatory Checkups and Other Things That Keep Me Up At Night

John Edwards is proposing mandatory "preventative care" for all US citizens.

"It requires that everybody be covered. It requires that everybody get preventive care," he told a crowd sitting in lawn chairs in front of the Cedar County Courthouse. "If you are going to be in the system, you can't choose not to go to the doctor for 20 years. You have to go in and be checked and make sure that you are OK."

He noted, for example, that women would be required to have regular mammograms in an effort to find and treat "the first trace of problem." Edwards and his wife, Elizabeth, announced earlier this year that her breast cancer had returned and spread.

Of course this makes perfect sense. If we the people are going to be paying for everyone's health care from birth till death, then we the people have every right to force you to take care of your self as we think best. It is just good public policy. After all, seatbelt laws have been defended with the same argument for years. When someone objects that not wearing a seatbelt hurts no one but oneself, the response is often, "But I have to pay for your hospital bills if you get hurt."

With this rational, anything that might make the average cost of national health care increase becomes a national threat. Alcohol, skydiving, mountain climbing, wilderness hiking, exposure to the sun, bacon, real made-from-cow-milk ice cream, anything can be controlled, limited, rationed, or banned. I will not even mention smoking, since it is on its way to being banned already.

Some people may think I am being hyperbolic for rhetorical reasons, a habit I am in truth not above. Sit back, however, and think over the last 40 years. Children used to run around their neighborhood playing. Now they can't be in the back yard alone. People used to be able to order a hamburger rare, now most chain restaurants daren't offer the option. We used to be able to walk on to a plane wearing shoes. 18 year olds used to be trusted to drink responsibly (and are still trusted to use fully automatic weapons and tanks responsibly). Little freedoms we used to take for granted are being taken away one at a time. Calls for restrictions and limitations "for our own good" are becoming ever more common. From hanging a picture without a license to drinking caffeinated beer, all aspects of our lives are coming under the control of a government we continue to expect to "do something." After all, it is for the common good. We can't allow you to continue to run around selfishly risking your health, then expecting us to pay for it.

And that is the key. Selfishness. People are selfish. If you tell someone that their rich uncle is buying lunch, they are much more likely to order the steak and lobster. Any plan that would work if only people would be less selfish is doomed. The only way to control selfishness is to ensure people bear the costs and benefits of their actions themselves. If people are not free to both succeed and fail, the incentives are for ever greater risk taking.

HT Club for Growth

Update: Read a similar rant on this here

Reagan Sees Success Overseas

Although protectionism and tax-and-spend ideologies are ascendant in the US, Reagan's vision is alive and well abroad.

The Reagan economic philosophy of lower taxes, less regulation and free trade has never been more in vogue abroad — so much so that it has become the global economic operating system. …nations of old-Europe seem to be in a sprint to see which country can get their tax rates lowest quickest. Nicholas Vardy, the editor of “The Global Guru” economic newsletter calls the phenomenon “Europe’s Reagan Revolution.” …Austria cut its corporate tax rate to keep pace with its neighbor, Slovakia which recently adopted an 19% flat tax. Singapore is cutting taxes to compete with its 16% flat-tax rival Hong Kong. Northern Ireland wants to cut its tax rates so that it can compete with the economic gazelle of Europe, the Republic of Ireland. In 1988 Ireland was a high-unemployment stagnant economy with a 48% corporate tax rate, today that rate is 12.5% and the rest of the world is now desperate to match its economic results. Meanwhile German Finance Minister Peer Steinbrueck sold the latest tax cuts as “an investment in Germany as a business location.” …it is a testament to the Reagan economic revolution launched in 1981 that, a quarter century later, global tax rates are 25 percentage points lower on average today than in the 1970s. And those figures don’t even include this latest round of chopping under Reaganomics 2.0. The enactment of supply-side policies is helping ignite one of the strongest and longest world-wide economic expansions in history.

I can only hope that after the eight years of democratic control of government we have coming, free market ideals can again assert their hold on Reagan's homeland.

More Insanity

Classically Liberal makes the argument that Americans are crazy, based on the reactions of a New Hampshire town to some flour in a parking lot. Also, the precautionary principle makes a return.

Record Lows

While I try not to spend to much time on Global Warming issues here, since they are neither Society nor Money, I do find it interesting from a social point of view that when the predictions were for the hottest summer on record back in June and July, it was all over the headlines, but now that the records are being broken in the other direction, there is much less noise being made. I suspect that some of the blame can be attributed to money, since no one gets a grant to study the possibility that nothing really important is happening. In addition, one must always beware of using an anecdote to prove a universal. Neither record highs nor lows on a local level really signify anything on a global scale. As John Brignell likes to say, it is the nature of records to be broken.

Liberty or Equality

While I am quite pleased that my co-author, Maarek, has returned from his honeymoon, I cannot resist the temptation to point out that, while he somewhat mockingly said that he hoped not to read anything on his honeymoon in response to my having read Freakonomics on mine, he went ahead and read Erik von Kuehnelt-Leddihn's Liberty or Equality on his. At least mine could be called "light" reading . . .

British Gun Ban Is Working Just Fine

After all, since the near total ban on handguns in 1997, gun-related crimes have only risen by about 100%.

DC Education Spending

Great post from Classically Liberal about DC public school spending. I highly recommend reading the whole thing. Besides the typical stories about spending millions to employ useless people for political reasons and unions demanding free money in exchange for political support at the cost of actually teaching children anything, for me the most interesting thing was the cost of private schools in the District.

St. Gabriel School has a tuition of $4,500. The more prestigious German School in the suburbs charges $10,000 per year. The most expensive, elite private school in the city, St. Albans charges $26,500 per year.

The most expensive school in DC is $26,500 per annum. The budget for the public schools comes to $20,000 dollars per student. DC could eliminate the public school system, send every student to a "prestigious" school in the suburbs, and still save $10,000 per student per annum.

Of course every year politicians campaign for more money for schools. As CL observes,

Markets reward solutions with profits. Politics is used to address “problems”. The more problems you have the more programs and subsidies that you qualify for. The nature of political financing is perverse. It rewards dysfunctionality far more than efficiency.

Yet some people hold up our public education system as a model to be extended to health care. After all, it worked so well for our "most precious resource."

So That's Where It All Goes!

Surprise! We pay a lot of taxes. Turns out that, for most Americans, taxes have been the biggest expenditure increase in the last 30 years.

Although income only rose 75%, and expenditures for the mortgage, car and health insurance rose by even less than that, the tax bill increased by $13,086 -- a whopping 140% increase. The percentage of family income dedicated to health insurance, mortgage and automobiles actually declined between the two periods.

Read the rest here

Trade Imbalance

A bit old, but I am still clearing our my back log of reading. Cafe Hayek's Don Boudreaux has a great post on trade imbalances.

Mr. Gettelfinger grumbles that "the U.S. and South Korea have a huge imbalance in auto trade." Well, duh - that's an inevitable consequence of specialization. Although we cook in our household, my family still has a huge "imbalance" in the prepared-food trade with McDonald's. But we would make ourselves only poorer if my family and I refused to buy from restaurants that do not buy equal amounts of prepared meals from us. In this case, what is true for each household is true for the collection of households that we call the United States.

Even Socialists See the Flat Tax Revolution

The World Socialist Web Site has a column up about how eastern European countries are falling for the capitalist tricks of low taxes to attract "multinational companies and western speculators."

The government of Albania has agreed on a standard tax rate (flat tax) of 10 percent aimed at outdoing its East European rivals and attracting international investors. The government in Tirana is determined to transform the impoverished Balkan state into a haven for multinational companies and western speculators.

From the start of next year, corporate taxes will be reduced from 20 to just 10 percent. The basic rate of income tax, which amounted to 5 percent for average incomes and a maximum of 25 percent for top earners, had already been changed to a uniform rate of 10 percent for all incomes on August 1.

But even this is not enough. In August the head of government, Sali Berisha, announced that the state would make development land available to foreign investors for the symbolic price of one euro. Concessions for socially indispensable services such as health service, education, water and waste disposal, infrastructure, energy and raw material production - are also to be sold off bargain-basement style for one euro.

Should any potential investor be nevertheless deterred by any remaining tariffs, the Albanian government is also ready to step in. A law over foreign trade zones is in preparation and is due to be passed by parliament in October.

Of course, while I would consider these developments to be good things, the author disagrees.

Government representatives repeatedly emphasize that the reform of the tax system is beneficial for the country. The participation of foreign investors in Albania would increase tax revenues, increase transparency, and provide an alternative to businesses, which operate outside of the country’s legal framework and tax structure.

In fact, none of these claims are true. The halving of corporate taxes will inevitably lead to sizable deficits in the national budget, which is already chronically under-financed due to high unemployment and wide-spread tax evasion. The state has already withdrawn financial participation in almost all public services such as health care, education, or infrastructure. Any further decline in the national budget can only worsen the situation.

The main victims of this reform will be those surviving on low incomes. The increase in taxes on low-income earners from 5 to 10 percent means that these taxpayers will finance the tax cuts for companies and high income earners. At the same time those on low wages will be hit hardest by the social consequences of declining tax receipts.

Sixteen years after the introduction of capitalist free-market reforms, the country already resembles an economic and social wasteland. The country’s few profitable national industrial companies have been sold off to the highest bidder and any sort of welfare provision only exists on paper.

It is enough to make one long for the days of plenty everyone enjoyed under the USSR, isn't it?

HT Cato-at-Liberty

Chinese Health Care To Blame For Trade Deficits?

The always fantastic Carpe Diem makes an interesting connection between China's cash-upfront medical industry, and their high savings rates, which contribute to the trade surplus they enjoy with the US. Not that I object to a trade imbalance, but it is an interesting connection.

Good For Youuu! :) Thaaanks! ;)

Apparently the fact that people want to be seen to drive hybrids is conflicting with the tax breaks being offered for them. The WSJ recommends offering incentives for things no one else will ever see, such as water heaters, to get more bang for the stolen-by-a-meddling-government-and-spent-on-pointless-market-distorting-subsidies buck.

Caffeinated Beer? That Sounds Great! Let's Ban It!

From US News and World Report:

State attorneys general have asked the federal government to crack down on beers that contain caffeine, saying the alcoholic energy drinks pose serious health and safety risks.

Thirty attorneys general called for an investigation of promotional claims that the drinks provide energy and power, while explicitly appealing to teenagers and young adults, who equate partying with staying up late. "Who's up for staying out all night?" says a promotion for Bud Extra, one of the drinks cited by the attorneys general in their letter to the Alcohol and Tobacco Tax and Trade Bureau.

Obviously any beverage that someone might enjoy drinking must be bad. I love the fact that Bud Extra had the line "You can sleep when you're 30" on it, at least until they were "asked nicely" to take it off by government busy-bodies. We wouldn't want to imply that people under 30 drink, would we?

Cato on Stossel on The Commonwealth Fund on Health Insurance

A very nice set of nested summaries. I recommend going a few levels deep.

Precautionary Principle

Classically Liberal has the story of Greenpeace activists dumping eleven tons of GM (genetically modified) papaya in front of a government building in Thailand as a protest against something or other. The story is significant for two reasons.

First, when Greenpeace dumped the "potentially" dangerous fruit it was immediately grabbed up by hungry passersby. Frantic warning from the illegal dumpers were cheerfully ignored by delighted fruit-lovers. Said one, “I’m not scared of GM papayas. I’m scared I won’t have any to eat.” Classically Liberal suggests someone attempt to sue Greenpeace for attempting to poison people with deadly food, forcing them to admit that there was no risk involved.

The second interesting facet of this story is the blatant use of groundless concerns and fear by Greenpeace to oppose changes they find unpleasant. The local representative of Greenpeace claimed this incident proves “the failure of government agencies to educate people about the possible health risks of genetically-engineered crops.” Possible health risks indeed. In every study ever conducted, no evidence of health risks associated with GM foods has ever been shown. Ever. The evidence is not "spotty" or "inconclusive." Every study not later discredited shows no danger. But Greenpeace want them banned just in case. They say "Well, they might still be harmful in the long run."

While there is no evidence for harm from GM foods, there is quite a lot of evidence for benefit. Insect resistant crops require less pesticides for the same food yield. Vitamin-fortified grains save lives across the third world. Heartier strains require less watter for irrigation. These concrete advantages, however, do nothing to counterbalance the wholly imaginary risks in the minds of Greenpeace. If millions starve to prevent the possibility of hyperintelligent corn rising up against its God-playing creators, so be it.

The entire campaign against GM foods stems from a feeling that they are "unnatural." Of course, not all unnatural things are bad. Airplanes, for instance. In his natural state the only action of which man should be capable at 30,000 feet is to plummet like a very squishy rock. Today, however, a range of activities is open to the stratospherically inclined, including sleeping uncomfortably, listening to detailed instructions on using a seatbelt, eating 5 dollar bags of chips, imbibing very small bottles of liquor, and fantasizing about a near mythical age when all flight attendants were stewardesses. An argument could possibly be made from a natural law standing that things which are truly unnatural are morally wrong, but if Greenpeace did so, it would open up a whole can of worms about everything else clearly unnatural, such as homosexuality, or Japanese pickup trucks.

Unless Greenpeace wants to get into the business of pontificating on objective morality (not an unlikely possibility) they should quit objecting to GM foods.

Back To Work

Our reader(s) may have noticed a lack of diversity in post authors over the last few weeks. I have been unavoidably preoccupied in recent weeks with the process of preparing for, joining, and adjusting to, the married state. I apologize for my lack of dedication, and will now attempt to throw myself back into my duties with all due diligence.




Thank you.