US Copyright Law

Hal Varian has written a nice piece for the NYTimes about the state of copyright law in the United States.

Here’s a quiz question for authors: To copyright a written work in the United States, you must (a) register it with the Copyright Office; (b) insert a notice that says “Copyright © 2007”; (c) insert a notice that says “All rights reserved.”

Answer: none of the above. Under current law, a work is automatically copyrighted the moment it is “fixed in tangible form.” And these days, that copyright lasts virtually forever: 70 years after the death of the author, in most cases.

This applies only to American copyright. In Russia, for instance, the Beatles catalog is already in the public domain. Most media companies are lobbying for a 50 year or greater extension to the current copyrights. Some want copyright to last forever.

Re: Fair Trade Coffee

Note: I wrote this last week in a long ramble, but rather than waste any more time trying to clean it up, I will just post it.

Triumvir Vis commented on my post about Fair Trade Coffee asking what I concluded from the essay I linked to. He noted, "While Fair Trade Coffee may not consider the seasonal worker, non-Fair Trade Coffee certainly gives those workers no more consideration." I was going to respond to the comment with another comment, as I usually do (I respond to all the comments that call for it, ask a question, or disagree with me), but ended up writing this post instead.

Fair Trade Coffee is yet another example of a project that, although begun with the best intentions, is designed (perhaps unintentionally) to make consumers feel good rather than effectively help anyone. Far too often efforts at helping "those less fortunate" (since it is always a matter of luck when people are poor, not bad policy or personal decisions) are not structured to help real people with real problems, but to boost the ego of guilty westerners/upper middle class/white/men/insert over privileged class here.

If you want to help coffee growers in third world countries, show them how to grow premium coffee and market it as such. "From the serene slopes of Mt. Where-the-hell-is-that." Establish the Fresh From Nature, All Organic (since they can't afford pesticides) Premium Coffee Brotherhood of Fairness and have the growers sell directly to high end restaurants. Or McDonald's. Think about it, McDonald's knows people want premium coffee, they have started selling it already. If they could slap a Brotherhood of Fairness label on it, they could sell it for more, and sell more of it. It would be fantastic publicity, and by cutting out the distributer, more profit could be sent back to the growers. To make a better life for these people, show them how to win in the market. Don't just enforce "fairness" and governmental structure.

But Fair Trade Coffee will never ensure better lives for the growers. All it does is throw around some buzz words about "cooperation" and "fairness" forgetting that if they enforce inefficient practices, it will cost the farmers money. I object very strongly to things like this, or Save the Earth concerts, or National Baby Seal Day. They exist only to make the organizers feel good about themselves, not to produce results. Did the concert to raise awareness of poverty really cause anyone to say, "What? There are poor people in the world? Thank God these musicians flew all this way to let me know!" People are well aware of poverty, especially the people who go to concerts to raise awareness of poverty. If a bunch of famous people held an event to raise awareness of snow blindness in cats, I am sure many people would learn something. But poverty, global warming, the fact that junk food may be bad for you? That is like going up to a smoker and asking "Did you know those will kill you?" As if the smoker is going to fearfully put out his very expensive, overtaxed cigarette, look at his savior and say "You saved my life! Thank you citizen!" The thing events like this do is allow people feel good without making them really do anything.

International programs of all kinds frequently fall into this trap. They must be seen to do something, so they brag about how much money has been spent "combating AIDS" (presumably unarmed combat, since that is more honorable) without asking what those dollars have gotten us. Are there fewer cases of AIDS now than before we spent $500 million? It doesn't matter, because we are doing something.

Just because a project is launched with good intentions does not mean that it will succeed. Charity must be held just as accountable for it actions as any private corporation or government program. Donors must ask if their money is being well spent and achieving results, and if not they must redirect those funds to where they will do more good.

Politicians often resort to these tricks. Montgomery County, Maryland recently banned trans-fats. It is claimed that this will increase health. Will it? What if in five years if a study shows the county is no healthier than its neighbors? If there is no evidence that the law does any good, will the law be repealed? No, because anyone who moves against the law will be accused of not caring about public health. The fact that the law might have no effect on health, only annoy citizens and inconvenience businesses, is not relevant to the do-gooders. Similar logic was used to pass the Assault Weapons Ban, since most of the banned features have nothing to do with real killing power, only the impression of nastiness. The image of helping is what is important and rewarded, not actually helping anyone.

While the offenses of Fair Trade Coffee may be far less than other efforts to do good, that is no reason to give an ineffective, burdensome project a free pass.

Collective Costs

Cafe Hayek explains why people are willing to advocate silly ideas if the cost is not borne by them, but by society and the government. In a society where feeling good is the only test of somethings merit or virtue, there is no cost too high for the thrill of "doing good."

Irrational Exuberance

Interesting Fact Of the Day (or middle of the night as the case may be): Everyone remembers that Alan Greenspan warned that the tech bubble of the 90's was an example of "irrational exuberance", and he predicted that the bubble would burst. Now, looking back, everyone wishes that they would have sold then and avoided the collapse, right?

Wrong. The stock market had a small dip immediately after Greenspan issued his warning, but since then, stock prices have never gone lower. Let me say that again: the stock market has never been lower at any time since that warning. If you bought then, you would now be up 139%.

Source: Don Luskin

I Can Haz Socialized Medicine?

Carpe Diem lists the Top 10 Reasons to Reject Canadian Medicine in CA

Federal Deficit

USA Today is again reporting on the fact that the Federal Deficit looks a lot worse depending on what style of accounting you're using. We posted at length about this issue previously.

Credit Cards Overseas

MarketWatch has an article entitled "An avoidable charge" which is a good read for anyone about to head overseas. It goes through the various considerations in deciding which credit card(s) to use overseas as well as how to use them, e.g., insist that retailers charge you in local currency rather than in US dollars.

Speed Traps

MSNBC has an article about a website called The Speed Trap Exchange, which is operated by the National Motorists Association. It's a site where individual can post and review information about speed traps of which they know - allowing others to get a heads-up when traveling to an area with which they are unfamiliar.

While the statistics one can glean of off such a data set are dubious at best, for what it's worth, Detroit was named the worst city in the country for speed traps. It's like adding insult to injury.

Memorial Day Links

So what did you do with your Memorial Day? I read this stuff.

An unsympathetic review of Myth of the Rational Voter, with some responses at the end. Do you think "The People" are truly wise? A bit long but worth the read.

The New York Times also has an article discussing whether voters make good decisions, and why three-fourths of them supported the invasion of Iraq at the time, but now two thirds oppose it, and why a statesman should listen to such easily swayed people in either case.

Ottawa fails to ban trans fats. And this is news now.

The New York Times devotes an entire article to a regional delicacy of Quebec, poutine, which it describes as "a gloppy, caloric layering of French fries, fresh cheese curds (a byproduct of Cheddar making) and gravy, poutine goes deep into the Quebequois psyche."

Reason has an article on price-gouging laws and whether they would lower gas prices. In case you thought they were a good idea.

An unreconstructed communist tells his audience that the Age of Empires is over, since the American Empire is imploding under the weight of its own ineptitude, and attacks by those infuriating mortar ships. They can wipe out your capital is seconds!!

This looks like a term paper some Catholic student wrote on medieval usury laws. While a little academic for popular consumption, it has some fascinating info on the Catholic moral debate around charging interest on loans and how Aquinas laid the foundation for the modern moral understanding of interest. Honestly, sometimes it seems that the motto of any student of Catholic thought should be Aquinas: You Either Agree With Him, Or Are Wrong.

Finally, Rachel Carson's Grim Legacy looks at, well, just that. I always knew environmentalists killed people, but at least it's only brown people in third world countries, so no one particularly cares.

The Case Against Homework

Boing Boing has a review of The Case Against Homework, which argues that homework is counterproductive. It posits that homework wastes time and stresses kids out, and is not significantly linked to any academic benefits. While I am not completely convinced (only mostly convinced) that the free form, do-what-you-want education endorsed by the Boing Boing reviewer is the most effective way to educate children, I think this is a great example of why parents should be able to send their kids wherever they want, and let their kids be taught however they think best. While some people will argue that parental school choice will mean society can't guarantee that all of our nation's youth receive the best possible education, forcing everyone to attend centrally administered public schools merely ensure no one does.

Taxi Monopoly

George Will has written a fantastic article about taxi monopolies. It may be a sign that I am way too into economics and freedom (if such a thing is possible) but the story of the immigrant who challenges the city for the right to drive a taxi, and wins, is the most inspiring thing I have read in months.

HT Carpe Diem

More Fun with Statistics

Reason Hit & Run has a fun post entitled "Why Do Smoking Bans Prevent Heart Attacks Only in Small Towns?" It is yet another example of statistics being made to misrepresent reality. Bonus: The same people using the statistic make egregious use of post hoc, ergo propter hoc.

For previous examples, see here.

"Washington writes the laws, and apparently re-writes the dictionary"

Great CNN report about pork. Via Club for Growth post:

Farm Subsidies

TCS Daily has an interesting article entitled "Kiwi Fruit for America" which is an exposition of the consequences of New Zealand's elimination of farm subsidies decades ago. Definitely worth a read.

Snippet:

"A prosperous farm sector without government subsidies? Sounds too good to be true...sounds like a fairy tale. It's not. In 1985, New Zealand permanently eliminated 30 different agricultural production subsidies and export incentives. Over the past 20 years, as New Zealand's farms flourished without assistance, the opportunity cost to American consumers and taxpayers of U.S. farm programs has totaled more than $1.7 trillion."

Define Your Terms

The Liberty Papers has an interesting post regarding the definitions of mercantilism, fascism, and capitalism and the differences between the systems. Worth a read if you're interested.

Links

In no particular order:

A Rising Tide Lifts all Boats - Cato@Liberty
Seattle's Race Problem -- and the Nation's - TCS Daily
Advice for Cash-Paying Patients: Just Walk up to the Desk and Demand Your 50 Percent Discount - Cato@Liberty
Stay-at-Home Economics - Townhall
The BBC still hates America - American Thinker Blog
Bounties, Sí; Hunting, No - Reason Hit & Run

Fairness Doctrine Resurrected

The Heritage Foundation has a good article on the Fairness Doctrine and how some in Congress would like to resurrect it. Anyone interested in free speech issues should read it.

The FDA and Tobacco

Multiple media outlets (USA Today, FOXNEWs, etc.) reported yesterday that a governmetn advisory panel has advised that the FDA should regulate tobacco:

"A government scientific advisory panel proposed sweeping changes Thursday to reduce the health burden of tobacco, which claims 490,000 American lives a year.

"The report from the prestigious Institute of Medicine calls on Congress to allow the Food and Drug Administration to regulate cigarettes as drugs and control the way tobacco is marketed. Authors from the IOM, a panel of independent experts who advise the government on health policy, say they aim 'to reduce smoking so substantially that it is no longer a significant public health problem.'"

The report suggested several specific steps to reduce tobacco use:

• Requiring all insurers — including the Medicare and Medicaid programs — to cover smoking-cessation programs.
• Licensing retailers that sell cigarettes, just as states issue licenses to sell alcohol.
• Raising cigarette taxes as much as $2 a pack, an effective way to reduce smoking.
• Dedicating $15 to $20 per capita annually of the proceeds from higher taxes or other resources to fund tobacco control efforts in each state.
• Banning smoking in all non-residential indoor areas.
• Limiting tobacco advertising and promotional displays to text-only, black-and-white formats.
• Launching additional efforts aimed at curbing youth interest in smoking and access to tobacco, including bans on online sales of tobacco products and direct-to-consumer shipments.
• Requiring new, large pictorial warnings on the harmful effects of smoking -- similar to those required in Canada -- on all cigarette packs and cartons.

So, the purpose of these changes would be to "reduce the health burden of tobacco." The question occurs to me: on whom is the burden? The individual or society? If the health burden of tobacco is on the individual (and assuming no one has forcibly detained the individual for a significant portion of his or her life, forcing them at gun point to smoke a pack or more a day), then it is a self-imposed burden.

One must ask, therefore, why society should try to "save" people from themselves.

{tangent}

As soon as one asks that question, however, it seems to me that they have a problem: that's no what anti-smoking activists want to do. They never say "we want to regulate this product to save people from themselves" rather, they say "we want to regulate this product to save people from the harmful effects of a product that is aggressively marketed by powerful corporations who control powerful lobbyists in Washington."

Anti-smoking campaigns seem to go to pain to gloss over the fact that people choose to smoke. Rather, they focus on everyone except the person who has actually chosen the activity (and the burden): the company that sold them the product, the government that allowed it to happen, etc.

I suspect that at least one reason for this tactic is that, generally speaking, people do not sympathize with people who get themselves into trouble (especially knowingly) and then want others to get them out.

{/tangent}

If someone has freely chosen to accept the consequences of their actions, why should others be taxed, or forced to pay higher insurance premiums, or not allowed to use their property in the way in which they wish, etc. in order to "make up for" the mistake of the individual?

If however, the health burden is on society (for example, in the form of increased health insurance costs or taxes on everyone in order to pay for the subset that smokes), then one must ask "why?" Why does society bear the burden of an individual's heath problem that was brought on by an extremely long series of decisions to smoke a cigarette? Perhaps a better way to discourage smoking (whether or not that in itself is a good end) would simply to shift the burden back to the individual by allowing insurance companies to offer people plans that do not cover smoking cessation programs nor smoking related health problems. The fact that these plans would be cheaper (and, therefore, attract a lot of eligible people away from other plans) would raise the cost of the plans that cover smoking - thus increasing the cost of smoking to the smoker.

In any event, it seems to me that this series of recommendations aimed at reducing smoking is another example (others being proposed bans on fast food and proposed bail outs for defaulting sub-prime mortgagees) of a mentality that the individual does not (or should not) bear the responsibility of their actions - rather, that responsibility is shifted to society (or the government), especially when, by "responsibility", we mean "burden".

This seems to me to be a variation on the theme of socialism (both in the economic and political senses) - mistakes are not punished, achievements are not rewarded. Everyone bears the burden of everyone else's problems (even when they are self imposed) and everyone gets to consume the fruits of everyone else's labor.

Newspapers Defend Gas Prices

The Club For Growth has list of newspapers across the country that are calling Congress out for the ridiculous grandstanding and politicking about rising gas prices. Nice to see some otherwise left-leaning papers on the list.

The World's Most Reputable Companies

MSNBC has an article about Reputation Institute's annual study on the reputation of 600 companies worldwide (press release (PDF)). The article and press release make for an interesting read for those interested in business, corporate culture, etc.

BTW, the most respected company: Lego; the least respected company: Australian Wheat Board (followed closely by Halliburton).

Those Darn Lenders!

From an MSNBC article:

A high-ranking Treasury Department official on Wednesday chastised mortgage lenders for too-often failing to verify the income of borrowers with blemished credit histories, blaming the practice for rising defaults and foreclosures.

Comptroller of the Currency John C. Dugan said federal banking regulators need to give the industry guidance for improvement in this area, though he did not offer a specific remedy.

So, in other words, people misrepresent their incomes to get bigger mortgages, then default, and it is the lender's fault that these "unfortunate" people lose their homes? What about the other people who are involved with the mortgage companies that are essentially victims of fraud (granted, the companies perhaps didn't do enough to protect themselves - but that doesn't suddenly mean that they are the offending party and the borrower the victim)? Should the Treasury recommend tougher criminal penalties for people who lie on their applications, default, and thereby hurt the company, its employees and shareholders?

The Modern Union

This is the latest in Techdirt's series on Professional Associations as the new unions, and the effect they have on the market they serve. If you remember the Interior Decorator scam from a while ago, or are interested in unions and protectionist policy, I highly recommend reading it.

Price Gouging

$3.49 Cost of a gallon of gasoline in San Fransisco

$0.18 Federal Taxes
$0.40 State Taxes
$0.30 City Taxes
_______________
$0.88 Total Taxes

$0.13 Oil Companies Profits

Source: George Will via Cafe Hayek

Do We Need The FDA?

Techdirt has a post up about open source drug trials, where private journals and doctors use public data to determine if a drug is safe. This allows individuals and doctors to look at the data and make their own decisions about what risks they are willing to take, without the Federal Government determining if certain drugs can even be on the market.

On a side note, Techdirt is a cooperate intelligence and technology trends company, but they have some really fascinating stuff on free markets, among many other things. They are always worth a read.

Your Home qua Investment

The Motley Fool has a good article on your home insofar as it is an investment vehicle. Read it.

Microfinance Side Effect: Distribution Channels

From Indiatimes article "Micro-finance firms turn into delivery boys":

"India’s microfinance, which is perhaps the ruling flavour of private equity players, is actually turning out to be a distribution highway for a variety of goods and services given the huge outreach of over one million customers each that large entities like Share, SKS, Basix and Spandana have managed to create.

"Fuelled by private equity investment and expansion, many of these entities are looking at reaching as many as five million people each in the near term. While the creation of reach has been purely for their own businesses of vending micro-loans, it now transpires that their channel could be widely used, and profitably too, for peddling insurance, money transfer, procurement and supply chain financing for agri and allied activities.

"Akin to banks tying with other services providers like insurance and raising their fee-based income, MFI players also stand to benefit from commission fees for routing various goods and services through their channel. In fact, the model not only reduces the transaction costs for the new services, but also would eventually reduce the cost of micro-loans from MFIs.

...

"The channel could be pushed for productive asset distribution and perhaps not for non-productive items like soaps, toiletries and other consumables as of now. In the future, there could be services like medical, education, para-medical, public health and awareness programmes, and even talent hunting that could be bundled through this channel.

"MFIs and self-help groups (SHGs) are also seen to be very active on the agri and allied activities given the huge rush in procurement activities, retail boom and relaxation of agri marketing norms in many states. For instance, Basix finances small and marginal farmers for the entire supply-chain activity of procurement of nearly 4,000 tonne (target for FY08) potatoes in Jharkhand for the end user, Frito Lay.

"Similarly, it is gathering milk producers, who own one or two cows each, to supply to Reliance as part of its dairy procurement initiative. There have a spate of such tie-ups recently. Most MFIs peddle insurance products helping companies fulfill their rural and social obligation for sale of policies."

Just In Case Target Tries It Too

Wal-Mart recently tried to get into the banking business, a move that would have been a serious threat to the banking industry precisely because it would have been service with a very attractive value proposition to consumers. Wal-Mart eventually abandoned the effort.

Apparently, that wasn't good enough, because the House has now passed a bill to limit any future attempts at such an enterprise:

Big retail stores like Home Depot and Wal-Mart would be barred from owning specialized banks known as industrial-loan companies under a House bill passed late Monday.

In a victory for the banking industry, the House approved a bill that would prohibit the Federal Deposit Insurance Corp. from granting new ILC charters to commercial companies. The vote was 371 to 16.

Bonus: One of the big opponents to companies such as Wal-Mart getting into the banking industry is House Financial Services Chairman Barney Frank, who a) has apparently been complaining about high credit card transaction fees charged by banks, and b) is featured in this video (HT: Club for Growth) about Democrats wasting taxpayer money flying around in military jets.

No Confidence in Congress

From Club for Growth post:

Senate Democrats want to hold a "no confidence" vote against Attorney General Alberto Gonzalez. If that happens, Senator Tom Coburn plans to offer an amendment, the subject of which he explained in a recent letter to Minority Leader Mitch McConnell (received via email). Excerpt:

I am requesting that I be consulted before the Senate enters into any unanimous consent agreements regarding a vote on any resolution or other legislation expressing a lack of confidence in any federal official.

If such a resolution comes before the Senate, I plan to offer an amendment expressing no confidence in Congress’ ability to cut wasteful spending or balance the budget.

Nice.

I Don't Understand

There are many things in this world that I simply do not understand. One class of such things is "who agreed to pay for that!?" For instance, I do not understand:

• How anyone agreed to fund Wrath of Khan after having seen Star Trek: The Motion Picture
• How anyone thinks that $19.95 + S/H is a good deal for a Hot Dog Toaster
• How anyone donates money to build an enormous building full of items such as toilet fountains and other examples of modern "art"

I found the latest example of this class of causes for my confusion in this article which describes the results of a study soon to be published in the Proceedings of the National Academy of Sciences that tested Viagra as a cure for eastbound-flight-induced jet lag using hamsters.

Today's Boards: Trigger Happy or Less Complacent?

The New York Times is reporting that, according to a recent Booz Allen Hamilton study, Boards of Directors are three times more likely to terminate a CEO for performance reasons as they were a decade ago. The overall turnover rate for CEOs is also up - to about the same level as it is for all employees.

"What About Aeroplanes"

A valid question from Carbon Leaf's What About Everything. Well, here are a couple articles that go towards answering it:

• Boeing changes way planes are made with 787 (MSNBC): An interesting article primarily about how Boeing is outsourcing much of the production of its much anticipated 787 Dreamliner. Bonus: it quotes a union president regarding the issue of Seattle based workers doing extra work on the initial Dreamliner due to supplier issues, "We need to be ready and available to pick up that slack and show them we can do it better than the supplier, and our hope is then that we can draw that work back." Note that the union president recognizes that his union needs to be more competitive in order to win back market share (rather than trying to distort the market by legislation or other non-market means).

• The Real Owner of All Those Planes (New York Times): An interesting article about Steven Udvar-Hazy (after whom the National Air and Space Annex at Dulles International Airport is named) who founded and co-owns International Lease Finance Corporation and is, as a result, one of the 100 richest Americans. In a nut shell, he owns an enormous number of planes and leases them to the major airlines who don't have enough cash flow to buy them outright. It's a fascinating article even if you couldn't care less: "'Not to put too fine a point on it, but in our industry, Steve Hazy is God,' said Edmund S. Greenslet, editor of AirlineMonitor.com."

More on the Gender Pay Gap

A snippet from a working paper quoted in Carpe Diem post:

"There is no gender gap in wages among men and women with similar family roles. Comparing the wage gap between women and men ages 35-43 who have never married and never had a child, we find a small observed gap in favor of women, which becomes insignificant after accounting for differences in skills and job and workplace characteristics.

This observation is an important one because it suggests that the factors underlying the gender gap in pay primarily reflect choices made by men and women given their different societal roles, rather than labor market discrimination against women due to their sex."

Fair Trade Coffee

Colleen E. H. Berndt has an essay up on TCSDaily about Fair Trade Coffee (FTC). It is an interesting critique of a well intentioned plan.

For instance, FTC is a designation that is "open only to co-operatives composed of farmers owning fewer than 12 acres of land and who do not employ any full-time workers. The co-operative must then pay the FLO to certify that the co-operative, not the member farms, meets specific standards for socially and environmentally sound coffee growing and accept the FLO's mandated organizational structures. No matter how well run or how benevolent a non-cooperative private organization is, no matter how well paid or well treated its employees are, that organization cannot obtain Fair Trade certification." It seems that FTC is not so much about ensuring that laborers are compensated justly for their work, but that coffee is produced in accord with a commune-like ideal.

Links

In no particular order:

• Venezuelans March to Support TV Station Critical of Chavez - FOXNews.com
• Houseguests Who Pay, and Pay Well - New York Times
• Music Licensing Online: YouLicense - TechCrunch
• Ad Hominum Adsurdum - Cato@Liberty
• The Coercion Herring - TCS Daily
• Australian Court Rules Woman Must Pay for Tossed Engagment Ring - FOXNews.com
• Switzerland Officially Rejects Request from Brussels to Negotiate Surrender of Tax Sovereignty - Cato@Liberty

What Constitutes the 'Track'?

USA Today has an article about how a recent poll indicates that 75% of Americans do not believe the country is "on the right track." I can understand people thinking that the country is not on the right track for many reasons, some of which are cited in the article: the war in Iraq, President Bush, etc. I can even understand people thinking that the country is not on the right track due to the economy (not because it is actually bad but because, no matter how good it gets, multiple news outlets will persist in insisting that the economy is in the tank and a portion of their audience is just stupid (or uninformed) enough to believe it (witness the closing sentence of the article)).

I cannot, however, understand 5% of respondents saying that the country - the entire country - is not "on the right track" because of the price of gasoline.

Sexism In The Hotel Industry

A new hotel is reserving an entire floor for women. The rooms are intended as a safe place for women traveling without the protection of a strong man, and the luxury rooms will be let at a premium. What do you call a luxurious, safe place reserved for only women? Oh, that's right.

Bring Back the Love

Via Club for Growth:

The Break Up
Uploaded by geertdesager

Statistics

From a Cato post:

"This week I’m getting emailed press releases telling me that '94% of international teens want the US to address global warming more aggressively.' If you read waaaay down in the email, you discover that it was an online survey of 250 teens who — it appears — mostly attend U.S. schools. So maybe the striking headline is just a teensy bit of a stretch.

But if it were a scientifically valid survey of actual teenagers around the actual world, one might still say: So 94 percent of teenagers in other countries — that is, respondents who don’t pay taxes and haven’t studied either climatology or economics and aren’t looking for a job — and if they did pay taxes or look for a job, wouldn’t do so in the United States — think that the United States should hobble its economy in the name of something that vaguely sounds scary. And we should care because…?"

For more on deceptive statistics, see this old post.

More Calls For A Flat Tax

As both dedicated readers of this site will know, Flat Taxes are spreading and gaining popularity in Europe, and are currently in place in 16 countries. Senator Robert Bennett of Utah is joining the call to bring a similar system to the USA.

Government Anti-Breast Policies

Cato is reporting on the government program that distributes baby formula to poor mothers despite every government agency and private expert claiming that breastfeeding is healthier for a baby. Apparently this WIC program (women infants children) is responsible for half of all formula consumed in the United States. This news comes courtesy of International Breastfeeding Journal, although "as a scholarly article, it had no photos." This program drives up the cost of formula for others, since it artificially raises demand, and counter acts all of the government efforts to encourage breastfeeding.

Cato sums up the argument:

I would favor the whole WIC program be terminated. Unfortunately, like many federal aid programs administered by the states, WIC has a vigorous lobby group –National WIC– made up of the thousands of state and local government officials that run the program.

The group’s 2006 legislative agenda is entitled “WIC at RISK! A Healthy, Strong America in Jeopardy!” The document predicts dire consequences if Congress doesn’t go along. Unfortunately, most members buy into such doomsday rhetoric and aren’t regular readers of the International Breastfeeding Journal.

More's the pity.

I Am Proud To Be A Marylander, But...

I would like to point out that I am from Anne Arundel County, not Montgomery County.

Why Does The Post Office Deliver the Mail while the Royal Mail Delivers the Post?

Cafe Hayek on the argument for ending the Postal Service's monopoly on first class mail. Actually, they just quote the Baltimore Sun, but I refuse to link to them unless I absolutely must. It does seem like it's time to kill this billion dollar turkey.

Fun Fact: The USPS is the third-largest employer in the United States (after the United States Department of Defense and Wal-Mart) and operates the largest civilian vehicle fleet in the world, with an estimated 260,000 vehicles. (via Wikipedia)

Really, Really, Really Big Numbers

I love a mind boggling math fact, and Cafe Hayek's Don Boudreaux has a very nice one.

The economist Paul Romer notes the astonishing fact that if you thoroughly shuffle a deck of 52 cards, chances are practically 100 percent that the resulting arrangement of cards has never before existed.

Never.

Each time you shuffle a deck, you produce an arrangement of cards that exists for the first and only time in history. The arithmetic works that way. For a very small number of items, the number of possible arrangements -- which item is first, which item is second, which is third, and so on -- is small. Three items, for example, can be arranged only six different ways. But the number of possible arrangements grows very large very quickly. The number of ways to arrange five items is 120. For 10 items it's 3,628,800. For 15 items it's 1,307,674,368,000. The number of different ways to arrange 52 items is 8.066 times 10 to the 67th power.

This number is so enormous that no human can comprehend it. By way of comparison, the number of ways to arrange a mere 20 items is 2,432,902,008,176,640,000 -- a number larger than the number of seconds that elapse in the course of 10 billion years. And this number is microscopic compared to 8.066 times 10 to the 67th power.

He then goes on to note that if 52 items can be arranged in that many possible ways, the number of ways the resources of any economy can be organized is orders of magnitude higher. From this he concludes that it is insane to hope an economy can be ordered optimally by central planners.

This puts me in the awkward position of agreeing with his conclusion completely, but thinking his argument is not very convincing. A dedicated central planner will respond with any number of variations on "But these are smart people," and "This just shows that we can't leave this organizing to random market forces." Some will even argue that, yes, if you want efficiency the market is the way to go, but we care about more important issues than mere material production, we care about justice and equality.

That in no way diminishes how cool these numbers are, or how stupid central planners really are.

Stipulations for All That Money

MarketWatch has an interesting article about trends concerning who attaches stipulations to assets that they leave to others in their will. Worth the read, if you're interested.

Always Low Prices

More on Wal-Mart's low cost clinics and health services. If you want to make a moral statement, the thing to do today is complain about Wal-Mart, but if you just want to buy something there is nothing better.

American Women Less Likely to Be in Kitchen, Barefoot.

Even though we have no comparable law to Norway's requiring a minimum percentage of women on any board of directors, America has a higher percentage of women in the workforce than Europe. I am torn about this. On the one hand, it shows the ineffectiveness of government policy to truly effect change. On the other hand, who will make me a sandwich?

Why Buying Slaves Might Be A Bad Thing

Glen Whitman has an article at The Library of Economics and Liberty on unintended consequences. One example he offers is people who buy slaves in war torn Africa to "redeem," or free them.

Did these charitable efforts do any good? Certainly, some people are free now who might otherwise of have lived their whole lives in slavery. But there is strong evidence to suggest that slave redemption made the overall situation worse. As journalist Richard Miniter reported in a 1999 article in the Atlantic Monthly, the high prices offered by relatively rich Americans increased the demand for slaves, turned the slave trade into an even more lucrative business, and thereby gave raiders an incentive to conduct even more slave raids. If not for the activities of Western charitable organizations, many of the redeemed slaves might never have been enslaved in the first place!

How did the slave redeemers err? They focused on just one incentive (to release people already in bonds) while ignoring another (to capture more slaves). The sad result was an incentive scheme gone awry.

This is an excellent story to bring up when trying to explain unintended consequences. Just because someone has a good intention does not mean that they will accomplish any good. This is a concept that many people seem unable to grasp. I have lost count of the times I have explained why some government program or another is a waste of money, only to hear the response "But we have to do something." Ignoring the assumption that no matter what the problem "we" have to do something, it in no way means that any well intentioned and poorly thought out plan will in fact help. Minimum wage, universal health care, endangered species laws (which encourage "kill it and cover it"), the war on drugs, all have serious side effects that can easily outweigh the supposed benefits.

The whole thing is a must read, it has some other really great stuff.
HT Cafe Hayek

Study Shows That No One In My Family Will Ever Binge Drink

The BBC is reporting on a new study that finds teenagers drinking at home with their parents are less likely to binge drink. According to the study 75% of 14-year-olds had tried alcohol.

The question is: are they learning to drink from their parents in a socially responsible environment, or are they learning behind some bushes in the park, or in a bar where they should not be in the first place?

"The chances are if they are in the latter position they are learning to binge drink, they are hiding their drinking, they can't talk to their parents about it.

"Drinking in the home environment, if it is done properly, can teach young people respect for alcohol, and how to consume in moderation."

This leads to disagreement with an earlier call for Britain to prosecute parents who let their kids drink. If drinking at home decreases binge drinking (which for now is the kind of drinking we hate, until it becomes drinking in front of kids, or in public, or at a bar) then in the name of preventing binge drinking should we punish parents who allow it?

The researchers do, however, call for increasing the price of alcohol to prevent underage drinking. Which makes sense, since if there is one thing we can all agree on, it's that kids today have no way of getting their hands on controlled substances without buying them from properly licensed tax-paying stores, and it should cost more for mature individuals like me to have a night out. With your mom.

Papillomavirus Causes Cancer In Males, Too

The human papillomavirus, which has been linked to cervical cancer and was at the center of the recent storm of controversy about mandated STD vaccines, promiscuity, sex ed, and government corruption, has now been linked to cancer in males, leading some to ask if vaccines will be mandatory for boys.

Full disclosure: the only reason I am writing about this is to have an excuse to link to an article from Reason with the headline "Oral Sex Linked to Throat Cancer," and that ends with the disclaimer "Disclosure: Despite any rumors you may hear, I am not shilling for Big Oral Sex."

Blades Banned In England. Rakes and Hoe's Future Uncertain

Little known fact of the day: The UK, where handguns are illegal, is being swept by a wave of bladed violence.

One Brian Seaton spent nine months and £10,000 trying to clear up the legal mess created when he was arrested for carrying a Swiss Army Knife in public, a knife he received as a retirement gift after 20 years as a police officer.

Startled by this heinous crime, the UK government is trying to ban the sale of swords. When swords are outlawed, only outlaws will have swords, making outlaws that much cooler.

They claim that there have been over 80 serious crimes involving swords in the last four years. I find this hard to believe. After all, it is illegal to carry a sword in the UK. It would seem to be very hard to commit a "serious" crime with a sword without carrying it. I suppose you could mount the sword to, say, the front of a car, but that seems more hilarious than serious.

Smoking Ban Coming To The Big Screen

Smoking will now be considered when rating a film, meaning it can bump a film from PG to PG-13 or R.

Along with violence, depictions of sex, adult language and other content considerations, ratings organizations will examine new releases to determine if they glamorize smoking or if it is pervasive through the films, even among adults. Underage smoking has always been considered when rating a film.
...
A number of groups have called for almost all movies that depict smoking to automatically receive an R rating, a plan the movie studios oppose.

Christopher Buckley, satirical author of Thank You For Smoking, responded to the news:

I can only hope this means that the MPAA will strip such films as 'Casablanca,' 'To Have and Have Not' and 'Sunset Boulevard' of their G-ratings and re-label them for what they were: insidious works of pro-smoking propaganda that led to millions of uncounted deaths. Bravo.

I was once shown a review of Constantine (a movie I enjoyed greatly) from Screenit.com which warned that the film contains "Extreme Smoking," which I suppose refers to the scene where the star lights an illegal Chinese cigarette in his doctor's office right after she tells him he is dying of lung cancer. I now smoke these→

which are king size unfiltered. Damn Hollywood.

Economic Competitiveness Index

The US has come in at the top of a list of the most competitive economies in the world.

I think it says something regarding how uninformed most people are about the operations of an economy (and, for that matter, how reporters will often throw in completed unrelated information, especially at the end of an article) that the above linked article includes these gems:

"The US economy has remained the world most competitive, despite the country's soaring trade deficit, a study says."

and

"The upbeat assessment came despite recent record levels in the nation's budget deficit."

Oh, by the way, in case you were wondering, Venezuela came in last.

Education Choice and Commie Toys

Two quick things:
Cato has a nice article on the rising support for education choice, specifically tax credits for education. Apparently support runs at about 3 to 1.
Also, Create-a-Commie is perhaps the greatest communism-themed toy ever.

Girls Gone Union

I am not sure what to say about this, except that it might help someone see how ridiculous compulsory unionization is. Unless you think it is a good idea. Then I can call you authoritarian and idiotic.

The problem with people like Joe Francis [owner and founder of Girls Gone Wild] is that he is exploiting non-unionized, unprotected, poorly compensated, unlicensed (and often incapacitated) temp workers, and profiting handsomely from this exploitative labor market. Eligibility to work as a model for pornography, and legal hiring for pornography, should be contingent on the model's membership in a sex worker union, which would a variety of legal, health, pay scale and other occupational protections. If we moved to such a model, then we might have some hope of rationally addressing this issue within the context of existing social norms about the appropriate legal age limits for contracting one's labor. And no one would have the legal right to drive by a crowd and say "here's 100 bucks to pull up your shirt" to a bunch of young women lacking union cards.

From Reason's Hit & Run

Time Square vs. Panama & Bolivia

A report is claiming that Time Square generates more revenue than the combined GDPs of Panama and Bolivia ($25.3 billion and $27.2 billion, respectively).

Hate Crimes Bill

From Reason Magazine article:

"'Hate crimes have no place in America,' House Speaker Nancy Pelosi boldly declared last week, 'no place in a nation where we pledge every morning "with liberty and justice for all."' Pelosi was urging her colleagues to approve a bill aimed at violence motivated by hostility toward members of certain designated groups.

"According to Pelosi, then, the 'justice for all' mentioned in the Pledge of Allegiance means equal opportunity to be a crime victim. It certainly does not mean equality before the law, which the hate crime bill sacrifices by treating perpetrators of the same crime differently because they hold different beliefs."

Is it just me, or is there a kind of proportion that looks something like this:

Affirmative Action Legislation:Economics::Hate Crime Legislation:Crime

?

Ah, Price Controls - Aren't They Great?

Gas Station Owner: I'll give senior citizens a $.02/gallon discount and people who sponsor local kids' sports a $.03/gallon discount.

State Government: We will sue you.

There's Unemployed and Then There's Unemployable

There's an interesting article in the Daily Mail regarding the theory that Britain will soon face a socio-economic dilemma in the form of a large segment of the population being unemployable due to a possible reduction in the number of unskilled jobs due to technological advances:

"Britain is in danger of creating 'an army of the unemployable' as disillusioned teenagers quit school with no qualifications. . .

"Mick Brookes, General Secretary of the National Association of Head Teachers, said advances in technology are set to slash the number of jobs available for unskilled workers, with potentially disastrous consequences for society."

Proposed Illinois Health Care Plan

The New York Times has an article describing the situation in Illinois whose governor has recently proposed a tax increase on businesses to fund a universal health care plan. Money Quote: “The fairness of what I’m proposing is why I’m all for it.”

Apologies for getting this out late.

Microfinance Bond Issue

From Reuters Africa:

"Investment bank Morgan Stanley and BlueOrchard Finance are launching a $108 million bond backed by loans to microfinance institutions that is the first to be rated by a major rating agency.

...

"The assignment of a rating by Standard & Poor's to this deal will increase the number of investors who are able to buy it, possibly boosting the amount of cash that is available for microfinance purposes.

...

"S&P said on Thursday it expected to rate another two or three transactions in the months ahead, with issuance possibly reaching $500 million by the end of 2007. Ultimately, issuance volumes could grow to $1 billion-$3 billion a year over the next decade, it said.

"The deal, dubbed BOLD 2, will fund loans to 21 microfinance institutions in 13 countries that will then make loans to around 70,000 low-income people to fund businesses. The countries are Azerbaijan, Bosnia, Cambodia, Colombia, Georgia, Ghana, Kenya, Mongolia, Montenegro, Nicaragua, Peru, Russia and Serbia.

"These loans will be offered in local currencies such as the Ghanaian cedi or the Mongolian tugrik, meaning borrowers do not face exchange-rate risk, as well as euros and dollars.

"Standard & Poor's will rate two classes of notes, a $42 million tranche at AA and a $16 million piece at BBB, with the remaining $50 million being unrated. Notes will be available in dollars, euros and sterling."

The Pay Gap

MSNBC has an article (note the lack of adjective) entitled "One reason for pay gap: Women don't speak up" in which the author puts forth the possibility that one reason for the "pay gap" between men and women is that women simply don't ask for or negotiate for higher wages/salaries and men do. There is quite a bit in the article that I could do without, but it's still worth reading. After all, if the president of Harvard had written it, he might have been run out of town.

Business or Pleasure?

Stephen J. Dubner and Steven D. Levitt (of Freakonomics fame) have a good article in the New York Times entitled "Laid-Back Labor" in which they briefly discuss the difficulties surrounding trying to determine what constitutes work and what constitutes leisure (from an economic standpoint, that is). It's an easy, fun read. I recommend it.

Centrally Planned Poverty

Arnold Kling has an essay up on TCSDaily about the failures of centrally planned poverty programs. It makes an excellent argument that most programs do more harm than good.

Unemployment Compared

Carpe Diem has a nice post pointing out that at the worst point in the last 10 years, US unemployment has never risen above the lowest point EU unemployment has reached in the same period.

More Stock Records

The stock market has traded up 22 of the last 25 days. That's the best streak since 1955
From Club for Growth

Problems and Solutions

• A great new government program - Problem: State government loses money due to reliance on gas tax; Solution: Spend $800 million to raise $4.8 million - from Townhall.com
• Stalin-Esque Show Trial At Tufts University - Problem: Free Speech; Solution: "'We don't like you. Nobody likes you . . . There should be consequences.'" - from Townhall.com
• Free Minds, Free Eastern Market - Problem: DC-owned market burns down; Solution: Have Eleanor Holmes Norton promise to rebuild it with federal money as soon as she's done trumping the constitution on who gets seats in Congress. - from Reason Magazine
• Blogged Down - Problem: Any "public figure" determines that any statement made on any blog is defamatory; Solution: State gives blogger two days to remove the statement, if he doesn't, state slaps blogger with "'a presumption of malice intent,' and the statement would not actually have to be defamatory for the presumption to kick in." - from Reason Magazine
• House Rules - Problem: Someone needs/wants a roommate. This person would prefer a person with or without certain traits so that they are compatible; Solution: Sue the site that hosted the online add using the Communications Decency Act - from Reason Magazine
• What the Hate Crimes Law Would Do - Problem: You tell me that you think something I am doing is bad in some way; Solution: I lobby congress to pass a law making any statement to that effect a hate crime (oh, and for good measure, congress restricts it to statement made against the specific thing that I am doing and refuses to extend it to anything else) - from Townhall.com

No More 3-Year T-Notes

The Treasury is discontinuing 3-Year T-Notes due to shrinking federal budget deficits.

"As If Any Black Student Will Do"

The title of the post is a quote from an article entitled "Questions raised over college diversity", which concerns the issue of a large portion of black students on college campuses not having been born in America. Read it for yourself - I'd rather not comment on it right now.

Supply-Side Health Care

Josh Hendrickson has an interesting take on the problems with US health care over on TCSDaily.

Requiring consumers to pay a deductible would give individuals the incentive to obtain pricing information and would thus cause doctors to be more forthright with their billing methods. Additionally, a market with consumers who no longer lack price information will begin switching to physicians that they perceive as offering better quality service and thus may induce some level of price competition among doctors. This type of policy is consistent with that advocated by demand-side reformers.

Worth a read if you are interested in this kind of thing.

How Much Is 49 Billion, Anyway?

Last week, I mentioned that the Federal Government took in $49 billion in taxes in one day, or roughly the GDP of Costa Rica. The Club for Growth has done some more research, and lets us know that:

The ENTIRE Federal budget didn't surpass that one day income tax receipt total until 1952. Think about that. The individual income tax receipts in one day last week were greater than the entire budget of 1951.

The week's individual income tax receipts exceeded all Federal spending until 1963.

Brian Wesbury estimates total "federal receipts at about $390 billion in April. This would be the largest tax take for any month in American history, up 25% versus last April, and up 18% versus the previous record high in April 2001."

Federal spending didn't top $390 billion until 1977.

I sure hope everyone is happy with what we have bought ourselves with that much money. Oh, wait, you didn't get anything you wouldn't have gotten in 1950?

BREAKING NEWS: Government Wastes Stuff

Angry Bear ("Slightly left of center economic commentary") has a post up where in they express shock and amazement that the federal government wasted untold millions of dollars in aid after Katrina. It consists mostly of quotes from this Washington Post article by John Solomon and Spencer S. Hsu.

Allies offered $854 million in cash and in oil that was to be sold for cash. But only $40 million has been used so far for disaster victims or reconstruction, according to U.S. officials and contractors. Most of the aid went uncollected, including $400 million worth of oil. Some offers were withdrawn or redirected to private groups such as the Red Cross. The rest has been delayed by red tape and bureaucratic limits on how it can be spent.
...
In one exchange, State Department officials anguished over whether to tell Italy that its shipments of medicine, gauze and other medical supplies spoiled in the elements for weeks after Katrina's landfall
...
Overall, the United States declined 54 of 77 recorded aid offers from three of its staunchest allies: Canada, Britain and Israel, according to a 40-page State Department table of the offers that had been received as of January 2006.

It continues to amaze me when people continue to be amazed by the incompetence of government. Of course this is blamed squarely on Bush and his administration, and perhaps his officials are more incompetent than the average bureaucrat, but the failure of massive government projects is nothing new, and will continue no matter how much we will them to work, or how many good intentions we have.

The same people (although perhaps not Angry Bear, they seem to be sort of free market) who now bemoan this latest tale of waste and tragedy will soon begin calling for a new program to prevent school shootings, drug use, poverty, splinters in school children, giving offense to the cross-eyed, and reality television. When these programs fail, they will respond that, with just a few billion more dollars, it would have worked.