Division of Labour: September 2006 Archives
September 30, 2006
The Gentle Cynic c. 1906
From the Sept. 30, 1906 NYT:
September 29, 2006
If you get the AZN channel on cable, set your Tivo to record "Ab Tak Chhappan" tomorrow morning at 9am Eastern, 8 am Central. It's a ruthlessly unsentimental cop/mafia drama, the best Indian movie of 2005. (I'd call it Bollywood, but there are no songs. There will be subtitles.) Nana Patekar plays an "encounter specialist" whose assignment is to shoot gangsters and then make up a story about how he did it in self-defense. I thought the premise was a bit over the top until I read Maximum City, which has a chapter about a real-life Bombay cop whose job is exactly the one depicted in the movie.
Kosovo now has a central bank – in name
Voice of America has reported:
The Banking and Payments Authority of Kosovo (BPK) was transformed Friday into a central bank for the region. The move provides more independence and regulatory authority to Kosovo's new banking system.
As far as I can tell, it’s only a nominal change. Fortunately for Kosovans, the BPK won’t be issuing its own currency. Like Montenegro, Kosovo uses the euro (except for Serbian-dominated areas where the Serbian dinar circulates), though it is not a voting member of the ECB.
The cleverest thing I've read today
Daniel Davies in The Guardian:
The phrase "The status quo is no longer an option" is reliably the leper's bell of the modern managerial idiot. It is almost always wrong. Like Status Quo, the status quo is often vastly underrated simply because it is unfashionable. The great thing about the status quo is that it is not any worse than the status quo. Surprisingly few proposals for "radical and far reaching reform" can actually beat this standard.
In reference to private organizations, I agree. In reference to the government, the bar is lower. (Excercise for the reader: imagine why would that be.) Universities are somewhere in the middle.
1. In Atlanta tonight, Roger Clemens starts what might be his last major league game. I was hoping to make it, but just couldn't pull it off.
2. The WaPo has an article on wildlife's contribution to water pollution.
3. I had a bit of deja vu reading that there may be another scandal about Congressmen soliciting pages for inappropriate activities. I was a House page when there was a similar scandal back in 1982. I had no part in nor saw any signs of bad behavior while I was there, but I did get interviewed by a couple of newspapers snooping around for dirt.
4. From the AJC:
As the senior official overseeing federal farm programs in Georgia, Duke Lane Jr. helps distribute billions in subsidies while serving farmers and safeguarding taxpayers.
In 2004, Lane's public actions benefited his private interests, and taxpayers picked up the tab.
Don't read the whole thing--it'll make you want to throw something at your computer.
5. (Via Drudge) Al Gore claims smoking significantly contributes to global warming.
6. The prisoners of Fidel's paradise now have reverted back to horse-drawn transportation. (HT: LR)
Hurricane X c. 1906
The Sept. 29, 1906 NYT reports on an unnamed hurricane that struck Mobile and Pensacola on Sept. 28, 1906. Let's see if there is anything in the article that sounds familiar:
Three lives at least have been lost and damage estimated from $8,000,000 to $5,000,000 has resulted from the hurricane that struck Mobile Wednesday night and continued with unabated fury until yesterday morning at 10 o'clock...all telegraphic communication with the outside world is cut off, the river boats are sunk at their wharves, and hundreds of launches and small boats are at the bottom of the river...Granted the destruction of 1906 Mobile was likely not as "big" of a deal, at least from the pure value of property and magnitude of the destruction, as Hurricane Katrina in 2005. Yet, perhaps because the storm wasn't of the magnitude of Galveston and/or because the storm didn't have name, how many people are aware of a "great storm of 1906?" Likely those in Mobile have heard stories, but the rest of us?
I wonder how Katrina will be viewed in 100 years viz-a-viz Galveston and (now) Mobile/Pensacola.
On wealth c. 1906
From the Sept. 29, 1906 NYT:
"Wealth has its disadvantages," said the philosopher.Yet, if you don't care if you win or lose, why place the bet in the first place?
Microeconomics question of the week
The Wall Street Journal has a free service in which weekly recaps of interesting stories are emailed on Friday [You can sign up here - look for the Weekly Review]. This week there are three topics in the microeconomics blast:
1) The lack of stop signs in Belgium and game theoretical implications
I posted the first two (as I regularly do) over at Heavy Lifting although I do not post "my answers" to the questions. I will post the 401(k) summary below the fold.
However, the third recap did have an excellent question, one that might make for some interesting lunch/class conversations:
One example of irrational behavior is insuring against small risks and ignoring big ones. Why is it irrational to purchase extended warranties for appliances while not purchasing life insurance?
Read More »
SUMMARY: "Congress has voted, and now it's official: Investors are irrational. Thanks to this year's pension law and yesterday's proposed rule from the Labor Department, it's becoming easier for companies to automatically enroll employees in their 401(k) plans and thereafter increase the amount these employees save each year." In this week's Getting Going column, Jonathan Clements reports that proposed rule is a triumph for behavioral-finance economists, who have championed the idea of automatic enrollment. "All this is a tad controversial. In building their models, economists have traditionally assumed that people behave rationally, and many view behavioral finance as little more than a series of clever anecdotes." However, as the column points out, people often make irrational investment decisions. One insight of behavioral-finance economists: How choices are framed can greatly affect investment decisions. By employers framing retirement account decisions as opt-out choices rather than opt-in choices, employees are more likely to make
1.) What is a 401(k) plan? (Check Wikipedia http://en.wikipedia.org/wiki/401k
« Close It
September 28, 2006
What economists do
William McChesney Martin famously said that the Fed's job is to take the punch away when the party starts getting good. My view is that economists have a similar role: To ask how much the punch costs and who's paying for it. It won't get us invited back to some of the best parties.
Russell Roberts relates interesting observations by John Baden on the economist's role. I disagree with Baden's statement that economists "are trained to measure the efficiency of alternative choices." We're trained to point them out, but not very good at measuring them. This is a quibble.
Making a Libertarian
Arnold Kling on the making of a Libertarian:
I travelled the route from Far Left to libertarian. I think that quite a few libertarians have travelled that route, and yet I cannot think of anyone who has gone the other direction. This leads me to suspect that:
Baby, you can drive my card
Paul McCartney’s daughter Stella, until now a fashion designer, has designed a new account card for the private bank Coutts. Curiously, none of the news accounts includes a picture of the card, but you can see it here.
Couldn't they see the expiration date approaching?
According to the Moscow Times, Russia’s central bank is now in limbo for lack of a quorum:
The board of the Central Bank on Thursday lost the quorum it needed for policy decisions after the mandates of half its members expired, while the seat of murdered banking supervisor Andrei Kozlov remained empty.
The Duma is expected to consider replacements next week.
1. I like the Weather Channel because it combines maps and weather, two things that have interested me since childhood. Alas, TWC is introducing a global warming show and the show will take the position that global warming is definitely happening. The show's host Heidi Cullen claims, "Scientists are very much in consensus about the fact that it's real." My reading, admittedly based on quite superficial research, is that scientists are not certain global warming is taking place and that they are much less certain about whether human activity has contributed global warming or whether policy changes could mitigate it.
2. I was glad to see 7-Eleven dropping Citgo. Although I have no pretense that my choice will have any effect whatsoever on Citgo or Chavez, for the last year or so (i.e., well before the Chavez's rant at the UN) I've been choosing not to patronize Citgo stations. I'm probably guilty of the "better to feel good than to do good" criticism, but I don't want to support a dictator.
3. Dave Berri posts on Freakonomics vs. Moneyball or, if you prefer, Steve Levitt vs. Skip Sauer.
Request for comment
I reach out to the DoL community with the following question. The following is an abstract of a working paper which is having a hard time getting past the editors at the journals to which we have submitted. We are not being rejected for being "wrong" but for being "different." This is not an unheard of experience, but one that is frustrating.
My question is what, if any, journal in which you might imagine such an abstract appearing. Hopefully not the Journal of Failed Research!! Any suggestions can be sent to depken-at-uta-dot-edu.
Fixed vs. Variable Costs at the Three Gorges Dam
Yahoo! News has a story concerning trash and debris building up behind the Three Gorges Dam in China:
The amount of floating garbage in the reservoir is expected to surpass 200,000 cubic meters (seven million cubic feet), Cao said.
September 27, 2006
In addition to my job at Berry, I do some forensic economics consulting. Mostly I estimate lost earnings in personal injury or wrongful death cases. (To those who think the legal system has some abuses, I agree. However, I think abuses are mostly in class action cases. I also think people have a right to seek damages for injuries they suffer, and I mostly agree with Alex of MR about the incentives facing contingent fee lawyers.)
To the point, I had a deposition earlier this afternoon. I entered the lawyer's office at the same time as one of the defense attorneys who was deposing me. We both told the receptionist that we were there for the deposition, we gave her our names, and we sat down. The lawyer then introduced himself to me and I introduced myself to him. He had now heard my name twice, and one would have thought that he would have recognized my name from the damage report I prepared. But no.
Presumably thinking that I was the other defense attorney coming for the deposition, he proceeded to tell me that he had an economist look over my report and that I had gotten the numbers about right (though in the other economist's opinion, my estimates in one part of the report were too high and my estimates in another part of the report were too low). I was inclined to reintroduce myself, but he blurted out his comments too quickly. About that time, though, the other attorney arrived. He recognized my name as we introduced ourselves and said something like "you're the one we're deposing right?" The look on the first attorney's face was priceless.
We have our merry band of bloggers here at DOL. I would guess that most readers are familiar with The Institute for Justice, which has their merry band of litigators defending individual rights and the rule of law. IJ has always done important work, but recently they've landed an impressive string of blows in the proverbial good fight.
You know about the Kelo case, which was a nominal defeat but fueled a backlash that, by the time it runs its course, may end up strengtheninig property rights. More detail on this below the fold.
Since Kelo, IJ has won a development takings case before Ohio's Supreme Court, Norwood v. Horney, the first of its kind to reach a state supreme court after Kelo. If you're into the whole Stackelberg leader idea, this is an important signal to courts in other states.
IJ has also meticulously documented the extent of eminent domain "abuses" (roughly, takings for economic development purposes). Two reports by IJ senior attorney Dana Berliner, one pre-Kelo and one post-Kelo, count the state-by-state filings of eminent domain for economic development, from 1998 through middle of 2006. Good stuff.
IJ's current splash is their new lawsuit against the city of Riviera Beach, Florida. The scenario is familiar. The mayor and city council expanded the city's redevelopment area, hired a big developer to put in a new fashionable multi-use complex, and threatened eminent domain on lont-time property owners to pave the way. IJ filed suit on behalf of four property owners yesterday.
Last week, IJ Senior Attorney Scott Bullock was out at San Jose State to give a Kelo lecture. He did a great job fielding questions, everything from Austrian-subjectivist critiques of "just compensation", to 14th Amendment selective incorporation stuff, to how the Roberts Court might have decided Kelo.
Like Richard Posner, IJ seems to be okay with eminent domain for "traditional public uses" under holdout problems. Others are more hawkish, such as Bruce Benson's article in The Independent Review undermining the holdout justification. Even for right-of-way, holdout-likely, traditional public uses, eminent domain poses serious problems for efficiency and for giving property owners the right incentives. Yesterday in Tehachapi, California, a homeowner had this to say about his struggle with the city over a proposed road (article).
“We’ve been notified that the road [Pinon Street] goes through our garage and the city has told me there’s nothing I can do about it,” Timothy Dunn said to the council...."If you take my garage, you take my whole property. Someone’s going to pay for the stress,”...
IJ has a knack for choosing sets of facts that will lead to larger ramifications when brought to court. In general, I think IJ deserves a fresh round of props for doing good work on many fronts, including and especially to stem the tide of development takings.
Read More »
So far about 30 state legislatures have passed or enacted legislation to curb eminent domain. In some western states (most notably prop 90 in CA), ballot propositions would curb regulatory takings as well. Not all the state laws impose actual constraints, but are instead symbolic gestures to an agitated electorate. Timothy Sandefur has a nice detailed analysis in his Michigan State Law Review article. In this paper (forthcoming in The Independent Review), my co-author and I analyze the backlash and conclude with a guardedly optimistic outlook:
If state legislatures can eschew symbolic politics and lobbying pressure from organized interests, an important effect of Kelo will be to restrict government’s ability to seize land for economic development, thus empowering policymakers to reconcile their own interests with those of “all members in the social group” (Buchanan and Tullock 1962, 23).
In the bigger picture, Kelo may strengthen property rights.
« Close It
Whither financial privacy?
SWIFT, the Society for Worldwide Interbank Financial Telecommunication, is a private institution (an industry-owned co-operative) based in Belgium that provides “secure, standardised messaging services” to thousands of banks and other financial institutions worldwide. Secure, that is, except from snooping by the US government. Payment messages sent via SWIFT include “customer names, account numbers and other identifying information”. After 9/11/2001 the US Treasury went on a fishing expedition, sifting through “millions of confidential financial transactions handled by SWIFT.” The New York Times revealed ("leaked") the secret program’s existence in June.
The Treasury Department has used broad administrative subpoenas to get access to large volumes of transactions from Swift, often millions at a time. The operation, while highly unusual, appears to fall into a gray area in American law protecting the banking privacy of customers. But legal experts said the program appears to conflict more directly in Europe with banking privacy restrictions, issued by the European Union and others, that impose tighter restrictions on how private banking data can be shared.
We in the US don't need to wait for the terrorists to restrict our liberty; our own government is doing a pretty good job of that.
Ig Nobel ceremonies coming up
The 2006 Ig Nobel prizes will be awarded next Thursday, October 5.
Live webcast is promised starting at 7:20pm Eastern.
Finally, Someone Has Captured American Economics
Finally, someone has captured the essence of the American economy - or at least the essence of the economic thinking of far too many Americans:
"[T]he Bush/Halliburton team [is] pulling out the stops to get the Republithugs back in office. Once the dirty deed is done we can expect heating oil prices to climb just when we need it the most. This will be followed in the spring by another “market driven” increase in the price of gas just as the summer driving season begins. It is an old game, drive prices higher just at the time when we need it the most and let them decline just when we don’t use it as much. These gyrations are just a way to tamp down our outrage enough to let them get away with it again next time and conveniently keep their profits down when elections are about to occur and our outrage might lead to change.
"Think I am wrong? When did we invade Iraq to seize their oil? March, just before driving season. Easy cover for jacking up oil prices wasn’t it? When will we invade Iran? Before May, I promise.
"It is no accident that elections are held in the fall. Long ago the oil companies figured out that the fall was not an especially profitable time for them due to low gasoline usage and relatively tame energy usage for heating and cooling. What better time to manipulate the market for lower energy costs?"
This is great satire precisely because it rings true - you can read rants that aren't all that different on left wing blog sites every day. Worth reading the whole thing.
College football c. 1906
1905 and 1906 was a period of reform in collegiate football. New rules were instituted, most notably the forward pass. As the first games were played with the new rules, there were interesting contrasts in how the new rules are received.
From the Sept. 27, 1906 NYT:
The first real game of football under the new rules was played here [Carlisle, Pa] between the teams of Carlisle Indians and Villa Nova College. The Indians won by a score of 6 to 0, scoring a touchdown and a goal in the first half and failing to score in the second.*
So, the "professionals" didn't like the new rules at first but the fans dialed in immediately? Why is that not surprising?
* In 1906, a touchdown was worth five points and a point-after-attempt was worth one point.
Yale's finances c. 1906
From the Sept. 26, 1906 NYT:
Yale University is free of floating debt, according to an annual report made public to-day...the university has a credit balance of $62,000 as against an adverse balance existing for several years.
In 1906, $980,000 was approximately $19,639,703 in 2005 CPI adjusted dollars.
[Update: The Chronicle of Higher Education reports: "Yale’s $18-billion endowment, the second largest of any private university in the nation, rose 22.9 percent" for a $2.8 billion dollar gain. UT Arlington's operating budget is in the area of $300 million.]
The local fishwrapper finally noticed that my university is suing its former VP for Resource Management and Director of Facilities as well as a local construction firm.
Specifically, the suit says Aungst handled Capital's purchase of two rental properties at 701 and 707 Sheridan Ave. in February, and paid the owners more than $350,000 over the fair market value of the buildings, plus an illegal broker fee of $50,000....Capital's lawsuit also says Aungst and Fares arranged for Gutknecht Construction to remodel a house owned by Capital for Fares to live in rent free. In [a] letter, Gutknecht vice president Jeff Feinman stated that the company would renovate the house, at 2361 E. Mound St., for $105,000. The lawsuit contends that Fares promised Fredrickson he would pay any cost above $80,000. The lawsuit says Gutknecht charged Capital $306,134 for the work, which Gutknecht never completed. The company also attached a $251,841 lien on the property. Fares and Aungst hid the cost of the renovation by charging some costs to Capital accounts for rental property maintenance and for the construction of a new residence hall, the lawsuit says.
Meanwhile, the former Director of Public Safety is suing us for $4.6 million.
I should've gone to law school...
September 26, 2006
Your federal tax dollars at work …
… fighting efforts to lower your state’s taxes and spending. The PBS show “NOW” on Friday did a hatchet job on donor Howie Rich and the efforts to limit state government spending in Montana and elsewhere through ballot initiatives. Though the show acknowledges that it’s perfectly legal for out-of-staters to donate funds to support initiative campaigns, and that Rich’s donations have been fully disclosed in states that require disclosure, “NOW” gave many minutes to opponents of those initiatives (they also interviewed one pro-initiative Montanan organizer, whom they put on the spot). The opponents – and the “NOW” reporter herself – insinuated that there’s something improper about non-disclosure in states that don’t require disclosure, and more generally something nefarious about a "wealthy New Yorker" funding such initiatives in pursuit of his “extreme” agenda. (The show also reports that some hired gatherers apparently faked a fair number of petition signatures in some states, which is bad, but that’s a guilt-by-association diversion from the funding issue.)
But don’t take my word for it that “NOW” has an anti-spending-limit slant. View the video (takes about 20 minutes), or read this copy from the PBS website, and judge for yourself:
The aim is to slash state spending, with the potential for deep cuts in health care, education, and other social services. But are these local initiatives really "home" grown? This week, NOW investigates how organizations associated with one wealthy New Yorker, Howard Rich, are secretly providing major funding for ballot measures. In some states, those contributions have been matched by ones from Americans for Tax Reform, an anti-tax group headed by the politically well-connected Grover Norquist. Since 2001, Norquist visited the White House nearly 100 times, including six meetings with President Bush.
Economic Freedom Debate
The recent edition of the ever-interesting Econ Journal Watch includes my comment on a recent paper [abstract] by Jakob de Haan et al. that surveyed the literature linking economic freedom and economic growth.
Abstract: Jakob De Haan, Susanna Lundström, and Jan-Egbert Sturm have written a valuable survey of the literature that uses the Gwartney and Lawson economic freedom (EFW) index. Their discussion of the index’s theoretical underpinnings and methodological ins and outs itself should be useful to scholars interested in the field. While DLS accurately describe the mechanics of the construction of the EFW index and the econometric literature that has found a link between economic freedom and economic growth, I find myself in disagreement with some of their commentary. This reply in part will address these issues.
They replied in turn.
I want my L-TV
Until now, the only self-identified libertarian among fictional TV characters has been “Penn Jillette” on the Showtime series “Bull$#@!”. But on Sunday’s season opener of Desperate Housewives on ABC, we got this exchange during a bedroom scene between Bree and her new boyfriend Orson:
"I don't do that," she says. "I'm a Republican."
Hah! Too bad they made the libertarian character not only a creepy control freak who murdered his wife and put Mike into a coma, but a dentist.
We're paying how much?
Front page of today's Fort Worth Star-Telegram has the following headline:
Uggh. I'm not sure that's what we wanted to hear.
For at least 25 years, market critics have decried the Missing Middle--the alleged bedrock of our society. As Bruce Bartlett points out, they've been right. Families with household income between $25,000 and $75,000 per year are going missing. The fraction of households falling into this category has been falling, from 52.9% in 1975, to 49.3% in 1985, to 46.7% in 1995, and to 44.6% in 2005.
Turns out, we also have a Missing Lower as well as a Missing Middle. The fraction of households with income below $25,000 has been in decline: 33.1% in 1975, 30.5% in 1985, 28.9% in 1995, and 27.1% in 2005.
Of course, arithmetic reveals the whereabouts of these Missing Households. The fraction of households with income above $75,000 has changed as follows: 14% in 1975, 20.2% in 1985, 24.4% in 1995, and 28.3% in 2005.
Incentives matter - 1906 San Fran Earthquake Edition
From the Sept. 26, 1906 NYT:
Marines have been deserting the barracks on Mare Island, Cal., at a rate which has made it necessary for Brig. Gen. G. F. Elliott, commanding the Marine Corps, to detail a strong squad to search San Francisco for deserters.
The NBER estimates hourly wages in the building industry in 1906 as $0.48 or $3.84 for an eight hour day. I haven't been able to locate the daily wage for a Marine in 1906. Evidently it was considerably less than $5 per day.
On baseball c. 1906
From an editorial in the Sept. 26, 1906 NYT:
Many and violent are the vicissitudes of baseball. Necessarily so, with the prevailing practice of strengthening the local teams by importing mercenaries without any regard for the real residence of the mercenaries, so that the strongest team indicates not at all the superior culture of its putative habitat in baseball. It denotes only the superior judgement or length of purse, or both, of the local management which has secured the services of the team. It is hard to see any rational basis for the local patriotism which can nourish itself on the achievements of "hired men" from anywhere, even though we have proof that local patriotism is roused by the contest to seething enthusiasm.In other words, the New York team should be populated by New Yorkers, and the Atlanta team should be populated by Atlantans. This is an interesting perspective on the potential labor market for baseball players. Assuming the distribution of baseball talent was similar across cities, smaller cities would have a hard time fielding a competitive team if they were unable to import "mercenaries" from other locales.
When baseball (and other sports) players lived in the local area during the off-season, interacted more with the local fans, often through off-season jobs, there might have been a stronger tie with the team. Indeed Psychologist Robert Passikov suggests that one component of fan loyalty is "bonding with players and other fans."
However, civic pride is only valuable to team owners in as much as it translates into revenues, i.e., people in the stands. To this end, if winning is more important than nativism, the decried "mercenaries" are potentially welfare improving - players are worth more and are paid more, team owners earn more revenue (and potentially profit), if the team wins more fans enjoy an increase in surplus. Evidently the editors of the NYT suffer a decrease in surplus, but I'm willing to bet that the net is positive.
For an example of local-only talent-based sports, look at high-school sports. Granted the competition is a little lower as the talent has not been completely developed, but in general people are not willing to pay as much nor willing to attend as much as at the "mercenary" based teams - even at the minor league professional levels. Although, I must admit to exceptions, such as certain Texas high school football games which attract more people than some college games.
Yarn Stealing Granny
A woman prosecutors called a serial yarn thief will spend a year in jail after pleading guilty to shoplifting Monday in DeKalb County.
Audrey Yandel, a 70-year-old Atlanta grandmother and a retired nurse, has been convicted 12 times in the past two decades, mostly for stealing yarn, according to DeKalb Deputy Chief Assistant District Attorney John Melvin.
In the DeKalb cases, Yandel was caught stealing yarn at a Decatur shop in January 2005 and knitting needles at a Dunwoody business in May 2006.
Kidding aside, I doubt spending perhaps $25k to lock up a serial yarn thief is good use of taxpayer funds. This is a crime that seems more appropriate to punish via a stiff fine.
At Least One Thing Is Right About Harvard
Harvard has more concentrators in economics than in any other discipline.
Source here; HT Mankiw.
Tragedy of the Common Potty
Harvey Mansfield's swipe at economists leads to a discussion on the tragedy of the commons on Volokh. Most comments are not kind to folks in my profession; lawyers get a few smacks.
2. Some of the Volokh commenters seem to have spent way too much time on their hands--the bathroom isn't high on my list of places to linger and people watch.
September 25, 2006
Man v. Nature c. 1906
From the Sept. 25, 1906 NYT:
Mobile, Ala -- A 500-pound octopus was caught yesterday by a fishing party in Mississippi Sound, and killed after a struggle that lasted for eight hours....The octopus towed the boat of the party stern first for a distance of ten miles. It was finally killed with rifles.
John Lott Will Love This
Greenleaf, Idaho -- All Americans have the right to bear arms. Some towns have even gone as far as to require each household to have a gun. Now a small Idaho town is contemplating a similar idea-- it's called the Civil Emergencies Ordinance. And although gun ownership is just one piece of this ordinance, it's the part that's getting the most attention.
"We've blessed to be a fairly rural area of the state, so we don't have a lot of crime and I think we'd like to keep it that way," said Lee Belt, Greenleaf city clerk.
Drive about 10 minutes west of Caldwell and you'll run into Greenleaf, Idaho, population 860. If city council member Steve Jett has his way, each head of household that can legally own a gun, will. Along with that they're encouraged to have ammunition and appropriate training.
Story here. Chuckles aside, the right to own a gun is a good thing but folks should not be required by law to do so.
September 24, 2006
Judge Robert G. James of the United States District Court, Western Division of Louisiana, has said that it is criminal trespass for the American boating public to boat, fish, or hunt on the Mississippi River and other navigable waters in the US.
Old frontiers in economic policy
Repeat after me, class: price control causes a shortage. A government that tries to help consumers get bread by forcing its price down in fact makes it harder for consumers to get bread. In Zimbabwe this week, Voice of America reports:
Bread has become hard to find since the government ordered bakers last week to roll back prices and sell loaves at the official price of Z$200 dollars. Bakers have had to import their own flour and say the official price doesn’t let them recover costs.
Rumble over central bank independence in Switzerland
Voters in Switzerland today rejected a ballot initiative that would have directed the Swiss National Bank’s annual profits (last year US$1.2 billion, basically from seigniorage on Swiss francs, gold sales, and foreign exchange gains) specifically to the national pension scheme (AHV, the country’s Social Security system). Currently about 55% of the SNB’s profits go to the federal government, and the other 45% to the various cantonal governments. These governments in turn, of course, subsidize the pension scheme. The Swiss National Bank opposed the initiative as infringing its independence. The Swiss Bankers’ Association likewise rejected treating the SNB as a cash cow, reports the International Herald Tribune:
"If the SNB could contribute 1 billion francs to the AHV, why not 2 billion or 3 billion given that the AHV will need the money?" the Swiss Bankers Association, an influential association of the country's commercial banks, said in the run-up to the vote.
September 23, 2006
Free trade argument c. 1906
File this in the "things never change" drawer. From a letter to the editor in the Sept. 23, 1906 NYT:
How does the [Republican Dingley] tariff raise the price of building material. By taxing it - some 40, some 60, some 100. Why should there be any duty on lumber? Did man create the great forests, whose owners are Republicans, and demand a tax on Canadian lumber, so as to increase their profits? Why should not the tax on every article in the metal schedule be reduced to 25 per cent.?...Competition with foreign countries, now prohibited by the Dingley bill, would put the managers on alert to improve the quality of their product and would compel a reduction in its [steel's] price. The structural steel, the hardware, the tin roofs of buildings, would all cost less. So would the mason's dinner pail and the tin pans used in his kitchen. And the capitalists would still get a fair return for their investment. In the name of justice, then, in the name of the tenant who has to count every dollar he pays in rent, of the man who has saved a little money and wants to build a small house for his family, and of the farmer who needs a new barn, let us stop paying the bonuses to the great manufacturers and owners of mines and forests that the present tariff compels.Wait a second. We have had tariffs on Canadian lumber for over 100 years and we still can't "compete" with the Canadians in lumber!?! Oh, right, that whole comparative advantage thing.
Bad prediction c. 1906
From the Sept. 23, 1906 NYT:
"I do not believe the present experiment in American college football can survive. In my opinion, the whole country will within five years be playing the Rugby game."Who dared such a prognostication? None other than Benjamin Ide Wheeler, President of the University of California, who was previously football coach (and professor) at Cornell.
Important lesson c. 1906
From the Sept. 23, 1906 NYT:
From the Louisville Courier-Journal - A health crank who has never smoked, chewed, nor used intoxicants, and who lives upon 10 cents a day, rode 11,761 miles on a bicycle when he was 50 years old. The lesson we learn from this is that strenuous economy does not always result in the ownership of motor cars.
Real genius c. 1906
From the Sept. 23, 1906 NYT:
The youngest collegian in this section of the country, if not in the United States, is eleven-year-old Norbert Weiner, who has entered the freshman class at Tuft's College. He is the son of Leo Weiner, Assistant Professor of Slavonic Languages at Harvard, and resides with his parents at 11 Bellevue Street, Medford Hillside....He is to make the study of philosophy his specialty.He changed his major, as his Wikipedia entry claims he went to study mathematics (although at that time philosophy and other subjects were sometimes rolled together).
Furthermore, a crater on the dark side of the moon carries his name.
September 22, 2006
Rumble over central bank independence in Poland
Back in March Poland’s parliament, where a nationalist-populist coalition prevails, was upset over a merger between two foreign-owned Polish banks. Leszek Balcerowicz, architect of Poland’s “shock therapy” free-market reforms in the 1990s and today ironically head of the central bank and of the Banking Supervisory Committee (KNB), refused calls to block the merger. So Parliament moved banking and financial regulatory authority out of the KNB and other agencies to a new agency (which began operation on Tuesday). Free-marketers in Poland have been skeptical about the new agency: "‘It's all about giving their friends a job,’ MP Zbigniew Chlebowski of the opposition [market-]liberal Civic Platform told Poland's Dziennik daily.”
Parliament also set out to embarass Balcerowicz by establishing a commission to investigate the deregulation and privatization of banking since 1989. Balcerowicz refused to appear before the commission, on the grounds that it would compromise the central bank’s independence. The battle ended up in court. The court has now ruled in favor of the central bank, Forbes reports:
Poland's constitutional court ruled Friday that a parliamentary commission set up to probe the activities of the country's central bank and its governor Leszek Balcerowicz was unconstitutional.
Balcerowicz’s term ends in January. I’m guessing that the next central bank head that Poland's ruling politicians appoint won’t be quite so independence-minded.
DDT: Some History
Steven Malloy offers an insightful history of DDT policy. Among the villains: the Audubon Society, EDF, the Sierra Club, William Ruckelshaus, and (of course) Rachel Carson.
On the activist groups: "Business are often held liable and forced to pay monetary damages for defective products and false statements. Why shouldn't the National Audubon Society, Environmental Defense, Sierra Club and other anti-DDT activist groups be held liable for the harm caused by their recklessly defective activism?"
Malloy might be a little hard on Carson, but he's spot-on with the rest. A charitable reading of Carson would include this sentence (Wikipedia entry for DDT): "Practical advice should be 'Spray as little as you possibly can' rather than 'Spray to the limit of your capacity.'" I did say, "A charitable reading."
Government projects c. 1906
On Sept. 21, 1906, the six ton cornerstone of the lesser known Roosevelt Dam was laid in Roosevelt, Arizona.
At 5:15 P.M. yesterday Supervising Architect Hill laid the cornerstone of the Roosevelt storage dam, an immense rock weighing six tons.That's the entire article. Perhaps what was happening in what, at the time, was a U.S. territory didn't warrant a big response in New York? Maybe the general mood was more favorable towards building dams? Perhaps the project was "big" but not "that big"? Note, the paper didn't say it was a "Big Government" enterprise.
I remember when I first stood at the bottom of Hoover Dam and wondered if it would even be possible to contemplate such a project today. My almost immediate conclusion was 'NO.'
This is why I love reading the paper from 100 years ago - you learn something new every day.
September 21, 2006
Polar Bears Revisited
ABC news ran two global-warming stories today. The first was Branson’s giveaway; the second was not news, but a revisit of the dying polar bears story. These are excerpts from an article cited by cei.org that calls this report into question.
One polar bear population (western Hudson Bay) has declined since the 1980s and the reproductive success of females in that area seems to have decreased. We are not certain why, but it appears that ecological conditions in the mid-1980s were exceptionally good.
By the way, Charlie Gibson closes the report by saying that scientists have documented a 20% population decline in Western Canada since the 1980s. Good work: Select your subset of the poplulation, select your endpoints, and fit your trend line. I never knew model estimation was so easy.
Incentives Matter: Rational Criminals Edition
The abstract of a new NBER Working Paper:
We report results from economic experiments that provide a direct test of the hypothesis that criminal behavior responds rationally to changes in the possible rewards and in the probability and severity of punishment. The experiments involve decisions that are best described as petty larceny, and are done using high school and college students who can anonymously take real money from each other. We find that decisions about whether and how much to steal are, in general, rational and responsive to the variations in tradeoffs, and sometimes, though not always, to the overall availability of criminal opportunities.
Incentives (Don't) Matter: Texas Teacher Edition
From today's Fort Worth Star Telegram:
That's one of the reasons teachers at Bellaire overwhelmingly rejected a state grant for $90,000 in salary bonuses linked to student achievement. The recent secret ballot vote was 44-2.Prediction: Bellaire will be looking to replace two teachers rather soon.
HT: Colleague Mike Ward.
On campaign contributions c. 1906
Another editorial from the September 21, 1906 NYT:
We have been invited to send a dollar contribution to the Republican campaign fund that is being raised by popular subscription and to which President Roosevelt recently subscribed. We would like to have our dollar in such select company all right, but we've done all the contributing we intend to this year.
Party advice c. 1906
From the September 21, 1906 NYT:
Recent events point to the belief that the Democratic nominee for 1908 must come from that section of the country wherein lies the voting strength of the party...it is well to cast about for an available standard bearer. Alabama has many favorite sons; so, too, have Mississippi, Tennessee, Georgia, North and South Carolina, Louisiana, and even Florida. Virginia has a score or more of very able men...So far, so good. Pull a candidate from, at the time, the heavily Democrat south. Yet the editorial closes with advice that is as sound today, suggesting that the South, and therefore the Democrat party,
...must now assert its independence, cast out demagogues, blatherskites, wild-eyed visionaries, who would use the organization to advance selfish interests...
I like the word blatherskites ("A babbling, foolish person"). Clearly, neither of the major parties has fully asserted its independence from such folks.
Does this mean that parties are, by definition, comprised of blatherskites and demagogues, and there is no reason for parties to change in nature? Or is it that successful parties are those populated with demagogues, and blatherskites (see, I love that word), that serve to lure the median voter? Many insist they want a third party, but of what kind? More of the same, yet different?
Choose Life Ohio.
The local fishwrapper reports
Ohio motorists can keep buying "Choose Life" license plates now that abortion-rights advocates have dropped their lawsuit to block sales of the plates. The move came because the U.S. Supreme Court refused to hear an appeal of a decision upholding a similar program in Tennessee.
Given that the state has authorized dozens of other license plates expressing clear viewpoints (Breast Cancer Awareness, Celebrate Kids, Cleveland Browns (ugh!), National Rifle Association...), this seems to make sense to me. Of course, a
What does Ohio need to get its economy moving again?
Tax cuts? Nah.
Medicaid Reform? Nah.
Real School Reform? Nah.
A new tag line? Yeah, that's it!!!
September 20, 2006
Will the Democrats Flip the House?
Slate's mathematician, Jordan Ellenberg, says the odds of a Democratic victory depend on the degree of correlation among races, but, "it's fair to say that the Democrats' chances of flipping the House are somewhere between 15 percent (the scenario in which the races are independent) and 50 percent (where the races are as correlated as possible)."
Intrade quotes 56.5 as the price of "Republican Party to retain control," suggesting a probability around 43.5%. The Washington Stock Exchange places the probability that Republicans retain control at 69.0%.
David responds to Goliath
NORFED, the issuer of the Liberty Dollar, officially reponds here to the US Mint's allegation that its silver pieces are illegal. The kernel of the reply:
In the sense that money may be used to refer to the coinage of a government the Liberty Dollar never has claimed to be, does not claim to be, is not, and does not purport to be, money. ... the Liberty Dollar, ... in addition to its being a numismatic item, is a means of voluntary barter.
Search and Rescue & the Wisdom of Crowds
In July 1996, a search and rescue (SAR) operation had begun for missing National Park Ranger Randy Morgenson in the Sequoia and Kings Canyon National Park area.
Backpacker magazine (June 2006, sorry--no story link) has and article about the SAR. Where do you look for a missing park ranger in such a vast area?
One of the organizers:
"inked up" a topographic map on the picnic table dividing it into 16 segments labeled A through P. Each segment was deliniated by obvious geographic features--rivers, ridgelines, trails, meadows, passes or mountains. Together they formed a zone that was roughly 80 square miles, the area that the rangers agreed represented the outer limits of where Randy might have traveled on a 4-day patrol. The sheer size of the operation sank in.
They decided to organize the search using the Mattson Consensus.
Each ranger was asked to assign each segment with a number value--high for areas where Randy most probably was, low for least-probable locales. According to Mattson, it was "best to do this privately because it will ensure that even meeker individuals will be able to express their opinion without being intimidated by the more vocal members of the group."
In the end, despite the "wisdom of crowds" approach, the SAR failed to find Randy Morgenson and gave up after two weeks of searching. Some five years later, his remains were found apparently drowned after a fall while crossing a creek "within an area of high probability of discovery in the original search." A book has been written about Morgenson's life and disappearance.
Lessons of DDT Policy
Thomas Bray's comments on implications of DDT policy:
Researchers haven't even been able to show conclusively that DDT is the cause of widely-cited declines in populations of eagles and other animals. There appeared to be a strong correlation, but the type of DDT use being recommended by WHO - indoor spraying to reduce the risk of mosquito bites to sleeping humans - is no threat to nature. All this was known more than three decades ago, but so powerful had the environmental lobby become that rational decision-making was all but impossible.
Incentives Matter: New York Poverty Edition
NEW YORK (AP) -- Poor New Yorkers who make healthy choices - such as staying in school and regularly seeing the doctor - should be rewarded with cash to help break the cycle of poverty, Mayor Michael Bloomberg suggested Monday.
The idea, which has seen success in countries including Brazil and Mexico, developed out of an anti-poverty commission's report released Monday.
Along the same lines, here's a post from MR about economist Roland Fryer's paying students for academic improvement.
September 19, 2006
On the public sector c. 1906
In 1906, there is an undercurrent or "movement" concerning municipal/government ownership of the means of production in several industries, most notably the railroads but also utilities, food preparation, and others. Perhaps it was a natural outcome of the political discussions of the times, but that doesn't mean there wasn't opposition to the idea.
Case in point is an editorial in the Sept. 19, 1906 NYT:
That [private ownership] might be what the people want, but it is not what the politicians want. The politicians hunger and thirst for the control of the payrolls which would accompany the adoption of municipal ownership. We have just had the report of the Haag commission informing us that in this city there are 60,948 persons on New York's payroll at present, to the tune of $57,068,253. How many times would this be multiplied if the municipal ownership theorist got their way? And what would be the chance of defeating them if ever they got control of perhaps several times 60,000 offices and the expenditure of hundreds of millions of dollars?Good question. Let's look at NYC today. The editorial goes on:
There is a yarn to the effect that in Chicago they mow the parks by man power, because horse mowers don't vote. We cannot vouch for the story, but it illustrates an idea in connection with municipal ownership.
[Update 2:14PM CDT: Came across this article concerning New Jersey considering taking over operations of Amtrak in the state (State considers Amtrak takeover). Says Gov. Corzine: "Amtrak can never do enough when they want to because of a lack of resources. Not enough money is put into Amtrak."]
September 18, 2006
He said what?
Think Progress reports on a speech by Al Gore at NYU Law School which included the following quotes:
Well, first of all, we should start by immediately freezing CO2 emissions and then beginning sharp reductions.
For the last fourteen years, I have advocated the elimination of all payroll taxes — including those for social security and unemployment compensation — and the replacement of that revenue in the form of pollution taxes — principally on CO2. The overall level of taxation would remain exactly the same. It would be, in other words, a revenue neutral tax swap. But, instead of discouraging businesses from hiring more employees, it would discourage business from producing more pollution.I have never (to my recollection) heard Al Gore advocate the elimination of payroll taxes. Replacing most of the personal income tax system with a tax system dependent upon CO2 production is a new one to me as well.
[Re-entered]: It seems that a) the payroll taxes would never be "done away with" but would only be shifted, perhaps to non-monetary taxes, b) a CO2 tax would not tax based on value added, upon which our current system is somewhat loosely based, c) it presumes that the government can and will choose the optimal CO2 tax, which is unlikely.
Would professors and politicians be taxed for their CO2 production. What about therapists or preachers?
The Fraser Institute has produced a seriously cool color 24x36 map using the Economic Freedom of the World index. For information about ordering the map, send an e-mail to firstname.lastname@example.org, or call (604) 688-0221 ext. 580.
Professor v. Cell Phone
Oh -- I would so love to do this when someone's cell phone goes off in my class.
[HT: Alex Padilla]
Is the solution the problem?
This article at the Chronicle of Higher Education describes a proposal in the Senate to provide funds that "would help states collect data on individual students from pre-kindergarten through the baccalaureate level. Officials and researchers could use the information to examine retention and graduation rates of college students..."
How this will not lead to a single nation-wide database of students, as students and their families move from one state to another, is not discussed. There is substantial opposition to the proposal, but not necessarily from the folks you would expect.
However, consider the following phrase from the article:
Meanwhile, momentum has been building in the Senate this year for a bill to help improve the country's global economic competitiveness...What "bill" (that has a chance in Hades of passing) will improve our global economic competitiveness?
Food Safety c. 1906
Given recent events, this story from the September 18, 1906 NYT was of interest:
"The Food and Drugs act," he [Dr. H. W. Wiley of the Department of Agriculture] continued, "has two great purposes in view, which stand out clearly throughout all its sections, namely, first, to prevent the introduction of any injurious substances to food and drug products, or the abstraction of any valuable properties therefrom; second, to prevent the misbranding of any package of food or drug products, either as to the nature of the contents of the package or their properties, or as to the place, country, State or Territory where made or produced.
Later in the article, it is described how hearings in Chicago turned to the topic of coloring of foods:
D.W. Hutchinson, Vice President of W. H. Hutchinson & Son, soda water makers, of Chicago, Ill., spoke for coal tar coloring. One ounce of coal tar red will color over 2,000 gallons of soda water, he said, while an ounce of coal tar yellow or orange will color over 4,000 gallons.
I've been quiet because I've been traveling. Just got back from the Economic Freedom Network Asia in Malaysia.
September 17, 2006
Better to feel good than to do good
How environmental activists are "Dooming Woods and Wildlife":
Unfortunately, legal action has blocked common-sense thinning to restore forests to their natural diversity and resistance to catastrophic wildfire. Already, many California public forests have grown dangerously overcrowded with 10 to 20 times more trees than is natural. The Giant Sequoia National Monument is near the top of the crowded forest list. It already burned once, and it is certain to burn again. ... Rather than protecting forests and wildlife with lawsuits, activists condemn them to destruction. Massive wildfires move so fast that flames can overtake animals like deer, bears and fishers before they escape. Streams boil and fish die. Ash fills burrows and suffocates ground dwellers. Smoke inhalation kills most animals before the flames reach them.
September 16, 2006
Homeland security c. 1906
From the September 16, 1906 NYT:
As a result of an investigation by the School Board of Hellertown [Penn.], a village near here, concerning the robbing of school houses, it has been discovered that Hellertown is the home of half a dozen boys, each about 16 years old, who have organized the "Jesse James boys" and who planned to commit various crimes.
The Gentle Cynic c. 1906
From the September 16, 1906 NYT:
350 years of discovery
The Royal Society announces their archive of 350 years of articles is freely available through the end of the calendar year. From the front page:
For the first time the Archive provides online access to all journal content, from Volume One, Issue One in March 1665 until the latest modern research published today ahead of print. And until December the archive is freely available to anyone on the Internet to explore.
Here's a link to Crick and Watson (1953) whose innocent sounding abstract is as follows:
This paper describes a possible structure for the paracrystalline form of the sodium salt of deoxyribonucleic acid. The structure consists of two DNA chains wound helically round a common axis, and held together by hydrogen bonds between specific pairs of bases. The assumptions made in deriving the structure are described, and co-ordinates are given for the principal atoms. The structure of the crystalline form is discussed briefly.I wonder if there is an article describing the discovery of dirt. That was tongue-in-cheek, the archive is an amazing browse.
September 15, 2006
Is private metallic currency legal?
A few years ago I wrote an article for The Freeman on a private silver-based currency, the Liberty Dollar, at that time known as American Liberty Currency. The issuing organization, NORFED continues to produce both coin-like silver pieces and silver-redeemable paper certificates. I saluted it as a noble experiment, though I doubted it would catch on in any big way while fiat dollar inflation remains in single digits. I called the alternative currency “fully legal”. Now come news reports saying that the US Mint is disputing its legality. (HT: “Common Sense” at HNN.) USA Today reports:
The government Thursday warned consumers and businesses that it is illegal to use alternative money known as "Liberty Dollar" coins, which organizers promote as a competitor to the almighty dollar.
Here’s what the US Mint’s own website says:
Read More »
prosecutors with the Department of Justice have determined that the use of these gold and silver NORFED "Liberty Dollar" medallions as circulating money is a Federal crime.
Unfortunately the prosecutors are not identified, and no actual statement of the determination is quoted or hyperlinked. But the US Mint site tries to provide a basis for considering the Liberty Dollar illegal. First we have this statement:
the advertisements confusingly refer to NORFED "Liberty Dollar" medallions as "legal" and "constitutional." However, under the Constitution ( Article I, section 8, clause 5 ), Congress has the exclusive power to coin money of the United States and to regulate its value.
This statement, however, is false (unless “money of the United States” means “money of the United States government,” in which case it is perfectly beside the point). The US Constitution does authorize the Congress to coin money, and it prohibits the states from coining money, but it nowhere prohibits private individuals from coining money, nor citizens from using privately minted coins (of which there have been numerous examples over the years) or foreign coins (which were quite popular in the early years of the Republic). It nowhere says that the Congressional power to coin is exclusive. Here are the relevant passages, all the passages in the US Constitution that mention coins:
The Congress shall have Power … To coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures; To provide for the Punishment of counterfeiting the Securities and current Coin of the United States; …
The US Mint site continues:
By statute ( 31 U.S.C. § 5112(a) ), Congress specifies the coins that the Secretary of the Treasury is authorized to mint and issue and requires the Secretary to carry out these duties at the United States Mint (31 U.S.C. § 5131). Accordingly, the United States Mint is the only entity in the United States with the lawful authority to mint and issue legal tender United States coins.
True, but again beside the point. Being “legal tender” and being legal are two different things. The issuers of Liberty Dollars, and the faces of the pieces themselves, don’t claim them to be “legal tender United States coins” in the sense of “this note is legal tender for all debts”, meaning, no creditor can refuse it in discharge of a contractual debt. Anyone is free to refuse payment in Liberty Dollars.
Then comes the Mint's genuinely troubling assertion:
Under 18 U.S.C. § 486, it is a Federal crime to utter or pass, or attempt to utter or pass, any coins of gold or silver intended for use as current money except as authorized by law.
Here’s the text of the hyperlinked statute:
Whoever, except as authorized by law, makes or utters or passes, or attempts to utter or pass, any coins of gold or silver or other metal, or alloys of metals, intended for use as current money, whether in the resemblance of coins of the United States or of foreign countries, or of original design, shall be fined under this title or imprisoned not more than five years, or both.
The Liberty Dollar folks may have a hard time making the case that this doesn’t apply to them. True, they don’t call their silver pieces “coins”, but they do call them “currency” and “money”, and they do market them for use as current (circulating) money. Repeal 18USC486!
UPDATE: Here is a reply to the US Mint by someone from NORFED.
« Close It
DDT, Malaria, and the WHO
A recent Wall Street Journal article suggests that the WHO, unlike much of the UN, has taken temporary leave of its insanity:
The World Health Organization, in a sign that widely used methods of fighting malaria have failed to bring the catastrophic disease under control, plans to announce today that it will encourage the use of DDT, even though the pesticide is banned or tightly restricted in much of the world.
HT to Jeff Hoffman, who expresses hope that some bureaucrats are coming to see the importance of marginal analysis. I'm less sanguine.
Property rights in the classroom
The Chronicle of Higher Education reports on an ongoing dispute at NC State concerning a professor selling audio versions of his lectures online. A dean at NC State and the school newspaper have objected to the idea, although for different reasons.
The upshot is that the professor has stopped selling his lectures until the whole issue is ironed out. If the professor transcribed his lectures and printed them in book form, would he be able to sell the lectures?
It will be interesting to see how this plays out.
The Elephant in the Room
Regular readers of this blog would likely be interested in Ryan Sager's new book, The Elephant in the Room, analyzing what the future holds for the long-standing coalition of libertarians and traditionalist conservatives that have made Republicans the majority party in America. I haven't read it yet, but Ryan, a rising libertarian star, is a bright young guy and an extremely good writer, so at an absolute minimum I'd expect a pithy, fun read. Excerpts suggest to me it will deliver more than that.
September 14, 2006
Brad and I have both commented on folks who think the government was involved in destroying the WTC or had advance knowledge of the attack. Andrew Samwick has a post on conspiracy theorists and includes links to some sites debunking the bunk. He also has this excerpt from an editon of CNN's "Reliable Sources":
[Program Host] KURTZ: I want to put up some pretty eye-opening poll figures from a Scripps Howard survey about 9/11 conspiracies. Thirty-six percent of those surveyed suspect the U.S. promoted or acquiesced in the 9/11 attacks; 16 percent believe explosives, not airplanes, toppled the World Trade Center; 12 percent believe it was a cruise missile that hit the Pentagon.]
Incredible--this is probably another reason to think that too many people vote not too few.
College Football Stadiums
Today's San Jose Mercury News runs a front page feature on Stanford's new football stadium, built in an astounding 43 weeks including demolition of the old 86,000 seat Stanford Stadium in an astounding 2 weeks.
Less than 10 months after bulldozers razed the old structure, Stanford's 50,000-seat, $100 million stadium will open for business Saturday when the Cardinal plays Navy.
The speed was made possible by a hybrid fast-track and design-build construction method. Move that old PPF outward. Tickets are still available for tomorrow's opener against Navy. Good thing the Cardinal didn't open against the mighty Spartans of San Jose State, who last Saturday overcame two 20-point deficits to beat the Stanford boys from down the street, 35-34.
While I'm talking college football stadiums, by-a-mile my favorite college football stadium is is Kyle Field at Texas A&M. I've seen probably a hundred games there. Maybe more. I could write a treatise on all the intricacies that make game day at A&M unique (my fiancee says the tradition of kissing your date after A&M scores says it all). But it's all a very tacit affair. Bottom line, you just have to experience it yourself. While the team has been in decline since 2000, the 90's saw a 92.5 win percentage at Kyle, including a 31-game streak from 1990-95 and a 22-game streak from 1996-2000. Kirk Herbstreit has repeatedly called Kyle Field his favorite place to call a game. MSNBC ranks it 4th in the nation.
Some notable stadiums I've been to that fail to impress. Notre Dame, LSU Tiger Stadium, and K-State's Wagner Field (Louisville's was bad too). The best small stadium is a tie between TCU's Amon Carter and Southern Miss's "the Rock" in Hattiesburg. Man, can those people tailgate.
I have not been to West Virginia's Mountaineer Field, but that will be corrected on Oct. 14 when I attend their homecoming game against Syracuse. Oh. I'm presenting a paper there too. It's currently half time of the WVU Mountaineers hosting the UMD Terps. WVU just returned a kickoff for a TD to go up 38-10. I hope there's similar fireworks when I visit. Go Mountaineers!
Well, enough economics for now. I have some more football to watch. :-)
From the BBC:
The first deputy chairman of Russia's central bank has died in hospital after being shot by two unidentified gunmen in the capital, Moscow.
Kozlov reportedly had plenty of enemies among the bankers whose licenses he suspended for money laundering.
How did the markets react?
Russia's financial markets, used to unpleasant surprises, shrugged off the murder. The RTS stock index closed up 0.65 percent and the rouble strengthened slightly.
From the strenghthening of the rouble I infer that Kozlov was less hawkish on inflation than his expected replacement.
Hat tip: WEG
Will sunshine help or hurt?
By next year, the public should have a public, searchable website that in one place tracks the approximately $300 billion in grants that the federal government doles out to roughly 30,000 different organizations each year, in addition to the roughly one million contracts that exceed the $25,000 reporting threshold.Making the information public sounds great, but one million contracts?! One wonders if this will prove sufficient to reduce the pork, er, earmarking. The database would be expected to yield some very interesting empirical public choice articles.
Do Drinkers Earn More?
Ed Stringham and Bethany Peters have a new study (.pdf) arguing that they do. The study is receiving considerable media attention. Note: this is just an edited version of their recent Journal of Labor Research article.
The Punter Did It
"... the backup punter on the University of Northern Colorado’s football team has been charged with stabbing the first-string punter in the kicking leg as a way of disabling his rival for the starting assignment ...
The first-string punter, Rafael Mendoza, was treated for the injury on Monday night and released from a local hospital, but he will be out of action indefinitely.
According to a witness to the alleged assault, Mr. Mendoza’s rival, Mitch Cozad, stabbed him from behind and then fled in his car. The Tribune reported that Mr. Cozad could be identified, even though he was wearing a hood, on account of the personalized license plates on his car, “8-KIKR.”
September 13, 2006
Those who can do, those who can't?
Norman Wain, a Cleveland-based former radio executive and investor in Air America, says he hadn't heard about any financial difficulties. "I know nothing about it," he says. "They don't communicate with investors very well. They only come to us when they're looking for more money." The last time that happened, he says, was "three or four months ago."
One Book Meme
I've been tagged so here goes:
1. One book that changed my life: Although it is overly dramatic to say it changed my life, when I read Friedman's Capitalism and Freedom in college I realized that I had left behind my liberal Democrat upbringing (when I was a child my father had a McGovern pin on the visor of his car) and embraced liberty.
2. One Book I've Read More Than Once: Steve Landsburg's The Armchair Economist. A bit contrarian but a fun read.
3. One Book I Would Want on a Desert Island: I'm tempted to say The Wealth of Nations so I'd finally have an opportunity to read all of it, but the depressing circumstances of being stuck on an island leads me to choose something humorous. My choice--Parliament of Whores by O'Rourke.
4. One Book that Made Me Laugh: I've used O'Rourke already and it's tempting to choose an early offering from Tom Wolfe, but let's go with A Walk in the Woods by Bill Bryson. My hiking buddy Chris gave me a copy and it's a stitch. Although Bryson is a bit crunchy for my taste he also ridicules the Forest Service for its ineptitude.
5. One Book that Made Me Cry: I haven't read any 9/11 books but one of those would almost certainly do the trick. The sheer evil of 9/11 upsets me more than most tragedies; I remember taking my son (then about 4 months old) home that afternoon and wondering what sort of world my wife and I had brought him into. (BTW, like Brad, I am offended by folks--like here and here--who think 9/11 is some sort of government conspiracy. There's a difference between favoring limited government and being just plain nuts.) As for a book I've actually read--All But My Life by Holocaust survivor Gerda Weissmann Klein.
6. One Book that I Wish Had Been Written: Something by me. I don't mean to sound flippant or narcissistic; I mean it as an indicator of respect for people who have written books.
7. One Book I Wish Had Not Been Written: Instead of serious answer like The Communist Manifesto, I'll offer a somewhat whimsical one--my father wrote a chitlin cookbook. A truly awful concept; fortunately, I had left home before he started trying these out on the family. My father has also written several local history books, perhaps similar to the one on Granville OH that Brad is reading. I only wish he'd stuck to history and left the stomach churning cooking to someone else.
8. One Book I'm Currently Reading: The Shackled Continent by Robert Guest. The human misery inflicted by predatory African governments would actually make this book a good candidate for the made me cry category.
9. One Book I've Been Meaning to Read: I have a draft of JC Bradbury's forthcoming The Baseball Economist that I've been meaning to read. Technically it probably shouldn't be considered a book yet since it hasn't yet been published. Instead, I'll go with Bees in America by Tammy Horn; I hope to have a bout of nostalgia thinking about the fun I had keeping bees as a kid.
Now to pay the tag forward--I'll tag Aeon Skoble, George Leef, and co-bloggers Tim Shaughnessy, Michael Munger, and Mike DeBow.
Tiebout sorting and mortality
Apparently where you live helps to determine how long you live. If you can help it, move to Bergen County, N.J. and become an Asian-American woman.
Of course the presumption that people will make is that your alloted number of days on earth is determined by your latitude and longitude (my theory is that it's your attitude, not your latitude, that probably makes a bigger difference). Someday your GPS device will say "Don't turn down that street; it will take 4 minutes off of your life."
It seems to raise some interesting questions a la Tiebout. If people conclude that location determines age, how will long-living cities cope with large immigration, especially as it relates to public service provision? If the city's budget is already tight, maybe we should contribute less to public health services so that our longevity drops? That will stop some of the free-riding.
Or, if people conclude that certain types of people statistically tend to live longer, then should we expect to see immigration of short-lived individuals to cities with reputations as lavish welfare providers? If I'm going to die young anyway, might as well get as much from the local gov't as I can.
Of course, coming in 49th place among state's with the best longevity is my adopted home state of Louisiana. Oops, gotta go. I feel a cough coming on...
Coase and Peanut Butter in Schools
Matt Ryan posts about the banning of peanut butter in schools.
It seems to me that if transactions costs are low, it shouldn't matter who gets rights to the school environment. Even if rights are given to those with the allergies, they might be willing to give up certain considerations for other concessions. If the value that all other students get from eating peanut butter is greater than the value those with allergies receive from an outright ban, they should be able to bargain to the efficient solution. Thus in terms of efficiency, it would seem not to matter what the rule is on peanuts in school.
Transactions costs are probably really high, however, since social norms likely prevent any post-rule bargaining. That is likely why we see such fights over the initial assignment of rights.
At least that's my thinking on the issue. Any others?
September 12, 2006
Incentives Matter: Pot for Homework Edition
GETTYSBURG, Pa. - A woman facing drug charges admitted in court that she smoked marijuana with her 13-year-old son, often to reward him for doing his homework.
She admitted she had been smoking marijuana with her son since he was 11 and said she had also smoked with two of his friends, ages 17 and 18.
For more bizarro criminal activity see:
Or see the entire archive here.
Rupee ka Kal Ho Naa Ho
The Indian rupee lacks full convertibility. Matlab (“meaning”): there are binding government restrictions on cross-border capital flows. For instance: an Indian firm cannot borrow more than a certain amount overseas, mutual funds are limited in acquiring foreign assets, and individuals can only remit $25,000 abroad annually. Banks cannot deal freely in foreign currencies.
Last week the Reserve Bank of India released the Tarapore Commission’s report (also known as “CAC-2”, because it is the second report in recent years on Capital Account Convertibility) on moving toward greater convertibility. The Commission understands the major benefits of liberalization, which this news account parphrases as: “facilitate growth through higher investment, improve efficiency in the financial sector through greater competition, and provide opportunities for residents to diversify investments”. Nonetheless the commission's majority report proposes a five-year plan with three “phases” toward merely partial liberalization – an overly timid approach. The report also recommends “reducing the government's stake in public sector banks to 33 per cent and allowing private corporations to set up banks”, which are good ideas even though they have nothing to do with convertibility.
The best commentary on the report I’ve found is this Financial Times column by Ila Patnaik. She points out that to improve financial services to consumers, free entry is paramount:
Entry barriers in banking need to go. At present, it is extremely hard to start a bank in India, and foreign banks face crippling constraints. Both kinds of entry barriers need to be removed in this world of competition. Citibank needs to have as much freedom to operate in India as Nokia and Pepsi. If India persists in trying to hinder foreign banks from operating here, they will reach Indian customers through USD denominated deposits held outside the country.
The title of this entry, btw, is paraphrased from a Bollywood blockbuster of a couple of years ago and means roughly "The Rupee's Future May or May Not Happen".
Markets for everything c. 1906
In response to President T. Roosevelt's "executive order" reforming spelling in the Executive Branch the Public Printer announced the following, as reported in the Sept. 12, 1906 NYT:
He [the Public Printer] has issued a pamphlet directed to the various Government departments explaining the new system to them, and will send this pamphlet to anybody who wants it and will send him 25 cents. With it he will send a wall card containing the 300 words which are to be spelled according to the simplified system, arranged for quick reference.
I haven't had time to search the Internet, but it would be neat to see one of the wall cards (or a likeness of one). Twenty five cents in 1906 is approximately $5.40 in 2005 CPI adjusted dollars.
In my email came this:
The prepared remarks of Edward P. Lazear on "Productivity and Wages" delivered this morning at the annual meeting of the National Association of Business Economics. Dr. Lazear is Chairman of the President's Council of Economic Advisers.
Incentives Matter: Teacher Pay in Florida Edition
From USNWR via Mitch Kokai of The Locker Room:
Before she took her current job, Virginia Harper sold law books. The more law books she sold, the bigger her bonus-and at the end of the year, the company would throw in a set of fine Irish Waterford crystal, too. Harper, who likes Waterford crystal, sold a lot of books. Then, six years ago, she left sales to teach reading at South Fort Myers High School. Things were different there: Your salary was your salary-no matter how many books you taught.
Now, however, the Florida Legislature has put $147.5 million into making book-teaching a little more like book-selling. This year, if Virginia Harper does a better job than 75 percent of her colleagues, she could get a bonus of up to $2,000. It's not Waterford crystal, but state legislators hope their new program called STAR (Special Teachers Are Rewarded) will do the same trick: make teachers perform better.
Florida is not alone. Texas and the Denver school district also launched "pay for performance" programs this school year. Arizona, Minnesota, and North Carolina have incentive programs in place, and at least nine governors of other states have voiced interest. The federal government is lending a hand, too. The Teacher Incentive Fund, conceived by President Bush and approved by Congress last December, will award $95 million to states and school districts that want to create incentive pay programs.
September 11, 2006
Washington Stock Exchange is Now Active: Check it Out
Be sure to check out the Washington Stock Exchange, which went live today. In addition to being fun and hopefully leading us to good political forecasting, my guess is that an enterprising professor can find ways to use it as a good teaching tool in politics or economics.
One book Meme
I've been tagged in the one book meme game.
Here are my picks:
1. One book that has changed your life: Anarchy, State and Utopia, by Robert Nozick. I remember reading this book as a college sophomore with growing excitement: why, the things I felt in my gut actually had intellectual heft and support behind them. People much younger than me will often not realize difficult it was to grow up libertarian in the 1960s and early 1970s.
Read More »
No Reason, no Reason Foundation, no Cato Institute, no Free to Choose. Samuelson was the day's economics textbook, and Keynesianism the orthodoxy, in an era when a "conservative" Republican president imposed wage and price controls. Into this came Nozick, handsome, a card-carrying member of the establishment, easy to read, funny, intelligent, blasting statists off the stage. I thought, "Yes. Now I understand."
I wish I could choose more, but it is the one book meme.
2. One Book that You've Read More than Once: Shelby Foote's three volume history, The Civil War: A Narrative. The American Iliad.
3. One Book that You Would Want on a Desert Island: Assuming this means I'll be stuck there for a while, I want something long: "The Complete Works of William Shakespeare."
4. One book that made you laugh: Anything by P.J. O'Rourke. It's hard to pick a favorite, but today, at least, I'll go with Holidays in Hell .
5. One book that made you cry: Tender is the Night, by F. Scott Fitzgerald. I rarely read fiction, but this is my favorite.
6. One book that you wish had been written: A serious biography of John McCain. All of the biographies so far are fawning hagiographies. McCain is the most fascinating political figure of our time, and deserves a more serious, balanced account.
7. One book that you wish had never been written: Ideas have consequences, and bad ideas have bad consequences. There are so many possibilities, so many books that have been influential, and whose ideas have created misery and destruction when put into practice. Yet one realizes that many really bad books of bad ideas are the product of their times: had they not been written, someone else would probably have come along with a similar book. But I am not sure that anyone else could have equalled Marx, and while I think the Russian revolution would have occured in some form anyway, and probably resulted in some dictatorship anyway, Marx is what made these dictatorships so virulent and enduring and damning. I'll choose the Communist Manifesto over Capital, as it came first.
8. One book you're currently reading: Like many, I tend to have several books going at once. I'll go with Granville, Ohio: A Study in Continuity and Change. What a remarkable little town I live in. The Granville Historical Society had the foresight to commission this work so it would be ready for the town's 200th birthday in 2005.
9. One book you've been meaning to read: About 18 months ago I started Gibbon's classic The Decline and Fall of the Roman Empire, so I guess this could go in answer to the previous question. But I haven't picked it up in several months and will probably start over when I do. It was great, by the way; what wonderful prose. I just got distracted. As Rufus Fears says, Gibbon never uses one adjective when two will do.
« Close It
Okay, libertarian professors, you claim to support capital formation. Let's see if you implement this in your classroom.
To entice you to click, of course you'll want a teaser quote:
"Now if only Apple could do this with girls."
Why Private Gun Ownership is Important
NEW YORK (AP) -- Margaret Johnson might have looked like an easy target.
But when a mugger tried to grab a chain off her neck Friday, the 56-year-old Johnson, while riding in her wheelchair, pulled out her licensed .357 pistol and shot him, police said.
"There's not much to it," she said in a brief interview. "Somebody tried to mug me, and I shot him."
Deron Johnson was taken to Harlem Hospital with a single bullet wound in the elbow, police said.
See also this John Derbyshire article.
Rationing by Age
We've had several DOL posts on non-price rationing (just enter "rationing" in our search box)--here's an example of age being used as a rationing device:
Despite evidence that even older patients benefit from timely treatment for stroke and mini-stroke (transient ischemic attack), a researcher has warned in the latest issue of the BMJ that many doctors do not bother treating people over 80 in a timely manner. In other words, the researcher contends that ageism is rampant in health services.
Professor John Young says that in the case of the English health services, many decades of under funding the health services have seen to it that older patients do not get the quality of treatment reserved for the younger ones suffering strokes.
Similar scenarios prevail in cancer services, coronary care units, prevention of vascular disease, and in mental health services, he said. He suggested that in order to overcome these obvious shortcomings, specialist and primary care responses to the management of transient ischemic attacks must be integrated in a manner similar to what has happened with coronary heart diseases.
National Service Framework for Older People since 2001 has made a difference to care received by older people, he added. But unless drastic changes are implemented, it would seriously undermine the health service. "Don't be surprised if older people lose trust in their health service and lobby for protection through anti-discrimination legislation. The result would indeed be a patient led health service."
A patient led health service--what a concept.
Headlines c. 2001
As a reference, here are some random headlines from the 9/11/2001 NYT:
The last article is about how the administration is beginning to "panic" about the economy and criticizes the proposal to reduce the capital gains tax from 20 percent to 15 percent.
The Biden article starts out:
Washington, Sept. 10 - Declaring a profound difference with President Bush, Senator Joseph R. Biden Jr., said today that plans for missile defense sacrifice national security for the sake of a "theological" belief - and that the effort to make such a system work would cost astronomical amounts of money...Mr. Biden said the administration would create greater insecurity than at any time since the 1960s if it went ahead [with the plans to test a limited national defense system]...
Regulation and 9/11
This Mark Steyn piece is mostly about anti-American Americans, but this observation about 9/11 is too good not to pass along.
It wasn't the box cutter that brought down the tower, but the Islamist fanatic ploughing the jet into it, and the only reason he could get away with seizing a jet with a box cutter is because the ... coercive hyper-regulatory regime of antiquated 1970s hijack procedures had trained an entire generation of air travellers to behave like lobotomized sheep. Had jihadists with box cutters tried to "bring down" a sports bar, they'd have had the crap beaten out of them.
While I'm at it, his take on Kyoto is pretty much on the target:
But what's his answer (to problems related to climate change)? A boilerplate defence of the Kyoto Protocol, a quintessential piece of transnational humbug. Canada and Europe signed it and increased their greenhouse-gas emissions; America didn't sign it but decreased its emissions, notwithstanding the toxic Texan's determination to destroy the planet.
I've been watching some C-Span this morning. I've watched about an hour of call ins, and at least 8 callers have called to claim that 9/11 was a plot by the U.S. government. Even allowing for the cranks and kooks to call in in disproportionate numbers, I find it incredibly disturbing how many people believe this nonsense.
Global Warming Policy
The issues surrounding global warming are these:
By accepting the bad with the good (increased material output).
By adapting to the reality but not taking large efforts to change it?
By adopting policies to reduce global warming? If we are to act
to ameliorate its effects, what sort of actions should we take and when?
For the sake of argument Don Boudreaux accepts that it is happening, is partly due to human activity, and is harmful. Even so, he concludes that the case for action is far from made.
I'm prepared to believe even the possibility that global warming will eventually kill millions of people. But I nevertheless insist that science does not unambiguously endorse action against global warming. Put differently – and contrary to today's elite opinion – ignoring global warming is not necessarily a sign of scientific illiteracy or of ideologically induced stupidity.
Don't Get Any Ideas Bob
History's first marathoner famously keeled over and died after finishing the grueling journey, which now measures 26.2 miles. But this summer brought the news that not just one but two men thought it would be "fun" to run 50 marathons in 50 states in 50 consecutive days.
Never mind that it's hard enough to get to the 50 states in 50 days without a personal jet. These men set out to put excessive force on their joints and ligaments, tear up their muscle tissue, tax their hearts, risk dehydration and kidney failure — and then squish themselves into a car or onto a plane for several more hours — every day for more than two months.
To many, it's a silly and dangerous waste.
When I first blogged about their endeavor, reader Dienne Anum asked: "And this is about health because why? It would probably be almost as healthy to strive to be in 50 car accidents in 50 states in 50 days."
But one of the men, 25-year-old Sam Thompson, recently became what is believed to be the first person to complete the triple 50, and when we talked two days after his last marathon, he said he felt astonishingly good. In fact Thompson, a virtually unknown ultrarunner from Vicksburg, Miss., actually ran 51 marathons in 50 days — he threw in Washington, D.C., for good measure, just hours after running one in Maryland.
September 10, 2006
Finance ministers threaten the independence of the European Central Bank
European exporters and producers of import-competing goods would like a cheaper euro. EU finance ministers have taken up their cause. The Telegraph reports that
Jean-Claude Juncker, chief of the euro-zone finance ministers … has been demanding a weekly meeting with the ECB chief to set policy, reminding Mr Trichet that the Maastricht Treaty gives finance ministers a major say over exchange rate policy.
Juncker is from Luxembourg, Trichet from France. The central banker is naturally resisting the challenge to his sole authority:
Jean-Claude Trichet, the ECB's president, brushed aside demands yesterday for a power-sharing arrangement with Europe's politicians, seen as a grave threat to the independence of the fledgling bank.
He’s right about that. Interestingly, that argument wouldn’t work for Ben Bernanke. Federal Reserve notes are signed by the Secretary of the Treasury and the Treasurer of the United States, not by the Fed chairman.
“Things are not well in Sweden”
Eric Culp visit Sweden and finds the welfare state fraying at the seams. Money quote:
… on any given day, one-fifth of the workforce is at home sick. Furthermore, around one-quarter of those under 25 are out of work.
September 09, 2006
I've been Tagged!
Yes, tagged. More to come.
Musings of the Gentle Cynic c. 1906
From the September 9, 1906 NYT:
On Government c. 1906
From the September 9, 1906 NYT:
As it was in times past most marked in the minds of ignorant but eager savages, so now it is to be found among our contemporaries who unite a modest range of information with considerable mental movement... toward the personification of the...State, or the Government. In reality the Government...is an agency chosen through more or less clumsy or complex methods, by the portion of the residents of a country possessing votes, to attend to the common business which it is not convenient or practicable for private persons to attend to. Being an agency, it is necessarily composed of agents, organized with various duties and powers, intrusted to them for terms usually short, tenure being uncertain and changes frequent. In itself the Government is not at all a person, with the unity and completeness of a person. it is not even an "artificial person," like a corporation, with definite obligations that can be enforced in the courts. It is a fluctuating body of individual agents, with varying abilities, notions, purposes, tendencies, according as the electorate may itself vary.
Vote Buying Pols
To borrow (with slight modification) a phrase from Tim, I realize that highlighting vote buying politicians is about as revelatory as realizing that the Pope is Catholic, but here goes. Some excerpts from an article in The Hill (with a HT to the Club for Growth):
The data, culled from The Hill’s analysis of 1,810 projects in the pending Labor-HHS-Education appropriations measure, reveal a system in which earmarks are distributed first to appropriators then to vulnerable incumbents and finally to rank-and-file lawmakers.
“We’re playing a game of politics over need and that’s why the whole earmark system needs to be blown up. Blown up and rebuilt,” said Keith Ashdown, vice president for policy at the government watchdog group Taxpayers for Common Sense.
In the Labor-HHS-Education bill for fiscal year 2007, more than $146 million in hometown projects is reserved for appropriators’ districts, placing roughly 30 percent of the earmarked money in the hands of 15 percent of the House members. If passed as written, the average appropriator’s district would get $2.25 million compared with averages of $1.35 million for the districts of 43 politically vulnerable lawmakers who are not appropriators and $663,000 for districts that are neither competitive nor represented by an appropriator.
The eight endangered appropriators – Northup, Reps. Don Sherwood (R-Pa.), Jim Walsh (R-N.Y.), Charles Taylor (R-N.C.), John Doolittle (R-Calif.), John Sweeney (R-N.Y.), Chet Edwards (D-Texas) and Alan Mollohan (D-W.Va.) – average $2.76 million per district.
Figures in this story are based on the 1,712 projects representing $472 million that could be tracked to entities, such as colleges or hospitals in one district. It is impossible to know —without benefit of the Appropriations Committee’s publicly financed tracking system exactly who sought which earmarks.
The Labor-HHS-Education measure is just one of the House’s dozen annual appropriations bills, but it provides a glimpse into how power and electoral strategy influence the expenditure of public money.
Labor-HHS-Education Appropriations Subcommittee Chairman Ralph Regula, the bill’s chief draftsman, set aside millions for his northeast Ohio’s Canton-based 16th District. Thirty-nine earmarks totaling $10 million dollars are headed to Regula’s district, nearly 30 percent of the $34 million haul for Ohio. Regula also may have been active in securing money for Democratic Rep. Stephanie Tubbs Jones’s 11th District in nearby Cleveland, which houses Case Western Reserve University’s National Center for Regenerative Medicine and other institutions important to the region they share.
In Cincinnati, where Rep. Steve Chabot is trying to fend off a challenge from Democratic City Councilman John Cranley, the arts community will receive a $1 million boost out of the 1st District’s total of $2.5 million in Labor-HHS-Education earmarks. The rest will go to educational and medical initiatives.
Republican Reps. Taylor and Patrick McHenry represent neighboring districts in North Carolina. The bill gives McHenry, a freshman who won with nearly two-thirds of the vote in 2004, $650,000. Taylor, an appropriator who is up against local football legend Heath Shuler, landed more than $3 million for his district.
Incentives Matter: NASCAR Points System Edition
Drivers and team officials are still grumbling about NASCAR's points system:
NASCAR vice-president Jim Hunter said series officials are seriously considering a change that would award more points to race winners.
"We've talked about that," Hunter said.
Hunter pointed out that no matter what the rules state, teams will adjust their strategies accordingly.
And as to the question of whether NASCAR would prefer its champion be a big winner or consistent runner?
"I think you want your champion to be both," Hunter said.
For years, NASCAR's season-long points format rewarded consistency. But it was scrapped after the 2003 season, when Matt Kenseth won the championship with a steady, but unspectacular, season-long performance. He won only once, but had 25 top-10 finishes. Ryan Newman led the series with eight victories, but finished sixth in points.
But even with the Chase format, consistency appears to pay better than winning.
In 2004, Kurt Busch won the first Chase with three victories, one during the Chase. Jimmie Johnson, who finished second in points, had eight victories, including four in the final 10 races.
Last year, Tony Stewart won the title with five victories, but all of them came before the start of the 10-race Chase. And Greg Biffle, who finished second in points, beat Stewart by one in the win column.
Atlanta Motor Speedway president Ed Clark said the best fix is to put a premium on winning.
Markets in Everything: Bridget Jones' Knickers Edition
LONDON — The famously large underpants worn by film character Bridget Jones are to be auctioned off to raise cash for some of London's most famous green spaces, Britain's Royal Parks Foundation announced Friday.
The large, white underwear was worn by Renee Zellweger in her role in "Bridget Jones's Diary" and prompted the comment, "Hello, mummy!" from Hugh Grant, who played her suitor, Daniel Cleaver.
I suppose that's better than the auctions for Britney Spears' discarded chewing gum, cigarette butts, and tissues, though tastes may differ.
HT to MR for the markets in everything concept.
September 08, 2006
If you're happy and you know it, ...
Does money buy happiness? Maybe a better question is whether a system that allows productive activity to generate wealth generates happiness. Anyway, an article at NewScientist.com answers in the affirmative. Excerpt:
Large industrialised countries fared well in the new analysis, with the US and UK coming in at 23 and 41, respectively, out of 178 nations. This stands in contrast with the recently released "Happy Planet Index" from the New Economics Foundation think tank, which placed Columbia (sic) and Honduras high up.
How did the "Happy Planet Index" reach its (to me) unexpected conclusion? The HPI is computed as follows:
This imposes an elasticity of -1 on income, assuing that "ecological footprint" and income vary more or less proportionately. This way you can conclude that Palestinians (52.6) are happier than either the Swiss (48.3) or the Israelis (39.1). Likewise, Americans (28.8) are less happy than Mexicans (54.4) or Guatemalans (61.7). I guess that explains why the Mexican and Guatemalan governments can't keep out those damned American immigrants. By the way, citizens of Nigeria (31.1), Congo (41.8), Burma (44.6), and Vietnam (an amazing 61.2) are happier than Americans.
Ohio's not the only state with rent-extracting optometrists. North Carolina's optometrists, apparently due to the optometrist who is speaker of the NC House, managed to get the NC Legislature to require all children entering kindergarten to have eye exams by optometrists or opthamalogists. A couple of excerpts from the article linked above suggest the public health rationale for the law is pretty weak:
The N.C. Pediatric Society is part of a coalition of education groups, doctors' lobbies and advocates for children and the poor who have asked legislators to repeal the law before school starts this fall. Most children won't need the eye exam, opponents say....
Dr. Jeffrey Board, a pediatric ophthalmologist in Raleigh, said children should have a complete eye exam at age 3. If doctors don't find problems then, having another test a year or two later is not necessary, he said. Most kids' vision problems are discovered in those early eye exams or in vision screenings, Board said. And problems not found before kindergarten are soon caught within six months by school nurses, teachers or parents.
The most common childhood eye problem, nearsightedness, probably won't be picked up by the pre-kindergarten exams because trouble seeing at a distance usually doesn't start until children are 6 to 12 years old, Board said.
But wait, as they say in the ginsu knife commercials, there's more:
RALEIGH — After three days investigating the campaign-finance activities of State House Speaker Jim Black and the state's optometrists ...
The board decided Friday to ask the Wake County District Attorney to investigate the campaign finance activity of optometrist Michael Scott Edwards and former state Rep. Michael Decker, whose 2003 change of parties helped Black become Co-Speaker of the North Carolina House of Representatives.
But it took no action on Black ...
The motion to make a criminal referral was made by chairman Larry Leake and unanimously approved after three days of testimony about possible campaign finance violations.
Michael Scott Edwards handled all the money for the N. C. State Optometric Society’s political action committee. Several optometrists testified that they delivered signed checks to Edwards with the payee line left blank. Some of those checks ended up deposited with the political action committee while others were made out to the campaigns of individual lawmakers. Decker apparently converted some of the checks for personal use.
Small world ... M. Scott Edwards is from my hometown and his office is only about 3 blocks from my childhood home.
In Honor of McCain-Feingold
I was in class this morning so Brad’s post on McCain-Feingold beat me to the punch. As Brad noted, we are now within 60 days of an election and certain forms of political advertising are now prohibited. I understand and appreciate Brad’s explanation of the logic of the Supreme Court’s finding that McCain-Feingold is constitutional, but it sure seems like piling one lousy decision on top of another. After all the First Amendment says, “Congress shall make no law … abridging the freedom of speech ….” That shouldn't be so difficult to understand.
So, as my little protest of McCain-Feingold’s infringement of liberty, I am going to criticize my Representative Phil Gingrey. Gingrey voted for the massive Medicare pills expansions, he’s pretty weak on pork (voting for only 8 of the 19 “Flake Amendments” (pdf; scroll down) to cut pork barrel spending projects), and he scores a mediocre 62 on the Club for Growth’s House Scorecard. In short, he's no great friend to the taxpayer and no big fan of small government. In fairness, he has been clearly preferable to any of the candidates who have run against him. His first opponent, Roger Kahn, was especially pathetic.
For more on the abomination that is McCain-Feingold see this post at the Club for Growth.
Earlier, I said ethanol probably won't become an important part of our energy mix, at least not under current conditions. Cheaper ethanol might be just around the corner (the same way shale oil has been for 30 years?), thanks to bioengineering. As the New York Times reports,
More miles to the bushel. That is the new mission of crop scientists. In an era of $3-a-gallon gasoline and growing concern about global warming from fossil fuels, seed and biotechnology companies see a big new opportunity in developing corn and other crops tailored for use in ethanol and other biofuels. Syngenta, for instance, hopes in 2008 to begin selling a genetically engineered corn designed to help convert itself into ethanol. Each kernel of this self-processing corn contains an enzyme that must otherwise be added separately at the ethanol factory.
Some of the same groups that don't want nuclear energy to be part of the mix also object to these prospects. From the same article:
Such prospects are starting to alarm some environmentalists, who worry that altered plants will cross-pollinate in the wild, resulting in forests that practically droop for want of lignin. And some oppose the notion of altering corn to feed the nation’s addiction to automobiles. “I don't think people want extra enzymes in the food supply put there to better fit the crops for energy production,” said Margaret Mellon, director of the food and environment program at the Union of Concerned Scientists.
Vouchers and Segregation
Milton Friedman's proposal for vouchers surfaced at an unfortunate time. In the 1960s, anything that seemed likely to foster segregation was suspect. Friedman predicted that segregation would be according to parents' interest in education and not racial, but few were persuaded. A recent study suggests that Friedman was right. No surprise. An excerpt:
"The widespread claims that private schools have high segregation levels and vouchers will lead to greater segregation are empirically unsupportable,” said the study’s author, Friedman Foundation Senior Fellow Greg Forster. “In these two cities voucher students attend schools that are less segregated than the public schools. School vouchers have the potential to break down neighborhood racial barriers in a way public schools can’t match,” added Forster.
Shut Up! - McCain-Feingold Ban Kicks In Today
Today the McCain-Feingold ban on certain broadcast ads run within 60 days of an election kicks in. From now through election day, it will be illegal for non-profit citizens' groups - from the ACLU to the Chamber of Commerce; from the Sierra Club to the AFL-CIO; from the NRA to Handgun Control, Inc.; from Planned Parenthood to Right to Life - to run most ads that even mention a federal officeholder.
Read More »
This outrageous provision of McCain-Feingold is sometimes called a "blackout," but "brownout" is more appropriate. You can still speak, you just can't do it at anything close to full volume. An organization can do newspaper ads, for example, but broadcast ads, the most effective form of communication today, are limited. An organization can run broadcast ads if it has a PAC to pay for them, but few organizations have PACs that large, and most don't have PACs at all. Of course, if you're rich enough to buy TV ads without belonging to a group, then the law allows you to do so. This in the name of equality.
This means for most citizens' organizations, it is tough to mount an effective grassroots campaign to get Congress to vote one way or another. Meanwhile, it is not as if Congress goes out of session. In the next few weeks they will be debating such trivial issues as making certain tax reductions permanent; increasing the minimum wage; and setting up military commissions to try terrorist war suspects, just to name three. Not to mention the federal budget.
Although many believe, as I do, that this limit is blatantly unconstitutional, the Supreme Court has upheld it, and there is a certain logic to the Supreme Court's opinion. Having already ruled that the government can limit your ability to spend your own money to urge people to vote for or against a political candidate, why shouldn't it be allowed to limit your ability to talk about an officeholder's position on issues. After all, if being able to say, "Vote against this jerk" is the core of what democracy and free elections and free speech are about, and if that can be limited, then why not also limit less important speech, such as the right to say, "Urge Congressman Jones to vote for tax cuts."
It is also worth noting here that the so-called "reformers" who push these limits do have at least some vague understanding of economics. They recognize that if the system of private, voluntary political participation can be made difficult enough, and its transaction costs high enough, so-called "publicly financed" (by which they really mean "tax financed" campaigns will begin to look like a more attractive alternative. McCain-Feingold is a step on the way.
« Close It
September 07, 2006
The MEAL Act
This Act may be cited as the `Menu Education and Labeling Act' or the `MEAL Act'.
You might ask how/why I would know about the MEAL Act. Good question. It is because the Center for Science in the Public Interest is gunning for your lattes.
Good Nukes, Getting Better
Consumer Reports has weighed in on E85, one of the most massive boondoggles of our time. Some salient points:
On the last point, Consumer Reports is mute on the question of what will fill those needs. One alternative that I suspect is seldom mentioned in the circles in which CR writers move is nuclear energy. A particularly promising alternative is the pebble bed reactor.
Glenn Harlan Reynolds (aka Instapundit) reports:
Meanwhile, in Britain, environmental guru James Lovelock has called for the deployment of nuclear power to fight global warming, but other environmentalists are horrified at the thought. At least, however, the subject is being debated after decades of being off the table entirely.
Further, Reynolds points to a development that might make nuclear power ever safer than it already is:
The Chinese seem to be on the right track. Pebble-bed technology looks to be both feasible and safe (and it's only one alternative), and it seems unlikely that the world can sustain another 50 years (or even 20) of economic growth on the scale of recent decades while depending on oil and coal -- at least, not without unpleasant side effects.
For more than you want to know about pebble-bed technology, see Wikipedia. An excerpt:
The pebble bed reactor (PBR) or pebble bed modular reactor (PBMR) is an advanced nuclear reactor design. This technology claims a dramatically higher level of safety and efficiency. Instead of water, it uses pyrolytic graphite as the neutron moderator, and an inert or semi-inert gas such as helium, nitrogen or carbon dioxide as the coolant, at very high temperature, to drive a turbine directly. This eliminates the complex steam management system from the design and increases the transfer efficiency (ratio of electrical output to thermal output) to about 50%. Also, the gases do not dissolve contaminants or absorb neutrons as water does, so the core has less in the way of radioactive fluids and is more economical than a light water reactor.
Take that government monopoly!
From the Warren Communications News email blast:
The FCC likely will hand T-Mobile, other wireless carriers and airlines a victory over the Mass. Port Authority (Massport) on a Massport demand that Continental Airline yank a Wi-Fi antenna from its frequent flyer lounge at Boston-Logan International Airport. Sources involved in the fight said Wed. the order has big implications for Wi-Fi's future. Continental wants to offer customers free Wi-Fi service, competing with Massport's $7.95-a-day service.What quality difference is necessary to justify spending $8 over $0, and would government "provided" Wi-Fi ever be expected to provide that difference?
Let's change course! Wait, no, just kidding!
I realize that highlighting politician hypocrisy is about as revelatory as realizing that the Pope is Catholic, but here goes.
On NPR this morning, they reported on the attempt yesterday to have a vote of no confidence in Rummy. Apparently, though, he's doin' a heck of a job because the attempt was quashed. One of the lines the Democrats used (sorry, I can't find a link to a direct quote) was that "staying the course [in Iraq] is not a strategy for success." Which got me to thinking of other situations where a change of course was or has been suggested:
Which political party more likely always wants to "stay the course" and continue these dreadful policies? In fact, I can remember Democrats saying exactly that regarding the Social Security debate a few years back. "We don't need to change, the system is working..." which anyone who has ever tried to balance a Trivial Pursuit pie piece on its tip knows is ridiculous.
Things that make a libertarian mad--Part 2,187.
The other day I headed off to LensVisionDOC to get a new pair of eyeglasses being sure to take along my last prescription. I'm having no trouble with my eyesight; I just need new glasses since I stepped on this pair a couple months ago and one of the lenses keeps popping out.
I get there, pick out a nice new set of frames, sit down, wait, wait, wait, and finally someone comes by to do the transaction. But nooooooo!!!! My presciption is more than two years old and has "expired." They can't do it they say. I say, "My eyes are fine with this prescription." They say it "doesn't matter--it's the law" Of course, they have an optician right there on
Ok here's the question for all you students of political economy. Which of the following two statements is most accurate.
1. It is important for people to get regular eye exams and therefore prescriptions should expire after a time. Without this requirement, people would wear prescriptions too long and would jeopardize public safety and their own health.
If you think (1) is most accurate, can you tell me why eye exams aren't mandatory for all people every two years and why it is not against the law to wear eyeglasses for more than two years? If you think (2) give yourself an A in my class.
Economic Freedom of the World: 2006 Annual Report
The 2006 version of the Economic Freedom of the World report (co-authored with Jim Gwartney) was released today.
Economic freedom promotes growth while foreign aid fails developing countries
Don Boudreaux writes about the index in his TCS column today.
Incentives Matter: Front Yard Oil Well Edition
HOUSTON (Reuters) - Oil prices are so high, that oilman Steve Jordan is drilling a well next to his home near Lake Charles, Louisiana, he said on Wednesday.
Jordan, 52, said the well will stretch 8,500 feet (2,591 metres) under his house and swimming pool and below the adjacent Calcasieu River.
He hopes to strike oil in about 10 days on a prospect that wouldn't have been worth drilling when prices were lower, he said.
September 06, 2006
The Problem with Candidate Debates
There are a zillion reasons to hate candidate debates, not the least of which is that they aren't debates, but joint press conferences with time limited answers, really. Wouldn't it be great to have a real debate? Imagine Joe Lieberman and Ned Lamont having real debates in Connecticut. How would this do? Resolved: The United States should set a time certain for withdrawing its troops from Iraq. Give the guys 60 minutes divided with an opening argument from the pro side, the con, rebuttal, surrebuttal, and a couple minutes closing. I think the public might actually learn something, and frankly, I think most viewers would find it more interesting.
Another problem with debates is the horse race reporting. I'm looking at the report in the Columbus Dispatch of yesterday's Ken Blackwell/Ted Strickland debate. It is the top headline in the paper, with 2 photos and big headline rading only, "ROUND 1." The accompanying article has over 250 words on the front page before the jump, and not one word on anything substantive that the candidates actually said. I mean literally not a word on substance.
Outside the article a box did provide a touch of substance, but not much. Under the subhead labeled "Major Themes" it reports that Blackwell said "Strickland would raise taxes," and Strickland "kept linking Blackwell to corruption in GOP-controlled state government." It reports under the subhead "Anything New?" that Blackwell and Strickland took differing positions on the Iraq war, which was, of course, the stupidest question of the day in this gubernatorial debate.
In other words, the Dispatch, a decent daily paper, does what they all do - it focuses almost entirely on the horse race. When did reporters become incapable of simply reporting an event? "The two candidates squared off in a joint press conference. Mr. Blackwell said he should be governor because... . Mr. Strickland replied that ... " I think maybe all reporters should be forced to do weddings: "The bride wore a open backed cream dress with a veil..." Just the facts. Nothing like, "the groom seemed vaguely distracted, but best man Al Buddyson was quick to spin the issue for his groom, saying 'Joe was just dazed that to have won such a lovely woman.'" Just report.
Meanwhile, once on the inside pages, the article quickly reports that Blackwell said Strickland would raise taxes, and that Strickland denied this. This exchange gets about 50 words of coverage. Then the article notes that probably few people saw the debate, and quotes an Ohio State communications professor who notes that probably not many people saw the debate.
But if you're the typical Ohioan, who could not (or rationally would not) watch the whole debate on television in the middle of the workday, or re-run at 11 p.m., the Dispatch didn't make it easy to find out anything from it.
Of course, then we complain that voters have to rely on 30 second ads - but what do we want them to do, when the press refuses to cover the things the candidates actually say?
Posted by Brad Smith at 09:04 PM
Google does it again
Google News Archive allows you to search 200 years back. I don't think this will put my "c. 1906" series out of business, but it reduces my editorial monopoly.
Whenever I hear of Google, my mind turns to the following comparison: Google vs. Ethanol. The former is a market-determined winner, continues to innovate, and is consistently reducing "price," which in the case of Google is the cost of accessing information, and the latter is a government-determined winner, fails to innovate for the most part, and seems to drive up the price of gasoline.
Something to ponder
Do you go to your 20th high school reunion when one of your classmates has just become editor of Newsweek? This is what I would face next year.
Congrats to Jon Meacham.
Soft America, Hard America
One of the peculiar features of our country is that we produce incompetent 18-year-olds and remarkably competent 30-year-olds. ... Why? Because from the age of 6 to 18, our kids live mostly in what I call Soft America--the part of our society where there is little competition and accountability. In contrast, most Americans in the 12 years between ages 18 and 30 live mostly in Hard America--the part of American life subject to competition and accountability; the military trains under live fire. Soft America seeks to instill self-esteem. Hard America plays for keeps.
Barone's focus is on on-the-job skill acquisition. Sameulson focuses more on post-secondary schooling as part of what he calls the American leaning system (as distinct from the U. S. school system).
This fragmented and mostly unplanned learning system is a messy mix of government programs and private business. ... But the American learning system partially explains how a society of certified dummies consistently outperforms the test scores.
PNC Park Threatens To Leave Pittsburgh Unless Better Team Is Built
An offering from The Onion:
PITTSBURGH—After five years of serving Pittsburgh as their state-of-the-art sporting facility, PNC Park, the home of the rundown, poorly maintained Pirates, said Tuesday it is threatening to leave Pittsburgh unless a new team can be built within the next three years.
"I love the city of Pittsburgh, but the Pirates are an old, dilapidated club built from other teams' spare parts, and its very foundation is rotting away," the stadium said to reporters assembled in its press box. "I had every intention to stay here for the duration of my career as a ballpark, but given that I haven't seen any realistic long-term plans for improving my resident team's ramshackle condition, I would be lying if I said I wasn't thinking about taking my services elsewhere."
The young stadium, regarded as one of the best of the recent crop of real-estate development projects throughout the league, added that "after this year's All Star Game, I have learned that a ballpark of my caliber deserves to host that kind of play every day."
...PNC Park, however, is not convinced.
"When I came here in 2001, they promised me a championship team," the stadium said. "I was warned by venerable and much-beloved Three Rivers Stadium—which imploded soon afterwards, as you know—that I should look elsewhere, that this team was set in its ways and not focused on rebuilding, that they were simply using me as a means to make money," the stadium said. "I was young and brash and I didn't listen. Now that I am more mature and have settled a bit, I realize I have to do what is best for me and my family."
September 05, 2006
I have yet another namesake
This one demonstrates remarkable talent with little physical capital.
Labor Day Once More
Earlier, I griped about the quality of my local newspaper's analysis of labor's progress and stated relief that most people don't seem interested in being part of any reversal of organized labor's fortunes. I omitted any reference to a source that relates the relevant history in a way that does justice to the role of markets. Once such article is at the Mises site. An excerpt:
Posted by Wilson Mixon at 05:50 PM
On "The Plan" c. 1906
The last of what I found interesting in the Sept. 5, 1906 NYT was an editorial excoriating Democratic Nominee for President William Jennings Bryan's proposal that state and federal governments take over the private rail network in the United States (seems like an Atlas Shrugged type of proposal):
Mr. Bryan is wasting his time, and wasting the time of the public and of the Democrat Party. His advocacy of an eight-hour day for labor does not interest the country. Everybody knew, or could have guessed, his views upon labor issues. The thoughts he has expressed about international arbitration and universal peace are as old as the hills. But his plan for the transfer of all the railroads in the country to the Federal and State Governments is new, yet he does not explain how the momentous change is to be brought about, presents no plan even in outline, tells us nothing about it, in fact, save that it ought to be done...
Substitute your favorite government power grab - be it retirement plans, nationalized health care, or whatever - fiddle with a few politician and party names and we have the same criticism (of both parties) today.
When he [Bryan] accepted the Democratic nomination to the Presidency ten years ago and began to advocate the free, unlimited, and independent coinage of silver at the ratio of 16 to 1, his writings and his speeches abounded in detail and explanation. He told the country precisely what he meant. Everybody understood that under the coinage laws as he would shape them a man having 100 ounces of silver could take the metal to the United States Mint and get it coined into 129 silver dollars. As silver could at the time be bought in the open market for about 67 cents an ounce, every mind could grasp in an instant the meaning and scope of the change proposed by Mr. Bryan in our financial policy and currency laws. His supporters could understand him, his opponents could get at him...And this is as it should be. Politicians who want to spend the public's money and want to fundamentally alter the way individuals live their lives, unintended consequences and all, should provide full information. My criterion: if the proposal is too complicated to convey during a thirty minute infomercial, then the proposal should be dropped. Heck, it is possible to show all the benefits of the Ab Crusher 5000 and the Salad Shooter during the same amount of time.
Mr. Bryan now asks the Democratic Party to accept him upon a platform of Government ownership and operation of railroads, but he does not even in a general way tell us how the Federal and State Governments are to come into possession of the thirteen billions' worth of railroad property now privately owned. Absurdities are not infrequent in politics, and electorates sometimes behave as if they were deprived of reason and without foresight. But there is a limit...Are we once again reaching that limit today? I wonder.
The undertaking he advocates is so gigantic that the unaided imagination cannot supply the missing details. Nobody except Mr. Bryan could present a working plan for carrying this policy into effect that would not be at once destroyed by the fire of criticism...
In my opinion, this editorial could be written in ad lib (mad lib?)fashion today and be almost as poignant; just fill in the blank of politician, party, and proposal and the wording would be as germane today.
The lack of a "plan" is a political convenience that we as an electorate allow politicians to get away with. We should demand clear language and specific plans on whatever it is the politicians propose to do with our tax dollars, let's say (for giggles): Social Security, Medicare, Medicaid, Natural Disaster "Relief," Nationalized Health Care, Immigration "Reform," Education "Reform," and National Security. This list alone would likely make the average voter's head explode - but isn't that in itself an indication of the problem?
Yet we know that the specific proposals are not forthcoming, because to do so would alienate/disgust voters to the extent that numerous (most?) political careers would crash and burn on "both sides of the aisle."
Not being a scholar of political science, I wonder if the lack of a plan is "justified," in the minds of politicians, by what happened to Bryan in the 1896 election (assuming the story is true)?
On the other hand, perhaps there simply is no plan, period. Which possibility is worse?
Legislative proposals c. 1906
The September 5, 1906 NYT also includes a tongue-in-cheek checklist for national legislation as offered by the Louisville Courier-Journal, some of which might be a better use of Congressional time even today:
#1 might still find support amongst the temperance groups but would be opposed by the mint farmers on national security reasons and also because without mint juleps they would need federal subsidies. Bourbon distillers might also be concerned but would not be allowed to participate in the debate for fear that they would write the legislation.
#2 could be opposed by natural language folks and early education types and on first amendment grounds.
#3 would be opposed by net neutrality folks and those who like to read the end of a fiction novel first.
#4 and #5 could easily be opposed on church and state grounds but #4 might be supported by the Parent's Television Council.
#6 is largely immaterial due to technological changes but could be opposed on first amendment grounds and a separation of powers argument.
What's in a name c. 1906
From the September 5, 1906 NYT:
LITTLE ROCK, Ark - Additional returns from yesterday's State election show that the Democrats will have a thirty-four out of thirty-five members of the State Senate and 95 out of 100 members of the House, assuring the election of Gov. Jeff Davis, Democrat nominee, as United States Senator...Chances of a Democrat or Republican named Jefferson "Jeff" Davis being elected to the U.S. Senate in 2006?
Watched the first Blackwell-Strickland debate on Ohio News Network.
Bob Lawson's old Shawnee State colleague Ted Strickland, for his part, probably did the minimum he needed to do. He said some dumb things - see below -
Read More »
but no classic "gotcha" gaffes that reporters love. He was congenial, as he always is, and had a good prepared closing statement. Strickland has a tendency to read prepared statements, but he didn't read this one, and he's much better when speaking from prepared text than in thinking fast on his feet. Exhibits of his weakness in off-the-cuff oratory:
Commenting on his years in Congress, Strickland said he had "left a light footprint in Washington." Rather odd to boast about being a lightweight congressman.
At another point, responding to a question about reviving the Mahoning Valley, where the debate was held, Srickland said, "My opponent is unwilling to invest anything in this Valley, except things that may benefit the private sector." The private sector as a way to help the state economy? What kind of nonsense is this Blackwell guy peddling?
Strickland walked into one, as well, when he spent some time bragging about how all the state's "big city mayors" supported him. "Why?" he asked rhetorically, "because they know I have a plan." Blackwell hammered him. "The reason the mayors of big cities support Ted is because they're all Democrats, and that's one reason our cities are doing so poorly."
But in the end, Strickland was still a nice guy, and if he didn't get beyond platitudes in any proposed solution, he didn't stumble and promise to raise taxes either. In this year, that may be enough.
Libertarian Bill Pierce was, of course, not invited to participate. It's too bad, as it would undoubtedly make the debates more interesting. Still, as these things go, this one was pretty good.
It airs again tonight at 11:00 on Ohio News Network. The two front-running candidates will debate two more times, the next on September 20.
« Close It
MEXICO CITY, Mexico (AP) -- Felipe Calderon became president-elect of Mexico on Tuesday, two months after a disputed election, when the nation's top electoral court voted unanimously to reject allegations of fraud and certify his narrow victory.
His leftist rival, Andres Manuel Lopez Obrador, had said he would not recognize the ruling.
How does one say Sore-Loserman in Spanish?
The Overselling of Higher Education
Given our recent posts on higher ed, it's timely that George Leef offers up "The Overselling of Higher Education" (link is pdf). I've only skimmed the paper so I can't offer detailed comments on it, but I think George is on solid ground in argueing that too many kids go to college (my guess is at least one-third of current college students shouldn't attend college or should attend a later time in their lives), that many go for the wrong reason (job grubbing rather than intellectual curiousity), and that government subsidies are a significant contributor to the problems.
ADDENDUM: Our discussion of higher ed reminds me of Wilson's characterization of education as the one market where customers try to get as little as they can for their money. In light of the heavy subsidies, the statement should probably be slightly modified to say people try to get as little as they can for somone else's money.
Incentives Matter: Oral Sex Edition
So says Tim Harford in this Slate article; ht to Alex of MR for the pointer.
Slogging Through Labor Day: Productivity, Income, and Redistribution
Wilson's local paper wasn't the only one running Labor Day mush; the Rome News Tribune reprinted this article by Harold Meyerson of the Washington Post. Much of Meyerson's column is based on or similar to the much discussed (e.g., here and here) Greenhouse and Leonhardt piece in the NYT.
However, these two passages caught my eye:
The median hourly wage for Americans has declined by 2 percent since 2003, though productivity has been rising handsomely.
Since 1973 productivity gains have outpaced median family income by 3 to 1.
Although there are many quibbles that can be raised with these passages, I want to focus on productivity and wage growth. Meyerson seems to implicitly that productivity growth should be proportionate for all wages. I know of no reason why this should be the case; I think it is entirely possible that prductivity growth has been greatest among folks with the highest skill levels.
Here's another Meyerson passage that caught my attention:
Ours is the age of the Great Upward Redistribution.
Repeat after me--income is earned, not distributed. Calling a period of rising wages for high skill, hard working people "redistribution" is an abuse of language.
What's in a name?
Advertising Age reports that Taco Bell is having a hard time convincing Hispanics, particularly Mexicans, to eat at their restaurants.
Taco Bell's fast-food version of Mexican food isn't playing very well with Hispanics, who contributed just a half-percent to the company's same-store-sales gain of 7% in 2005, despite making up 20% of Taco Bell's core 18-to-34-year-old target market.
If native Mexicans choose not to eat at TB is it because of the advertising or because the food isn't really Mexican food? According to one Carl Kravetz, who handles advertising for El Pollo Loco (The Crazy Chicken?!?), it's the food:
"If they say they deliver good Mexican food to [Hispanics] they won't be believed. If they say they have good, filling, cheap American food, they may have a chance."Ouch.
William Chace on College Costs
Chace, the former president of Emory and Wesleyan, offers his thoughts on college costs in today's NYT. Perhaps surprisingly, some of this thoughts (e.g., on colleges spending on lots of amenities like posh residences) are similar to those expressed by Vedder in the Fox special.
HT: Louis Louis
September 04, 2006
Game Six of the 1986 World Series with Nintendo RBI Baseball
Ahh... takes me back to middle school. The best part is the use of Vince Scully's play by play.
On negative externalities c. 1906
From the September 4, 1906 NYT:
LONDON Sept. 3 - If any one throws a banana skin on a London pavement and is caught at it by the police, he will have to pay a fine of 40s.
40 shillings (2 Pounds) in 1906 is worth approximately 143 pounds in 2005. At today's exchange rate, the 143 pounds is worth about $272.
Another poor prediction c. 1906
From the September 4, 1906 NYT:
Secretary Root and his party, who reached this city [Santiago, Chile], who reached this city on Saturday, breakfasted to-day with Baron de Giskra at the Austrian Legation and spent the afternoon visiting the schools...The Secretary declared that, while the nineteenth century was the century of the United States, the twentieth century would be the century of South America, and that no part of the world had better prospects. The opening of the Panama Canal would revolutionize the world's commerce, and the west coast of South America would be benefited most.The per-capita income of Argentina and the per-capita income of the United States was just about equal in the early 1900s. By the early 2000s, this was no longer the case.
It is interesting that the Secretary of State would predict the relative demise of the United States in 1906. One could hardly imagine such political language being used today by the party in power.
In its Labor Day editorial, my local newspaper asserts, "The glory days of the American worker appear to be on the wane." Evidence? The recent New York Times piece and a largely fictional retelling of American labor history with labor unions and the federal government as heroes. Depressing reading.
This article improved my prospects for a happy Labor Day (that and looking forward to lunch at Pisgah Inn).
A couple of excerpts:
When asked, "Would you personally like to be a member of a labor union?" 74 percent said "No."
The poll also found continuing support among workers for the principle of the "right to work," which gives employees the option of deciding for themselves whether or not to join or financially support a union.
Posted by Wilson Mixon at 10:09 AM
September 03, 2006
Santorum on Social Security Reform
From this morning’s Meet the Press:
MR. RUSSERT: There are 40 million people on Social Security and Medicare. There’s going to be 80 million in the next 15 years. Life expectancy is—used to be 65, it’s now approaching 80. We all know it. Senator Santorum, when you ran first for the Senate in ‘94 you said, “You can raise taxes, you can cut benefits, or you can push back the retirement age in the future.” […] Will you push retirement age back because of the huge influx of baby boomers? […]
Hurrahs to Santorum for favoring op-out personal retirement accounts, but hisses for claiming that they can solve the underfunding problem.
I’ve discussed before how opt-out (aka “carve-out”) personal retirement accounts can be fiscally neutral when the worker gives up $(1+r) in future Social Security benefits for each $1 in current Social Security contributions he opts into his own PRA. The Treasury borrows $1 to replace the diverted contribution, and repays it with the $(1+r) future benefit savings. (We set r equal to the Treasury’s borrowing rate.) There is no “transition cost” to the Treasury from replacing an implicit obligation with an explicit obligation; it’s merely a refinancing.
A fiscally neutral carve-out program makes the worker better off, and nobody else worse off. I'm for it. (Robert Barro says he's against personal accounts, but I think he means add-on accounts. )
But truth be told, a fiscally neutral carve-out program doesn’t provide any windfall to the Treasury. The only way for the Treasury to gain from PRAs is for the offset rate ("r") to be set above the Treasury's cost of borrowing. I'd be against that -- and so should Santorum, if he's against increasing taxes on saving. With a fiscally neutral carve-out, the underfunding problem – future promised benefits in excess of scheduled tax revenues – remains. Addressing it will require some combination of tax increases, benefit cuts, and retirement age pushbacks, just at Santorum recognized in 1994.
September 02, 2006
Security searches c. 1906
From the September 2, 1906 NYT:
MOSCOW - A huge pumpkin carried by a man garbed as a country-man to-day attracted the attention of the police in the market here by its excessive weight and induced them to make an investigation with the result that it was found to be filled with cartridges.
Musings of the Gentle Cynic c. 1906
From the September 2, 1906 NYT:
September 01, 2006
Of Shoes, Snow Cones, and Bras
Mark Steyn says that on September 10, 2001, "The airline cabin was already the most regulated jurisdiction in America, a kind of way-up-there-in-the-blue state, where Ted Kennedy and Al Gore's fondest desires on gun control, smoking and indeed free speech had all been implemented. So on September 11, three out of the four planes followed all the 1970s hijack procedures and everybody died. On the fourth, free-born citizens reclaimed their rights, fought back against the terrorists and provided the only good news of the day. Half a decade on, the regulatory regime is even more coercive."
Steyn concludes, "The arithmetic is very simple: Can we regulate for all faster than they can adapt for some?"
How about a security program based on these two premises: the airlines own their airplanes, and individual passengers should pay their own way.
Allowing individual airlines to determine how to provide security and making them liable for their selections would take away the "one size fits all" aspect of the current approach, making it impossible for troublemakers to plan.
Regarding the second, suppose that passengers pay for security checks. I might travel with a small mesh bag that could be inspected at a nominal fee. If I carry on a computer and a full makeup case, then I would pay extra for the baggage inspection. I might check much of my materials, where it could presumably be checked more cheaply, or leave most of it home. Most likely, a small industry would evolve, with simple travel kits being sold within the confines of the secure perimeter.
God and Unions
Cal State Hayward's Chuck Baird successfully sued the California faculty union on grounds that it interfered with his freedom of religion. He won and is no longer represented by the union.
It looks like the idea is spreading.
COLUMBUS, Ohio (AP) — State employees should be able to donate their union dues to any charity, not just a church, when they have religious objections to how the money's being spent, federal justice and civil rights officials decreed today.
Scrap the Canadian dollar?
Two years ago Gilles Duceppe, leader of the Quebec secessionist party Bloc Québécois, was calling for North American currency union:
"Do we really need the Canadian dollar?", Duceppe asked blue chip members of the Economic Club of Toronto. "We must ask ourselves: Are there still economic reasons justifying the existence of the Canadian currency?" Duceppe said "the instability of the Canadian dollar" over the years has been "considerably harmful" to things like trade.
Good questions. Currency union would make sense for Quebec as an accompaniment to independence, because Quebec would lack credibility issuing its own currency. A currency union would indeed promote cross-border trade and investment.
Last weekend Duceppe once again called for debate on the issue. He told reporters:
We've been demanding this debate in Ottawa, but they don't want it because of the symbolism of having the face of Elizabeth II on the Canadian dollar.”
Of course, Canada could adopt currency union while still retaining Elizabeth II’s face on its currency. Scotland and Northern Ireland have a currency union with England, but their own commercial banks issue the banknotes. If Canadian banks were allowed to, they could similarly issue US-dollar-denominated notes featuring any face their customers want: the Queen, hockey great Rocket Richard, mountie Dudley Do-Right. Plus, the seigniorage would then stay at home.
Read More »
Duceppe blamed the instability of the Canadian dollar for the takeover of a Quebec forestry firm Domtar by the U. S. firm Weyerhauser. This may seem like protectionist nonsense, but he has a point: part of motive for merging the two firms might be to hedge the effect of C$-US$ exchange rate fluctuations. If Weyerhauser contracts to buy from Domtar at prices denominated in US$, one firm or the other loses when the exchange rate moves. A single balance sheet is a substitute for a single currency as a way of eliminating that risk.
Unfortunately, Duceppe misunderstood how the foreign exchange market clears:
“We have this ridiculous economic policy that when exports grow, the economy gets stronger and the value of our currency increases. Then exports decline and things get worse. It's always like a yo-yo," Mr. Duceppe said yesterday.
The actual sequence is: when demand for Candian exports grows, the demand for Canadian dollars grows, and so the value of the Canadian dollar increases, until exports stop growing and equilibrium is restored. It’s not like a yo-yo, it’s like a kaleidoscope after you turn it: everything falls into a new pattern.
Duceppe went on to give a self-contradictory argument for currency union:
A debate on monetary policy is needed, he said, because the Bank of Canada is so closely tied to U.S. Federal Reserve policies that it has lost its ability to influence independent economic policies at home.If you want an independent monetary policy, then you don’t want currency union, which is the antithesis of monetary independence.
« Close It
Sheldon Richman On Income Inequality
A superb read; click here. Sheldon must write with a stiletto; the NYT doesn't stand a chance.
Rationally Irrational Politicians?
My brother in Savannah informs me that yesterday, the day that Ernesto was predicted to possibly, maybe, hit Savannah with estimated 40mph winds and 4 inches of rain, Savannah closed its schools:
The threat of Tropical Storm Ernesto downgraded to a tropical depression overnight Wednesday, nevertheless canceled classes today for Savannah-Chatham County Public Schools.
More evidence that in the post-Katrina world the expected marginal-cost to the politicians/buerucrats of not acting in a time of "emergency" has increased?
"No man's life, liberty, or property is safe while the legislature is in session."
According to the pundits, Gov. Schwarzenegger is expected to sign the global-warming and minimum-wage bills, but veto the socialized-medicine and Wal-Mart bills. (For more on conservatives' disappointment with the Governor's performance, see Shikha Dalmia in the Wall Street Journal and Steven Greenhut in the OC Register.)
And, if that's not enough economic illiteracy for one post, I will point out that in November Californians will have the opportunity to vote on Proposition 87 -- a measure that would raise taxes on California oil production. The thinking is that it may pass because voters are angry about high gasoline prices. If you're wondering why people would think that increasing taxes on a product would help lower its price, rest assured that (according to the California AG's description of the proposition) it "[p]rohibits producers from passing tax to consumers."
"You're Fired" - Who me?
I quit watching "The Apprentice" a few years ago, but I did find it somewhat intriguing for a while. I especially liked Carolyn. Alas, Carolyn may not be on the show any more as The Don cracks the whip:
"Being on 'The Apprentice' went to her head. She was no longer focused on business. She was giving speeches for $25,000 and doing endorsements," said a person quoted in the New York Post as an "insider."
I wonder why Trump didn't incorporate this into the show. Instead of firing one of the apprentice-wanna-bes, he could have fired Carolyn on the show and shocked the world. As it is, it seems like The Don might be concerned that focus stays on the middle chair in the boardroom.
I wonder if she received the news via email?
Better and Better
Thanks for allowing me to join this august body of serious thinkers, this self-styled band of merry bloggers. I begin on a positive note.
Don Boudreaux asserts, "I suspect that ... the growth in real dollar income between 1967 (or 1973) and today underestimates the improvements to everyday life brought to us by economic growth during the past 30 or 40 years." More precisely, he says we are at least 46326/35379 (1.309) times better off than the NIPA figures suggest. His argument relates mainly to the options that consumers enjoy. He briefly addresses the work that must be done to get our income (about 11 percent shorter workweeks). Add one more item: work is more comfortable and safer. More people work in air-conditioned offices rather than factories, and the fatality rate has fallen to about 1/2 its 1967 level (BLS and DallasFed. The DallasFed entry is a PDF file that shows how the work experience has improved).
Sobel v. FEMA
I recieved this note today from Russ Sobel:
I just finished taping my interview with the CBS Evening News on FEMA reform. It is scheduled to be shown during tomorrow night's CBS Evening News that starts at 6:30pm. Of course, some major news story might displace it, but I hope not. I think my interview went well, I certainly did my best to defend our free market system. It will be on during a segment where they tour a new FEMA distribution facility in Atlanta.
The statesman who should attempt to direct private people in what manner they ought to employ their capitals would not only load himself with a most unnecessary attention, but assume an authority which could safely be trusted, not only to no single person, but to no council or senate whatever, and which would nowhere be so dangerous as in the hands of a man who had folly and presumption enough to fancy himself fit to exercise it. -Adam Smith
Our BloggersJoshua Hall
E. Frank Stephenson
Michael C. Munger
Lawrence H. White
Edward J. Lopez
By Author:Joshua Hall
E. Frank Stephenson
Michael C. Munger
Lawrence H. White
Ralph R. Frasca
Edward J. Lopez
By Month:February 2014
Site design by