Division of Labour: October 2012 Archives
October 29, 2012
Hurricane Sandy as Stimulus?
Is this rush of consumers to spend a very-much needed stimulus of the US economy?
If this were the answer to an exam question, it'd be worth maybe a C for having the right answer but the wrong reasoning. Repeat after Bastiat: Breaking windows (or flooding homes) does not increase economic well being even if there is a temporary blip in GDP while rebuilding destroyed buildings. That the writer doesn't get this point is evident from his saying that $100B of damage is too small relative to the size of the U.S. economy--I suppose he'd prefer a storm that does $1 trillion in damages. Or maybe, since the author laments Sandy's being a one-time event, a Hurricane Sandy every month--nah, every week!--would be stimulus.
UPDATE: For an explanation worthy of an A, see this piece from Tim Worstall.
UPDATE2: And coming in with an F is Bo Peng's muddled mess ("destruction is constructive") over at The Street.com.
UPDATE (10/30): More bits of economic ignorance on public display--here's one that features a reference to our favorite Chinese copier salesman and here's another extolling the benefits of clean up costs (dude, there's a reason we call them clean up costs not clean up benefits).
UPDATE (10/31): Today brings Richard Eskow proclaiming "God must be a Keynesian" and describing Sandy as "God's Stimulus." Ugh.
Posted by E. Frank Stephenson at 08:25 AM
October 28, 2012
Why this libertarian is voting Romney, with enthusiasm
Earlier this week, the flagship libertarian think mag, Reason, published its individuals staff members’ choices for president. Not surprisingly, Libertarian Party candidate Gary Johnson was the overwhelming choice. As a libertarian, I think they are wrong.
Libertarian voters are variously estimated to make up ten to twenty percent of the electorate. It would be not only presumptuous but foolish to try to tell libertarians how to vote. We are, by definition, far too prickly and independent for that.
But for those that are interested, let me say why this libertarian plans to vote, with enthusiasm, for Mitt Romney.
Read More »
First, it is admittedly tempting for a libertarian voter to fill in the oval for Johnson, the former New Mexico Governor. Johnson is far and away the best candidate the LP has ever put forward, and would make an excellent president. But the bottom line is this: Gary Johnson is not going to be elected president on November 6. Either Mitt Romney or Barack Obama will have that honor and burden. So I don’t have to choose between Romney and Johnson. I’m choosing between Romney and Obama.
Here’s why I like Mitt:
1. Obamacare. One reason many libertarians are skeptical of Romney was his introduction of “Romneycare” in Massachusetts. Many people, including the Obama Administration, like to say that this was the genesis of the despised individual mandate. Governor Romney has offered various reasons why Romneycare is different (federalism, substantive differences), which are not convincing to many libertarians.
Fine. But here’s the thing. For most libertarians, this is one of the most important issues in decades. Libertarians worry that Obamacare, beyond being an atrociously designed law even on its own terms and assumptions, will fundamentally alter the relationship between Americans and our government, and cement into place once and for all a European-style social democracy.
Romney has pledged to repeal Obamacare. It is one of his most visible pledges, and therefore – even if one doesn’t trust Romney (I do, although I’m not sure he can get repeal done) – it will be one of the hardest for him to break or ignore. And he has vowed to use Obama’s own weapon – executive branch waivers – to effectively stop implementation of the Act immediately.
So let’s be skeptical. Let’s assume there is only a 10 or 20 percent chance Romney carries through on this promise (I think the odds are much higher, but I’m being cautious and skeptical here). What are the odds of repeal if Obama is re-elected? Zero. Zilch. Nada. None. Nothing. If repeal of Obamacare is truly important – and I think it is – I will not pass up the most (or only) realistic chance to get it done.
2.Taxes. Mitt Romney has expressed a desire for sensible tax reform that most libertarians support – lower rates with a broader base. We’d like to see overall taxes decline, but in the face of massive deficits, with a public unwilling to stand for major cuts in entitlements, that’s probably not a realistic option. But Mitt Romney and his running mate Paul Ryan have promised to try. Barack Obama, on the other hand, has expressed again and again his desire and determination to raise income tax rates, and, at times, even to do so solely for the purpose of redistributing income. And to add insult to injury, Obama’s Orwellian language about “asking” some “to pay a little bit more” grates every time one hears it.
Walter Mondale campaigned on raising taxes and lost. Bill Clinton campaigned on cutting taxes, won, and promptly raised the marginal income tax rates. Libertarians often like to say that there is no difference between the two major parties. But in my lifetime (and I was reading Reason and walking precincts for Ed Clark before many of those young Reason staffers were born) there have been two Presidents who have substantially reduced income tax rates: Ronald Reagan and George W. Bush, both Republicans. Republicans have delivered on income tax rate reductions, and can do so again.
Romney is clearly the superior candidate.
3. Entitlements and Spending. Republicans have never had a lot of success in reforming, letting alone ending, entitlements. Often – particularly under G.W. Bush – they have played a key role in expanding them. On the other hand, Republicans scored a huge success in the 1990s in ending welfare as an entitlement, and Obama is now attempting to undo this success through the regulatory process.
Beyond the possibility of repealing the massive entitlement of Obamacare if Romney is elected, Romney’s running mate, Paul Ryan, has been a congressional leader in attempting to reform entitlements. No, he is not the Randian that the Democrats wish to make him out to be, much as many libertarians wish he were. But let’s be clear. No politician is going to be elected President in the near future on a pledge to abolish the entitlement state.
The Romney/Ryan plan for entitlement reform is the closest thing we have to a meaningful first step at reform – indeed, it is meaningful reform. There may never come a time when a majority of Americans are prepared for more radical reform, let alone an end to entitlements. If this is the reform we can get, it is necessary and good, and consistent with libertarian values. If an end to entitlements is one’s goal, successful, incremental reforms are probably a necessary step toward reshaping Americans’ mindset.
Obama currently stands as the single biggest obstacle to any consideration of entitlement reform. Romney and Ryan have taken on the issue in as strong a manner as any presidential ticket since Barry Goldwater in 1964. Libertarian voters need to reward such politicians, not ignore them because their proposals are deemed insufficiently libertarian.
For a libertarian who wants any kind of entitlement reform, Romney is the only choice that might make that a possibility. The defeat of the Romney/Ryan ticket, including the GOP’s leading congressional reformer, will make future politicians less likely to take on the issue.
Discretionary spending is a tougher matter. We know that Republicans failed miserably to control discretionary spending when they controlled both the executive and legislative branches from 2003 through 2006. But we also know that the Democrats have no interest in limiting spending.
Some libertarians argue that divided government is the best way to promote spending restraint, forgetting that much of the biggest spending of the Bush era came during the three plus years that the government was divided. Moreover, the Democratic congressional party is much more liberal than it was just a generation ago. On the GOP side, there are a new set of leaders and a large tea party contingent that seems serious about getting spending under control. I don’t think Romney is a spender like Bush II was. I see no downside if I’m wrong, because I know that Obama and the Democrats are.
4. Regulation. I can’t imagine Obama will be better than Romney. The president appoints hundreds of officials,. Few Democrats, but many Republicans, are skeptical of regulation. People like Gale Norton and Lynn Scarlet (libertarian Bush appointees) will never see the light of day under Obama. There is no doubt that Romney is more skeptical of regulation than Obama, and having come from the business world, he brings a better understanding of the actual working of regulation. I can think of no area where Obama is arguing for less agency regulation than is Romney.
5. Free Trade. Like most libertarians, I am a free trader. I consider opposition to free trade little short of a callous disregard for the world’s poor.
In this race, both candidates have taken to bashing China relentlessly and speaking in protectionist terms, an obvious recognition of the sad fact that the decisive, “undecided” voters are largely low-information voters with little understanding of economics, bordering on xenophobic, and populist in their politics. That said, Romney is clearly the superior trade candidate.
Early in his term, Obama signed free trade agreements negotiated by George W. Bush. Since then, he has done nothing on the issue. Romney has proposed a broad, western hemisphere free trade agreement. I’m not sure this is realistic, but there is a much better chance that Romney will promote free trade in the hemisphere than will Obama, who is a slave to the anti-trade unions. Obama opposed CAFTA and NAFTA, and seeks to “amend” NAFTA, and not for the purpose of reducing barriers to trade. Romney, in contrast, has criticized Obama’s failure to pursue free trade, adding earlier this month, “I will champion free trade and restore it as a critical element of our [foreign policy and economic] strategy.”
Obama rails endlessly against “outsourcing” and has supported congressional efforts to impose tax increases on businesses that seek to allocate capital efficiently. His latest slogan, “The New Economic Patriotism,” should send shivers up the spine of every libertarian who believes in free trade. On the flip side, Romney seems to clearly have the soul of a free trader.
6. Other Domestic Issues. Many libertarians like to describe themselves as “fiscally conservative, socially liberal.” I find this to be a facile description, but here’s how I see the candidates on major non-economic domestic issues of importance to libertarians, in no particular order:
a. Immigration. Obama offers a bit more liberal immigration policy in principle, but Romney is more likely to gain concrete results for easier access for skilled workers. Broadly, I think Romney is much more likely to look for policies fostering assimilation, which I think is a good thing in itself and will increase support for a long-term immigration policy more amenable to libertarians.
b. Gun Control. Advantage Romney.
c. School Choice. Advantage Romney.
d. Abortion Rights. I have never believed in a “libertarian position” on abortion. Whether the traditional “pro-choice” view, which is probably the majority view among libertarians, is pro-freedom depends on numerous assumptions about when life begins and what degree of protection the law should provide to life in its different stages. A libertarian can come down on either side.
I am pro-life, and therefore give a huge advantage to Romney. But note that even for pro-choice libertarians, the major issues actually on the table in the next years cut in favor of Romney. I assume that pro-choice libertarians are aghast at the Obama Administration’s efforts to have government pay for abortion and even contraception, and worse, to force Americans with moral objections to pay for these items. Which leads me to…
e. Religious Freedom. Some libertarians tend to think religious freedom is unimportant, at least as a separate item (i.e., why give added protection from government regulation to those with religious beliefs). However, as a practical matter, the protections of the First Amendment for religious groups has helped to support a major counterweight to state power. Religious freedom matters, and Romney is an easy choice.
f. Same Sex Marriage. Libertarians who favor government recognition (and, therefore, regulation of) same sex marriage and think this issue important enough to offset the rest will favor Obama. I am not one of them. I believe that in the long run gay rights are best protected by a more limited government, and Obama is much more interested in growing government power than Romney.
g. War on Drugs. Obama has been horrible. No advantage in principle either way, but it’s in practice it’s harder, for me at least, to envision something like “Fast & Furious” occurring under Romney.
i. Free Speech. Give Romney, with his opposition to campaign finance (i.e. political speech) regulation and “hate speech” codes, a huge edge over Obama. Obama has even used government regulation to attempt to silence corporations opposing elements of the Obama agenda, including the provision of true information about his health care plan.
6. The Courts. I’ve never been a big fan of voting based on hoped for judicial appointees, in part because the issues will change so much over the course of a federal judge’s time on the bench – and over that time, the judge may change quite a bit, too.
But this year, I do think it matters. On Inauguration Day, Antonin Scalia will be 6 weeks shy of his 77th birthday, with Justice Kennedy, arguably the most libertarian member of the Court, just 4 months younger. Ruth Bader Ginsberg is a cancer survivor who will be 80 before the next President has been 2 months in office. Stephen Breyer will be 74. Even Clarence Thomas will be 68 before then next presidential election. There is a very good chance that the next President will get at least one, and perhaps more, appointments to the Supreme Court.
On issue after issue of importance to libertarians – gun control, property rights, political speech rights, Obamacare, federalism, even on questions of self-incrimination, search and seizure, forfeiture, and the war on drugs (see Raisch) – Republican appointees on the Court have lined up on the side of freedom against a solid block of Democratic appointees. There is no libertarianism left in Democratic appointees – they are not necessarily radical, but they are totally statist in orientation, including Obama’s two appointees, Elena Kagan, and Sonia Sotomayor (who are the two youngest justices). In the next four years, one side or the other could lock up a working majority on the Supreme Court for two decades. I have no doubt that Romney’s appointees will be MUCH better than Obama’s. Indeed, how could I not – in 2008, I was a member of Romney’s advisory committee on the Constitution and the Courts, a group that included other libertarians such as Michelle Boardman. I have confidence that Romney will appoint judges who see the constitution as a document that limits government power.
Beyond the Supreme Court, of course, the President appoints hundreds of federal judges. The question of judicial power is a HUGE advantage to Romney.
7. Foreign Policy. As the third presidential debate indicated, the differences between Obama and Romney on the Middle East are not all that large (although Obama’s demonstrated incompetence and Romney's better understanding of the nature of radical Islam still gives an advantage to Romney.) Similarly, Obama and Romney differ relatively little on the broad U.S. approach to China, Russia, and Europe, but as we have seen Obama’s incompetence in dealing with the world, I’m more comfortable with Romney. Elsewhere, however, I think Romney’s advantage is more substantial.
Beyond free trade, which I’ve discussed separately, Romney is much more oriented towards freedom. We will not see President Romney cuddling up to populist dictators such as Hugo Chavez in Venezuela, or undermining democracy in Honduras, where Obama sanctioned the government for upholding its constitution against efforts by left-wing former President Manuel Zelaya to unconstitutionally retain power. Obama has also frayed our relationship with Canada, in part through his obstinate opposition to the Keystone Pipeline, which Romney supports.
Under Obama, favorable perceptions of the United States have declined throughout the Muslim world, in Mexico, and, save Australia, with our strongest allies - Britain, France, Germany, and Japan.
I am less hawkish than either Obama or Romney, but I view foreign policy primarily through the lens of competence – in which Romney seems to me a relatively easy choice.
Thus, in pretty much every major group of policy issues I can think of, Romney is better than Obama, usually by large margins.
Beyond specific policies, I think it is important to have competence in the presidency, and Romney is a very competent man who is well prepared for the presidency. After four years in office, Obama still is not.
I also want a president who speaks in terms of freedom and individual initiative and who does not denigrate success in the private sector. Presidential rhetoric is important in shaping long term public views. Today's libertarian oriented Tea Parties are middle-aged men and women who came of age with the pro-freedom rhetoric of Ronald Reagan.
Romney may not be a libertarian, yet Romney not infrequently launches wonderful verbal defenses of hard core libertarian views. I can scarcely imagine another major party presidential candidate who would take on leftist hecklers about the rights of individuals organized using the corporate form; or defend the value of being able to fire people for incompetence; worry openly about individual dependency on government; or demand that voters “take personal responsibility and care for their lives.”
So next week, this libertarian will be voting Romney. No regrets, no doubts.
« Close It
October 26, 2012
Steve Horwitz on Herbert Hoover
Cato podcast here.
Cato briefing paper here.
These should be required reading/listening for Paul Krugman.
Posted by E. Frank Stephenson at 07:47 PM
October 24, 2012
Incentives Matter: Bureaucrats and Other People's Money Edition
Posted by E. Frank Stephenson at 06:07 PM
The School Staffing Surge: Decades of Employment Growth in America’s Public Schools
That's the title of a new report authored by Ben Scafidi and published by the Friedman Foundation. It includes an interactive state-by-state map that makes it easy for readers see what changes have occurred in their states.
Posted by E. Frank Stephenson at 05:55 PM
October 23, 2012
Outline for my Economic Outlook Talks
I get asked to give occasional "economic outlook" talks to different groups. If you're an aspiring economist, you will, too. Here's my basic outline; feel free to adopt it & modify it as you see fit:
I. Where we've been, where we are, where we're going
II. How we got here
III. How we are messing it up
Notes and variations:
Inspired by an Ed Lopez status update on Facebook.
October 22, 2012
Incentives Matter: Schooling Edition
From The Economist:
October 20, 2012
Ken Burns supports Obama: but has he seen It's a Wonderful Life?
Documentary filmmaker Ken Burns has a piece in the Manchester Union Leader this week entitled, "Why I am voting for Barack Obama." Burns is a wonderful director, but the column makes one wonder if he really understands the stories he sees on the screen.
Read More »
"One of my favorite movies of all time is Frank Capra's 'It's A Wonderful Life,' starring Jimmy Stewart. In the film, Stewart's character, a despondent and near suicidal George Bailey, who runs a small savings and loan in the town of Bedford Falls, is given a gift: the chance to see what his town would be like if he'd never been born — if he'd never extended a helping hand to his neighbors when they needed it most, never helped his community understand how much they depended upon one another.
"In this alternative vision, the town's plutocratic banker, Mr. Potter — without the decent George Bailey to counter him — rules everything. A bottom-line-is-everything, every-man-for-himself mentality runs unchecked, resulting in Bedford Falls' metamorphosis into 'Pottersville,' an amoral, soulless place.
"The movie has a happy ending, thank goodness, but its themes endure to this day and echo in the current presidential election, which at its core asks the question: What kind of country are we? Are we Bedford Falls or Pottersville? Are we all in this together — and stronger and better because of it — or are we entirely on our own, with a few 'makers' on the top of a heap of 'takers?'”
Burns eventually concludes: "What can one person do to make their community a Bedford Falls instead of a Pottersville? Well, there are many things. But one of them, I think, is to vote for Barack Obama."
Now, it so happens that "It's a Wonderful Life" is one of my favorite films, too. I have seen it, start to finish, at least 50 times in my life (for one thing, my wife of 31 years has insisted that we watch it at least one each Christmas season since our marriage). Yet somehow I've missed the parts where George Bailey - who is, we note, a businessman, a banker, and the son of a capitalist banker - calls for more government regulation, higher taxes, and greater redistribution of the wealth. Indeed, I missed the part where, because of Mitt Romney's election, George Bailey was never born, and thus wasn't about to make Bedford Falls a better place by supplying customers with good banking practices and affordable housing - for profit.
I missed the part where George Bailey told Violet Bick that if she really needed money, she really ought to apply for food stamps or some other form of government welfare. I suppose it's possible that at some point off-camera George sought a government bailout for his small lending company during economic hard times, but all I recall seeing on-camera was that George used his own creativity and infusion of capital - making a huge personal sacrifice and taking a huge personal financial risk - to keep his business afloat during the depression.
I recall that in the movie George Bailey worked long, long hours at the Bailey Brothers Building & Loan, often arriving home late in the evening, tired and weary; and in the version I've seen those 50 or more times, young George notes that his father, too, put in long hours and years of hard work to build his business. The Baileys in "It's a Wonderful Life" would probably have been shocked to hear a President say, "If you've got a small business, you didn't build that." And in the end, what comes closest to putting George under is not Mr. Potter alone, but Mr. Potter working to manipulate government regulators. And it is the government regulators who arrive to put the Bailey Brothers Building & Loan out of business.
In the movie, we don't know much about Mr. Potter, how he got his wealth or became the man he is. But we do know that Mr. Potter had powerful contacts in government, and we see him call on those contacts to try to drive his competitor - George Bailey - out of business. Violet Bick indicates - and no one suggests she is talking nonsense - that Mr. Potter is deeply involved in local government, and it is probably safe to assume that Potter benefits from powerful friends in government and quite probably from extensive government contracts and favors - what today we might call "shovel ready jobs" funded by government. Does anyone who watches "It's a Wonderful Life" doubt that George Bailey would refuse government subsidies to start a "green energy" business, whereas Mr. Potter would be plotting his next Solyndra and lobbying for more government funding?
Meanwhile, George's virtuous younger brother, Harry Bailey, goes off to make his way not as a community organizer, or working for PBS (Burns specifically criticizes Romney for wanting to cut funding for PBS), but working for his wife's family manufacturing business in Rochester. And George's old friend, Sam Wainwright, leaves Bedford Falls to make his fortune in plastics. Though a bit of a rogue - we see him calling his erstwhile girl friend, Mary Hatch, even while flirting with other women in his New York City office - Sam, like George, uses his talents for good. He makes a great deal of money as a wartime government contractor, but there is no suggestion that he cuts corners, inflates invoices, or fails to provide valuable products. He helps the war effort, and is implicitly praised for his efforts. He is apparently a creative entrepreneur, developing new uses for plastic that improve people's lives. And he is quick to use his wealth to help George in the movie's climactic final scene (note that it is Sam's unconditional offer of assistance that drops the final boom on the Mr. Potter and the bank examiner).
Indeed, Bedford Falls is populated with good people who ask nothing from the government and never seek a handout, and many of them are businessmen - Mr. Gower, the pharmacist; Mr. Martini, the tavern owner; Ernie, the cab driver (does he own or lease his own cab? We're never told, although Mr. Potter does refer to Ernie as driving "his cab," which may suggest that Ernie owns or leases the vehicle); Joe, the cheerful luggage shop proprietor; Dr. Campbell, the Chairman of the Building & Loan after Pa Bailey's death. And can you ever conceive of the family's cheerful and proud maid, Annie, voting for a candidate because he gave her a free phone?
I have no doubt that Mr. Burns has seen, and perhaps even studied, from a filmmaker's perspective, "It's a Wonderful Life." But he has totally missed the lessons that come from the movie.
Most of the column is full of boilerplate accusations that one can find in most any commentary thread at the Daily Kos, including the whopper, which Burns apparently makes with a straight face, that the Republican Party is "the furthest right they have ever been since the party was founded in 1856." (Yes, who doesn't recall the GOP platform of 1856, arguing for need to preserve Medicare, getting federal spending to 21% of GDP (it was well under 5% in those days), and opposing a federal income tax rate of over 40 percent (during the Civil War, the Republican Party enacted a flat rate income tax of 3 percent. I suspect today's GOP would support that).
But that Burns would invoke "It's a Wonderful Life" to support his version of a government subsidized paradise illustrates a tremendous confusion between civil society - those diverse institutions that people voluntarily form and join to create a rich community - and the coercion, one-size fits all approach government, especially the government that takes from Peter to pay Paul. Bedford Falls is what it is precisely because people don't rely on some distant bureaucracy to solve their problems. The join together, voluntarily. They trade, voluntarily and without subsidies, in goods and services. The folks in Bedford Falls, I think would have found Ken Burns' thinking totally alien to their values.
« Close It
October 13, 2012
This is my life
Billy Joel's classic "My Life" was released 24 years ago this month, peaking at #3 on Billboard in January of 1979.
This is one of my favorite rock songs, because, although I doubt that Joel intended it as such, the lyrics are a great summary of the libertarian philosophy. This includes the importance of voluntary social institutions. Indeed, my favorite line is when the singer notes "I still belong, don't get me wrong" - getting it wrong is what the statist left routinely does, assuming anyone who wants control of his own life or who opposes state coercion is somehow anti-social.
Got a call from an old friend
I don't need you to worry for me cause I'm alright
I never said you had to offer me a second chance
They will tell you, you can't sleep alone in a strange place
Quick check on the presidential race
A quick check-in on the Presidential race. These are the last publicly released national polls:
Rasmussen Tracking, Oct. 10-12: Romney 49, Obama 48.
It would seem pretty clear that Romney holds a narrow lead nationally. This is very bad news for Obama, as late undecided voters almost always break for the challenger, often by very large margins.
Obama is stronger on the electoral college front, where he still has more votes that are certain or likely to fall his way, and thus more paths through the remaining competitive states to a winning 270 votes than does Romney.
An interesting point is that the polls are not including two third party challengers who could affect the race. The Libertarian Party nominee, former New Mexico Governor Gary Johnson, is a likely candidate to peel off five percent or more of the vote in his home state and could do well in other states, especially the competitive western states of Arizona and Colorado. Johnson argues that the second choice of his voters - i.e., whom they would likely vote for if Johnson were not in the race - is split almost evenly between the two major party candidates. But historically, libertarians have broken heavily Republican (typically 60-70%), and LP voters appear to have favored Republican candidates as their second choice by similar margins.
The Constitution Party, a conservative outfit, has nominated former Virginia Congressman Virgil Goode. Goode doesn't appear to be much of a factor outside of his home state, but in that battleground he could gain a couple percentage points. His old district basically consists of much of the conservative, rural south-central Virginia, and presumably almost all his votes would come from Romney.
But we ought to consider that this race may not be close at all, at least in the electoral college. A shift of just a couple points nationwide to either candidate would likely result in almost all of the battleground states falling in the same direction, producing a solid, if not landslide victory for the winner.
There are two presidential debates and one crappy job report left before the election; the burgeoning flap over Libya bodes ill for Obama. Overall, it seems unlikely that Obama will get any good news before the election, unless the November jobs report, due out less than 96 hours before election day, produces another tumble in the top line unemployment figures. On the other hand, if the numbers are bad - if the top line ticks back up (especially to an official rate over 8%), it will be devastating to the President's core argument that he at least has things moving in the right direction.
That puts enormous pressure on the President to perform well in the next two debates. But it's hard to see how he can reverse things in the debates barring a major Romney mistake. All Romney has to do is fight to a draw, or something close to it, to solidify his new status as an acceptable alternative.
At this point, the Romney people should feel pretty good.
October 02, 2012
Incentives Matter: Marginal Tax Rates and Hours Worked Edition
The graphic below is from Casey Mulligan (details here) who concludes:
This paper calculates monthly time series for the overall safety net’s statutory marginal labor income tax rate as a function of skill and marital status. Marginal tax rates increased significantly for all groups between 2007 and 2009, and dramatically so for unmarried household heads. The relationship between incentive changes and skill varies by marital status. Unemployment insurance and related expansions contribute to the patterns by skill while food stamp expansions contribute to the patterns by marital status. Remarkably, group changes in hours worked per capita line up with the statutory measures of incentive changes.
Posted by E. Frank Stephenson at 01:13 PM
Industry X's Union supports the Union, not necessarily Industry X
It probably doesn't shock many DoL readers to learn that unions in particular industries care more about the viability of the union than the viability of the industry. We are familiar with last month's Chicago teachers' strike, where some of the highest-paid teachers in the country initially wanted a 30% raise but settled for 16%. I suppose they need the money, though, since only 15% of Chicago fourth graders are proficient in reading, and only 56% graduate from high school. But what is the union's main concern? Heritage gives us an answer in the union's own words.
Closer to (my) home, the growing buzz over the Louisiana film "Beasts of the Southern Wild," helped by critical success at Sundance, is hitting a roadblock. It will not be eligible for a Screen Actor's Guild award because "it was not made under provisions of the union’s contracts, guild officials said Monday."
“We’re baffled at the fact that the producers of ‘Beasts of the Southern Wild’ failed to sign a SAG agreement as every other important film released this year did,” said guild spokeswoman Pamela Greenwalt in a statement. “We would love for the performers in this film to compete for a SAG Award. Celebrating such performances is what we’re all about.”
It would appear, rather, that the SAG is "all about" getting filmmakers to toe the union contract line, and not primarily to celebrate great performances in film.
Anyone surprised that the union membership rate has fallen from 20.1% in 1983 to 11.8% in 2011?
October 01, 2012
Economic Freedom: A Study Through Video
You've probably seen one of the many "N. Korea/S. Korea" comparative memes that have floated about, but let's go to the video.
Here's a good time in North Korea:
And here's a good time in South Korea:
SNL on Obama and the Sluggish Economy
Posted by E. Frank Stephenson at 11:16 AM
On Undecided Voters
Voter ignorance, rational or otherwise, on display ...
Posted by E. Frank Stephenson at 11:12 AM
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:November 2013
Site design by