Division of Labour: January 2013 Archives
January 29, 2013
An easy fact to find, less easy to understand
If you're like me, you've gnashed more than a few teeth trying to get data from the Census Bureau's redesigned American Fact Finder. The old version was such a piece of cake to use; now I want to find the % African-American and the % Hispanic in each state for the past few decades, and I think it would be quicker to turn lead into gold.
A data-savvy friend pointed me to a story describing the cost of redoing the AFF:
How much did the government spend -- and to whom did the money go -- building the American FactFinder tool on the U.S. Census Bureau's website? ... The answer? $33.3 million, which went to IBM.
I guess since I get 3,000 different tables when I ask for race by state, on a per-table basis that's not a bad deal.
January 28, 2013
Wrong, Wrong, and Wrong Again
A Mr. Jonathon Welch has a letter in the Buffalo News that cries out for a fisking so here goes:
"... there is a broad consensus among honest and respected economists that a higher minimum wage, one that more realistically reflects the cost of living, will strengthen the economy, particularly the local economy, by increasing consumer demand."
Here's Greg Mankiw's take on a survey of AEA members: "One issue that fails to generate consensus is the minimum wage: 37.7 percent want it increased, while 46.8 percent want it eliminated." Not much of a consensus there--perhaps Mr. Welch thinks the 62.3% of economists who did not favor increasing the minimum wage are either dishonest or not respected.
Then there's the bit about an increasing minimum wage increasing consumer demand--he must think that employers who don't have to pay another, say, dollar per hour burn the dollars they save rather than spending them themselves.
So now to another part of the letter:
"Contrary to the popular perception that small businesses favor a low minimum wage, many small business owners support raising the minimum wage because we understand that lower employee turnover decreases the costs of constantly training new workers, ..."
Businesses that think it to their benefit to pay more than the minimum wage are certainly free to do so. In fact the vast majority of employers do--how many nurses do you think would accept jobs at the local hospital if they would only be paid the minimum wage?
Repressed minimum wages typically benefit large corporations more than small local businesses ..."
Wrong again. Wal-Mart has supported increasing the minimum wage. It has also supported the employer mandate in Obama care, support that seems designed to tilt the playing field toward Wal-Mart and away from small businesses that would have a more difficult time offering medical benefits.
For being so thoroughly incorrect, Mr. Welch's letter deserves a special place in the pantheon of economic illiteracy. Congratulations sir.
Posted by E. Frank Stephenson at 01:27 PM
Why, Yes, Police Can Deter Crime
A NYT headline:
Maybe tomorrow we'll see the grey lady tell us water runs downhill ...
Posted by E. Frank Stephenson at 09:33 AM
January 27, 2013
Lessons in Tax Shifting
The community-based, pediatric and academic hospitals served by Novation are reporting that many are being directly billed by at least one medical device manufacturer to cover the costs associated with the Affordable Care Act’s medical device tax. But Novation ... is taking a firm stance with suppliers who are trying to pass their medical device excise tax obligations on to hospitals.
Source. I suppose they think that Congress didn't intend for motorists to pay the gas tax. The only surprise is that the manufacturers are apparently itemizing the tax as a surcharge instead of simply embedding it in the price of medical devices.
Posted by E. Frank Stephenson at 04:47 PM
An Open Letter to Charles Rangel
The lifting of the ban on women in combat has prompted Rep. Charlie Rangel to reiterate his support for "reinstatement of the military draft to ensure a more equitable representation of people making sacrifices in wars." (Thanks to Volokh and Instapundit for the pointer.) So it seems like a great time to reprint an open letter to him that a student and I penned back in 2004.
Dear Representative Rangel:
Of course a more ambitious proposal would be for all taxpayers to face the same marginal tax rate.
Posted by E. Frank Stephenson at 02:08 PM
January 26, 2013
Motel Caswell is Safe from Federal Seizure
It's good to see some pushback against the civil forfeiture racket.
Posted by E. Frank Stephenson at 12:22 PM
More On Japan's Supposed Austerity
In a recent post, I took issue with a claim that Japan's spending under new Prime Minister Abe is a turn away from a recent policy of austerity. As the chart below from The Economist shows, Japan has tripled its budget deficit as a share of GDP over the past five years. Japan's policy is to austerity what downing a 12-pack of beer is to sobriety. (The chart also shows that Britain, another country often cited for unwisely following an austerity policy has reduced its budget deficit, but only by ~2% of GDP.)
Of course, there are folks who never let a bit of data get in the way taking a swipe at austerity. Paul Krugman says Japan is "breaking ranks" with countries who want to pursue "ever harsher austerity." Robert Reich recently tweeted: "Austerity fails: Japan still basket case." Gregory Clark adds that "Japan has long been a victim of the fiscal austerity disease now afflicting Europe ...." These folks seem to have run the definition of austerity through one of those funhouse mirrors.
Posted by E. Frank Stephenson at 12:14 PM
January 24, 2013
80 Year Old Priest Goes Mike Tyson ...
Yeah, it seems like something Munger would post on KPC.
Posted by E. Frank Stephenson at 08:55 AM
The Never Ending Evils of Ethanol
Posted by E. Frank Stephenson at 08:44 AM
January 23, 2013
Yet another story that blames technological advancement for the loss of jobs and general economic crappiness:
Most of the jobs never will return, and millions more are likely to vanish, say experts who study the labor market. What's more, these jobs aren't just being lost to China and other developing countries.
Just imagine if China and other developing countries starts to use technology! Talk about a double-whammy.
You'd think an editor would have caught the logical inconsistency of describing machines that are "more sophisticated and powerful and ... efficient" as a bad thing. So the solution is to use weak, inefficient, and less sophisticated things? (Actually, that's a pretty good description of me...)
On Austerity in Japan
Under Prime Minister Shinzo Abe, elected last month, Japan has turned away from the well-worn practices followed by economies under duress — conventions that call for austerity and debt reduction. Japan, instead, is trying to spend its way out of a recession rather than cutting back.
Mr. Harlan has a rather odd notion of austerity. The red bars in the chart below (source) show that Japan's debt to GDP ratio increased from about 80% to more than 120% from 2007-2011 (here's a longer view). Perhaps Mr. Harlan should "turn away" from the austerity bogeyman in favor of actually examining the data.
Posted by E. Frank Stephenson at 10:02 AM
January 22, 2013
Speaking after Sunday's Humana Challenge, Mickelson hinted at what could be a "drastic" change for the world of golf, and himself in particular. Thanks to his substantial earnings and his residency in California, Mickelson now falls into two sets of laws that substantially increase his taxes ... and he's not pleased.
UPDATE: Len Berman sticks up for confiscatory taxation, telling Mickelson to:
Please stop whining and give thanks for being able to earn a fabulous living playing a game and selling golf clubs (even after tax). 99.999% of people would never have that option, no matter how hard they worked on their swing.
The key word here is EARN.
Posted by E. Frank Stephenson at 05:10 PM
High Tax Rates Make M. Sarkozy Unhappy
Posted by E. Frank Stephenson at 05:07 PM
January 20, 2013
"I will fly around the world doing good for the environment''
So sayeth one Leonardo DiCaprio. I wonder if he flies an emission-free plane ...
Posted by E. Frank Stephenson at 02:56 PM
The Stench of Rent-Seeking Is In The Air
Today's AJC has an article about Georgia's local governments use of lobbyists at the state legislature. A snip:
Communities large and small get involved in the Statehouse influence game. In 2011, the small north Georgia communities of Helen, Lula and Cumming hired lobbyist Mike Evans, a former state lawmaker, to pursue funding for projects benefiting pedestrians, including sidewalks and biking trails. Evans, a former member of the State Board of Transportation, now focuses mostly on transportation lobbying.
Posted by E. Frank Stephenson at 02:51 PM
January 18, 2013
IJ Victorious Over the IRS
Congratulations to my former student Dan Alban and his IJ colleagues for their court victory over the IRS.
Posted by E. Frank Stephenson at 10:18 PM
Manti Imitates "The Simpsons"
Armin Rosen in The Atlantic (thanks to LRH for the pointer):
The episode begins at the end of a typical day at Springfield Elementary School, where the recently divorced Ms. Krabappel's fourth-grade class is watching a movie about zinc ("Thank goodness I still live in a world of telephones, car batteries, handguns [gunshot sound] and many things made of zinc!"). The bell rings, and Ms. Krabappel's pupils rush for the exits. Part of the genius of The Simpsons is (well, was) its almost Dickensian ability to impart humanity and psychological depth to what lesser shows would have treated as throwaway characters. The next two minutes or so, a darkly comic glimpse into Ms. Krabappel's lost and lonely soul, is a master class. "If anyone wants to learn more about zinc, they're welcome to stay," she says to an empty hallway. "We can talk about anything. I'll do your homework for ya?" She drives home alone, in the rain. She buys a scratch-off ticket at the Kwick-E-Mart. "Still teaching?" Apu asks her. The ticket yields two dollar signs and a cherry. "For one more day, at least." Her apartment is a spinster's walkup. She isn't someone who just needs a man--she's someone who needs anyone. She takes out a personals ad in Springfield Magazine.
Of course, I still don't get all the publicity about a 20ish year old guy having a fake girlfriend. A fake harem, now that might be newsworthy ...
Posted by E. Frank Stephenson at 08:27 AM
January 16, 2013
Interested in learning more about liberty. Check out Liberty's Library. It guides you to a book that you might be interested in based on your responses to a series of questions.
Time for Thinking Past Stage One
A news headline:
A few possible results ... wonder how many will occur ...
Posted by E. Frank Stephenson at 02:35 PM
January 15, 2013
Demand Curves Are Downward-Sloping: Albuquerque Minimum Wage Edition
In November, Albuquerque voters said yes to raising the city's minimum wage from $7.50 to $8.50 an hour, and just 13 days into the increase, historic city restaurant is already feeling the pinch.
Posted by E. Frank Stephenson at 11:44 AM
January 10, 2013
Incentives Matter: Obamacare and Full-time Employment Edition
Other restaurants are making similar cuts.
Posted by E. Frank Stephenson at 09:39 AM
January 04, 2013
An Open Letter to Brian Shactman
Dear Mr. Shactman,
Based on reports that restaurants near hockey arenas experiencing a decrease in traffic during the NHL lockout, you claim that if the NHL season is canceled then “billions—yes billions--of dollars won’t be spent.” I have a few questions about your claim.
What do you think the people who would have eaten at, say, the Eagle Street Grille in St. Paul are doing with their dollars in lieu of attending hockey games and eating at nearby establishments? Do you think displaced NHL fans are fasting instead of eating elsewhere? Do you think that displaced NHL fans are destroying the dollars they would have spent on NHL entertainment and dining instead of spending them elsewhere? Unless your answer the last two questions is "yes," then your claim that the NHL lockout will lead to billions of dollars of lost spending is likely meritless.
Here's a suggestion to enhance your reporting: You might want to visit some minor league hockey arenas and restaurants located nearby. Economists Jason Winfree and Rodney Fort, in an analysis published in the August 2008 issue of the Journal of Sports Economics, found that fans substituted toward minor league and junior hockey during the 2004-2005 NHL lockout. Perhaps some of your billions of dollars of lost NHL spending are being redirected toward other levels of hockey entertainment.
UPDATE: I could have also mentioned that at least two papers (here and here) have looked at strikes/lockouts and found no economic harm in host cities. Seems like the hockey cliff is mostly horse hockey.
Posted by E. Frank Stephenson at 12:27 PM
January 03, 2013
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
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