Russell Roberts's Blog, page 150

Some Covid Links

(Don Boudreaux)

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This Wall Street Journal report reveals just how very dystopian and deranged is China’s pursuit of zero Covid – a pursuit that, of course, relies heavily on the straw man. (HT Phil Magness) Three slices:

Jane Polubotko didn’t see darkness for almost three weeks.

After testing positive for Covid-19, she was forced to live under 24/7 lighting in a Shanghai exhibition center along with thousands of strangers and the din of their chatter and mobile phones.

The 30-year-old Ukraine national was released from the makeshift government quarantine facility Friday, after three negative tests in the past week. The experience, she said, made her feel like a “Covid criminal.”

Arriving back at her apartment she shares with her boyfriend, Ms. Polubotko said she first let worried friends know she was home. Next on the list: a long, hot shower after 18 days without one at the center. She was relishing the silence and privacy of her home—and being in control of her own bedroom light.

…..

China doesn’t make public the total number of people in its isolation facilities, but official data published Friday show there were more than 270,000 asymptomatic cases nationwide under medical observation. It couldn’t be determined how many are in government centers, and there are signs that, as these fill up, more people are being allowed to quarantine at home.

…..

The policy of sending positive cases into quarantine facilities is contentious, especially since most people have only mild symptoms, if any at all. Some now say they are more frightened of being confined in a fangcang than of catching the disease.

The Editorial Board of the New York Post writes wisely about the meaninglessness of Covid case counts. A slice:

A new survey of adults in New York City suggests that our testing regime may have missed more than 1.3 million cases between January and March of this year. The numbers also suggest that an astonishing 27% of the city’s adults may have been infected during that time.

This massive statistical whiff also means that the official positivity rate — the number by which entire sectors of our economy lived and died for two years, the number that shut schools and sent paroxysms of terror through the media — was near-meaningless as a measurement.

And that, from the start, and particularly since the time vaccines were rolled out, we should have been paying more attention to actual bad outcomes from infection.

That is, hospitalizations and deaths. Those are what matter.

If someone gets a mild flu and recovers in 24 hours, no one panics. But a few asymptomatic COVID cases in a city school were enough, for months, to shut classrooms and trigger insane quarantine protocols.

The New York Post‘s Editorial Board is also correct to describe the renewed mask requirements on many college campuses as grounded in superstition.

Steve Templeton recounts the long history of irrationality connected with widespread fear of being killed by some natural disaster. Here’s his conclusion:

In other words, we can see the long arm of history reaching from the times of the Black Death to modern epidemics, where coercion and state control are accepted by a terrified public and conveniently deemed by a power-hungry elite to be the only acceptable way to combat natural disasters, even at the risk of tremendous and unnecessary collateral damage. The disastrous response of many countries to the COVID-19 pandemic is merely the latest reminder that increased power during times of crisis will always tempt leaders, and that this temptation must not be left unchallenged by free people.

Wow – yet another Covidian is caught hypocritically violating her own Covid mandate.

Philippe Lemoine is not impressed with a new ‘study’ that is purported to show the great life-saving benefits of Covid lockdowns. (HT Noah Carl)

In response to White House Covid czar Ashish Jha’s recent suggestion that it might be advisable to mandate that travelers be vaccinated, Ian Miller tweets: (HT Jay Bhattacharya)

It’s hard to imagine after the tremendous, world altering displays of incompetence we’ve seen from them over the past two years that public health authorities are somehow getting worse, but here we are

Quotation of the Day…

(Don Boudreaux)

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… is from page 190 of my colleague Peter Boettke’s September 2013 speech given at a conference, in honor of James Buchanan, at George Mason University, “What Should Classical Liberal Political Economists Do?”, as this speech is reprinted in Pete’s 2021 book, The Struggle for a Better World:

Absent the three Ps of property, prices, and profit and loss, individuals will be devoid of the incentives and information required to continually innovate and coordinate their plans to realize the gains from trade and the gains from innovation.

DBx: This point cannot be repeated too often – the reason being that this point is too often never learned, or it is forgotten or ignored. And those persons who are among the most prone to overlook this point are proponents of industrial policy.

Industrial policy, by its very nature, attenuates property rights, overrides market prices, and distorts signals of profits and losses. With industrial policy, owners of inputs are not allowed to sell their inputs as they choose; owners of production facilities are not allowed to operate their facilities as they choose or in ways guided by market prices and the willingness of investors to invest, or not, their own funds. Income earners are not allowed to spend their own money as they choose.

The particular producers who are somehow (we are never told how) divined by industrial-policy officials to be ‘vital’ are protected from losses, or even have their profits topped off with funds taken from taxpayers. One result is that producers who are deemed not ‘vital’ confront artificial barriers in seeking profits or avoiding losses. After all, resources transferred to ‘vital’ firms must come from somewhere; these resources are drawn away from other, less-favored producers.

And of course industrial-policy officials spend other people’s money. These officials have no claim on whatever residual sums are left to enterprises after the enterprises pay their out-of-pocket expenses. Genuinely plausible efforts to improve efficiency – and also to innovate – are thus muted. Nor do these officials personally suffer monetary loses if the enterprises they favor fail to perform up to these officials’ expectations. Genuinely wasteful ‘innovation’ – or, depending on the officials’ demeanor, genuinely wasteful stasis – is thus encouraged.

Although I – and, with greater clarity, others – have said so repeatedly, industrial policy will work as promised only if and when officials charged with carrying out industrial policy come to have both the mind and motivation of gods. This fact is why all arguments in support of industrial policy are, at root and through and through, religious arguments.

Quotation of the Day…

(Don Boudreaux)

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… is from page 20 of David Mamet’s hot-off-the-press 2022 book, Recessional: The Death of Free Speech and the Cost of a Free Lunch (original emphases):

Public officials mandated the wearing of masks, then openly flouted their own regulations. Why did the Left not object? If the masks were essential to the preservation of life, even the most depraved and corrupt of officials would, one would think, obey that law. If they are, thus demonstrably, not necessary to preserve life, why did the solons pass the laws?.

And why didn’t the co-opted populace ask the question?

The display of a face covering must, because the responsible officials doubted its utility, function as a religious symbol, like the burka.

Some Covid Links

(Don Boudreaux)

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Jay Bhattacharya warns of proposed authoritarian legislation in California that would “strip medical licenses from doctors who disagree with government positions on Covid.” Three slices:

Remember when we were told that China was a model for the world in controlling Covid? Sure, as a totalitarian state, it was able to weld people inside their homes and monitor its citizens via drone. But many in the West believed that such measures were necessary. They argued that the abandonment of personal liberty was an appropriate way to fight a respiratory virus.

Now Shanghai is the model for the terrifying dangers of giving dictatorial powers to public health officials. The harrowing situation unfolding there is a testament to the folly of a virus containment strategy that relies on lockdown. For two weeks, the Chinese government has locked nearly 25 million people in their homes, forcibly separated children from their parents, killed family pets, and limited access to food and life-saving medical care—all to no avail. Covid cases are still rising, yet the delusion of suppressing Covid persists.

In America, many of our officials still have not abandoned their delusions about Covid and the exercise of power this crisis has allowed. As the Shanghai debacle demonstrates, of all the many terrible consequences of our public health response to Covid, the stifling of dissenting scientific viewpoints by the state might be the most dangerous.

I would know: For the past two years I have been the target of a smear campaign aimed at demonizing those who dare to question official policy. Now, a proposed California law threatens to make such dissent career-ending by handing the state the power to strip medical licenses from doctors who disagree with government positions on Covid.

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I do not practice medicine—I am a professor specializing in epidemiology and health policy at Stanford Medical School. But many friends who do practice have told me how they have censored their thoughts about Covid lockdowns, vaccines, and recommended treatment to avoid the mob. Though Stanford is supposedly a bastion of academic freedom, one junior untenured professor recently wrote to me: “I have heard you several times on television regarding the Covid issue and find myself resonating with your views. I am inclined to express those very same opinions to my colleagues and administrative members at Stanford. I have been reluctant to date because quite honestly, I expect that my faculty appointment would not be renewed. I have the perception that free speech is just not there.”

This forced scientific groupthink—and the fear and self-censorship they produce—are bad enough. So far, though, the risk has been social and reputational. Now it could become literally career-ending.

According to California Assembly Bill 2098, physicians who deviate from an authorized set of beliefs would do so at risk to their medical license. The bill, written by Assemblyman Evan Low, a Democrat in Silicon Valley, and currently making its way through the California Legislature, is motivated by the idea that practicing doctors are spreading “misinformation” about the risks of Covid, its treatment, and the Covid vaccine. It declares that physicians and surgeons who “disseminate or promote misinformation or disinformation related to COVID-19, including false or misleading information regarding the nature and risks of the virus, its prevention and treatment; and the development, safety, and effectiveness of COVID-19 vaccines” shall be subject to “disciplinary action,” which could result in the loss of the doctor’s medical license.

The language of the bill itself is intentionally vague about what constitutes “misinformation,” which makes it even more damaging. Doctors, fearing loss of their livelihoods, will need to hew closely to the government line on Covid science and policy, even if that line does not track the scientific evidence. After all, until recently, top government science bureaucrats like Dr. Fauci claimed that the idea that Covid came from a Wuhan laboratory was a conspiracy theory, rather than a valid hypothesis that should be open to discussion. The government’s track record on discerning Covid truths is poor.

…..

The ultimate effect of the bill will be to chill public criticism by California doctors of mistaken government public health diktats since few will want to put their licenses in the hands of the very public health officials with whom they disagree over the interpretation of science. Even legitimate dissent from public health orthodoxy by licensed doctors may be excised from the public square as a consequence. Worse, the widespread distrust Americans now have in public health institutions will only deteriorate further.

And that’s to say nothing of the impact this bill would have on the practice of medicine. Doctors have an obligation to treat each patient as an individual. Yet the California Assembly bill turns doctors into agents of state public health rather than advocates for their patients.

Lucia Sinatra defends medical freedom.

J.D. Tuccille urges Covidocrats to “drop the useless mask mandates and leave us alone.” Two slices:

The last couple of years have been a revelation when it comes to public health measures for battling COVID-19 and whatever bugs come next. We’ve seen that masks offer little protection unless they’re the uncomfortable medical variety, states that locked down hardest took nasty economic hits in return for little if any health benefit, and kids isolated by decree from their peers suffer mental health issues.

But don’t tell the politicians—they want more!

Across the country, government officials seem eager to revive mask mandates and, perhaps, other artifacts of pandemic policy, if only as reminders of the high-tide mark of their emergency authority.

“If we do start seeing an uptick, particularly of hospitalizations, we may need to revert back to being more careful and having more utilizations of masks indoors,” Anthony Fauci, chief medical adviser to the White House, taunted a COVID-weary nation on ABC News earlier this week.

Sure enough, within days the Centers for Disease Control and Prevention (CDC) extended the mask mandate for federally regulated travel; Philadelphia’s city government did the same for indoor spaces. (Many colleges and universities followed suit.)

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Not that face masks make up the entirety of pandemic theater. Political figures ordered businesses and schools closed (while exempting themselves from inconvenient rules), restricted travel, and savaged anybody who objected. But the evidence suggests these authoritarian measures impose high costs in return for little benefit. A new working paper covering state-level pandemic policy published by the National Bureau of Economic Research finds that closing businesses and schools increased unemployment and reduced GDP without reducing deaths from COVID-19.

“The correlation between health and economy scores is essentially zero, which suggests that states that withdrew the most from economic activity did not significantly improve health by doing so,” wrote authors Casey Mulligan, a University of Chicago economist, and Stephen Moore and Phil Kerpen of the Committee to Unleash Prosperity. (Hawaii is an exception, suggesting to the authors “that island locations can, by sustaining significant economic losses, reduce mortality for a year or more.”)

The study largely replicated findings in an earlier paper by Jonas Herby, Lars Jonung, and Steve H. Hanke that lockdowns in Europe and the United States were ineffective.

Peter Suderman identifies a hidden cost of Covid restrictions – a cost that we will be paying for years. A slice:

All of which is to say that the pandemic, and the policy responses to it, have disrupted American social life in ways hardly seen since Prohibition. The effects of COVID-19 have arguably been more widespread, reaching into classrooms and churches and other community gathering centers, not just drinking establishments. Opportunities for informal interactions dwindled precipitously at the onset of the pandemic; two years later, many of those opportunities either have yet to return or have come back in altered forms. Think of the difference between a scheduled Zoom meeting and an ad hoc office happy hour: Something is lost, even if it’s not precisely clear what.

Jeff Singer tweets: (HT Jay Bhattacharya)

Even such extreme/inhumane Zero-COVID policy won’t stop spread of the virus. China’s public health officials are just delaying the inevitable & inflicting great harm/suffering on the people. Yet some “experts” in the U.S. still urge us to emulate China.

“With no end to Shanghai’s Covid lockdown in sight, anger among residents is at risk of boiling over.”

Jordan Schachtel offers some possible explanations for why Beijing is now tyrannically and derangedly pursuing zero Covid.

TANSTAFPFC (There Ain’t No Such Thing As Free Protection From Covid.)

Yep

(Don Boudreaux)

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Here’s a letter to the Wall Street Journal:

Editor:

After exposing the economic fallacies that fuel the effort in California to mandate a 32-hour workweek, you ask “Why do progressives think any idea they come up with has to be imposed by political coercion?” (“California’s French Four-Day Workweek,” April 16.) And you answer, “Because they believe in their superior moral virtue, and they like to order other people around.” Nicely put, but H.L. Mencken was even more piercing: “The kind of man who demands that government enforce his ideas is always the kind whose ideas are idiotic.”*

Sincerely,
Donald J. Boudreaux
Professor of Economics
and
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA 22030

* H.L. Mencken, A Mencken Chrestomathy (New York: Knopf, 1949), page 622.

Quotation of the Day…

(Don Boudreaux)

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… is from page 32 of Matthew Hennessey’s hot-off-the-press 2022 book, Visible Hand:

If a society can bear to hear the unmistakable sound of what the mid-20th-century Austrian economist Joseph Schumpeter called the “perennial gale of creative destruction,” then it can be pretty sure its markets are working as intended.

DBx: Indeed.

Of course, markets aren’t set into operation by anyone’s design or intent, so strictly speaking there is no intention – no purpose – that markets can be said to fulfill or to disappoint. But because what most people want from markets is the provision of high and rising standards of living for ordinary people, when and insofar as markets make such a provision, markets are operating as we ‘want’ them to operate.

Also of course, many people want markets to do the impossible – namely here, to provide high and rising standards of living for ordinary people without ever causing any ordinary person any disappointment. One of the most difficult tasks confronting those who wish to make a sound economic case, as well as a compelling ethical case, for free markets is to explain that the innovation that is utterly necessary for ordinary people to enjoy high and rising standards of living simply is impossible if government were to attempt to protect everyone, or even just every ordinary worker, from economic disappointment.

…..

Pictured above is Joseph Schumpeter.

Government Efforts to Make Supplies More Secure Are Too Likely to Make Supplies Less Secure

(Don Boudreaux)

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In my latest column for AIER, I explain that each private firm in the domestic economy has strong incentives to obtain for itself the optimal degree of security against disruptions in its sources of supplies. A slice:

Unusually heavy challenges, misfortunes, and difficulties that manifest themselves today are not necessarily proof that yesterday’s decisions – decisions that led to today’s problems – were mistaken.

This reality should be kept in mind whenever we observe domestic firms experiencing disruptions to their sources of supplies. Each of these firms had strong incentives to weigh the costs of diversifying their sources of supplies against the benefits of doing so. There’s no good reason to suppose that these firms generally made their sourcing decisions imprudently or harmfully.

Even less is there reason to suppose that politicians, pundits, and bureaucrats – none of whom have their own money at stake in such assessments – know better than do the owners and managers of private firms how many or how few sources of supplies any particular business ‘should’ have. Nothing is easier when supplies from abroad are disrupted by the likes of war or Covid lockdowns for politicians or pundits to proclaim, in theatrical fits of pique, that the government should have used tariffs or subsidies to avoid the disruption. Yet the very fact that private companies themselves – having at stake their own money – chose not to arrange their sources of supplies in the ways later endorsed by politicians and pundits is strong evidence that the proposed schemes of these politicians and pundits are unlikely to better promote the country’s long-run best interest.

Hindsight, as they say, is 20/20. (Actually, I suspect that, while at least the recent past is indeed usually more visible than is the future, in reality hindsight is closer to 20/40. But that’s a topic for another time.) The fact that pundits and politicians can take stock of the present situation and describe how it would have been better had different choices been made in the past is paltry evidence that these persons should be trusted with the power to override the decisions of business people regarding future sourcing of supplies.

The case, in short, for government to ‘repatriate supply chains’ is too weak to take seriously. Ignore it.

Market Prices are Objective Reports

(Don Boudreaux)

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Here’s a letter to the New York Post:

Editor:

You report that critics of Uber call that company’s rising fares “downright unethical” (“Uber ‘taking advantage’ of unsafe NYC with astronomical fares: outraged riders,” April 15).

Prices reflect underlying realities of demand and supply. In NYC, rising crime (thanks Bill de Blasio!) simultaneously raises the demand for Uber rides as it lowers the supply of such rides. These realities cannot help but push fares upward. The supply of rides is further reduced – and, hence, fares further raised – by rising fuel costs (thanks environmentalists!) and the continued use of the medallion system to artificially limit the number of taxicabs (thanks New York City Taxi and Limousine Commission!).

Blaming high fares on Uber makes no more sense than blaming a city’s high murder rate on a newspaper that accurately reports crime statistics. Further, accessibility of rides would no more be increased by a government prohibition of rising fares than would safety in the city be increased by a government prohibition of reports of rising murder rates.

Ride-share fares will remain high in Gotham for as long as these underlying problems persist.

Sincerely,
Donald J. Boudreaux
Professor of Economics
and
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA 22030

Some Non-Covid Links

(Don Boudreaux)

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George Will decries the attitudes and reckless ‘reasoning’ that have resulted in $1.6 trillion of student debt in the United States. Two slices:

The Constitution, which modern presidents treat as a tissue of suggestions to be complied with when doing so is not inconvenient, says: “No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law.” The Committee for a Responsible Federal Budget (if the committee has 20 members or so, it has about half of the Americans who care about responsible budgeting) is not amused. It says this will bring to more than $115 billion the effective disbursement, granted by executive largesse, of funds that otherwise would have flowed into the treasury in payments of principal and interest. Now four more months, at about $5 billion per month in non-accrued interest, will fuel consumption in the overheated economy.

In March 2020, the first suspension of loan payments was instituted by presidential action (remarkably, Congress then involved itself in governance by codifying the suspension) as the economy plunged into lockdowns and uncertainty. President Donald Trump extended it two times.

Twenty-eight days into his presidency, Biden, responding in a CNN town hall to a question-cum-exhortation about loan forgiveness of “$50,000 minimum,” embarked on a syntax-defying 648-word ramble that included an almost decipherable vow not to forgive “the billions of dollars in debt for people who have gone to Harvard and Yale and Penn.” Now, however, he has again given such people, included in the about 41 million borrowers, relief. Otherwise, he says, a resumption of loan payments in May could produce a cascade of delinquencies and defaults that would “threaten Americans’ financial stability.” It is remarkable that the economy can be both as robust and as fragile as he says it is.

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Instead of rethinking many assumptions and practices, Biden is poised to use student loan difficulties as an occasion for political opportunism on a grand scale. When the latest payment pause expires after Aug. 31, it is highly unlikely that most borrowers will then have to resume full payments. It is highly likely that there will be not just another payments pause but a splashy and expansive loan forgiveness — one of the largest wealth transfers in U.S. history, by presidential fiat.

Biden — subtlety is not his strong suit — probably assumes that the gratitude of up to 41 million beneficiaries will exceed the resentment of borrowers who scrimped to pay their debts. Biden is probably right. Comedian Lily Tomlin certainly was when she said: “No matter how cynical you become, it’s never enough to keep up.”

My intrepid Mercatus Center colleague Veronique de Rugy warns of the folly of price controls. A slice:

To believe that inflation is the product of corporate greed requires even more obliviousness to reality. Inflation is truly a general and ongoing increase of all prices, including wages (which are the price of our labor). This reality means that all companies would have to be getting greedier simultaneously, and that all workers are, at the same time, overcome with similar avarice.

On that note, if corporate greed is sufficient to allow companies to get away with raising prices, why isn’t it sufficient to allow them to resist demands for higher wages?

Here’s Ben Zycher on…

… the Biden administration’s desperate efforts to avoid political responsibility for the sharp increases in fuel costs for which its fossil-fuel policies are almost entirely to blame. The incoherence of those policies is blatant, combining tightening constraints — formal, informal, direct, indirect — on investment in domestic crude oil production capacity and associated infrastructure (e.g., pipelines) with exhortations to both foreign and domestic producers to expand output in the here and now so as to reduce the adverse political effects of high fuel costs.

Is Sen. Marco Rubio (R-FL) as stupid as he often sounds?

Matt Welch explains the anxiety now suffered by many elites over the prospect of Twitter being taken over by Elon Musk. Three slices:

News Thursday morning that the outspoken serial tech entrepreneur Elon Musk has offered to buy Twitter and take it private has surfaced widespread anxieties within the knowledge-class industries that free speech and even societal peace will be jeopardized if the Tesla CEO lifts content restrictions from journalists’ favorite social media platform.

“I am frightened by the impact on society and politics if Elon Musk acquires Twitter,” wrote Max Boot, columnist for The (Jeff Bezos–owned) Washington Post, on Twitter. “He seems to believe that on social media anything goes. For democracy to survive, we need more content moderation, not less.”

Boot is a longtime apocalyptic troll—past lowlights include declaring that “I would sooner vote for Josef Stalin than I would vote for Donald Trump,” and advocating the Federal Communications Commission go after Fox News to forestall “the plot against America.” But his anxiety about allegedly unfettered free speech is revealingly common in media, academia, Silicon Valley, and the government.

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At the core of these objections is the notion (misguided, in my view) that social media platforms, once they achieve a certain ubiquity, should be treated less like private companies, and more like utilities—subject to robust government regulation in the name of both the greater good and the protection of historically disadvantaged minorities.

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Perhaps ironically, the social-media-as-public-utility mindset is being embraced not just by a growing number of left-of-center knowledge-class professionals, but by some of their antagonists in the nascent trad-con right. “Twitter should be a public utility controlled by a rightly-ordered state,” Harvard law professor Adrian Vermeule tweeted today. “Short of that, I’m not sure I care which particular billionaires use it as an ideological playpen.”

Populism of all ideological flavors tends to treat not just government but constitutional principles as instruments, to be used bluntly against ideological opponents. Twitter may have had some libertarian, anything-goes roots, but in the Trump era especially the company has become both the professional plaything and ideological piñata of the white-collar left.

My Mercatus Center colleague Robert Graboyes defends the sanctity of medical oaths.

My GMU Econ colleague Chris Coyne talks with Juliette Sellgren about “manufacturing militarism.”

Congrats to Jon Murphy and Stephen Zimmer

(Don Boudreaux)

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Congratulations to Jon Murphy and Stephen Zimmer!

Jon yesterday successfully defended his PhD dissertation at GMU Econ. His dissertation was directed by me, with Dan Klein and Alex Tabarrok serving as the other two committee members. (Here we are celebrating yesterday evening at Giordino’s, a neighborhood restaurant.)

The other student who completed his dissertation under my direction this academic year is Stephen Zimmer, who successfully defended on March 31st. (That’s Stephen, during his dissertation defense, in the upper right cell of the matrix.) The other two members of Stephen’s dissertation committee were Chris Coyne and Dick Wagner – the latter of whom is now taking a very much-deserved retirement. GMU Econ was made much better by Dick’s active presence, since 1988, on our faculty. To say that it’s an understatement to say that we will miss him is itself a deep understatement.

Now Jon and Stephen, you are hereby charged to do all that you can to instill in your students, colleagues, friends, pets, and any creature who will listen the economic way of thinking.