Russell Roberts's Blog, page 1514

Fast Fools?

Here's a letter to the New York Times:

So McDonald's informs its employees that "If the right people are elected, we will be able to continue with raises and benefits at or above the current levels.  If others are elected, we will not" ("McDonald's Workers Are Told Whom to Vote for," Oct. 30).  McDonald's then names three candidates who it believes will promote policies that will improve the economy.

That's it.  McDonald's workers were merely given their employer's opinion.  They were not – contrary to the title of your report – "told whom to vote for."  Indeed, given the secret ballot, any such command would have had as much teeth as a flounder has fur.

So why is McDonald's facing possible criminal charges for this action?

Is it wrong for an employer to express an opinion to employees about which candidates are best for business?  Are employees so stupid and paranoid that they cannot be trusted to be exposed to such opinions?  If so, then let's also criminalize the incessant barrage of such opinions – often phrased in tones far more apocalyptic than the one used by McDonald's – coming from U.S. Presidents, members of Congress, and newspaper editorialists.

Sincerely,

Donald J. Boudreaux

The Geniuses Who Lord Over Us

Here's a letter to the New York Daily News:

Celeste Katz reports that Vice-President Joe Biden recently remarked that "Every single great idea that has marked the 21st century, the 20th century and the 19th century has required government vision and government incentive.  In the middle of the Civil War you had a guy named Lincoln paying people $16,000 for every 40 miles of track they laid across the continental United States….  No private enterprise would have done that for another 35 years" ("The Daily Politics," Oct. 26).

Let's overlook such fruits of private creativity and enterprise as the light bulb, refrigeration, the assembly line, container shipping, and the polio vaccine and focus instead on Mr. Biden's example of America's first transcontinental railroads.  The Great Northern – conceived in 1886 and owned and run by the immigrant James J. Hill – received no government assistance (not even free grants of rights-of-way).  Moreover, unlike the other three transcontinental lines that were completed in the 19th century – and each of which was indeed government subsidized – the Great Northern never went bankrupt.  It's with us still today as the BNSF Railway.

Sincerely,

Donald J. Boudreaux

And Bob Higgs tells me, by e-mail, the following:

He's [Biden's] got the subsidy amount wrong, too. For the UP [Union Pacific] and CP [Central Pacific], it was $16,000 or $32,000 or $48,000 per mile, depending on the grade (paid in U.S. bonds, of course).

Making the world a better place

Right now, a child is crying. A blind woman is walking the streets of New York asking for help at an intersection. A beggar has his hand out. A classroom full of students awaits the teacher's entrance. Someone's heart is breaking. A friend's wife is in the hospital and he finds himself overwhelmed in so many ways.

Someone needs you. Do you help? Do you look the other way? If you help, how do you help? With all your heart and soul? Or are you bitter or bored or distracted? Is your phone ringing? Or are you checking your email while you're listening to a friend's troubles? Can you find a reason to do what is easy and what is best for you? Or do you help?

These are the decisions we make every day. What we do and how we do it make up our lives and the quality of the lives around us, the family and the friends and the strangers. It goes way beyond compassion and devotion to our friends and family and strangers. It's how we do our jobs and the spirit we bring to everything we do–work, play, and family—the full range of responsibilities and obligations.

We don't have any data on these daily encounters. We count jobs but be don't count devotion to the task. We don't measure how many workers go the extra mile for the customer, or how many employees are patient with the annoying customer even though they didn't get enough  sleep the night before. We don't measure how many people smile at the homeless person who is lonely, we don't count the visits to the hospital to comfort the sick and dying.

We don't know if there is more devotion in 2010 than there was in 1910. We don't know if there is more in California than there is in New York. But we know they are important. We would never say they are trivial or fleeting simply because they do not get measured by the Bureau of Economic Analysis or the Bureau of Labor Statistics.

A few weeks back, Thomas Friedman wrote a piece on the Tea Party movement, dismissing it as the Tea Kettle movement:

The Tea Party that has gotten all the attention, the amorphous, self-generated protest against the growth in government and the deficit, is what I'd actually call the "Tea Kettle movement" — because all it's doing is letting off steam.

That is not to say that the energy behind it is not authentic (it clearly is) or that it won't be electorally impactful (it clearly might be). But affecting elections and affecting America's future are two different things. Based on all I've heard from this movement, it feels to me like it's all steam and no engine. It has no plan to restore America to greatness.

No plan to restore America to greatness. Thomas Friedman doesn't know where greatness lies. Greatness is all around us. It doesn't come out of Washington. It comes out of you and me and how we live our lives. We make the world a better place not by advocating some new public enterprise but through our devotion and love and patience and kindness to the people around us. We make the world a better place one minute and one person at a time.

Understanding Regime Uncertainty

Writing in today's Wall Street Journal, Robert Reich reveals his misunderstanding of regime uncertainty.  Unleashing this destructive uncertainty requires more than simply changing in major ways government's role in the economy.  Instead, regime uncertainty is increased by changes that portend into the indefinite future a greater degree of arbitrary government economic intervention.

For this reason, talk of replacing the Federal Reserve's arbitrary monopoly over the U.S. money supply with a more decentralized and competitive monetary system does not – contrary to Reich's claim – spawn regime uncertainty of the sort that is spawned by "Progressives'" talk of (and action toward) empowering government with ever-more authority to tax, spend, borrow, block, 'protect,' punish, reward, subsidize, bailout, restrict, require, prohibit, cap, withhold, grant, 'quantitatively ease,' 'universally insure,' stimulate, regulate, investigate, interrogate, moratoriate, and otherwise override with politically poisoned official diktats the private choices and contracts of individuals.

Barack Delano Obama

Reason TV's Ted Balaker (a protege, by the way, of my GMU colleague Dan Klein) produced and narrated this truly excellent six-minute-long video on regime uncertainty and the parallels between FDR and Barack Obama.

"Liberals" Aren't Liberal; "Liberals" Aren't for Liberty

Here's a letter to the New York Times:

Michael Vines believes that opponents of the "liberal" agenda in Washington are "reactionary" (Letters, Oct. 28).

Such "liberal" self-congratulations reminds me of H.L. Mencken's description of "the Liberals, who pretend – and often quite honestly believe – that they are hot for liberty.  They never really are….  If a law were passed tomorrow taking away the property of a large group of presumably well-to-do persons – say, the bond-holders of the railroads – without compensation and even without colorable reason, they would not oppose it; they would be in favor of it.  The liberty to have and to hold property is not one that they recognize.  They believe only in the liberty to envy, hate and loot the man who has it."*

Who can seriously doubt that Mencken's description of the "liberals" of 1925 holds – likely with greater robustness – for the "liberals" of 2010?

Sincerely,

Donald J. Boudreaux

* H.L. Mencken, "Liberty and Democracy," first published on April 13, 1925, in the Baltimore Evening Sun; reprinted in H.L. Mencken, A Second Mencken Chrestomathy (New York: Alfred A. Knopf, 1995), pp. 35-36.

isms

(Most of) You will enjoy this nine-plus minute cartoon from 1948.  (HT Andrea Rich)

The Earth Is Flat. See for Yourself!

Here's a letter to the Baltimore Sun:

Charles Campbell's case that "Free trade has failed the U.S." (Oct. 25) is a stew of errors, misunderstandings, and non sequiturs.

Mr. Campbell is misinformed about facts – for example, contrary to his assertion that "we have hollowed out our industrial base," the real value of American manufacturing output today is near an all-time high, and growing.

Mr. Campbell is misinformed about history – for example, contrary to his allegation that Hong Kong "restrict[ed] imports of finished goods," Hong Kong, during its period of fastest growth, imposed no barriers to trade.

Mr. Campbell is misinformed about policy – for example, contrary to his claim, the Samuelson-Stolper theorem was never "the cornerstone of U.S. industrial policy."  That theorem was, and is, merely an abstract economic model that gives insight into how trade changes the relative prices of inputs.

Far from offering a serious case against free trade, Mr. Campbell's essay packs all the intellectual ummpph of a hillbilly-preacher's fulminations against Darwin, homosexuality, or Halloween celebrations.

Sincerely,

Donald J. Boudreaux

Steve Hanke, Among Others, Has Written on This Matter

Here's a letter to the New York Times:

Bob Herbert despairs over the condition of America's water-supply infrastructure ("The Corrosion of America," Oct. 26).  But rather than simply calling for more government funding, he should – and we should – look to France.  The French have long relied heavily and successfully on the private sector to treat and deliver water.

America's much-greater reliance on government to deliver potable running water naturally holds Americans' water supply hostage to the irrationalities and absurdities of politics.  It's time that we instead rely on the allure of profits and the fear of losses – and the creativity of entrepreneurs – to ensure that our homes and businesses are well-supplied with running water.

Sincerely,

Donald J. Boudreaux

Self-Serving Lies

Here's a letter to the Wall Street Journal:

G.M. North America President Mark Reuss reports that "The early enthusiastic consumer response – more than 120,000 potential [Chevy] Volt customers have already signaled interest in the car, and orders have flowed since the summer – give us confidence that the Volt will succeed on its merits" (Letters, Oct. 25).

Splendid news!  I trust, then, that the Volt's success "on its merits" means that General Motors will return all subsidies it has received from taxpayers for development of the Volt and refuse any further subsidies that Uncle Sam might offer.

Sincerely,

Donald J. Boudreaux