Russell Roberts's Blog, page 267
June 9, 2021
Quotation of the Day…
Cooperative market behavior … allows individuals to seek to improve their own conditions only by simultaneously improving the conditions of others. In markets, we compete with each other to find ways to cooperate with and benefit one another.
DBx: Among the finest honors in my life is to have been a co-author with the late, great Hugh Macaulay. Hugh and I joined forces to write this piece for the March 1996 issue of The Freeman; it’s related to the above quotation. (Pictured here is Hugh. This photo is likely from a Clemson University classroom in the 1970s or early 1980s.)
June 8, 2021
Bonus Quotation of the Day…
… is from page xi of the 2002 Dover Publications edition of the 1896 English-language translation – The Crowd: A Study of the Popular Mind – of Gustave Le Bon’s 1895 La psychologie des foules:
Little adapted to reasoning, crowds, on the contrary, are quick to act.
Some Covid Links
“We’re still in a state of emergency,” Newsom said Friday. “This disease has not been extinguished. It’s not vanished. It’s not taking the summer months off.”
Many diseases have not been extinguished or vanished, but it would be absurd for a governor to take near-complete control to respond to all of them. New COVID-19 cases and deaths in California have plunged to levels that can be managed without the governor’s intrusive involvement.
Wall Street Journal columnist Gerard Baker decries Covid groupthink. A slice:
Last year, many scientists beclowned themselves by bowing to the prevailing political pieties with their absurd assertion that taking part in protests on behalf of Black Lives Matter was literally salubrious, whereas taking part in protests against lockdowns was lethally reckless.
“To avert global disaster the West must end its ‘forever’ war against Covid” – so writes Sherelle Jacobs. A slice:
The only solace for Britain is that few countries in the West have done much better. The “free” world’s approach to Covid has proved as decadently insular as it has radically draconian, from Australia’s fortress mentality and Europe’s reckless vaccine nationalism to Ireland’s lockdown, ranked almost as tough as Eritrea’s.
Jay Bhattacharya talks with Michael Smerconish.
Quotation of the Day…
… is from page 4 of the 1983 second edition of Peter Mathias’s 1969 book, The First Industrial Nation: The Economic History of Britain 1700-1914:
Britain’s was the first industrialization of any national economy in the world. Even more remarkable, it occurred spontaneously, not being the result of conscious government policy sponsoring industrial progress. Although inevitably the results of state policy were significant in legal processes, taxation policies, tariffs, shipping regulations and the like, it derived virtually no momentum directly from public taxation, or public promotion, or state-guaranteed loans to raise capital for productive investment…. Britain saw an industrial revolution by consent. It owed nothing to planners and nothing to policemen.
June 7, 2021
Unfathomable, Unseen Complexity
Perhaps the single most consequential, widespread misunderstanding about economic reality is that this reality is relatively simple – simple enough, at least, to be grasped, and hence mastered, by the human mind. But in fact this reality is unfathomably complex. (If you can think of a stronger word than “unfathomably,” please insert that word here in place of “unfathomably.” The result will still be an understatement.) The human mind cannot begin to hope to get its mind around the complexity of modern market processes.
This unfathomable complexity is the subject of my latest column for AIER. A slice:
In contrast, the human eye cannot see the full extent of the productive processes that make this cornucopia a reality. Indeed, this massive, ‘below-the-surface’ market activity is easy to deny or to trivialize. And it’s therefore tempting for those who are unhappy with what they see on the surface to demand that the surface phenomena be rearranged to be more pleasing to the unhappy complainers’ eyes.
But these unhappy complainers don’t realize that to knowingly meddle with that which is on the surface is to unknowingly meddle with far more; it’s to unknowingly yank on an uncountably large number of cords by which the surface phenomena are connected to the Everest of market processes beneath the surface.
Meddling with the surface phenomena causes these unseen cords to pull, twist, and rearrange in unpredictable ways many beneath-the-surface economic arrangements and processes. Among the simplest examples of such unseen pulling, twisting, and rearranging involves raising tariffs on imported steel in order to protect the jobs of today’s steelworkers or to better ensure supplies of a critical military input. Seems simple; and, indeed, it’s likely that such tariffs work – at least for a time – to ensure that more steel is produced domestically and, hence, to protect some steelworker jobs that would otherwise be made redundant by imports.
But peer beneath the surface. The higher tariffs on steel artificially raise the costs to other domestic producers of supplying the likes of precision tools, automobiles, home appliances, and office buildings. These producers of goods made with metal react with some combination of reduced outputs, lowered quality, and greater use of aluminum and other substitutes for steel. Buyers pay higher prices for these goods, thus generally leaving them less to spend to buy other goods and services – such as health care, restaurant meals, nights out at movie theaters, and vacations to Disney World. Employment in these other industries falls, thus offsetting any tariff-engendered gains in the employment of steelworkers.
The unseen consequences continue. As more aluminum is used domestically to produce (say) home appliances, the price of aluminum rises. The cost of supplying some military hardware thus also rises, both because of the higher prices of steel and because of the higher prices of aluminum. The defense budget grows, causing either taxes to rise today or – through debt issuance today – taxes to rise tomorrow. The need to pay these higher taxes reduces consumer spending and business investment in ways unforeseeable, thus causing contractions in the size of some industries. As these industries contract, they employ fewer workers and buy fewer inputs from suppliers.
Yet because the consequences of tariffs play out over large numbers of economic relationships in space and time, no one can trace out their details. We know – chiefly through economic theory – that these consequences are real and generally worse than what would prevail absent any tariffs. But out of sight, out of mind. If the surface economic phenomena can be manhandled in ways that give it a better appearance to those who mistake the surface for the entire economy, then that’s that. The manhandling of the surface phenomena is mistakenly thought to work.
“See! Steel tariffs ensure that we produce more steel!” boasts the protectionist. The economist is left to verbally insist – quite correctly – that this visible ‘success’ comes at too hefty a price paid in the form of invisible distortions now infecting the vast subsurface web of market processes.
Some Covid Links
How much of the economic and social damage during 2020-2021 was caused by voluntary responses to Covid-19, and how much of this damage was caused by government-imposed lockdowns and other restrictions? It’s a good question; an answer to it should be sought. (Here’s a report on one recent example to find an answer.) But it’s also a question not easily answered – or, at least, not easily answered if what is desired is information on how much damage was done to society by government. The chief reason for this difficulty is that government was and remains a major source of information about Covid. If that information is poor – as, for example, it most certainly is when based on models from the likes of Neil Ferguson – then voluntary responses to such poor information surely are in some significant degree the fault of government. Here’s more from David Henderson. Two slices:
If government simply settled for providing information, would that be better than a more radical alternative: not regulating and not providing information? That would depend on two factors: (1) whether government agencies provided information that people didn’t already have, and (2) whether the information those agencies provided was clear and accurate.
…..
In one recent and important episode, though, the government record does not look good: the case of COVID-19.
Consider two questions on which accurate information would have been helpful.
First, how at risk of the disease were students in K–12 schools and how at risk were their teachers? On October 9, 2020, the Atlantic published an article by Brown University economist Emily Oster in which she reported some striking numbers. She wrote, “[O]ur data on almost 200,000 kids in 47 states from the last two weeks of September revealed an infection rate of 0.13 percent among students and 0.24 percent among staff.”
I emphasize the article’s date because it was early enough in the school year that officials at public schools, most of which were not open for a normal five-day in-person school week, could have adjusted to this information and returned to normal. To do so, though, many officials thought they needed to follow information promulgated by the federal government’s Centers for Disease Control and Prevention. Did the CDC report Oster’s data? I couldn’t find it anywhere on the CDC’s site and I was looking weekly.
Finally, on February 3, 2021, almost four months after Oster’s article, the CDC’s director, Dr. Rochelle Walensky, stated at a press conference:
There is increasing data to suggest that schools can safely reopen and that safe reopening does not suggest that teachers need to be vaccinated.
Later that day, though, White House press secretary Jen Psaki stated that Walensky’s statement was not “official guidance” from the CDC. People who are trying to use government information could be forgiven for not knowing which government official to believe.
Interestingly, when the CDC guidance on reopening was published on February 12, it contained language that a strong union, the American Federation of Teachers (AFT), had suggested. The new language, as the New York Post pointed out in a May 1 editorial, softened the guidance somewhat. One such line that had not been in an earlier CDC draft was this: “In the event of high community-transmission results from a new variant of SARS-CoV-2, a new update of these guidelines may be necessary.” One could argue that the AFT has information that the CDC doesn’t. But does anyone really think that the CDC wouldn’t have thought of this on its own? Moreover, if the argument is that the AFT should have input into the CDC guidance based on its knowledge of teachers’ situations, wouldn’t it also have made sense for parents qua parents to have input? Yet it doesn’t appear that they did.
TANSTAFPFC (There Ain’t No Such Thing As Free Protection From Covid.)
Quotation of the Day…
… is from page xxix of George Will’s superb 2019 work, The Conservative Sensibility:
The American project, distilled to its essence, was, and the conservative project is, to demonstrate that a government constructed on the assumptions of natural rights must be limited government. The natural rights theory is that individuals in the state of nature possess rights that pre-exist government; that government is created for the limited purpose of securing those rights; and that the individual surrenders some sovereignty to government on the basis of a rational calculation that government secure more sovereignty than it requires to be surrendered.
DBx: This project is indeed the American one. And this American project is indeed noble. Yet it is unclear if it will succeed over the long run.
A good case can be made that, up until now and largely (if hardly perfectly), it in fact has succeeded. But is two and a half centuries long enough to count as the long run? This span of time certainly spans several generations; in that sense it’s long. But in another sense it’s not at all long. Consider that my own life – I was born in 1958 – overlaps those of many individuals who were alive when Lincoln still breathed, and that when Lincoln was born not 33 years had passed since Jefferson penned the Declaration of Independence. From this perspective, the American project remains quite young.
Will this project succeed for several more generations? I have serious doubts. We might keep it on life support for a bit longer – and any such ‘success’ would be no mean achievement. I’ll certainly work toward this goal for the remainder of my days.
But no government will long bargain fairly with those over whom it wields the sword – or the cage, or the taser, or the gun, or the bazooka, or whatever weapon is most effective du jour. And the typical person seems to me to be far more interested in enjoying the sensation (however false) of safety from reality, and of being on the winning ‘team,’ than in being a free and responsible man or woman.
Liberalism – true, civilizing, enriching, peaceable liberalism – is likely not in our genes. I fiercely hope that history proves my pessimism to be unwarranted.
June 6, 2021
A Day In the Life Under Lingering Covid Derangement Syndrome
For the first time in over a year, I visited the physical premises of George Mason University’s Fenwick Library (on the Fairfax campus). I was in search of a non-circulating collection of early essays in The Economist.
Mask wearing, of course, remains mandatory in GMU buildings – a policy that this Summer semester I, being fully vaccinated, proudly ignore when I teach my in-person class. Yet I wanted badly to consult the volume, so upon entering the library I dutifully donned a mask. But when I tried to go into the stacks, a friendly 20ish-year-old library worker informed me that “For everyone’s safety, the stacks are closed because of Covid.”
Quite surprised, I asked “For how long?” Answer: “Until at least the Fall.”
“How can I access this book, then?” Answer: “We can send someone up to get it and bring it down, but it’s Sunday and we’re short-handed, so we can’t do it right now. But you can try to access it on-line.” I stalked out of the library in a fury, and made sure to take my mask off before even leaving the circulation desk.
Luckily, after much effort, I found a semi-readable version on-line – with the emphasis on “semi.”
…..
When, if ever, will this derangement fully end?
Some Covid Links
Daniel Hannan continues to speak out against the straw man who has so viciously terrorized Britain. A slice:
Until recently, I was of the view that the lockdown was over. In all its essentials, I thought, life had returned to normal on May 17, when hotels, theatres, gyms, cinemas and sports stadiums reopened. Yes, there were still some irksome prohibitions. You can’t hold a big wedding, enjoy a fortnight on the Spanish costas or sit unmasked on a train. But these things, it seemed to me, hardly merited the name “lockdown”, and I was relaxed about the precise date on which they would be phased out. I have since come to realise that, as long as the Government mandates social-distancing rules of any kind, a certain kind of bureaucrat will see it as an all-purpose licence to cancel services.
Today is the 40th anniversary of the first reported case of AIDS in the US. Since a certain NIH bureaucrat is doing a self-congratulatory victory lap for his claimed role in controlling the AIDS epidemic, here again is a reminder of what he actually said as the disease became known.
This article, which appeared 2 years later in the JAMA, was the most prominent instance of a government health official promoting the theory of regular household transmission. It generated headline-grabbing stories across the country the very next day, and led directly to the infamous wave of ostracism that AIDS victims faced throughout the 1980s.
Here’s a report of yet more Covidocratic tyranny in Canada.
I generally get the sense of a lifelong bureaucrat who implausibly found himself as the world’s most influential public-health official during the most dramatic upheaval in public policy in generations. He didn’t entirely know what to do with his new-found influence. It’s shocking to observe his complete lack of interest in the health and economic consequences of lockdown policies.
Maybe he believed they would work but it is hard to say because he was putting down the idea as late as February 25:
“You cannot avoid having infections since you cannot shut off the country from the rest of the world,” he wrote to CBS News. “Do not let the fear of the unknown…distort your evaluation of the risk of the pandemic to you relative to the risks that you face every day…do not yield to unreasonable fear.”
A few days later, he was pushing virus suppression via closures, human separation, and travel restrictions, while finding a good friend in “unreasonable fear.” Medical professionals from around the world wrote to him and begged him to stop this, that people were being bullied by cops all over the world in the name of a virus control method that could not and would not work. He read these and did not answer them.
Speaking of those Fauci e-mails, National Review reports on Ron DeSantis’s reaction. A slice:
“I think now with Fauci’s emails . . . it’s pretty clear that a lot of this stuff was fly by the seat of your pants guidance. This was not based on hard data,” DeSantis stated.
“This bureaucracy needs to be brought to account. You can’t have a bureaucracy that’s just going out and issuing these rules on the fly. They literally said, ‘If you’re sunbathing on a cruise ship you have to wear a mask.’ Really? I mean, give me a break,” he added seemingly in critique of the CDC.
The governor criticized legacy media’s strict adherence to the accepted COVID orthodoxy in 2020 and neglect of intellectual openness that might give way to other competing, compelling explanations. He lambasted the tech companies’ censorship of those who discussed the lab-leak hypothesis of COVID’s origin on the internet.
DBx: For the record, I do not agree with all that Ron DeSantis says and, as governor of Florida, does. But he’s a politician, and as my old friend Roger Garrison says, when a donkey flies, you don’t complain about the fact that it doesn’t remain airborne for very long. DeSantis is, in my view, downright heroic in keeping Floridians free of the statewide lockdowns and other Covid restrictions that were used to tyrannize most other Americans. My strong disagreement with some of his other stands is no reason for me to avoid praising him for keeping Floridians largely free of lockdown tyranny.
Quotation of the Day…
… is from page 58 of Arthur Diamond, Jr.’s, superb 2019 book, Openness to Creative Destruction: Sustaining Innovative Dynamism (footnote deleted):
The word “comfort” was first used in its modern sense in 1770. Until two or three hundred years ago, humans did not worry about comfort because they were too busy just trying to survive. How wonderful that we have advanced to the point that we can now care about comfort!
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