Russell Roberts's Blog, page 306

Bernie Sanders Is to Economics What Road-Runner Cartoons Are to Physics

(Don Boudreaux)

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Here’s a letter to the Wall Street Journal:

Editor:

Sen. Bernie Sanders (I-VT) wants to punitively tax certain firms that pay any employees less than $15 per hour (“Plan B for a $15 Minimum Wage,” March 1).

Sen. Sanders clearly believes that employers are responsible for low-skilled workers earning less than $15 per hour, and that employers whose actions keep worker pay lower than this amount commit an ethical offense that government should discourage with punitive taxes.

By this logic, Sen. Sanders should agree that even heftier punitive taxes – roughly twice the amount – should be imposed on himself and other supporters of a minimum wage of $15 per hour. After all, forcing employers to pay more for low-skilled workers, either directly or through punitive taxes, will cause some of these workers to lose employment. These individuals’ hourly incomes will thereby fall to $0, which is fully $15 less than is the amount that Sen. Sanders thinks is minimally acceptable, and a bit more than double the difference between what workers at the current minimum wage of $7.25 actually earn and the amount that Sen. Sanders has somehow divined these workers ‘should’ earn.

Unless Sen. Sanders is willing to take personal responsibility by being punitively taxed for the huge income losses that his proposed policy would cause, his proposal deserves only to be ridiculed for the political grandstanding that it is.

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 Covid Links

(Don Boudreaux)

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British MP John Redwood understandably calls for more care in distinguishing deaths with Covid-19 from deaths from Covid-19.

Also from Mr. Redwood is this short reflection on the state of freedom today in Britain. A slice:

I never thought I would be living in a country where you needed a reason to leave your house, where you were banned from making trips just for pleasure and where every social contact you wished to make had to be done electronically or under a special dispensation allowed by the regulations.

If history is recorded with any accuracy at all, Boris Johnson will surely be remembered as one of the most calamitous, destructive, and illiberal Prime Ministers in that noble nation’s history.

The consequences of Covid restrictions for the world’s poorest are dreadful.

Notice the legerdemain used by some politicians – such as a British MP peddling inflated estimates of the number of people suffering from “long Covid” – to stoke fears of Covid.

Here are three recent Facebook posts by Phil Magness. One:

If you’re more outraged over facetious tweeting about masks than you are over the last year of lockdown policies, knowing full well the failure of those policies and their deeply regressive socioeconomic effects, allow me to suggest that your priorities are askew and your judgement on both subjects is deeply suspect.

Two (this one aimed at some people who claim to be libertarian):

30 years from now…

“Hey grandpa/grandma, did you oppose the lockdowns that unleashed a global wave of poverty and ripped apart our social fabric for the decade that followed them?”

“No, but I did write a bunch of twitter threads about how libertarians needed to be seen as not opposing The Science ™ behind lockdowns, lest we squander our 0.02% share of influence in the American political system.”

Three:

Through his many unscientific and self-contradictory statements about the efficacy of vaccines as displayed in his recent casting of doubt on our ability to return to normal even after being vaccinated, Anthony Fauci has personally done more to fuel the ignoble cause of vaccine skepticism in the last few months than every single anti-vaxx conspiracy theorist from the bowels of the twittersphere combined.

Let’s conclude today’s list of links with some optimism from Joakim Book. A slice:

It is plain as day that the centrally-planned mandates and the withdrawal of individual liberty – that in the last year often were portrayed as responsible and necessary – are having a bottom-up backlash. People, even the very ones issuing the mandates, ignore the rules left and right because those rules don’t work with how people live their lives. Those who aren’t political or intellectual elites (or make decent amounts of money) overwhelmingly report that the events of 2020 have made their lives worse. The anarchist growing in everyone’s minds is bound to come out; the infantilization of grown-up human beings will create a liberty-fueled backlash. Leave. Us. Be.

My idea of a century of liberty rests on much more than that – on megatrends that governments and statist ideologies are in no position to counter. The internet and its mass access to information. Cryptography and its mass ability to hide from view. And yes, the bitcoin and the mass ability to hold instantly-teleportable value (somewhat) outside the purview of Uncle Sam or banks censoring payments that they, or their regulations, don’t like.

Quotation of the Day…

(Don Boudreaux)

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… is from page 123 of Thomas Sowell’s splendid 1981 volume, Markets and Minorities:

When the government chooses between policy A and policy B, it is making a choice in which the personal interests of the decision-maker are involved. Rewards for both elected and appointed officials – whether in money or in kind – come from increasing the demand for their services. If policy A will achieve a certain result largely through the individual efforts of the citizens themselves, and policy B requires the presence, activity, and visibility of politicians, clearly it is to the politicians’ advantage to advocate policy B.

DBx: So true. But I wonder if we can find a current real-world example of the manifestation of this political bias. I wonder where we might look for such a thing….

Anyone have any ideas?

A Serious Argument Contains Serious Argumentation

(Don Boudreaux)

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Here’s a letter to a college student who tells me that she was “shocked,” when while doing research for a debate on welfare policy, she encountered my blog posts on minimum wages.

Ms. L___:

Thanks for your e-mail.

You allege that my and other “neoliberals’” opposition to minimum wages “shows” our racism. You reach this conclusion by asserting that, because blacks generally are paid less than whites, “raising the minimum wage to $15 will raise more black than white incomes.” Therefore, you reason, opposition to raising the minimum wage must be rooted in racism.

Are you aware that most research on the effects of minimum-wage hikes shows that, while some workers do get higher hourly pay, some other workers lose employment? Pushing up employers’ costs of labor makes labor less desirable to employ. And so especially if you’re correct that “America as a nation is inherently racist,” then do you not worry that blacks will bear a disproportionately large share of these job losses? Might it then be said that support for minimum-wage hikes is evidence of racism?

I happen now to be re-reading a book that I recommend to you; it’s my late colleague Walter Williams’s 2011 volume, Race & Economics. In this book Walter presents ample documentation of the racist consequences of minimum wages, as well as of other smiley-face-wearing government interventions, such as statutes mandating equal-pay-for-equal-work. Walter shows also that blacks would now bear a disproportionate share of the unemployment caused by minimum wages even in the absence today of racism.

Ms. Lambert, you might in good faith disagree with the arguments, and question the data, that are presented in Walter’s book, in the paper linked above (and in those linked below), and in the mountains of other research that reveal minimum wages to be an enemy of blacks and other minorities. I would welcome your reaction to this research after you study some of it.

But even if you have no wish to communicate further with me about minimum wages, it’s in your own interest to carefully study this research. If you’re genuinely convinced that minimum wages are “one of society’s best antipoverty and pro-equity tools,” then you owe it to the groups whose welfare you champion to make yourself as informed as possible in order to be as effective as possible an advocate for minimum wages. You’ll want to know your opponents’ strongest arguments so that you’ll be prepared to counter these with your strongest arguments.

To learn your opponents’ strongest arguments against minimum wages, consult the works of scholars such as – to name only a few – Walter Williams, Thomas Sowell, David Neumark and William Wascher, Jeffrey Clemens, Jonathan Meer, and Richard Burkhauser.

You’ll greatly improve your prospects of swaying people to support minimum wages if you open your argument, not by labeling opponents of minimum wages as racists, but instead by knowing what the best of these opponents say and then by doing your best to explain why they are mistaken. If you’re correct about minimum wages, you should have no trouble doing so.

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

Bonus Quotation of the Day…

(Don Boudreaux)

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… is from page 208 of Lord Acton’s late-1890s lecture “The Influence of America,” as this lecture appears in Essays in the History of Liberty: Selected Essays of Lord Acton, Vol. 1 (J. Rufus Fears, ed., 1985; on-line access to this essay is available free of charge here):

[T]he American notion [is] that the end of government is liberty, not happiness, or prosperity, or power, or the preservation of an historic inheritance, or the adaptation of national law to national character, or the progress of enlightenment and the promotion of virtue; that the private individual should not feel the pressure of public authority, and should direct his life by the influences that are within him, not around him.

DBx: Let us hope, however vain this hope might now seem, not only that this liberal, adult, and civilizing notion is regained by us Americans, but also that it will soon be embraced by all of humanity.

Some Covid Links

(Don Boudreaux)

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Here’s Steve Cuozzo on NYC restaurant-critics’ uninformed shrieking against government allowing people to dine indoors at restaurants. (HT Manny Klausner) A slice:

Why are critics so hostile to indoor dining? Remember that New York City, with all its restaurant restrictions and closures, has seen 27,000 COVID deaths to date while the whole state of Florida has suffered only about 3,000 more despite having nearly three times the Big Apple’s population and looser dining regulations.

Journalists united against indoor dining might be genuinely motivated by health fears. But there’s more than a whiff of woke about it. Remember, Mayor de Blasio declared last summer that indoor dining signifies “entitlement,” even though most of the low-paid restaurant workers are anything but entitled, and “restaurants” include many more cheap pizza, burger and dumpling joints than fine-dining locations.

I applaud these Brits who yesterday, in defiance of lockdown orders, went out and about as free people do to enjoy glorious weather. Some even risked death by not wearing a mask outdoors!

I applaud also the recent federal-court ruling against the CDC’s unconstitutional effort to issue a nationwide ban on tenant evictions. As Christian Britschgi reports:

In a surprise decision Thursday, a federal court has struck down the Centers for Disease Control and Prevention’s (CDC) controversial ban on evictions as unconstitutional.

The federal government’s power to regulate interstate commerce “does not include the power to impose the challenged eviction moratorium,” wrote Judge J. Campbell Barker for the U.S. District Court for the Eastern District of Texas in his opinion yesterday. “Although the COVID-19 pandemic persists, so does the Constitution.”

This ruling comes in response to a lawsuit brought by the Texas Public Policy Foundation (TPPF) and the Southeastern Legal Foundation on behalf of several Texas landlords who’ve been prevented from evicting non-paying tenants because of the CDC’s order.

Normally I refuse to link to essays written by writers who are anonymous, but this essay is so good that I here break my rule; this essay nicely exposes the tyranny that is inherent in the worldview of technocrats such as Neil Ferguson. A slice:

Having decided to defer to ‘experts’ in making policy, there is then a second political decision as to which data counts. The choice to rely on computer modelling – and to treat it as if it were impartial, apolitical expertise – is itself a political choice. Different methods would have produced different outcomes. Suppose, for instance, that the response had been based on the knowledge provided by historians who have studied previous epidemics. The Government and public would have been told that non-medical interventions do no good, that even such an intuitive measure as closing borders between affected and unaffected regions only delays spread by a few weeks, and that one of the biggest dangers is public panic. Suppose the discussion was driven by virologists. The focus might have been on rapidly testing promising drugs and fast-tracking these into use with Covid patients. In this scenario, Remdesivir might have been confirmed effective back in March (say), instead of only in autumn, and lives might have been saved. Or suppose a decision had been taken early on to test virus transmission and impacts of interventions on small but substantial communities of volunteers from among the low-risk population. One would, within a month of the outbreak, have clear evidence on whether (for example) masks or distancing or Vitamin D have any effect. If the ‘experts’ were people working in sociology of health, likely they would have recommended avoidance of compulsion and encouragement of community support. The response might then have been more like Venezuela’s or Kerala’s. It’s also worth noting here that had scientists, including modellers, been consulted earlier, NHS beds per capita might be nearer to those of Sweden and Belarus, who never feared their health systems being overwhelmed. Ferguson suggests a novel pandemic was the Government’s number one priority risk, yet neither the current nor the previous Governments ensured there were enough ICU beds to handle a pandemic on the scale of the 1918 flu. If the central focus was preparedness, this failing would be at the centre of the public debate – and lockdowns could also cost lives if they incentivise future Governments to keep under-resourcing healthcare without accepting resultant risks.

Australian Steve Waterson writes insightfully about Covid and the deranged response to it. A slice:

As various countries assemble their annual mortality rates, the figures suggest we should be relieved, celebrating the fact this pandemic was nowhere near as lethal as some had feared.

Here in Australia, this week’s data from the Bureau of Statistics, covering January 1st to November 24th, 2020, registers 126,974 deaths, against an average of 127,872 over the past five years. Interestingly, influenza and pneumonia deaths in that 2020 period numbered 1952, against the five-year average of 3097.

Should we attribute that decline to the use of masks and social distancing, as we are encouraged to do; or is it faintly possible the missing 1000 people who would normally have died of flu and pneumonia are the ones who succumbed to COVID when it first arrived? Did the virus simply tip those teetering on the verge of death into an earlier quarter?

We, of course, cut ourselves off from the world, so perhaps our figures are artificially low. So let’s consider the “nightmare scenario” playing out in Britain.

Last month the UK’s Office of National Statistics added its provisional 2020 figures to a series that goes back almost 200 years. It shows a rate of 1043.5 deaths per 100,000 population, ahead of 2019’s number of 925.

I would describe that rise with the COVID-appropriate word “unprecedented”, except the rate has been higher before, most recently in 2008, when I don’t believe the world shut down. Oh yes, and it was higher in every single year before 2008, right back to 1838, when the records begin.

Dan Hannan justifiably complains about the British government moving yet again the goalposts for ending lockdown tyranny. A slice:

Think back to the debate we had during most of 2020. Broadly speaking, there were two camps. There were those who believed that we had no choice but to learn to live with an endemic virus. A lockdown, on this reading, might be justified as a short-term measure to buy time and build up healthcare capacity; but, once that had happened, the costs would become hard to justify. On the other hand, there were those who placed their faith in pharma, and were prepared to put the country into cryogenic stasis until a vaccine was available.

I was in the first camp, and was painfully conscious of being in the minority. The second camp won the day and, in fairness, the vaccine came much earlier than expected. But now, having got their way, the wait-for-the-vacciners are reluctant to follow through. By the time we have vaccinated the over-50s – something that the government aims to do by late April, but which might happen sooner – we will have covered the groups that account for 80 per cent of Covid hospitalisations and 99 per cent of deaths. Had the disease had that level of lethality last March, there would have been no question of a lockdown.

Quotation of the Day…

(Don Boudreaux)

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… is from page 56 of my late, great colleague Walter Williams’s 2011 book, Race & Economics:

Low skills can explain low wages but not unemployment. The history of blacks provides concrete evidence. A person is qualified or unqualified only in a relative sense – that is, relative to some wage. For example, a carpenter who is qualified, and hence employable, at a wage of $20 per hour, may be unqualified, and hence unemployable, at $35 per hour. This principle applies to everything. A Sears suit is “unqualified” to sell for the same price as a hand-tailored Pierre Cardin suit.

DBx: Yes.

By “The history of blacks provides concrete evidence,” Walter refers to the overwhelming evidence that shows that, when governments do not obstruct labor-market transactions with the likes of minimum-wage statutes, equal-pay-for-equal-work requirements, and occupational-licensing restrictions, blacks (and other minorities) have no more trouble finding employment than do whites and other groups of people. Some of this evidence is offered in the book from which the above quotation is drawn.

I Miss Walter Williams

(Don Boudreaux)

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Here’s Walter Williams from eight years ago. He was a dear friend, a treasured colleague, a world-class teacher of economics, an economist’s economist, and a great and courageous man.

Just after the two-and-a-half-minute mark, Walter says “That’s the difference between me and most Americans. Many Americans will let these people [government officials] do anything to them in the name of safety. ‘As long as it’ll keep us safe!'”

Bonus Quotation of the Day…

(Don Boudreaux)

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… is from page 57 of Frédéric Bastiat’s May 15th, 1848, article (for Le Journal des économistes), titled “Propriété et loi,” as this article is translated as “Property and Law” and appears in Volume 2 (“The Law,” “The State,” and Other Political Writings, 2012) of Liberty Fund’s The Collected Works of Frederic Bastiat (Jacques de Guenin and David M. Hart, eds.):

I repeat, we were asking for the abolition of the protectionist regime, not as a good government measure but as justice, as the achievement of freedom, as the rigorous consequence of a right that is higher than the law.

DBx: Yes. Ultimately, the case for free trade is a case for freedom. It is a case for people to be left free to peacefully spend their earned incomes as they choose rather than as how others choose – even if those others happen to have won the most recent political election, to occupy impressive faculty positions at elite universities, or to run think tanks that spit out papers expressing displeasure with the pattern of economic activity that arises from whatever freedom people currently possess to spend their own money as they choose.

When the U.S. president, to protect the jobs of American steel workers, calls for tariffs on Americans’ purchases of foreign steel, he is calling on the government to force you (if you are an American) and other ordinary Americans to subsidize particular workers’ desires not to have to find different employment or to take a cut in wages. He is calling on the government to diminish your ability to as fully as possible satisfy your peaceful desires in order to increase other people’s ability to better satisfy their desires – for these other people to live partly on your dime. He is calling on the government to reduce your spending power in order to increase the spending power of some of your fellow citizens.

The above truth holds whether the president is named Biden, Trump, Obama, Bush, Washington, or Hardyharrharr.

When think-tank mavens call on the government to use protective tariffs and subsidies to alter the current pattern of economic activity, they are calling on the government to force you to subsidize their intellectual vision of what a better pattern of economic activity looks like.

Forget such people’s suffocating arrogance – arrogance revealed by their express belief that they somehow know that, say, the home-country economy should have more of these types of jobs and fewer of those types, or that there should be less concentration of economic activity in locations X,Y, and Z, and more economic activity in locations A, B, and C.

Forget such people’s ignorance of economics – ignorance revealed quite plainly in much of what they write and say about trade. (One among countless examples is Oren Cass’s failure to understand both the principle of comparative advantage and the uses economists make of their understanding of it.)

Forget such people’s refusal to recognize both the knowledge problem and the incentive problem that inevitably plague any attempt by government officials to use their coercive powers to alter commerce in ways that improve the overall economy, or even, in many cases, to achieve simply the observable economic patterns that ostensibly motivate the interventions.

Forget all of the above. Recognize, ultimately, that protectionists want to seize part of your income – they want the government to coercively separate you from part of the fruits of your work effort – in order to use it for purposes that they happen to cherish. Protectionists don’t respect you. They hold your rights in contempt. They fancy that they are better than you.

Protectionists might intend to make you more prosperous even though the results of their interventions will be to make you less prosperous. But protectionists also intend to make you less free. And this intention is one that their interventions unfailing succeed in fulfilling.

Some Covid Links

(Don Boudreaux)

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Is the U.K.’s Covid-19 death count inflated? Here’s the opening of a new report by the Daily Mail:

Grieving families last night said deaths had been wrongly certified as Covid-19.

Demanding an inquiry, top medical experts and MPs also insisted they were ‘certain’ that too many fatalities were being blamed on the virus.

One funeral director said it was ‘a national scandal’. The claims are part of a Daily Mail investigation that raises serious questions over the spiralling death toll.

I’m always pleased to be a guest on Dan Proft’s radio program.

Guy de la Bédoyère explores the insane fantasy world of the movement for zero Covid.

Sinéad Murphy is rightly appalled by the dishonesty and ill-tempered arrogance of some in the pro-lockdown crowd. A slice:

An example. Following his grotesque ‘take-down’ of Karol Sikora, Jones turns his vitriol on Sunetra Gupta, who he introduces as having been remarkable this year for “her sheer wrongness”. In general, during this video, Jones’s language is that of the schoolyard – full of hyperbole and poor in vocabulary.

To prove Gupta’s “sheer wrongness”, Jones reveals that, contrary to her claims, early on in the first lockdown, that the Sars-CoV-2 virus was already on the wane, by the end of the year “one in every 554 Britons had been killed by the pandemic”. So, either Gupta must admit her “sheer wrongness” or she must deny that “one in every 554 Britons had been killed”.

Of course, Sunetra Gupta would wish to do neither. The number of those who died in 2020 with ‘Covid’ mentioned on their death certificate may indeed translate as one in every 554 Britons – if it does, then Gupta would surely admit this. But does this mean that she admits that “one in every 554 Britons have been killed by the pandemic”?

One of Gupta’s repeated insights throughout 2020 has been that no number is so reliable as the overall mortality number. How many Britons died in 2020? And in 2019, in 2015, in 2008? 2020’s overall mortality, when adjusted for age profile, is more or less equivalent to that of 2015, slightly lower than that of 2008, and only the ninth highest of all of the years since the turn of the millennium.

Those in an ethical abyss are the pro-lockdowners.

Sonia Elijah makes the case against putting masks on school children.

How do those persons who continue to praise the authoritarian New Zealand government for protecting people in that island nation from Covid process this news? (HT Phil Magness)