Russell Roberts's Blog, page 354
November 12, 2020
Quotation of the Day…
…. is from pages 365-366 of Tom Palmer’s important 2004 monograph, Globalization and Culture: Homogeneity, Diversity, Identity, Liberty, as this monograph is reprinted in Tom’s 2009 book, Realizing Freedom (footnote deleted; link added):
[I]mplicit in the conception of culture involved in theories of collective identity is a static understanding of what constitutes a culture. But for a culture to qualify as a living culture, it must be capable of change. To insist that it not be influenced by other cultures, or that it be “protected” behind barriers to trade and other forms of external influence, is to condemn it to wither and die. It is also to impose on people an “identity,” a vision of themselves, that they themselves do not share, as evidenced by the fact that their choices must be overridden by coercion in order to “protect” that vision. As Mario Vargas Llosa puts it, “Seeking to impose a cultural identity on a people is equivalent to locking them in a prison and denying them the most precious of liberties – that of choosing what, how, and who they want to be.”
November 11, 2020
Bonus Quotation of the Day…
… is from page 128 of the hot-of-the-press (2020) splendid work – co-published last month by the Adam Smith Institute and AIER – by Deirdre McCloskey and Alberto Mingardi, The Myth of the Entrepreneurial State (footnotes deleted; links added):
A person of sense trying to understand the nature of a complex modern economy arrives quickly at a certain humility. Which would not describe Mariana Mazzucato. The American columnist and political thinker George Will recently summarized Hayek’s central idea of proper humility, against top-down State steering: “Human beings are limited in what they can know about their situation, and governments composed of human beings are limited in their comprehension of society’s complexities. The simple, indisputable truth is that everyone knows almost nothing about almost everything.” Though he was the first among economists to draw particular attention to it, such sobering thought is not original with Hayek. It is implied by every thinker who has gotten beyond being a statist epigone of Plato’s Republic or The Laws (and not simply a footnote, as we all are, to Plato’s vision of philosophy). An economist who lacks such humility believes she can engineer the world, set up an ideal New Republic, imagine into existence a worldly-philosopher king manipulating her fellow citizens. Easy.
DBx: I say again: You show me someone who sincerely advocates industrial policy as a means of improving overall economic performance and I’ll show you someone with a god-complex – someone who believes that he or she has supernatural access to knowledge, or can provide such access to others.
Such soothsayers are taken seriously in polite society for the same reason that fortune tellers working with crystal balls are taken seriously among a certain kind of people: the will to believe in such miracles overpowers reason.
I’m quite certain that the book pictured above has in it as much practical, useful, and accurate information as does any book or position paper you’ll ever read in support of industrial policy.
More Faulty Covid Data
Writing in tomorrow’s Wall Street Journal, AIER’s Phil Magness exposes not only a major error in a scientific study on mask wearing, but also appalling irresponsibility of a science-journal’s editors, as well as of the media in reporting on the findings of this deeply flawed study. Here are two slices from Phil’s superb op-ed:
Unfortunately, the IHME modelers’ findings contained an error that even minimal scrutiny should have caught. The projected number of lives saved, and the implied case for a mask mandate, are based on a faulty statistic. Using a months-old survey, IHME modelers assumed erroneously that the U.S. mask-adoption rate stood at only 49% as of late September, and therefore had plenty of room to increase to “universal adoption,” defined as 95%, or to a more plausible 85%. According to more recent survey findings, however, America’s mask-adoption rate has hovered around 80% since the summer.
…..
Nature Medicine’s editors have shown little interest in addressing the error. I asked the journal’s editors for a response, but they demurred for 13 days—nearly twice the time it took to vet the entire paper—and the belated answer wasn’t to correct course. An editor replied that the “alleged discrepancies” were “not issues of substance that would require further action” because “information about what datasets were utilized in the authors’ models and periods they encompass are reported in the study.”
In layman’s terms, Nature Medicine thinks it’s OK for the IHME team to rely on obsolete figures as long as it cited its source. The misleading depiction of U.S. mask use is apparently immaterial.
DBx: The amount of misinformation about Covid-19 is vast. And it combines with the easy ability to mislead with even true statistics to continue to fuel the deranged hysteria over Covid – and the resulting, equally deranged willingness to endure more lockdowns and other inhumane disruptions of economic and social life.
Fortunately, Phil Magness is on the job. As David Henderson described Phil recently in a Facebook comment, “Phil Magness is a large public good.”
Some Covid Links
Jeffrey Tucker points to new research showing that the Covid-inspired closing of schools is a mistake. Here’s his conclusion:
From the beginning, the lockdowns were a policy in search of a rationale. In all these intervening months, none has been forthcoming. And we are only now seeing the solid research proving that the skeptics were correct from the beginning. The only question now is whether and when the “experts” that produced this astonishing failure will admit their error. Perhaps the answer is: when the media start reporting on it.
Zoë Harcombe argues that SAGE – the British panel that pushes for lockdowns in that country – is fatally infected with conflicts of interest and inadequate expertise. You judge. (HT Dan Klein) A slice:
[Johan] Giesecke said of the Ferguson/Imperial paper: “I don’t think any other scientific endeavour has made such an impression on the world as that rather [pause] debatable paper.”
In the Wall Street Journal, George Mason University law professor Adam White reviews John Fabian Witt’s American Contagions – a book that seems to be uneven. I do like Witt’s description, as quoted by White, of America in 2020 being a “prison archipelago.”
Phil Magness documents further evidence of lockdown-leaders’ sheer hypocrisy.
Quotation of the Day…
… is from pages 140-141 of the 2015 Fourth Edition of Dartmouth economist Douglas Irwin’s superb volume, Free Trade Under Fire:
Because exports increase the number of workers in relatively more-productive, high-wage industries, and imports reduce the number of workers in relatively less-productive, low-wage industries, the overall impact of trade in the United States is to raise average wages. Conversely, any policy that limits overall trade and reduces both exports and imports tends to increase employment in low-wage industries and reduce employment in high-wage industries. Restricting trade would shift American workers away from things that they produce relatively well (and hence export and early relatively high wages in producing) and towards things that they do not produce so well (and hence import and earn relatively low wages in producing) in comparison to other countries.
DBx: Indeed. And so when a protectionist or a proponent of industrial policy tries to sell you on a scheme to use subsidies and protective tariffs to enrich ordinary people, point that person to Doug’s book (now deservedly in its fifth edition). Ask that person if he or she has read it.
That question will end the conversation, for you can be sure that the (honest) answer is “no.” Peddlers of protectionism – past and present – almost never bother really to learn the case for free trade; they never study carefully the works of scholars such as Adam Smith, Jean-Baptiste Say, David Ricardo, Frédéric Bastiat, Richard Cobden, Henry George, Jacob Viner, Gottfried Haberler, Fritz Machlup, William Allen, Harry Johnson, Leland Yeager, Robert Mundell, Jagdish Bhagwati, Arvind Panagariya, Pierre Lemieux, Dan Griswold, Doug Irwin, Dan Ikenson, Scott Lincicome, and Johan Norberg. Instead, protectionists content themselves with their straw-man concoctions of the case for free trade. After all, straw men are so much easier to slay than are the real McCoys.
November 10, 2020
Bonus Quotation of the Day…
… is from page 96 of Philipp Blom’s 2010 book, A Wicked Company:
As long as people are unwilling or unable to use their reason, to think for themselves, and to see the blatant perversity of the beliefs preached to them, their misery is bound to continue.
DBx: Yep.
Some Links
Texas Tech economist, and GMU Econ alum, Ben Powell makes a case against Covid-19 lockdowns. A slice:
Instead of following Europe into a second round of lockdowns, the United States should follow the advice of the top scientists and medical experts who have signed the Great Barrington Declaration. They advise avoiding lockdowns and focusing instead on protecting the most vulnerable, letting the disease spread among the young and healthy to build population immunity.
Jonas Herby explains cross-country differences in Covid death counts. A slice:
The high death toll has been attributed to the soft lockdown, but Sweden had a remarkably mild flu season in 2018/19 and 2019/20. Many vulnerable souls who normally would have died of the flu survived to April 2020 and, then, sadly died from Covid-19 instead. This buildup of a stock of vulnerable persons has been called “dry tinder.” The “tinder” metaphor is that more forest fires this year can be explained by fewer fires in previous years. Dry tinder accumulated, awaiting a spark.
A recent article suggests that dry tinder in Sweden is an important factor in explaining the country’s large number of Covid-19 deaths. Sweden was an exceptional case, both compared to other Nordic countries and in a historical perspective. Dry tinder is important for our understanding of the differences in Covid-19 deaths tolls between countries.
Mark Perry mourns the death of Rabbi Jonathan Sacks. And he shares this wonderful quotation from a 2017 speech given by Rabbi Sacks: “The market is about the creation and distribution of wealth. The state is about the creation and distribution of power.”
Alex Nowrasteh thanks Donald Trump for revealing nativism’s true, hideous face. Here’s Alex’s conclusion:
President Trump killed respectable, polite, and well‐mannered nativism and replaced it with rude, crude, and poorly‐mannered nativism. If I were a polite and well‐mannered immigration restrictionist, and there are many, then I would be furious. As somebody working to liberalize American immigration policy, President Trump deserves my thanks for creating that legacy. Thank you, Mr. President.
I am honored to have been a recent guest on Bretigne Shaffer’s podcast. The discussion was mostly about Covid and the deranged response to it.
Eric Boehm calls White House trade advisor Peter Navarro a loser. Good call.
Quotation of the Day…
… is from page 71 of Deirdre McCloskey’s and Art Carden’s superb new (2020) book, Leave Me Alone and I’ll Make You Rich: How the Bourgeois Deal Enriched the World:
An ethical market economy, we further claim, has been best achieved not by industrial policy from Paris or Washington but by a free society, one with no masters: modern liberalism.
DBx: As I obsessively point out, proponents of industrial policy have no answer to the question “How will government officials know enough to carry out industrial policy in a manner that will out-perform competitive markets at allocating – and continuously reallocating – resources in ways that create prosperity for ordinary men and women?” Having no answer to this question, industrial-policy proponents typically sidestep it by implying that (somehow!) government officials will miraculously be blessed with this knowledge.
Another strategy for evading this question is a four-stepper: (1) Cobble together a flimsy straw man out of poorly remembered (or poorly taught) strands of materials from the Econ 101 or Econ 460 courses they took as undergraduates; (2) name the straw man “market fundamentalist”; (3) slay this straw man; (4) loudly and proudly declare victory over “market fundamentalists.”
Yet even this second strategy, at the conclusion of step four, runs into the problem of having no answer to the question: “How will government officials know how to do better than even the straw man might have done?”
The knowledge problem is, quite simply, never acknowledged by proponents of industrial policy.
But as the above quotation from Deirdre and Art implies, turning resource-allocation decisions over to government officials also creates an incentives problem. It promotes corruption. Inherently unethical – why should some bureaucrat in the Department of Building a Bright Tomorrow be authorized to obstruct your ability to spend and invest the income that you earn? – industrial policy naturally attracts rent-seekers. And rent-seekers inevitably ensure that the political supervisors of, and the daily operatives in, the DBBT allocate resources in ways that benefit the politically powerful, all at the expense of the general public.
But, hey, industrial-policy advocates mean well! Their intentions are pure and pretty. And lots of them boast terminal degrees from elite universities. They’re well-meaning and smart, and they’ve read lots of books and even have written some. What could possibly go wrong if we implement one of their schemes? (Note: By the nature of industrial policy, only one such scheme can be implemented at any one time. But the details of each industrial-policy proponent’s scheme differ from those of the schemes proposed or envisioned by other industrial-policy proponents. Questions about how to choose which particular scheme to implement – and to stick with long enough to see if it will work as advertised – are ones that I’ll here put aside for a later epistle.)
…..
To be clear, by “modern liberalism,” Deirdre and Art above mean classical liberalism, not some tepid version of Progressivism.
November 9, 2020
Bonus Quotation of the Day…
… is from page 128 of the hot-of-the-press (2020) splendid work – co-published last month by the Adam Smith Institute and AIER – by Deirdre McCloskey and Alberto Mingardi, The Myth of the Entrepreneurial State:
The statist economic engineers such as [Mariana] Mazzucato want to begin the world over again, by replacing society with government, replacing a voluntary order with comprehensive coercion.
DBx: What arrogance! What appalling arrogance of such people as Mazzucato – and of Marco Rubio, and of Oren Cass, and of Robert Reich, and of Elizabeth Warren, and of Julius Krein, and of Daniel McCarthy, and of … the parade of such arrogant, hubris-saturated people is depressingly, distressingly, and disturbingly long. Because the details of a dynamic, open-ended global economy consisting of billions of largely free individuals doesn’t perfectly satisfy the particular fancies of any one of these individuals, that individual believes that he or she is entitled to recommend that the state unleash its coercion on hundreds of millions of fellow citizens in order to better satisfy that individual’s fancies.
Each of these individuals has a God-complex: He or she mistakes his or her intellectual visions as being those of a deity. That he or she sincerely is unaware that he or she presents himself or herself to the world as a deity doesn’t change the fact that that’s just what he or she does.
This avalanche of arrogance is indescribable.
Adam Smith and Covid-19
What would Adam Smith say about humanity’s reaction to Covid-19? Of course, no one can really know. But there’s good reason to think that Smith would worry about the Covid-inspired social separation.
In his 2020 book, Adam Smith, the University of Glasgow’s Craig Smith unpacks and explains to his readers Adam Smith’s philosophy. On pages 50 through 52 – in a chapter on The Theory of Moral Sentiments – Craig Smith writes (emphasis added):
[Adam Smith] is aware that we are able to generate more perfect sympathy [i.e., empathy] with those who are close to us, and it is in the presence and approbation of friends and family that we are able to indulge our strongest feelings and expect the greatest understanding. But we are also subject to the judgement of more distant spectators who are not partial enough to indulge our strongest feelings, and who cannot enter into our passionate experience as fully as those who are familiar with us. Such figures may enter into our experience of serious misfortunes, like the death of a loved one, but they are less willing to indulge our disappointment at matters of smaller account. This fact about humans leads Smith to observe that society and conversation have a therapeutic effect. Moreover, the society of strangers with their weaker degree of sympathy [again, empathy], and our subsequent desire to flatten our emotions, suggests that mental tranquility can be restored by associating with those who are less willing to indulge our feelings….
[Adam Smith is led] to the idea that the desire to secure the approval of strangers helps us to compose ourselves. It is company, particularly the company of strangers, that calms our minds. Our friends and family indulge and condole us, but strangers force us to master our feelings….
Society is the “great school of self-command.”
DBx: That is: By being among strangers, each of us controls our emotions in ways that we do not when we are among only family and close friends. You might, for example, express dramatic disappointment and sadness to your spouse or to your brother over the fact that your favorite football team lost today’s game. But you don’t do such a thing to strangers you encounter at the supermarket or at a restaurant; it’s simply inappropriate.
Your family and close friends allow you to indulge, with them, a wider range of your emotions than you feel appropriate inflicting on strangers.
Being among strangers, therefore, prompts each of us to keep our emotions more in check than when we are in the exclusive company of family and close friends. And this habit of keeping our emotions more in check when we are out and about in society promotes our “mental tranquility.”
In short, I would not be surprised that, were Smith still alive, he would observe that being among strangers, because it prompts us to control our emotions, plays an important role in keeping us sane. And, thus, one significant cost – danger, even – of the Covid-inspired greater isolation of human beings is indeed an increase in genuine mental problems.
Note that I am not arguing, or even suggesting, that Adam Smith would disapprove of this isolation or of any of the policies and reactions to Covid that led to it. Such a thing is unknowable, for Smith might well estimate that the benefits to physical health of this isolation are greater than its costs. But I am saying that Adam Smith would indeed understand that one of the significant downsides of the Covid-inspired isolation is increased mental anguish. He would surely counsel us to take into serious consideration the deleterious emotional and mental consequences of separation from the larger society.
Russell Roberts's Blog
- Russell Roberts's profile
- 39 followers
