Russell Roberts's Blog, page 467

Pittsburgh Tribune-Review: “Of sunroofs & motor scooters”

(Don Boudreaux)

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My column for the June 27th, 2007, issue of the Pittsburgh Tribune-Review was inspired by a trip to Paris. You can read my column beneath the fold.

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Quotation of the Day…

(Don Boudreaux)

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… is from page 20 of Matt Ridley’s splendid 2018 Hayek Memorial Lecture at London’s Institute of Economic Affairs, as this lecture is printed (with comments by Stephen Davies) as How Many Lightbulbs Does It Take to Change the World? (2019):

So my message is that because innovation is a bottom-up evolutionary process deriving from dispersed knowledge, instead of messing around trying to find a magic way to create innovation, government should focus on removing things that stop it.

DBx: Yes! Oui! Si! Ja! Da! 是!

And one sure way to stifle innovation – including, but not only, by redirecting resources away from competition for the expenditures of consumers and toward competition for the favor of government officials – is to give power to government to direct and ‘encourage’ innovation through the likes of industrial policy.

Bonus Quotation of the Day…

(Don Boudreaux)

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… is from page 825 of Paul Johnson’s 1991 book, The Birth of the Modern: World Society 1815-1830:

The British had a long tradition of respect for personal liberty, imperfectly followed at times but always deep, and it was reinforced by an interpretation of Christianity which saw all human beings as essentially individuals, to be treated as such, and not as raw material for schemes, however well meaning, which handled them as though they were sand or earth or stones, to be shifted about by governmental machines.

Mind-Expanding Stocking Stuffers

(Don Boudreaux)

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In my latest column for AIER I recommend seven books, each published in 2019, to give as gifts to friends with curious and open minds. A slice:

Arthur Diamond, Jr. Openness to Creative Destruction: Sustaining Innovative Dynamism. As does George Will, Diamond emphasizes the vital role played by individual entrepreneurs in helping to create modern mass prosperity. (The accounts of the challenges and efforts of flesh-and-blood entrepreneurs through the years is alone worth the price of this book.) And as does Deirdre McCloskey, Diamond recognizes also the importance of widespread respect for innovators and businesspeople. Making clear that modernity’s prosperity is the result of creative destruction, this book offers an unusually effective and powerful explanation of genuine market competition and a brilliant brief for its indispensability and for its goodness.

Tyler Cowen’s Big Business: A Love Letter to an American Anti-Hero. Short and fast-paced, my George Mason University colleague Tyler Cowen gives here three unapologetic and enthusiastic cheers for big business. In doing so he mows down, one after another, many of the superstitions and myths that foster in the popular mind an unwarranted suspicion of – and often a downright hostility to – firms that in markets grow large. Tyler has nothing against not-big businesses. But he performs a much-needed public service by revealing not only the special conditions and abilities that enable some businesses to become big, but also the too-often-unseen advantages that those big businesses, in turn, enable us denizens of modern commercial society to enjoy.

Virgil Storr and Ginny Choi, Do Markets Corrupt Our Morals? Nothing has ever been more fashionable among intellectuals, left and right, than to condemn markets for allegedly transforming noble, generous, and community-minded folk into contemptible, venal, and self-centered near-sociopaths. Storr and Choi go beyond convincingly showing that this allegation is wholly untrue; they reveal it to be the opposite of the truth. That which in fact does most to civilize us is markets. Markets tame our instincts to physically aggress against each other. Markets, in other words, create not only immense and widespread material prosperity, they also create a humane, generous, polite, and truly civilized society. Montesquieu’s doux commerce thesis is true after all.

Bryan Caplan and Zach Weinersmith,  Open Borders: The Science and Ethics of Immigration. Being illustrated, this book is literally colorful. And although fun – indeed joyous – to read and filled with cartoons, this is no cartoon book. The authors – text by Caplan, illustrations by Weinersmith – tackle objections, big and small, to opening America’s borders much wider to immigrants. They make a compelling case that those objections collapse under close scrutiny.

I am in awe of the amount of knowledge conveyed convincingly in the book’s 214 pages of illustrated text. Statistics, history, economics, and philosophy are brought together seamlessly to put opponents of immigration on the intellectual and ethical defensive. Yet while the authors don’t shy away from endorsing completely open borders, they are neither dogmatic nor unrealistic. They understand that achieving imperfect liberalization is indeed an achievement compared to no liberalization at all, and they even give insight into how to make small steps in the direction of liberalization politically doable. This amazing book could be a game-changer in the immigration debate.

Some Links

(Don Boudreaux)

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Joakim Book rightly celebrates the reality of technology increasing people’s employment options.

My amazing GMU colleague Ilya Somin, from over in the Scalia School of Law, is among the immigrants whose inspiring stories are celebrated by Stuart Anderson.

Edward Lazear, John Cochrane, David Henderson, Richard Epstein, Michael J. Boskin, and Daniel Heil productively ponder taxation.

Dan Ikenson justifiably is no great fan of the USMCA.

And Eric Boehm justifiably is no great fan of “phase one” of the U.S.-China trade deal. A slice:

This Phase One agreement seems to be, at best, a face-saving way to back off from imposing costly new tariffs, and a way to punt the thorniest parts of the China trade dispute until after the next election. It comes with only modest tariff relief for U.S. consumers, doesn’t undo the worst losses of the trade war, and contains likely overblown promises about China’s ability to buy more American farm goods. But don’t be surprised if Trump acts like it’s a major victory.

On this 249th anniversary of the birth of Beethoven, Arthur Brooks teaches us what Beethoven can teach us.

I only just now discovered this EconTalk podcast that Russ Roberts did this past summer with George Will.

Quotation of the Day…

(Don Boudreaux)

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… is from page 188 of Open Borders: The Science and Ethics of Immigration, the magnificent 2019 illustrated book written by my GMU Econ colleague Bryan Caplan and illustrated by Zach Weinersmith:

‘Squeezing foreigners’ is a classic protectionist smoke-screen for squeezing your own citizens.

DBx: Yup.

Protectionism is indeed protected by the myth identified here by Caplan and Weinersmith. It’s a myth that is found to be especially appealing by conservative economic nationalists. Protectionism is protected as well by all manner of other myths, including many that are found to be especially appealing by “Progressives,” such as the myth that protectionism protects ordinary people from the predations of greedy corporations.

Pittsburgh Tribune-Review: “The Environmental Creed”

(Don Boudreaux)

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In my Pittsburgh Tribune-Review column of June 13th, 2007, I wrote about today’s hottest religion: environmentalism. Below the fold you can read what I wrote (link added).

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Quotation of the Day…

(Don Boudreaux)

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… is from page 185 of the Mercatus Center’s 2016 re-issue of my late colleague Don Lavoie’s brilliant 1985 volume National Economic Planning: What Is Left?:

But the first principle of any analysis of the capital structure has to be the clear recognition of the fact that, unlike a physical structure such as a building, it is continually changing. Its parts are forever adjusting to one another the basis of profit. Profit and loss signals are the only information that can guide producers of higher-order capital goods toward the production of the kinds of intermediate goods that will contribute to the production of lower-order consumption goods. This intricate network of relations among the thousands of orders and sectors of capital goods is continually being restructured by the factors set in motion by differential profit rates. Thus, a call for governmental restructuring or shoring up of this self-ordering system amounts to a destruction of the very mechanism that tends to keep the sectors of the capital structure integrated.

DBx: In short: to the extent to which a government puts the economy under an industrial policy it obstructs and distorts the elicitation and sharing of information necessary not only to enable that economy to become more productive but even to maintain its current level of productivity.

The fatal conceit of supposing that the spontaneously ordered processes of human interaction can be replaced to better effect by conscious direction arises in many different particular contexts. Today, people on the political left are increasingly joined by people on the political right in arrogantly (and ignorantly) believing that they – or agents whom they are willing to trust – are smart enough, informed enough, and politically courageous enough to survey in detail a reality that is too vast for any human being to comprehend and then to coercively intervene into that reality in ways that will ensure that it will turn out better than it would if left to its own devices – that is, than if left to the devices of millions of individuals spending their own money and guided by their own unique access to information.

To those of you on the political right, I ask if you trust the likes of Bernie Sanders, Elizabeth Warren, Joe Biden, or Michael Bloomberg to so improve the economy. To those of you on the political left, I ask if you trust the likes of Donald Trump, Mike Pence, Wilbur Ross, or Marco Rubio to so improve the economy. And to everyone I repeat this reality: industrial policy will not be designed or carried out by hyper-informed heavenly angels but by poorly informed political agents. It is beyond me why anyone supposes that these agents are sufficiently trustworthy to deserve the privilege of superintending and overriding our individual economic choices.

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The photo above is of a sugar-cane field in Florida – proof positive that the likes of Marco Rubio are not to be trusted to carryout or to oversee industrial policy. Rubio has a long record of supporting, for political reasons, inefficient uses of resources such as the use of land and other resources in the U.S. to produce sugar. Industrial policy would simply uncork more such inefficiencies, all sold with lies to the American public as ingenious schemes to make us richer.

Some Links

(Don Boudreaux)

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Kevin Williamson is brilliant. Here he eviscerates progressives, as well as conservatives such as Marco Rubio and Michael Brendan Dougherty, whose advocacy of industrial policy and other forms of protectionism reveals both their economic ignorance and their skill at slaying straw men. A slice:

Conservatives like to laugh at Paul Krugman, revisiting his long-ago prediction that the Internet would prove no more economically significant than the fax machine, but nobody is really very good at predicting the future of economic developments at any meaningful level of detail. Go spend some time around private-equity investors and see how they come by their billions: They are smart, but they are not superhuman, and they do not have any special insight into long-term economic trends — they do a tremendous amount of grunt-work discovering and creating value in ordinary companies and complex deals, inch-worming their way through. That’s how a lot of wealth gets built. That’s the real world. And Senator Rubio scoffs at it as fiddling with “financial flows detached from real production,” as though factories just built themselves.

My intrepid Mercatus Center colleague Veronique de Rugy goes beyond poking fun at the jaw-droppingly ignorant Alexandria Ocasio-Cortez to explain that this alleged case for mandated paid family leave is hooey.

Jeff Jacoby isn’t buying the claim of rising economic inequality. A slice:

Contrary to progressive belief, America is not divided into rigid economic strata. The incomes of the wealthy often decline, while many taxpayers go from being poor at one point to not-poor at another. Research shows that more than one-tenth of Americans will make it all the way to the top 1 percent for at least one year during their working lives.

Scott Sumner wisely counsels that people just say “no” whenever their ‘leaders’ propose waging a trade war.

Judith Curry calms the fears of people frightened out of their minds by the likes of St. Greta of Stockholm and other hysteria-mongers.

The great Bruce Yandle proposes that business people be allowed to seek profit only through commerce and not through state-granted special privileges.

Pittsburgh Tribune-Review: “‘Like little puffs of smoke'”

(Don Boudreaux)

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In my Pittsburgh Tribune-Review column of May 30th, 2007, I reprised a true story that I first published years earlier in The Freeman; it’s a different spin on the theme of the “seen versus unseen.” You can read my column beneath the fold.

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