Russell Roberts's Blog, page 74

Quotation of the Day…

(Don Boudreaux)

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… is from pages 38-39 of the 1981 Liberty Fund edition of Felix Morley‘s 1959 volume, Freedom and Federalism:

It is perhaps too much to say that Madison‘s thinking denied any validity to the conception of a general will. But it was certainly careful to ensure that if there is a general will it shall not at any time or place run roughshod over the individual.

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(Don Boudreaux)

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Deirdre McCloskey reviews Bruce Caldwell’s and Hansjörg Klausinger’s Hayek: A Life. A slice:

The peculiarly American term for such a worldview is libertarianism. The usage delivers liberal over to the social democrats. Hayek and I disapprove. True liberalism adopts instead the strange and wonderful idea arising suddenly by happy accident in northwestern Europe during the 18th century that the ancient hierarchies of husband and master and king should not stand. Ordinary people were to be treated for the first time like adults. Such a liberalism could be called adultism.

Fabio Rojas reflects wisely on Phil Magness’s and Michael Makovi’s paper showing that an outsized portion of Karl Marx’s fame is due to the ‘successful’ Bolshevik revolution. A slice:

Where does Marx’s oversize impact come from? Magness and Makovi (2022) in the The Journal of Political Economy offer a simple and straightforward answer: the Bolshevik Revolution. Their paper is essentially a quantitative affirmation of what many intellectual historians had noted throughout the 20th century. Marx had a real following among German socialists in the late 19th century, but he was catapulted to international fame in 1917.

George Will explains why politics today is so toxic. A slice:

The fundamental economic problem of attaining subsistence having been banished by plenty, many hyper-politicized Americans have filled the void in their lives with the grim fun of venting their animosities. This would not have surprised Peter De Vries, the wittiest American writer since Mark Twain: “Human nature is shabby stuff, as you may know from introspection.”

Writing in the Wall Street Journal, Roland Fryer helps to make clear why “disparity doesn’t necessarily imply racism.” A slice:

I write this with some degree of trepidation, in part because I still have my grandmother in my ear and in part because I am keenly aware of the harm in underestimating bias. But there is also a cost to overemphasizing its impact. A black kid who believes he will face daunting societal obstacles is likely to underinvest in trying to climb society’s rungs. Every black student in the country needs to know that his return on investment in education is, if anything, higher than for white students.

The solution is neither to stop fighting biased behavior nor to curb honest inquiry about race in America. We shouldn’t stop searching for and penalizing discriminatory employers, or trying to reduce racial differences in police brutality, or estimating whether the value of a home appraisal depends on the race of the homeowner, or reducing bias in bail decisions by using artificial intelligence. I could go on, like the conversations stuck to those slipcovers. The solution isn’t to look away from discrimination. It does exist. But we also can’t point at every gap in outcomes and instantly conclude it’s racism. Prejudice must be measured rigorously. Statistically. Disparity doesn’t necessarily imply racism. It may feel omnipresent, but it isn’t all-powerful. Skills matter most.

Wall Street Journal columnist Holman Jenkins recognizes that “climate reparations” (so called) are really dressed-up “foreign aid” (so called). A slice:

Even the New York Times has lately surmounted its psychological infirmities to noticerealities, with a long piece on a recent Sunday recognizing that the outlook is less dire than routinely claimed. One nit I might pick with the sociological realists concerns a carbon tax, which might yet appeal for fiscal reasons. But even here the wisdom of Mr. Ausubel can’t be discounted:

“The outcome of [a carbon tax]” he said in the same 2007 interview, “will likely bear little relation to what experts forecast. I will wager the main beneficiaries will be government administrators, lawyers, accountants, and financial intermediaries, not people bothered by weather and climate. Keeping energy cheap for end-users matters. For those adapting to climate change, cheap energy matters enormously. Cheap energy can translate into cheap water, for example, through pumping or desalination. Cheap energy also means people can range further in search of jobs and income.”

It also allows them air conditioning to cope with hotter days, one might add.

Bjorn Lomborg decries the hypocrisy on display at the recent U.N. Climate Summit.

My intrepid Mercatus Center colleague Veronique de Rugy talks turkey about work.

Ordinary Chinese citizens are bravely protesting being continually terrorized by the straw man. Two slices:

Residents in Shanghai, China’s most populous city, gathered Saturday night and early Sunday, calling for the end of pandemic lockdowns and chanting “We want freedom” and “Unlock Xinjiang, unlock all of China,” according to witnesses at the event. In even more extraordinary scenes of public anger aimed at the government’s top leader, a group of protesters there chanted, “Xi Jinping, step down!” and “Communist Party, step down!”

…..

The immediate trigger for the demonstrations, which were also seen at universities in Beijing, Xi’an and Nanjing on Saturday, was a deadly fire in Urumqi, the capital of Xinjiang, in China’s far northwest on Thursday. Ten people, including three children, died after emergency fire services could not get close enough to an apartment building engulfed in flames. Residents blamed lockdown-related measures for hampering rescue efforts.

Zac Bissonnette tweets: (HT Jay Bhattacharya)

The original sin of the western COVID response was thinking China is in any way a model of public health.

It is a single-party dictatorship with no respect for individual rights, and a controlled media that isn’t allowed to investigate the voluminous fake data the CCP puts out.

James Bovard is rightly critical of Fauci. A slice:

No American has been more revered by the media in the COVID era than Anthony Fauci, President Joe Biden’s chief medical adviser and the director of the National Institute of Allergy and Infectious Diseases. Since early 2020, TV and print profiles have deluged Fauci with endless adulation, spurring the sale of Fauci votive candles, Fauci bobbleheads and #trustFauci Twitter hashtags. But Wednesday, Fauci’s mind vanished.

Or at least that’s what he claimed. A federal judge compelled Fauci to answer questions from lawyers suing to reveal the role of “dozens of federal officials across at least 11 federal agencies “ to suppress “disfavored speakers, viewpoints and content on social-media platforms.” That lawsuit is exposing how Biden’s war on disinformation is demolishing Americans’ freedom of speech.

Fauci was deposed on Wednesday by Missouri Attorney General Eric Schmitt and Louisiana Attorney General Jeff Landry. Landry labeled Fauci the “man who single-handedly wrecked the US economy based upon ‘the science, follow the science.’” But “over the course of seven hours, we discovered that he can’t recall practically anything dealing with his COVID response,” Landry said.

So Fauci is “omniscient except during depositions”?

Missouri Attorney General Schmitt said the deposition revealed: “When Fauci speaks — social media censors.“ The lawsuit will continue to expose federal shenanigans with perhaps the biggest bombshells still to come.

Quotation of the Day…

(Don Boudreaux)

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… is from page 26 of the 2006 Liberty Fund edition of Ludwig von Mises’s 1956 volume, The Anti-capitalistic Mentality (available free-of-charge on-line here):

Nobody is needy in the market economy because of the fact that some people are rich. The riches of the rich are not the cause of the poverty of anybody. The process that makes some people rich is, on the contrary, the corollary of the process that improves many peoples’ want satisfaction. The entrepreneurs, the capitalists and the technologists prosper as far as they succeed in best supplying the consumers.

Racism Is a Poor Explanatory Variable

(Don Boudreaux)

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Here’s a letter to a regular Café patron, but one who often respectfully disagrees:

R__:

Thanks for your e-mail.

In response to my recent post that is critical of the ‘New History of Capitalism’ – a ‘history’ whose practitioners argue that capitalism is rooted in slavery – you write:

Although New Historians probably exaggerate the links of capitalism with slavery, they are useful for reminding people racism is the root cause of American inequality and other problems.

I disagree. I don’t doubt that, in our nation of 332 million souls, several of our fellow citizens continue to be bigoted, narrow-minded, and racist. Alas, the imperfections of humanity ensure that it will always be so. But I also don’t doubt that, because charges of racism today are so easy to level – and because they grab so much uncritical attention – these charges create the impression that racism is more widespread than it really is, and that it is responsible for many more problems than can, in truth, be credibly attributed to it. Social and economic processes are far more complex than most people realize, with the ‘outcomes’ of these processes being determined far less by people’s attitudes and intentions and far more by the opportunities and constraints that each of us daily confronts.

Consider a pertinent example. In competitive markets without a minimum wage, the racist supermarket manager wishes to employ only whites to work in his store, but he’ll be driven by competition to hire the best workers available regardless of their race. The ability of minorities to accept work at wages lower than are demanded by whites makes it unacceptably costly for this manager not to employ qualified minorities. Further, competition for workers among supermarkets and other employers eventually compels this manager to pay workers according to their productivity and not according to their race or other irrelevant characteristics. Competition and the flexibility of wages, in short, cause the ignorant racist manager to behave as an enlightened liberal.

Now introduce a minimum wage and let the supermarket manager be without a racist atom in her body. As in the previous example, grocery retailing is highly competitive. In this instance, however, the minimum wage ensures that the number of applicants for jobs at the supermarket exceeds the number of jobs available. This nonracist manager then must choose which applicants, from a relatively large pool, to hire at the minimum wage. The black applicant was schooled in poor-quality government schools while the white applicant went to an excellent private school. The black applicant must rely upon public transportation while the white applicant has his own car. The black applicant lives with her single mother and might often have to stay home to care for her younger siblings, while the white applicant has no such family constraints.

Which of the two applicants will the manager hire? The white applicant – not because the manager is racist but because the minimum wage prevents the black applicant from offering to work at a lower wage in order to compensate the employer for this applicant’s handicaps. The minimum wage, in short, causes the enlightened nonracist manager to behave as would a racist.

The above doesn’t deny the reality of racism. Instead, it’s a plea to replace childish explanations based on attitudes such as racism, with adult explanations based upon scientific analyses of the complex realities of constraints and opportunities. Leveling charges of racism is easy and fills accusers with a gratifying sense of self-righteousness. Further and deeper thought about the matter is thus discouraged. But such charges, because they’re knee-jerk, are nearly always shallow. Worse, they divert our attention from the true, if less emotionally rousing, sources of problems.

Sincerely,
Don

Quotation of the Day…

(Don Boudreaux)

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… is from page 989 of Will Durant’s 1950 volume, The Age of Faith:

[A]bout 830 the Hindu numerals entered Eastern Islam about 1000 Gerbert brought them to France; in the eleventh and twelfth centuries Greek, Arabic, and Hebrew mathematics streamed into Western Europe through Spain and Sicily, and came with Italian merchants to Venice and Genoa, Amalfi and Pisa. Transmission is to civilization what reproduction is to life.

DBx: Yes. Just look around you.

And yet many people, right and left, deny this reality. On the political right we find some people pushing xenophobia, as well as bigotry for (what they imagine to be) “the” national culture. On the political left, we find some people who, the moment after they ostentatiously and self-righteously denounce the bigotry of the right, proceed to display their own, equally obnoxious bigotry by condemning so-called “cultural appropriation”: “Group X isn’t fit to mimic or absorb any of the cultural ways of group Y!”

Group X’s xenophobes on the right insist that group X is too superior or advanced to group Y to have its – group X’s – culture polluted with the different ways of the Ys. Group X’s bigots on the left insist that group X is too inferior or backward to legitimately adopt any of the different ways of the Ys. And bigots of both sorts look with ignorant contempt upon trade, which is the great transmitter and improver of cultures.

Bigots on both the right and left oppose free trade and cultural mixing – which is to say, oppose the progress of civilization.

Are Scandinavian Welfare States Rooted in Viking Slaveholding?

(Don Boudreaux)

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Scandinavian welfare states are admired by many people the world over, and are regarded as perhaps as close to ideal as welfare states can be in reality. But were I convinced that Scandinavian welfare states are evil and cannot possibly survive of their own accord, I might launch a ‘research’ program sparked by this passage on pages 112-113 of Mark Kurlansky’s wonderful 2002 book, Salt: A World History:

But without salt, meat and fish were too perishable, and all the [medieval-era] Vikings had to trade were tools made from walrus tusk and reindeer antler. In search of a trading commodity, they raided coastal communities in northern Europe, kidnapped people, and sold them into slavery, which is why they are still remembered for their brutality.

If the reasoning of the practitioners of the so-called “New History of Capitalism” is valid, then the following argument is also valid:

Although Viking slaveholding ended long ago, the wealth that Viking slaveholders extracted from their slaves enabled Vikings to accumulate excess, unearned wealth. This slave-extracted wealth – lasting and growing automatically through the ages (as, of course, wealth does) – enables modern governments throughout Scandinavia to create and maintain costly and soul-crushing welfare states. The fact that many citizens of Scandinavian countries today seem to approve of their welfare states proves only that this oppressive institution brainwashes its victims into not only compliance with its commands and conditions, but into seeming approval of these.

The thesis’s logic, after all, is impeccable and indisputable: Vikings raid foreign lands ⇒ Vikings enslave many of the denizens of these lands ⇒ Vikings extract wealth from the labor of their slaves ⇒ the fruits of this extracted wealth is used today to fund oppressive welfare states throughout Scandinavia.

Plain as day! It’s astonishing that no one until now has stumbled upon this thesis. I will name my thesis the New History of Welfare States. Because this thesis is obviously correct, we can be sure that anyone who questions it is either so ignorant of facts and logic as to be unworthy of attention, or – more likely – intellectual mercenaries hired with dark money by evil oligarchs who support these welfare states. I mean, seriously, what other explanations for resistance to my thesis can there possibly be?

…..

Of course, this so-called ‘thesis’ of mine is rank idiocy. Only the most puerile mind would entertain it for as much as a micro-moment. Yet in substance and logic my ‘thesis’ is on par with the New History of Capitalism – a ‘history’ that claims to show that capitalism today (especially American capitalism), and the wealth that capitalism today produces, is rooted in the chattel slavery that ended in the U.S. more than 150 years ago.

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My intrepid Mercatus Center colleague, Veronique de Rugy, is thankful for the work of low-skilled workers. A slice:

Before I begin, I want to challenge an increasingly popular fallacy. It has become a talking point of the political left to insist there are no such thing as low-skilled workers. Rep. Alexandria Ocasio-Cortez (D–N.Y.) for example, tweeted earlier this year that “the suggestion that any job is ‘low skill’ is a myth perpetuated by wealthy interests to justify inhumane working conditions, little/no healthcare, and low wages.” Many have since jumped on the bandwagon to make the same point. But it’s utter nonsense.

If simply calling workers “low-skilled” allowed employers to underpay and overwork them, then every worker in America would be labeled as such and paid a pittance, including professional sports stars and neurosurgeons.

Juliette Sellgren talks further with Colin Grabow about the cronyist and economically destructive Jones Act.

Emma Camp encourages us liberty-minded people to remember and be thankful for Roger Williams. Two slices:

While the Thanksgiving holiday is normally spent in memory of the semi-mythical 1621 feast between recently arrived Puritans and local Native Americans, a settler who arrived a decade later is a much better-suited hero for the more liberty-minded among us.

Roger Williams, known best as the founder of Rhode Island, was a Puritan minister, an early advocate for the separation of church and state, and, as writer Sarah Vowell describes in her 2008 book on the early Massachusetts Bay Colony, “a fully-formed crank, a man whom even Puritans dismiss as a tad too fanatical.”

However, Vowell has a soft spot for the oft-zealous minister—one I and many other libertarians share. As she writes, despite William’s eccentricity and fanaticism, “He is nevertheless principled, self-confident, forthright, and true to himself.”

…..

Williams was a unique character in America’s early colonial history. Driven by, above all else, a fierce devotion to a demanding God, Williams was nonetheless unwilling to use that devotion to justify punishing dissenters. Ironically, one of the most stridently zealous Puritans ended up building one of the world’s first secular governments.

Arnold Kling gives examples of what annoys him. A slice:

Which finally brings me to Matt Yglesias. At the risk of being uncharitable, I find that Yglesias personifies naive realism, meaning that he writes as if he is utterly convinced that his view of the world is the true one.

Often, he comes up with ways to solve problems using technocratic ideas. One recent inspiration is to spend a fortune on research to develop plant-based alternatives to meat. Not his own money, of course, but money from taxpayers. The goal is to eventually come up with products that are cost-competitive and taste-competitive with meat, with lower carbon dioxide emissions than the meat production cycle.

Yglesias does not talk about the possibility that the project could fail along some dimension. He does not mention that $3.8 trillion invested in renewable energy over the past ten years reduced the share of fossil fuels in energy consumption by just 1 percent. He does not talk about risks, such as the possibility that artificial meat will require additives that when consumed in large quantities turn out to cause cancer. He does not talk about how this sort of program typically turns into a keg party for rent-seekers.

There is no room for doubt. Since he has a solution to a problem, then by golly, he has a solution. And government is just the institution to implement it.

David Henderson applauds economics’s humanity.

Donald Kochan, a GMU colleague over in the Scalia law school, argues in today’s Wall Street Journal that “[c]ountries should lose sovereign immunity if they fund suits here.” A slice:

Litigation financing is normally done through confidential contracts, and disclosure generally isn’t required. Researchers are mostly in the dark about the extent of control by funders or the number and types of cases they influence. Thus the overall effects of litigation financing on American innovation and economic dynamism can’t be measured.

The U.S. Chamber of Commerce Institute for Legal Reform warns of the foreign danger in a Nov. 2 report titled “A New Threat: The National Security Risk of Third Party Litigation Funding.” Foreign financiers might see this opaque third-party funding mechanism as an exploitable fissure in the U.S. legal system through which to weaponize the courts for strategic goals.

Foreign adversaries can fund frivolous litigation to overwhelm U.S. courts, target lawsuits to weaken critical industries, or obtain confidential materials through the discovery process. Enemy funders might also push theories or use court filings as part of the well-documented disinformation campaigns they already wage through social media.

The report recommends disclosure and transparency requirements to reveal the existence of litigation financing by foreign states or their agents. But this threat requires an even more serious response: If a foreign adversary is funding lawsuits in the U.S., that country should be deemed to have waived its immunity from being sued in U.S. courts. This should apply to all cases, even those it isn’t funding. Congress should amend the Foreign Sovereign Immunities Act accordingly.

Telegraph columnist Allison Pearson decries the continuing infantilization of higher education. A slice:

The English department at the University of Greenwich in London has issued a trigger warning for Samuel Taylor Coleridge’s Rime of the Ancient Mariner. Not only does the 1798 poem feature the shooting of an albatross with a crossbow, which is clearly upsetting to the anxious, herbivore students of today, it also contains references to “supernatural possession” and “human death”.

I remember studying the Ancient Mariner at university with no noticeable ill effects, but that was back in the days when we still had “women” and “men” who were allowed to fancy each other so maybe we weren’t enlightened enough to be offended.

The Wall Street Journal‘s Editorial Board is unsurprisingly unsurprised by the failure and futility – from the perspective of the Chinese people – of the Chinese state’s tyrannical policy of zero covid. A slice:

Remember when China’s handling of Covid-19 was supposed to be a global model? Western public-health sages looked fondly on Beijing’s zero-Covid policy as an alternative to America’s messy democratic decision to live with the virus after the disastrous initial lockdowns. Well, so much for that.

As the third anniversary of the Covid outbreak nears, China is reporting record infections. The daily highs are surpassing April’s surge in Shanghai, which shut down for two months. Outbreaks are occurring across China, and cities are again imposing lockdowns. Nomura, the Japanese brokerage, estimates that more than a fifth of the country is under restricted movement.

David Bell busts four myths about pandemic preparedness.

Quotation of the Day…

(Don Boudreaux)

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… is from page 62 of Israel Kirzner’s March 1992 South African Journal of Economics paper, “Subjectivism, Freedom and Economic Law” as this paper is reprinted in Austrian Subjectivism and the Emergence of Entrepreneurship Theory, (Peter J. Boettke and Frédéric Sautet, eds., 2015), which is a volume in The Collected Works of Israel M. Kirzner:

Physical realities and constraints have, of course, enormously important consequences for economic outcomes. But the subjectivist must insist that economic outcomes are not determined by any objective physical phenomena whatever. All the powerful influences exercised upon human affairs by external phenomena are exercised strictly through the intermediation of active human minds. Because of this process of intermediation, outcomes are simply not uniquely implied by external phenomena.

Quotation of the Day…

(Don Boudreaux)

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… is from pages 227-228 of Samuel Gregg’s superb 2022 book, The Next American Economy: Nation, State, and Markets in an Uncertain World:

Part of [Adam] Smith’s critique of eighteenth-century mercantilism was that it exacerbated the potential for international conflict. Thanks to its beggar-thy-neighbor conception of wealth, mercantilism encouraged governments to think that national prosperity could only come at others’ expense. This mindset stimulated national rivalries, whether it concerned territory in Europe or colonies and trading rights in the Americas, Africa, and Asia. To the extent that free trade undermined many of these sources of conflict, Smith thought that it could encourage greater peace among nations.

DBx: And Smith was correct.

That the beggar-thy-neighbor view – that the zero-sum conception – of the international economy is still prevalent is made clear by the rantings, complaints, and interventionist proposals of Donald Trump and his ilk. But Trump and Trumpians aren’t alone. The very same misunderstanding of the nature of trade is held by non-Trumpian ‘national conservatives,’ as well as by most progressives. Indeed, this misunderstanding is the dominant view across the political and ideological spectra. The fact that non-Trumpians are usually a bit less bellicose than are Trumpians when they describe international trade as being a ‘competition’ of ‘our’ country versus some other country, or versus the rest of the world, doesn’t dilute the substance of their error – an error that’s both impoverishing and dangerous.

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(Don Boudreaux)

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Mike Rowe talks with Justin Hart about the government’s response to covid.

The Wall Street Journal‘s Editorial Board decries one of the many consequences of covid panic – specifically, politicians’ continued use of the U.S. government’s ’emergency’ powers to violate the Constitution as they buy votes. A slice:

The Administration last extended the [student-loan-repayment] moratorium through December when it announced its student loan write-off in August. Few borrowers needed it. The unemployment rate among college grads (1.9%) is similar to pre-pandemic levels. A Federal Reserve study in May found that “borrowers have seen their financial positions improve during the pandemic,” owing in part to generous government transfer payments, including $3,600 child tax credits and $3,200 in stimulus checks. Delinquency rates on auto loans and credit cards are below pre-pandemic levels.

The two-and-a-half-year pause has saved the average borrower $400 a month, which many have saved, invested or used to pay off higher-yielding debt. Yet it has also cost taxpayers $155 billion to date since interest isn’t accruing on student debt that Uncle Sam is financing with debt that carries increasing interest rates. This latest extension would start in January, and if the litigation isn’t ended by June 30 payments would be delayed for another 60 days after that. This could cost another $40 billion.

None of this money has been appropriated by Congress. The Administration cites the same legal justification—the 2003 Heroes Act—for extending the payment moratorium as it has for canceling debt outright. It claims the law allows the Education Secretary to waive any regulatory or statutory provision related to the federal student aid program during a national emergency.

Also decrying the opportunistic exploitation of covid ’emergency’ powers is Elizabeth Nolan Brown.

Jeffrey Tucker justifiably admires Dr. Joseph Ladapo.

David Henderson laments the damage done to society by covid hysteria and lockdowns.

Vinay Prasad tweets: (HT Martin Kulldorff)

Marty [Makary] is right; he [Fauci] funded 0 RCTs [randomized control trials] of masking; 0 of masking kids; 0 of bivalent boosters, etc. most of his policy recommendations lack data. Bizarre to be so confident and claim you are science itself.

James Harrigan and Antony Davies ponder the war on poverty. Here’s their conclusion:

We fought a war on poverty in the United States, and the bureaucracy won. Yet, poverty in the United States is not extreme poverty, not by a long shot. And extreme poverty in the rest of the world is vanishing, bit by bit, day by day. And for that, we have economic freedom to thank.

My GMU Econ colleague Dan Klein joins with Caroline Breashears to present Adam Smith’s works as a whole.

Scott Lincicome reports on the continuing economic damage done by protectionism.

John Stossel looks back on the Plymouth pilgrims’ failed experiment with socialism.