Sunday, December 5, 2010

White Student Union?

There's a clear double-standard going on here.  I don't mind Black Student Unions, because I know it's not really about race, it's about culture.  People want to have a place for people like them on campus, just like D&D nerds have their own club, only sometimes cultures happen to run along racial lines and people see racism where there isn't any.

So why are people who don't mind a BSU complaining about the very idea of a WSU?  I think because the automatic assumption is that a WSU would be all about "white power," "white supremacy," intolerance of non-white races.  Not many people make the same assumption about a Black Student Union, Asian Student Union, or Latino Student Union, etc.  The assumption there is that it is a social club combined with a kind of support group or whatever for people who are the (racial) minority on campus.  As I said, various minorities, and not just racial minorities, have their own similar groups.  Most people aren't into economics, most people aren't very interested in math, and most people don't go horseback riding.  That's why these groups exist.  So people can be around others with a similar interest or similar culture.

A black student who joins a SIG (special interest group) may find he gets along better and has more in common with other members of that SIG than with other black students at the BSU.  Your race does not determine your culture, or interests, etc.

Getting back to a WSU, why does the very idea seem strange or offensive, or even comical, when other racial student unions do not?  Even I would be taken aback if I were strolling through campus and saw an ad for a WSU.  I would immediately assume it was some kind of white power group at worst, or a stunt to make people think, at best.  Why do myself and others react this way?  Is it the assumption that most white people have "white privilege" and thus don't need any kind of support groups or advocates because "the system" is already rigged in their favor?

Is it because of the past mistreatment of racial minorities in this country that causes people to avoid making negative assumptions about BSUs?  I don't think the explanation is a purely political one.  For instance, I wouldn't say that the negative reaction against the idea of a WSU is solely about the fear of raising a much-needed debate about racial quotas, affirmative action, special treatment for "victim groups," etc.  The knee-jerk reaction people have for BSUs and against WSUs can't just be chalked up to liberals vs. conservatives.  I think it runs deeper than that and I think it's primarily about the fear of what a WSU might stand for (racism) rather than for any fear of making people think about race in a way different from the conventional "white privilege" narrative.

Which is not to say that plenty of dishonest people out there know very well what a sham a lot of this "white privilege" talk (I'm still waiting for my white privilege to kick in, any day now.....) is and who want to completely control the debate and do not want people to think honestly about race.  But I'd say most people are motivated against a WSU purely for concerns that anything called a "White Student Union" must be a front for some racist group.

So why does nobody ever complain about such obviously white things as Irish festivals, Scottish festivals, Oktoberfests, Renfests, or for that matter campus groups devoted to Russian, Irish, Anglo, French, German, etc.-descended students or culture?  Is it because they are specific to a particular nationality or ethnicity rather than being a blanket "white" group?  If I say "white pride, worldwide," would everybody shuffle away from me for fear I might try to set a cross on fire, but if I say "Irish pride!" then everybody will cheer and drink a pint of Guinness?  Is it because I'm talking about ethnicity rather than race?  If I proposed a Dutch Student Union, would anybody make the knee-jerk assumption that I'm trying to set up a Dutch nationalist hate group on campus?  I doubt many would leap to that conclusion.

So what is it about a WSU?  I'm really asking, because it's not entirely clear to me.  Is it the history we're taught in school, which (as far as I can remember) still being taught primarily about racial politics?  Is it because we've been trained from a very early age about white oppression so we see everything through that lens?

Another big issue is why do most white people not feel the need to create something like the WSU?  Is it because we're already the racial majority in this country, and that Western European culture and its Americanized descendant is the dominant culture?

I was thinking about a WSU and what exactly would happen there if somebody created one and it was not a hate group of any kind.  What would be its function?  Why would it exist?  What would its members do?  And then I got to thinking about why BSUs and similar groups exist.  What are their functions?  Why do they exist?  What do their members do?  This isn't a hundred years ago, where being lynched was a very real possibility, or where lawyers and political activists needed to gather and secure certain rights.  Those battles have been fought and won.  The economic and educational disparities that exist among many blacks, hispanics, American Indians, and whites, are largely due to cultural disparities (fatherlessness, aptitude to crime, job habits, study habits, dress differences, hygiene differences, all sorts of cultural things that help determine what sort of education credentials, job, income, etc. we'll have), not due to Jim Crow laws or widespread racial discrimination.  For that matter, economist Gary Becker won the Nobel partly for demonstrating that in a competitive market, racism does not determine income disparities.

Friday, November 26, 2010

A Few Thoughts On Invading Iraq--It Wasn't About Oil

On the Econlog blog, somebody in the comments asked if anybody, even the "nuttiest necon" could believe that "the Halliburton Presidency" would have invaded Iraq were it not for oil.  I replied:

The argument that the war was fought over oil never made an ounce of sense to me. In the first place, if Bush wanted to "enrich his oil buddies" as everybody on the left-wing blogs seems to think, a far simpler and less costly route would have been to lift the stupid sanctions against Iraq. He would come out as a hero for free trade, a "political genius" for splitting Iraq off from various assorted Islamofascist peeps, and not shed a drop of blood or risk his entire political career on successfully convincing the country to go to war and to stick with that war when things got hairy.

But was never out to enrich his oil buddies, he was out to topple the Iraqi government which he believed posed a serious military threat to the US.

I don't think we should have invaded but it doesn't make me see mustache-twirling plutocratic conspiracies behind every move.

Another commenter, one Andy Hallman, wrote:

[quote]The point is to have control over the flow of oil, not necessarily its price. Oil companies want the price to be high, consumers want it to be low, but both want it to keep flowing, and the US wants to be in control of that flow.[/quote]

To which I replied:

Again, that makes no sense. If "control over the flow of oil" was the goal, then Bush and Co. could have made oil drilling and whatnot far less restricted by the government here in the US. That would have been a much cheaper way to give Bush's "oil buddies" control over the flow of a major source of oil. Why plunder abroad when you can plunder at home for less cost?

I'm reposting blog comments because it's easier than trying to rewrite what I wrote.  All through the evolution of my views on the invasion of Iraq, from disapproval (before the invasion), to worry (the eve of the invasion), to tentative approval (Shock and Awe phase), to whole-hearted approval (Iraqis dancing in the street and Saddam in a cell phase), to doubt (reading what Smith and Bastiat wrote about war), to disapproval again (thinking of how free trade could have prevented this whole mess) one thing hasn't changed, and that's my view of the "anti-war" left.  I put "anti-war" in quotes because I never took seriously the claims that the left really opposes war or is in favor of peace.  Even the most die-hard "peacenik" lefty in San Fransisco will make excuses for cop killing thugs, bank robbers, and the Pol Pots and Arafats of this world.  I'm willing to accept that there are some leftists who are genuinely against war and in favor of peace and non-violence and equally condemn American militarism at the same rate they criticize Cuban totalitarianism or Black Panther thugs, in the same way that I believe there are particles of dust in the otherwise empty black abyss of outer space.

Thursday, November 25, 2010

Obama's Travel Expenses.

Conservatives, promise me you'll still complain about Presidential travel expenses when a Republican is President.  Don't just complain when it's a Democrat, and then make excuses (or ignore it) for a Republican.

Sunday, October 31, 2010

What I Hate About (Some) Conservatives and Republicans

Not every so-called conservative or Republican exhibits these behaviors, but enough do that I bristle at being called "conservative" or confused with Republicans.  They range from the small to the large, and I see them in conservative editorials and political speeches, on conservative web forums, talking to conservatives, etc.

1.  Rank ignorance of economics.  But this bugs me about everybody.  The same people who say that government stimulus spending doesn't work (and it doesn't), will in the same breath advocate spending government money on sports stadiums and teams to "stimulate the local economy."

2.  Confusing the "socialism" and "Marxism" with "statism."  One can be statist without being a Marxist or socialist.  Very few people, even many liberal Democrats, are actually socialists and Marxists, and most of the genuine socialists and Marxists are in academia or ensconced in government bureaucracies.  Not many of them actually run for office (there are exceptions, like Bernie Sanders and Barbara Lee).  You sound like an idiot when you call somebody a Marxist just because they are left-of-center.  Even being a communist does not make one a Marxist, and (believe it or not) you can be a bona fide Marxist without being a communist.  "No way!" you say?  Yes way!  Why not read Thomas Sowell's excellent book on Marx so you actually know what you're talking about?  Conservatives are always attacking Europe and other countries with large welfare states or nationalized industries as "socialist," which is sometimes true and sometimes not.  France has privatized water utilities.  We have socialized water utilities.  France has more nuclear power than we do.  There are many things about so-called socialist countries which do not fit the socialist mold, and you make yourself ill-prepared to logically defend free market economics when you've painted everything with the same broad brush.  Americans often mistake a large welfare state for socialism.  However, social services are not necessarily the same thing as socialism, and you can in theory have a free market economy and a welfare state at the same time (though I don't recommend it), in the same way that an organism can be healthy and living and growing in spite of having an ailment.  Part of the reason many other countries spend so much more on welfare state programs is because A)  they don't spend much on defense and B) they often spend their welfare state money more wisely than we do, by which I mean they ration care and cut corners all over the place.  Americans wouldn't put up with that, but generation after generation of them have grown up with rationed medical care.

3.  Protectionism.  Throw a rock in any gathering of conservatives and you'll hit somebody who on one hand claims to hate government interference in the free market, and on the other hand never met a protectionist policy they didn't like.  They can say they aren't protectionists, like Lou Dobbs claims, but they are.  They dig up arcane quotes from economists that they don't understand, dredge up discredited episodes in history, use misleading statistics that they don't know how to read, and good ol' bad reasoning to support their arguments for high tariffs, import quotas, worrying about "trade imbalances" and how to correct them, and nationalism (not to be confused with patriotism).  Free trade (not "fair trade") is simply a good policy.  "Fair trade" and protectionism aren't.  End of story.  No argument.  I can respect people who disagree with me on most issues, but two schools of "thought" for which I have nothing but contempt are socialism and it's ugly twin, protectionism.

4.  Conspiracy mongering about the NWO or globalism or some such crap.  It doesn't crop up super-often, but it does crop up.  Economic illiterates often accuse staunch free trade supporters of belonging to some NWO cabal wanting to impose one-world government, as if free trade has anything to do with that.

5.  Seeing Biblical prophecy everywhere.  Just stop.  Stop embarrassing us.  The Bible does not predict that something call the "AntiChrist" will rule the world, or that Europe will unite into one nation, or that a global government will form, etc.  There is not a shred of Scripture to back up any of this malarkey.  Reread Revelations.  Notice how the word "anti-Christ" isn't actually in there.  Revelations is about God's Kingdom.  It is a prophecy that we will not understand until it has happened, in the same way that the Old Testament prophecies about Christ were not understood until after Christ came, died, and rose again.  It is not to guide us, but to show us, after the fact, that God's Word predicted it.

6.  Remaining ignorant of other countries and cultures.  This goes hand in hand with unfounded assumptions about other countries and cultures.  Once on a conservative web forum, somebody posted pictures of Sikhs visiting Obama at the White House for a function.  All the conservatives saw the turbans the Sikhs were wearing, immediately mistook them for Muslims, and went railing on about how Obama is a secret Muslim and cavorting with the enemy.  Why not wear a dunce cap while you're at it?  This type of behavior is typical of a great many conservatives.  I talk to conservatives who seem to think that every other country in the world lives in poverty and oppression, seemingly ignorant of what it is actually like to live in Australia or France or Norway or Singapore.

7.  Mistakenly assuming that the US has anything like a free market health care system, and then trying to defend it on those grounds.  No objective observer who understands economics would mistake the US health care system, with it's 50% (give or take) government funding, myriad rules, licensing restrictions, regulatory bodies, and onerous requirements put on insurance companies.  For some reason, too many conservatives try to defend the US health care system and attack foreign socialized systems.  A few things wrong with this:  the US health care system is a government bureaucrat's dream, not a free market, and not all socialized or government universal health care systems are the same, so the same arguments against, say, Britain's NHS won't fly against Singapore's much-better government universal health care system, which is run much more like a business and less like a government bureaucracy.  Again, as with protectionism, I run into conservatives who claim to love the free market but want to protect (rather than reform or abolish) Medicare, Medicaid, etc.  A big mistake that everybody makes is that health care cost rises are simply bound to out-pace inflation in perpetuity, rather than trying to reform the system, another huge mistake is to assume that health insurance (with all of its problems) and health care (with all its problems) are one and the same issue.  The health care industry is a perfect place for free market boosters to point out the flaws in government intervention, yet this rarely happens.  I have never read a conservative editorial pointing out how licensing laws increase the costs of health care, sometimes drastically.

Wednesday, October 6, 2010

Political Analysts on TV

Now, I have a lot more important things to do, like clipping my fingernails or making sure my dresser is perfectly parallel to the wall, than to watch tv political talk shows.  But sometimes I'll sit and watch for a few minutes (and when I was younger I remember my dad watching them all of the time).  I've noticed that there are two types of "analysts" or "strategists" you see on tv political talk shows.

The first kind is the cheerleader, the my-party-is-going-to-win-and-here's-why guy.  You can safely ignore them, they are just there to fill up airtime.  The second kind is the person who actually analyzes the political scene and makes predictions about how things (particularly elections) will turn out.  Some of them are just terrible at this, like Dick Morris, who by my count is wrong on every prediction he makes.  Some, like the late Bob Novak and the hated Karl Rove, are actually very good.  They make reactions dispassionately, with no optimism and no pessimism.  I have learned from experience that Novak (before he died) and Rove are worth listening to.  I guess it's from simply observing the political scene and absorbing it for so many years, they are just in tune with what's happening.  Neither of these guys are always right, and it's not hard to find examples of their predictions gone wrong.  But these guys and others like them are right often enough, and in ways I didn't expect, to make them worthwhile (if you care about the political horse races, I for one think that election outcomes aren't nearly as important as they're made out to be because The System already has such enormous momentum and special moneyed interests guiding it and bureaucracy keeping it from deviating etc.).

The great thing about this type of analysis is that it's ideology-free.  It doesn't matter what a person's position on the flat tax is, or whether they voted for the porkulus bill, it's simply an objective matter of reading the political landscape, seeing how things are going, how voters in aggregate are feeling, etc., and making a prediction.  Two ideologically-opposite analysts, using the same methodology, could arrive at the same results.

But what I do not understand is why so few of these really-good-at-making-predictions guys are on the left.  I mean the left left, not the Larry Summers left.  I mean, I can't even think of one.  Left-leaning, sure.  Especially veteran ex-politicians who know how the Washington Machine works.  But actual socialist left?  Nope.

Key Changes I Would Like To See In Right-Wing Politics

I shy away from calling myself "right-wing" (the title of this blog notwithstanding) for a few reasons.  Namely, there are big areas of disagreement with me and most of the other right-wingers.  I'm pretty much anti-war, would like to see defense spending slashed, question the idea maintaining a standing military in the first place, want to see the government get out of marriage, and favor open immigration.

I'm certainly not left-wing though, partly because my opposition to war, the military, and strict immigration springs from different reasons than most leftists.  There's a certain crowd amongst the left that says they are anti-war but what they really hate is the American military, they really hate when a Western, relatively free country exerts itself militarily.  They have no end of excuses for dictators and terrorists the world round waging war.  These are people like Noam Chomsky or the people on Democratic Underground or Daily Kos.  I'm against war because it is costly, devastates economies, and destroys life and spreads misery.

Although in America we often think of war as a tool used to fight dictatorships and evil, more often than not war is the final stage of a simmering conflict that rose to the heights it did because of bad economic policy, specifically bad trade policy.  Pick any war, and you'll find trade barriers, embargoes, tariffs, etc. somewhere preceding it, allowing normal nation-against-nation bad attitudes to turn into outright war.  Nobody likes the French but we don't fight wars with them because they trade with us too much for war to be worth it.  Ditto China.  We *might* go to war with North Korea or Iran because, essentially, we don't trade with them enough (or at all).  A lot of people think war is about misunderstanding or hatred.  It ain't.  Those things can exist in abundance and war can still be a virtual impossibility because it would conflict with too many general and special interests.  No, war happens because, as the great economist Frederic Bastiat said, "when goods don't cross borders, soldiers will."

And yet the "anti-war" crows for "fair trade," higher barriers to trade with China, etc.  The only trade embargoes they seem to want dropped are those against communist or Islamofascist nations.  For the record, I say we should open the borders and let the trade fly between us and Cuba, N. Korea, Iran, etc.  China is a textbook example of how nations that--according to common sense--ought to hate each other and being warring with each other, are instead cooperating with each other in the form of markets.

I'm against gay marriage bans because I'm just against the government being involved in marriage at all.  I don't want to be forced to recognize a marriage I disagree with, nor should the government prohibit two people from calling themselves "married" or whatever else they want to call themselves.

I'm in favor of open immigration, but not because I want to create a pathway to citizenship, or grow the welfare rolls to create a dependent class of Democratic voters, or sign up more people to join the labor unions.  I'm in favor of open immigration because there's no good reason to be against it.  Why shouldn't I have the right to hire somebody just because they live across some border?

Yeah, Been a While

Not that anybody reads this blog, but I felt like coming back to it because I had a lot of things I needed to get off my chest and stored somewhere else.  So I'm putting those things here.

I felt moved to talk about so-called progressive Christians, even though this is largely a political/economic blog.  They come in a variety of flavors.  Many of them are downright heretical.  These are your Shelby Spongs and others who merely dispense with whatever part of God's Word they do not like.  Many others strive to maintain Biblical integrity while fostering intimate alliances with secular political movements that are inherently anti-Biblical.

So-called conservative Christians aren't perfect.  But this post isn't about them.

What I'm getting at is that for the more serious leftist Christians who are pro-life, try to stay Biblically integral, etc., but happen to favor leftist politics and leftist means, I have a really hard time taking them seriously.  I'm not questioning their faith, but I mean taking them seriously as the agents for good they think they are.

In the first place, if you are serious about minimizing poverty, your first step is to educate yourself on how affluent people and affluent countries achieved their affluence, and then try to make the rest of the impoverished world mimic those institutions and habits that brought about the affluence in the first place.  Which means that you would be in favor of continuous maximized economic growth.  While there is room for debate over particulars (especially as regards social services i.e. welfare state programs) in broad terms this means you are in favor of:

1)  unfettered free trade between nations (not "fair" trade)

2)  as little regulation as possible over the economy

3)  no price floors or price ceilings, no monkeying around with the price system at all

4)  sound monetary policy

5)  maintaining law and order

6)  maximizing market competition, minimizing government central planning

You don't have to take my word for it, you just have to ask reality.  What's the track record of central planning, or interferences with free trade?  The track record is crap.  I'll save you the time of looking at the data, but feel free.

I see a lot of progressive Christians rooting for various schemes which undermine economic growth, foster dependency rather than stimulate productivity, and focus on wealth redistribution rather than wealth creation.  That "fair trade" coffee you buy may have put some extra money in some impoverished African farmer's pocket, but you deprived his neighbor of a living by making the price for coffee artificially high and thus the demand artificially lower than it would be, which means his neighbor's supply of coffee goes unbought.  Fair trade is like unionization:  great for those few who actually get to participate, very bad for those who don't.  It's econ 101, by keeping the price at higher-than-market levels, you stimulate oversupply, but since you are keeping the price high rather than allowing it to fluctuate with supply and demand, there is a surplus of coffee.  This result's in many farmers having to sell their coffee to non-fair-trade buyers at a *lower* price than they otherwise would.  Distorting the price system is never a good thing, except to the well-connected special interests.

It doesn't take a graduate degree to learn about this, all it takes is the curiosity and the drive to understand how an economy works so that we can alleviate poverty.  It's the reason I studied economics in the first place.  But too many progressive Christians blindly swallow the leftist line about fair trade rather than listening to what hundreds of years of economic thought has to say about truly free trade.

The other big issue is that progressive Christians mistake the Biblical call for charity as a mandate for a welfare state.  Not at all.  There is nothing charitable about the government spending other peoples' money.  Charity is when I make a choice to give.  Taxes aren't a choice, they are coerced from the tax-payers.  Regardless of what you may think about the welfare state, do not blatantly misinterpret the Bible as an excuse.  Do not say that more welfare spending is required because the Bible says so, because it doesn't say so.  Defend or attack welfare on its own merits (or lack of).

Monday, March 22, 2010

A Few Thoughts on Obamacare

I see a lot of despair among those on the right, and it's hard not to join in.  Despair can feel good, it's optimism that requires hard work.  But unfounded optimism is just stupid.  That said, I'm optimistic on the whole about this whole thing.  To save a lot of space and time, here's a link to a great NRO editorial that sums up a lot of what I've been saying since last year about Obamacare.

Let me add some things that NRO did not say.

This isn't full Obamacare, this is the preliminary.  While the subsidies create a de facto socialized medical system, a genuine socialized system a la the NHS in the UK has not yet been created.  It's no secret that what the Democrats are trying to do is bankrupt the insurance industry in this country, leaving the government to step in and take its place.  Despite the sound bites Obama and Pelosi create saying that there is no government takeover of health care, you can keep your doctor and health plan if you like it, won't cost a dime, etc., they know very well that isn't true.  That is the BS that it intended to fool the great unwashed, nobody seriously believes it.  When you see somebody bringing luggage out to the driveway, and getting all of the junk out of their car, it's not hard to see that somebody is about to take a trip.

So we haven't reached the alleged point of no return.  This is all still very fixable.

Which brings me to my next point, the common complaint that this will create a welfare state we will never be able to get rid of.

First, we already have a welfare state.  Don't know if you knew that.  Well, we do.  Medicare, Medicaid, Social Security, about a jillion other programs, most of which you've never heard of, at the Federal, State, County, and City level.  It's a Frankenstein's monster of a welfare state, and nobody would purposefully design the welfare state from scratch that we have in this country.  Other countries have a much more unified, rigidly cost-contained welfare system.

Second, of course this is fixable.  This isn't like the New Deal, or the Great Society of the LBJ era, or the Civil Rights Act, all of which were quite popular at the time and won handily in the House and Senate by large margins.  Even the invasion of Iraq had broader support, both among voters and among politicians, than this.  This was a back-room, bribe-filled, passed-by-the-skin-of-their-teeth, hodge-podge of things that nobody really wants except for the far left who want to bankrupt the insurance industry so the government can take over as middle-man between consumers and health care providers.

Even on the far-left message boards they are complaining about this bill, saying nobody really wants it.  It has a two-fold purpose:  So Obama can say he won his historic fight to get health care reform, and so that the insurance industry can be quickly bankrupted and then nationalized.

It is not unprecedented for major new government programs to flop badly and be repealed.  Nixon's wage and price controls scheme is a good example.  This will be another one.  This bill IN NO WAY addresses the real problems that are driving health care costs higher every year, in fact it exacerbates them.  The NRO article summarizes pretty well what's going to happen over the next five or so years, assuming all of this passes into law and survives the numerous court challenges it will face from day one.  To say nothing of the devastation this will do to the job market.

My only worry is that we will have to wait until 2012 for a full repeal, and things could truly get nasty by then.  Depression-era unemployment levels would not surprise me.

Saturday, March 13, 2010

Screwl "Reform"

Here's the brochure, sorry, I mean the article, from the AP on Obama's education proposals.  As always, I suggest you read the whole article.

And here are my comments on some bullet points:

"A plan to overhaul the 2002 education law championed by President George W. Bush was unveiled by the Obama administration Saturday in hopes of replacing a system that in the last decade has tagged more than a third of schools as failing and created a hodgepodge of sometimes weak academic standards among states."

Only a third of our schools are failing?  I can see why the law needs to be changed, it's understating the problem.  Basically, the teacher's unions (NEVER forget the awesome importance of the labor cartels to the Democrats, they are even more important than Hollywood money) don't like having their failings pointed out.  So the focus must be on schools that are "improving," according to some phony standard.  That way the only headlines we'll ever see will be about this or that school improving, rather than the headlines we see about schools failing.

"The proposed changes call for states to adopt standards that ensure students are ready for college or a career rather than grade-level proficiency — the focus of the current law."

Okay, testing whether kids are "ready for college" depends on a universal definition of what "ready for college" means.  And with the record number of remedial English and math classes colleges have, that bar is pretty low these days.  As for testing whether kids are prepared for a career, well, the government is not qualified to do that.  Most employers have a hard enough time telling whether somebody is ready to work for them, some bureaucrat in an office in DC sure as heck ain't going to devise a scheme to tell when people are ready for a career.

Ah, but what am I thinking, this is just a pretext to add more classes like shop, woodwork, computer repair, etc.  Thus providing more employment for teachers and more money for the teachers unions (and for the Democrats).  Remember, the US public education system is NOT, repeat NOT, designed to educate.  Its purpose is to provide employment to teachers so they can hand over money to the unions in the form of dues, who can then give a cut to the Democrats.  Any actual education that happens is incidental.

"Give more rewards — money and flexibility — to high-poverty schools that are seeing big gains in student achievement and use them as a model for other schools in low-income neighborhoods that struggle with performance."

The problem with "high-poverty schools" is, and never has been, a lack of money.  All sorts of money is spent on these dumps, you would truly be shocked.  But so much of it is absorbed in administrative and labor costs and red tape, that very little of it trickles down to help the students.  Not that you need oodles of cash to provide a basic education in English, math, science, history, etc.  Many textbooks from thirty years ago are perfectly usable for a great many topics, and these schools typically wind up spending money on totally unnecessary facilities and services.

Many other countries have proven that a voucher-based system (where actual choice is involved, and you can attend a traditional public school, private school,  or some type of home-based alternative) is the way to go, but since this scares the teachers unions to death, the left is 100% opposed to it.  It would mean that they'd actually have to shape up and trim the fat from their ranks.

"Punish the lowest-performing 5 percent of schools using aggressive measures, such as having the state take over federal funding for poor students, replacing the principal and half the teaching staff or closing the school altogether."

This was put on their so they can create the impression they are being tough on failing schools.  Fear not, teacher's unions, you are well-protected.  For this "nuclear option" to be unleashed, there will undoubtedly be an insurmountable wall of hoops to jump through, i's to dot, appeals to be heard, red tape to be cut, etc.  In the same way that it's theoretically possible for a teacher to be fired, they pretty much have to murder a student on videotape for it to actually happen.

"It was criticized by educators for focusing too much on testing and not enough on learning. Daniel Domenech, executive director of the American Association of School Administrators, said he is glad to see No Child Left Behind go away.

"We're delighted over that," he said. "We have not been a fan of No Child Left Behind."

Says all you need to know.  Of course, as any REAL educator could tell you, testing is the only means by which it can be verified that actual learning has occurred.  It is not something separate from learning, it is what CONFIRMS learning.  By setting standards for tests, you are in effect setting standards for what must be learned, and thus what must be taught.

But unionized employees are terrified of an honest day's work.

A few last points to make.  First, I'm not defending the No Child Left Behind act, which I don't know much about except that it's part of the status quo.  As I said, we need radical reform, not more vote-buying stuff that helps the unions out.

Second, yes, I'm well aware that many people employed by the public education system take education seriously (I'm not counting the people who take indoctrination seriously, I mean the actual educators who want to teach math, science, reading, etc.).  These also happen to be the same people who are fed up with the politics that gets in the way of education.  Many of them have their hearts in the right place but they may not have realized the true cause of their problems or what really needs to be done about them.  Many of these people may even see a larger role for the government, in spite of it being the government in the first place that is creating these problems.

Third, yes I know Republican politicians are also beholden to their own lobbyists, whether they be agricultural firms, insurance firms, defense contractors, or whatever.  That's one of the many reasons why I do not belong to a political party and don't want to.  I'm also aware that few, if any, lobbyists (and this includes unions) are truly partisan; defense contractors will donate to Democrats, and you'll see unions donating to Republicans, etc.  Lobbyists donate to whoever they believe will be most receptive to pulling strings for them.  Some categories of lobbyists just tend to find more receptivity in one party or the other.  I have a lot to say about lobbyists but that will have to wait.

Lastly, a brief word on what I believe is the government's proper role in education.  I believe it is more limited than most people do, but nor am I a doctrinaire libertarian.  I believe that having a citizenry that is competent in English, math, and basic science and basic history and basic economics is a boon to everybody and that there is a role for the government in supplying it.  I do not believe that government needs to be involved in college education, or any kind of vocational education (I'm counting everything from welding school to medical school), as those are private goods and best provided by the free market.  I also believe that it is not up to the government to require that everybody get an education, or to define what form that education should take.  I believe that standards should be set in math, history, etc., and that competence in those areas should be confirmed with testing.  I believe it should be flexible.  If a ten-year-old can take the tests meant for 12th graders and pass, then that student should be confirmed as a 12th grader.  If a seventeen year old can only pass as high as the tests meant for fifth-graders, then that student should be confirmed as a fifth-grader.  Of course, different subjects could have different grades.  I believe that vouchers should provide for this system, and the vouchers can be spent at a private school, on home study materials, or whatever, and that parents should receive a tax credit on any voucher money they do not spend so as to give them the incentive to get the most with the least.

I do not believe in forcing education on people, I do not believe that what we now call a school system is really about education or even that education should take the prison-like form that it does now.  I think compulsory education is the second-worst environment to grow up in after prison, and no kid should be forced to attend a school where he or she is bullied, and I believe that bullies should be kicked out of school the same way they'd get kicked out of a restaurant or grocery store.

Lastly, I don't think my ideas are the be-all, end-all, in fact I could see the system evolving over time as our society adapts to the new system, but they are my suggestions for changes that could be made.  They are heavily inspired by the writings of Milton Friedman.

Saturday, January 16, 2010

Why Do I Call This Place "Right-Wing"?

It's kinda funny, especially since I personally avoid labels like liberal, conservative, libertarian, and right-wing.  In different times and different places I might be called any one of these, but I reluctantly chose right-wing for several reasons:

1:  While I'd prefer to call myself a liberal, "liberal" doesn't mean now what it meant only forty or fifty years ago.  "Classical liberal" is something I might call myself if I weren't worried about how snotty it sounds.  "Liberal" today is synonymous with left-wing, socialist, big-government, atheist, etc.  It used to mean that you believed in human freedom.  Now it means that you believe in government crushing those freedoms for the sake of "social justice."

2:  Conservative is even worse.  What is it I want to conserve?  Not enough to warrant being called one.  It means different things depending on where you are.  A conservative in China would be a communist.  Plus, I spend a lot of time arguing with self-described conservatives and I don't think I have a lot in common with them beyond being staunchly pro-life.

3:  Libertarian comes closest, and I'd use it more often if only there weren't so many wackos and anti-authoritarians who usurped it from us decent libertarians.  Fewer Ron Pauls, Art Bells, Lew Rockwells, and more Friedmans, Hayeks, and Sowells, I say.  Plus, I prefer to make my arguments for political and economic policy on pragmatic bases without resorting to subjective positions about rights or freedom.  If I'm against something, I want to show objectively why it produces bad results, not just because it offends my value system.  For example, when attacking minimum wage, I don't want to resort to arguments about the rights of employers and employees, rather I'd first want to talk about how minimum wages raise unemployment rates, in case I'm talking with somebody who isn't big on rights.  Also, some people are confused about what a libertarian is, they confuse us with libertines--not the same thing.

4:  Right-wing is even worse, but it's more familiar than libertarian.  Right-wing often has a militaristic context to it, or even a fascist one depending on who you're talking to.  "Left-wing" is a much more consistent term.  I hear people described as "right-wing" who don't agree with me on much.  People as completely dissimilar as Milton Friedman and Hitler have been described as "right-wing," bizarrely.  But I find "right-wing" a good starting point, and people really want to have a label to pin on you before they even listen to you, I find.  That's why I also call the place "re-birth," I think we need to change our thinking.  I want people to think "libertarian" when they hear "right-wing," not "fascist" or "militarist," and I want people to know what "libertarian" really means and what it's all about.

A Year-Late Rant on Delong

For those who don't know, Brad Delong is a professor of economics at UC Berkeley.  I think of him as the Grima Wormtongue to Krugman's Saruman, and a shining example of how many (most?) economists are just glorified statisticians who never really learned how to think like an economist, which is what economics is all about if you ask me.  Delong is one of the more well-known econo-bloggers and he is also famous for deleting comments that argue with his position, in the well-known tradition of non-thinkers everywhere.

Anyway, real economist from U Chicago had this to say:

"Most fiscal stimulus arguments are based on fallacies, because they ignore three basic facts.

First, if money is not going to be printed, it has to come from somewhere. If the government borrows a dollar from you, that is a dollar that you do not spend, or that you do not lend to a company to spend on new investment. Every dollar of increased government spending must correspond to one less dollar of private spending. Jobs created by stimulus spending are offset by jobs lost from the decline in private spending. We can build roads instead of factories, but fiscal stimulus can’t help us to build more of both1 . This form of “crowding out” is just accounting, and doesn't rest on any perceptions or behavioral assumptions.

Second, investment is “spending” every bit as much as is consumption. Keynesian fiscal stimulus advocates want money spent on consumption, not saved. They evaluate past stimulus programs by whether people who got stimulus money spent it on consumption goods rather than save it. But the economy overall does not care if you buy a car, or if you lend money to a company that buys a forklift.

Third, people must ignore the fact that the government will raise future taxes to pay back the debt. If you know your taxes will go up in the future, the right thing to do with a stimulus check is to buy government bonds so you can pay those higher taxes. Now the net effect of fiscal stimulus is exactly zero, except to raise future tax distortions. The classic arguments for fiscal stimulus presume that the government can systematically fool people.

The central question is whether fiscal stimulus can do anything to raise the level of output. The question is not whether the “multiplier” exceeds one – whether deficit spending raises output by more than the value of that spending. The baseline question is whether the multiplier exceeds zero.2

A cure should have something to do with the diagnosis. The classic argument for fiscal stimulus presumes that the central cause of our current economic problems is this: We, the people and our government, are not doing nearly enough borrowing and spending on consumer goods. The government must step in force us all to borrow and spend more. This diagnosis is tragically comic once said aloud."

Delong took exception with this, and had the nerve to pretend to be a learned expert correcting a newbie error, and feigned exasperation at having to correct this same type of error all of the time:

"Time to Bang My Head Against the Wall Some More (Pre-Elementary Monetary Economics Department)

Oh boy. John Cochrane does not know something that David Hume did--that the velocity of monetary circulation is an economic variable rather than a technological constant."

The velocity of money has nothing to do with this, and no where does Cochrane say that it is constant.  What's more, his reasoning does not rely on the velocity of money staying constant.  The velocity of money, for those who don't know, is how fast the money supply changes hands.  If you counted up the entire money supply and it was a million bucks, and GDP was a billion bucks in a year, you know that the money supply must have been swapped a thousand times, roughly speaking.  That would make the velocity of money one thousand.

Delong posts a story to illustrate how the changing velocity of a fixed amount of dough leads to more than that fixed amount's worth of wealth being produced.  This is elementary and doesn't bolster the fiscal stimulus theory one iota.  He begins by saying "let us take this slowly."  Okay, we will.

"Suppose that we have four agents: Alice, Beverly, Carol, and Deborah.

Suppose that Beverly has $500 in cash that she owes Carol, due in two months. Suppose that Alice and Carol are both unemployed and idle.

In one scenario in two months Beverly goes to Carol and pays her the $500. End of story."

You'll notice that the government isn't an agent in his story, yet we're supposed to imagine that the voluntary, wealth-producing transactions of this little story support fiscal stimulus.  Also note that Beverly borrowed the money and has to pay it back.  Which means Carol produced something worth $500 in the first place, and so did (or will) Beverly (in order to pay it back, assuming she didn't just borrow the money to look at it).  Delong's story begins after this first wealth creation and begins, as do most pseudo-Keynesian rationales, with the money already in existence somehow.

"In a second scenario Beverly says to Alice: "I have a house. Why don't you build a deck--I will pay you $500 after the work is done. Here is the contract." Alice takes the contract and goes to Carol. She shows the contract to Carol and says: "See. I will be good for the debt. Cook me meals so I will have the strength to build the deck--here's another contract in which I promise to pay you $500 within 90 days if you cook for me." Carol agrees.

Two months pass. Carol cooks and feeds Alice. Alice goes and builds the deck."

So far money has only been spent by people who earned the money, buying things they want at prices they are willing to pay.  This is the basis of the market and of economic growth and increased prosperity.  Carol wasn't coerced into cooking for Alice, and Alice didn't offer her a thousand dollars of somebody else's money, but the money she could earn with her productivity.  So far, resources are being used where they are most demanded, not where a government planner decides they should be used.

"Alice then asks Beverly for payment. Beverly says: "Wait a minute." She goes to Carol and says: "Here is the the $500 cash I owe you." Beverly pays the money to Carol. Beverly then says: "But now could I borrow the cash back by offering you a long-term mortgage at an attractive interest rate secured with an interest in my newly more-valuable house?" Carol says: "Sure." Beverly files an amended deed showing Carol's mortgage lien with the town office. Carol gives Beverly back the $500. Beverly then goes to Alice and pays her the $500. Alice then goes to Carol and pays her the $500."

Stories are one thing, but unfortunately hack economists often assume that people will behave like they do in their stories and models, rather than observing what people actually do.

"The net result? (a) Alice who would otherwise have been idle has been employed--has traded her labor for meals. (b) Carol who would otherwise have been idle has been employed--has traded her labor for a secured lien on Beverly's house. (c) Beverly has taken out a mortgage on her house and in exchange has gotten a deck built. (d) Carol has the $500 cash that Beverly owed her in the first place.

Alice has more income and consumption expenditure than if she hadn't taken Beverly's job offer. Carol has more income and saving than if she hadn't cooked for Alice and then invested her earnings with Beverly. Beverly has an extra capital asset (the deck) and an extra financial liability (the mortgage) than if she had never offered to hire Alice.

A deck has gotten built. Meals have been cooked and eaten. Two women have been employed. And all this has happened without printing any extra money."

Notice the assumption "who otherwise would have been idle."  In the absence of a government minimum wage, actual unemployment is typically extremely low.  Barring that, it is a self-imposed minimum wage ("I'm not working for less than fifty-thousand a year!") which leads to the remaining unemployment (I'm obviously not counting people who are in job-to-job transitions or have extenuating circumstances).  A lot of the unemployment right now is a result of the minimum wage.  Labor that is in demand is priced out of the market, which raises unemployment which lowers aggregate demand even further.  Nearly all economists recognize this, though many of the left-wing economists will continue to advocate a minimum wage for purely emotional reasons (again, glorified statisticians and political wonks).  And no, money didn't need to be printed because these are not market transactions and at no point was anybody trading something for nothing.

When I buy a car with my money, it is trade.  I get my car, and the car-seller gets all of the things he can buy with the money he gets from me.  When the government gives me money to buy a car, it's giving me somebody else's money, not my own.  They get nothing, the car-seller gets the things they can buy with the money, and me, a de facto external party to the transaction (owing to it being somebody else's money altogether), gets the external benefit of the car.  This is not trade, this is coercion.  This is not the basis of the market or of economic growth, this is taking water from the deep end of a pool and dumping it in the shallow end, then saying you've made the shallow end deeper (I stole that analogy).

If the trade isn't voluntary and I'm not using my own money (or if I'm given a government-granted discount), then the forces of supply and demand can't work their mojo, they can't guide resources to where they are most valued and away from where they are less valued.  A government subsidy to buy cars leads to more cars being produced, but this is not because more cars are demanded at the prices they sell for, rather it is because government planners demand that more cars be bought and sold.  This subsidy takes resources away from other enterprises that produce what is in actual demand (given the price).  It takes workers, investment money, human capital, equipment, time, energy, space, etc., away from things that consumers want and puts it into things that government planners want.

But it's by providing what consumers want that prosperity happens, and that economies grow.  You may be thinking "but people do want cars!"  Well yes they do, but if the full cost of these cars is not passed onto the consumer but by the tax-payer, then more cars will be bought than really ought to be, taking resources away from other areas and leading to an unsustainable car bubble.  Kind of like when the government tried to stimulate home-buying throughout the 90s and aughts.  How'd that work out?

"John Cochrane would say that this is impossible. John Cochrane would say:

[I]f money is not going to be printed, it has to come from somewhere. If Beverly borrows a dollar from Carol, that is a dollar that Carol does not spend, or does not lend to Deborah to spend on new investment. Every dollar of increased Beverly spending must correspond to one less dollar of Carol or Deborah spending. Alice's job created by Beverly spending is offset by a job lost from the decline in Carol or Deborah spending. We can build decks instead of fountains, but Beverly stimulus can’t help us to build more of both. This is just accounting, and does not need a complex argument about “crowding out”...John Cochrane is wrong."

No, Delong, YOU are wrong, spectacularly wrong.  It is hacks like you that ensure I will never join the ranks of the professional economists.  You are taking an example involving market transactions and shoe-horning a point about GOVERNMENT spending into it.  You are making a horrible straw man argument and anybody who agrees with you is a chimpanzee.  No, I don't make arguments by insulting people.  I make arguments and insult people.  :-D

Let's take this apart:

"If Beverly borrows a dollar from Carol, that is a dollar that Carol does not spend, or does not lend to Deborah to spend on new investment."

People only loan government because is is a safe investment, and that's only because the government has the power to tax.  It is not because the government produces anything that it is able to pay interest, it is merely because it has the coercive force to take peoples' money.  Note to those of you who jump to conclusions: this is not to say that the government doesn't produce anything of value, rather this is to point out that the government can pay back interest on a loan regardless of whether it is productive or not, companies can't.

If Beverly borrows a dollar from Carol, then it's because Beverly offers a good ROI, not because she is a government who can guarantee a small-but-better-than-inflation return.  And if she can offer a good ROI, it's because she produces something.  Whereas, if the government borrows money, it is literally taking money away from productive investments and putting it into the black hole that is called the Federal deficit.

"Every dollar of increased Beverly spending must correspond to one less dollar of Carol or Deborah spending. Alice's job created by Beverly spending is offset by a job lost from the decline in Carol or Deborah spending."

No, because Beverly doesn't have to borrow money, Beverly can freakin' EARN money by being productive.  Governments don't do that.  They simply tax it, or borrow it once and pay it back later with future taxes.  You are trying to make the point that Cochrane's point about government spending is absurd because if you switch "private citizen" with "government" then it doesn't make sense.  But using your logic, I can show that it's good for the economy if I steal money and spend it on stuff I want.  Instead of saying "government taxes," I just say "money I stole by other people who actually produced."

Instead of supporting the stimulus hypothesis, you've merely shown how you cannot treat private individuals and governments as if their actions have the same effect on the economy.

"We can build decks instead of fountains, but Beverly stimulus can’t help us to build more of both. This is just accounting, and does not need a complex argument about “crowding out”..."

Again, you just show the absurdity of your little story about Beverly, Alice, Carol, and Deborah by showing how absurd it is to equate governments and private individuals--and hence their actions and effect on the economy.

"John Cochrane is wrong.

You sometimes see this mistake in freshmen students in Economics 1, students who do not fully understand either the circular flow of economic activity or what a credit economy is. They think--like Cochrane--that the flow of spending must be constant unless somebody "prints money" because, you see, you need "money" in order to buy things."

I wonder if you really believe what you're saying, or if you know what a load of crap it is and you're hoping nobody will notice your rhetorical sleight of hand.  Straw man arguments is all you have here.  Cochrane never said what you are putting in his mouth, and more to the point you are once again assuming that private inviduals (who get their money by being productive) and governments (who get their money through taxes) can be treated as equal in your first story, and then you mock that very concept when you mock Cochrane.  You either don't realize your double standard or you hope nobody notices.

"Cochrane's mistake--an elementary, freshman mistake--is because he has not thought enough about how a credit economy works to recognize that the velocity of circulation can be an economic variable and is not necessarily a technological constant. And as the velocity of circulation varies, the amount of the flow of spending varies as well: it is now longer the case that if Beverly borrows a dollar from Carol that is a dollar that Carol does not spend.

Milton Friedman knew this. Irving Fisher knew this. Simon Newcomb knew this. David Hume knew this. John Cochrane does not know this: does not know that the velocity of circulation is an economic variable rather than a technological constant.

I do want to pound my head against the wall.

I do not know what else to do..."

Again you insult him, again you go out of your way to call him ignorant and a noob, and again you completely fail to support the fiscal stimulus.  All you have are examples of how market transactions lead to wealth production even with a fixed money supply.  Big deal.  Let's look at what started all of this, Cochrane's paper.

"First, if money is not going to be printed, it has to come from somewhere. If the government borrows a dollar from you, that is a dollar that you do not spend, or that you do not lend to a company to spend on new investment. Every dollar of increased government spending must correspond to one less dollar of private spending. Jobs created by stimulus spending are offset by jobs lost from the decline in private spending. We can build roads instead of factories, but fiscal stimulus can’t help us to build more of both1 . This form of “crowding out” is just accounting, and doesn't rest on any perceptions or behavioral assumptions. "

If the government wants to spend so much as a penny, it must first have the penny.  It either confiscates it with taxes, borrows it, or prints a new penny.  It has no other way of getting that penny.  So far this is true.  Delong makes the mistake (?) of thinking that this sentence is about the options private citizens have rather than governments.

Next he says that any dollar of increased government spending must correspond to one less dollar of private spending.  This is true, because governments don't earn their money, they take it.  If I have a dollar, it's because I produced a dollar's worth of wealth for somebody else.  If I spend that dollar, I'm not taking a dollar away from anybody else.  However, the government can only have a dollar, ultimately, by taking it, not by earning it through production.  So Cochrane is right.  The rest of the paragraph follows from that.