Category: free trade & free markets

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free trade & free markets nannyism too much government

Kids Demand Right to Chores

“The Department of Labor is poised to put the finishing touches on a rule that would apply child labor laws to children working on family farms,” Daily Caller’s Patrick Richardson reported on Wednesday, “prohibiting them from performing a list of jobs on their own families’ land.”

Somewhere, farm kids high-fived each other.Rusty tractor

But not Rossie Blinson of Buis Creek, NC. Now in college, Blinson expressed concern that the new rule would shortchange young people. “I started showing sheep when I was four years old. I started with cattle around eight,” Blinson declared. “It’s been very important. I learned a lot of responsibility being a farm kid.”

Minnesotan John Weber, 19, argued that the proposed regulation would “prevent a lot of interest in agriculture. It’s harder to get a 16-year-old interested in farming than a 12-year-old.” Weber is majoring in Agriculture at college and credits working on his grandparents’ and uncle’s farms with instilling a “work ethic” in him. “It gave me a lot of direction and opportunity in my life.”

In high school, Weber took out a loan to purchase a few steers to raise and sell. “Under these regulations, I wouldn’t be allowed to do that.”

Further, the regs would forbid groups like 4-H and FFA from providing safety training, mandating, instead, a 90-hour federal government course.

Oh, but wait a second . . . it must be an election year or something! “Citing public outrage,” informs a notice posted on the Daily Caller story after business hours last night, “the Department of Labor has withdrawn the controversial rulemaking proposal described in this article.”

My goodness, that’s actually common sense! I’m Paul Jacob.

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education and schooling free trade & free markets too much government

Harvard Shrugs

Wait for it: There’s another financial bubble ready to pop.

I’m not an economist, so I could be as wrong as, uh, a Keynesian strung out on (and pushing) “economic stimulus.” But the usual signs of an over-priced market sure seem to apply to higher education, today. After all, colleges and universities are sustained and over-fed by massive debt . . . in this case, government-guaranteed student loans, now passing the trillion-dollar mark.Harvard Shrugs

From your local community college to the Ivy League, the whole industry reeks of insider advantages, constricted supply and inflated demand. So of course prices rise.

Beyond all reason.

The latest sign on the way to the bubble’s bursting comes from Harvard. That august institution’s Faculty Advisory Council for the Library issued a memorandum last week declaring that the cost of subscribing to peer-reviewed journals has become too great to bear. Robert T. Gonzaleaz, writing at io9, puts this news in perspective:

What does it say about the world of academic publishing, the accessibility of knowledge, and the flow of information when the richest academic institution on the planet cannot afford to continue paying for its peer-reviewed journal subscriptions?

When I look at the prices of textbooks and journals and academic books, I wince. Were this industry marked by laissez-faire policies and free markets, the typical leftist “anti-greed/anti-business” attitude might make sense. But this is an industry riddled with government intrusion, as far-reaching as the intrusions into housing and banking that led to 2008’s financial debacle.

How could the over-sold, over-subsidized, over-controlled college-university industry remain immune to a similar catastrophic deflation?

This is Common Sense. I’m Paul Jacob.

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free trade & free markets too much government

Censoring a Diet

North Carolina, like many states, licenses all sorts of businesses activity, especially enterprises related to medicine. That’s why the state’s Board of Dietetics and Nutrition is gearing up to jail a blogger. According to the Carolina Journal Online,

Chapter 90, Article 25 of the North Carolina General Statutes makes it a misdemeanor to “practice dietetics or nutrition” without a license. According to the law, “practicing” nutrition includes “assessing the nutritional needs of individuals and groups” and “providing nutrition counseling.”

Steve Cooksey has learned that the definition, at least in the eyes of the state board, is expansive.

Cooksey had been hospitalized for diabetes in February 2009, and decided to take a major, independent step towards his health, beginning a low-carb, high-protein diet dubbed the paleo (or “cave man”) diet. Within 30 days, he claims, he was off insulin; within a few months he had shed off 45 pounds.

He started his blog, Diabetes-Warrior.net, to chronicle his progress and help others achieve similar success. But after he challenged a local, certified nutrition expert at his local church, the state board went after him, especially objecting to his Q&A section: “If people are writing you with diabetic specific questions and you are responding, you are no longer just providing information — you are counseling.”

Need a license for that!

Journalist Brian Doherty wittily asserts “that someone should be able to describe his experiences . . . and advocate for his own good results should go without saying, though my saying that may well contradict a directive of the California Board of Going Without Saying.”

We don’t need another bureau.

Getting rid of some that we have might be the best policy diet.

This is Common Sense. I’m Paul Jacob.

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free trade & free markets ideological culture tax policy

Unfuzzying Up the Past

We hear a lot of talk about the disappearing middle class. Sometimes this jabber goes so far as to posit that normal folks — say, the “99 percent” — haven’t really experienced any progress since the ’60 or ’70s.

So blame the rich. And their government.

It’s not an implausible case. Wealthy interests do rent politicians at extravagant rates, changing policy in their favor.

But as economist Russ Roberts and Cornell University’s Richard Burkhauser discussed recently, sloppy statistics feed the hand-wringing over middle-class decline. Considering government transfer payments from rich to poor and plotting income by household rather than individually, the basic “stagnation” thesis doesn’t pass the “smell test.”

For the real stink, however, consult the Internet memes, particularly this goofy contention:

In the 1950s and 1960s when the top tax rate was 70-92%, we laid the interstate system, built the Internet, put a man on the moon, defeated Communism, our education system was the envy of the world, our middle class thriving, our economy unparalleled. You want that back? Raise taxes on the rich.

Forget the obvious nonsense (ARPANET was the Internet only in ovo; Communism collapsed in the ’80s), and concentrate on the main points, as Tom Woods has done: tax evasion was rampant back in the alleged “good ol’ days”; public schools have doubled in per capita spending since then, and not improved; and the stagflationary ’70s followed the booming ’60s, almost certainly as a consequence of the policies being touted, here.

Selective memories help in constructing just-so policy “proofs.” The middle class has received some big hits, I grant you. Still, we’ve seen progress, too.

This is Common Sense. I’m Paul Jacob.

 

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free trade & free markets too much government

The Shape of Bills to Come

Q. Why are the bills on farmers’ feed caps rounded?

A. So they fit inside the mailbox as each farmer roots around for his government check.

Old joke — and a useful reminder of how subsidy-dependent agriculture has become. Scott Faber, writing in The Washington Times, barrels right into the subject:

From 1995 to 2010, taxpayers provided nearly a quarter-trillion dollars in subsidies to farm businesses. Only one-third of America’s farmers grow crops that are even eligible for these subsidies, and the top 10 percent of these operations collected 74 percent of available funds. More and more farm payments are being delivered as premium subsidies for farm insurance policies. As more farm businesses purchased government-subsidized insurance, the cost to taxpayers has exploded: from $2.4 billion in 2001 to nearly $9 billion in 2011.

So the joke doesn’t quite limn the nature of today’s agribiz subsidies, which tend to be concentrated in the bigger businesses, not the more sympathetic “family farm.”

Faber notes that, today, as profits rise so do discoveries of insurance fraud . . . and yet farm lobbyists now trot out subsidy extension packages, even to the point of erecting new entitlement programs.

Just what we need, an even more dirigiste agricultural policy.

Faber proposes to cut back on covering farmers’ “shallow” losses — cover “deep” ones only. Move away from an agribiz “entitlement” system. Help reduce the federal deficit, not pile up more bushels of debt. That’s a start, at least.

Certainly, something must be done: Farm legislation is up for renewal this year.

But will Midwestern politicians wearing feed caps dare cut back?

This is Common Sense. I’m Paul Jacob.

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free trade & free markets too much government

X Marks the Mistake

Take subject X. What if nearly everything we’re told about X — by the most famous experts and by people in government, as well as most folks in the media — is wrong?

Let X be diet. Maybe the whole “anti-fat” idea, dominant for most of my adult life, is wrong. There’s evidence for it.

Let X be AGW, the theory of anthropogenic (human-caused) global warming. We’re told that there’s a consensus in favor of it. But there’s less to that alleged consensus than meets the eye — or scientific rigor.

But to really blow your mind, consider central banking.

We’re told that the job of the central bank is to protect us from the fluctuations of boom and bust. The Federal Reserve was established by the federal government just to help us! But . . . what if that was never the actual reason that banks have been centralized?

Economist George Selgin posted, last week, a thorough debunking of Federal Reserve Chairman Ben Bernanke’s recent statements about what he’s up to. If you have never heard of free banking before, or the long tradition of central banking criticism among monetary economists, Selgin’s critique may seem outrageous . . . as outrageous as Copernicus and Galileo were back when most folks thought the Earth was the center of the universe.

If Selgin is right (and I think he is), nearly everything we’ve been told by experts and politicians about money, boom and bust, and banking, is wrong.

The central banking school is X.  X is wrong.

So if the Fed doesn’t do what it’s “supposed to,” why do we have it?

It serves big government and some big bankers.

This is Common Sense. I’m Paul Jacob.

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free trade & free markets ideological culture too much government

From Local to Federal

Both the politics of “getting what we want” and the politics of reasonable principles — too often two very different things — rely, ultimately, upon the local, upon voters in actual communities.

In a review of a book with the provocative title How Local Politics Shapes Federal Policy, economist Robert Meiners considers the political economy of America’s most famous dam:

[M]ultiple states wrestled for control of the multi-state Colorado River and for control of the electricity that might be generated. When there is a pot of gold on the table, the stakes are high. Eastern interests opposed the dam. The rhetoric was about “states’ rights” . . . but likely had more to do with eastern members of the legislature seeing no benefit, only costs, for themselves. Again, assuming the dam had net benefits, there is no reason the national government needed to be involved in a project that provide benefits to six states at best.

The book’s author tells the story in terms of ideology, but the reviewer counters that it looks, to him, “more like traditional rent-seeking and logrolling. . . .” Our folks in Congress “constantly think about how to satisfy local interests at the expense of non-local taxpayers,” and that’s certainly the current problem.

And here ideology comes back into the picture. If you think that some people’s lives or property should be sacrificed for some other people’s lives and property, then the ultimate result is the mess we have today. Voters have little option but to take a stand and “ideologically” place limits on politicians and their very own selves.

In our limits, our liberty.

Lacking those limits, we’re each others’ hosts and leeches.

This is Common Sense. I’m Paul Jacob.

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free trade & free markets national politics & policies too much government

The $820 Billion Oops

Getting good estimates is not easy. Anyone who’s hired a contractor knows to make sure the estimates are sound by insisting that bidders stick to their estimates.

This is not what happens in government, though. Projects almost always start out with a whopping figure for an estimate . . . and then as the project gears up the costs shoot higher and higher — it soon becomes clear that the high initial cost estimate was a low-ball figure after all.

My “favorite” recent example of this has been California’s high-speed rail project, which soared by the billions before even breaking ground.

But move over, transit. Here’s medicine — 2008’s Patient Protection and Affordable Care Act, better known as “Obamacare,” has just received an estimate upgrade. When passed, the legislation’s enthusiasts boasted a ten-year cost estimate of “only” $940 billion. Now, the Congressional Budget Office has revised the decade’s cost tally up to $1.76 trillion.

According to Philip Klein in the Washington Examiner, the CBO says that weakness in the economy leads to more people “obtaining insurance through Medicaid than it estimated a year ago at a greater cost to the government . . . fewer people will be getting insurance through their employers or the health care law’s new subsidized insurance exchanges.”

I “daringly” predict that this estimate, too, will turn out to be woefully below the actual figure . . . unless something novel happens, like Americans rallying around a “throw the bums out” campaign to elect a Congress and a President that will surgically remove Obamacare from the body politic. Before it kills us.

This is Common Sense. I’m Paul Jacob.

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free trade & free markets national politics & policies too much government

Blame Policy

Petroleum-based fuels are going up in price, so naturally people start looking for someone to blame. Call up the Usual Suspects:

  1. Speculators. These futures market folks never get credit for lowering the prices of gas, but they can always be counted on to serve as easy “bad guy” targets when prices go up. Same this time. You’ve heard the rumors, the rancor. (It’s nuts.)
  2. President Obama. You know, for not allowing drilling and pipelines and such. Go to a meeting of conservatives and you’ll hear someone yell out “Drill, baby, drill!” Now, I’m all for drilling, and it’s stupid to clamp down on future supplies of oil — indeed, investors in the futures market for oil see these political and bureaucratic restrictions on exploration and mining and refining, etc., and no doubt bid up the price of oil — but really, don’t blame just Obama, blame, also,
  3. Romney and Santorum and Gingrich. All these presidential candidates have engaged in hysterical, belligerent rhetoric about Iran, threatening warfare in the Persian Gulf region. War is bad for supply lines. Compromising supply lines means compromised supplies. Which means less oil. Which means rising prices.

So of course futures traders will bid up those prices — they would lose money if they didn’t — and in so doing they make the likely future conditions palpable to contemporary decision makers.

That’s their economic function. Don’t blame the messenger.

So, if you think the U.S. should bomb Iran to prevent that country from bombing the U.S. in a few years (after which the U.S. could easily make the populous nation, full of innocents, a sea of irradiated glass), don’t gripe.

One consequence will be (must be) rising prices.

This is Common Sense. I’m Paul Jacob.

 

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free trade & free markets ideological culture insider corruption

Billions and Billionaires

Where do billionaires come from?

Douglas French, president of the Ludwig von Mises Institute, reminds us where the term “millionaire” came from. It was

coined in 1720 during John Law’s “Mississippi Bubble” to describe those making vast fortunes in Law’s Mississippi Company stock that rose from 150 livres to 10,000 in the matter of months. But just as quickly, the stock and the currency wildly inflated by Law’s Banque Royale, crashed and Law was forced into exile.

Today’s plethora of billionaires — which in 15 years has increased fivefold — is (argues French) at least in part the result of Ben Bernanke’s monetary manipulations. He’s the John Law of our time. “What were once Law’s millionaires are now Bernanke’s billionaires. . . . Bernanke has been on the job for six years, and the Gates, Buffetts, and Slims of the world are reaping the benefit. But for how long?”

Keeping track of today’s billionaires has become both a form of popular entertainment (Forbes’s list) as well as a topic for careful study. The political “philanthropy” of George Soros and Charles Koch inspires both enthusiasm and dread in activists, left and right; Warren Buffett has become something of a hero to the 99 percenters, what with his repeated pitches for higher taxes on the rich.

But Buffett is a sly one. He makes his money in a variety of ways — one of which Peter Schiff recently explained: “Buffett actually stated in September 2008 that he would not have invested in Goldman Sachs if not for the implicit guarantee of federal assistance. As a result, he profited at the expense of taxpayers at the very time when they were losing their savings in the markets.”

Not all billionaires are created equal.

This is Common Sense. I’m Paul Jacob.