Archive for April 2015

Harrison Bergeron Meets My Little Pony

Brandon Morse wrote about the My Little Pony critique of Marxism and social justice warriors.  I couldn't really believe it, so I had to watch (or at least skim).  Check out the 25 minute mark for a taste.

And yes, I know Vonnegut intended Harrison Bergeron as a parody of the parodies of Marxist dystopias.  But it reads just fine straight up.  Or in particular, in the really well done short film version from several years ago called 2081.  If interested, skip the songs in the My Little Pony episode above and watch 2081 instead, it is barely 20 minutes long.

 

Everything You Need to Know About California Water Pricing

California is the #2 rice grower in the nation, with 22% of US production.

There is a debate growing in California about whether crops like almonds (that use a lot of water) should be allowed.  But all that authoritarian command and control debate about "allowing" certain activities is unnecessary.  Just raise prices to some sort of supply and demand matching level (it is a bit awkward to do this because there is not a true free market in water supply but any attempts have got to be better than the current absurdly low prices).  Then the almond growers themselves, and the rice growers, and the golf courses, and everyone else will decide if they can still operate in CA or not.  No politicians' commands necessary.

Raising prices also creates a secondary benefit over government-imposed rationing -- it provides incentives for people to seek out and invest in new sources of supply.  Desalinization, any one?

OK, I Relent: I Will Support A Carbon Tax If Y'all Will Stop the Torrent of Stupid

President Obama is preparing to unleash a Colorado-River-sized torrent of stupid.  He wants to spend tens of billions of dollars on goofy green energy projects that will have an indiscernible affect on world temperatures but will have a very robust effect on some crony bottom lines.   Here is one example:

As part of President Obama’s plans to combat climate change, the White House announced a program on Friday for the U.S. Department of Energy to train 75,000 people to work in the solar power industry by 2020, many of whom will be part of a military veterans jobs initiative called Solar Ready Vets.

Seriously, is the training costs of workers really a substantial portion of a solar installation?

Andrea Luecke, president and executive director of the Solar Foundation, which publishes the annual National Solar Jobs Census, said that Obama’s announcement will not likely increase the size of the solar industry’s workforce but will instead ensure that the industry will be able to find highly skilled workers to fill jobs.

“We’re experiencing difficulty finding more skilled and qualified workers to install and do design work required,” she said, adding that the industry’s workforce has a “skills gap” as well-trained electricians and other workers go back to other construction jobs as the economy gains momentum.

I will translate that trade-group speak for you:  We like to pay our workers less than similarly-skilled construction workers so we lose a lot of skilled workers to higher paying construction companies. This program will not add any net employment to the economy but will help us keep wages lower by increasing the supply of qualified workers.

I can't help but think of Henry Ford, who famously raised the wages of his employees substantially.  The fake story is that he did this so all his workers could buy his product.   The real reason he did this was that he had horrendous labor turnover problems.  Like the solar industry, he was training folks who then left for higher paying jobs.  So he had to raise his wages to retain trained people.  How history would have changed if Ford had instead been able to call Obama and ask him to have the taxpayer pay to feed him with new, trained workers so he wouldn't have to raise his wage rates!

Seriously, did a bunch of technocrats get together and study the whole solar industry and come to the conclusion that solar installation skills were the keystone problem that was holding back the whole industry?  Of course not.  The solar industry will sink or swim based on panel costs and efficiencies.   What happened is someone said, "well the public always seems to like job training programs.  Those poll well."  And then they called the solar crony association or whatever it is called and they said, "sure, we would love to have taxpayers pay some of our training costs.  Thanks, we will be very supportive." And then someone said, "well, won't the Republicans pitch a fit over this?" And then someone had the brilliant idea of making it a veterans program -- "Republicans love soldiers, that will help defuze their opposition."  And an expensive crony giveaway was born.

About 5 years ago I said I would be willing to accept a carbon tax whose proceeds were used to reduce various labor tax rates (e.g. social security).  Substituting an energy consumption tax for a labor consumption tax was probably at least neutral and maybe even a net positive.

Now, I want to come back to that idea.  I don't believe any more than I did then that CO2-driven global warming will be catastrophic.  In fact, I am more confident than ever that while CO2-induced warming is a reality, the sensitivity of temperatures to CO2 levels is relatively low.  But please, I am willing to fully support a carbon tax that offsets some other existing tax if only we will stop all this stupid crony useless green energy stuff.  At least with a carbon tax, the markets will reduce fossil fuel use in the most efficient ways possible.  As opposed to programs like this one that will reduce fossil fuel use not at all but will cost a lot of money.

Let Them Buy Whatever They Want

I am frankly exhausted with all the stories of people buying item X with food stamps that some folks fear they really should not be buying, where X is everything from liquor to twinkies.

People are either adults or they are not.  I don't think our act of charity towards them gives us the right to be their mother.  I am all for consolidating all the zillions of existing niche government benefits programs into one single EITC or similar income-floor program.  Then people spend their money however they hell they want -- if they screw up and spend on unwise things, well that is their business.

I used to have this argument all the time with my New England liberal mother-in-law.  Interestingly, in this argument, we would both call the other arrogant.  I would say she was arrogant for assuming she knew better than other adults how they should spend their own money.  She would call me arrogant for assuming that people without my background and education could make quality decisions for themselves.

Since this is my blog, I will grab the last word here.  If we were talking about having the poor choose between a number of exchange-traded derivatives, I could concede her point.  But we are essentially talking about what to buy in a supermarket.  We force everyone through 12 years of public education.  The Left pretty much gets to determine what that education encompasses.  If adults are leaving that system and still can't be trusted with their own money, then why are we even bothering?

That Mysterious, Unavailable "Correct" Price

This quote from a hotel owner in Venezuela that now asks its patrons to bring their own toilet paper caught my eye:

Camacho says she refuses to buy toilet paper from the black market on principle.

“In the black market you have to pay 110 bolivares [$0.50] for a roll of toilet paper that usually costs 17 bolivares [$ 0.08] in the supermarket,” Camacho told Fusion. “We don’t want to participate in the corruption of the black market, and I don’t have four hours a day to line up for toilet paper” at a supermarket….

I see this all the time, the notion there is somehow a "correct" price that no one is willing to charge.   There is nothing real about the 17 bolivares price.  It is a fiction.  There are only two real prices in the market -- 110 bolivares PLUS any risk/penalty from breaking the law or 17 bolivares PLUS 4 hours of your personal time.  My sense is that if the legal risk of buying on the black market is low, and you knew the average order size and the value people placed on their own time, you would find these two prices converging.  But in any case, it is dumb to continue to insist that 17 bolivares is the "right" price.

Should I Just Give Up Expecting Consistency in Public Discourse

I generally have refused to even participate in the debate over Indiana's RFRA because most of the discourse is so incredibly ill-informed that it is impossible to have a serious discussion.  But I would like to make one observation:

Here is Ruth Marcus with as good a proxy for the anti-RFRA position as I can find:

Hold whatever religious views you want: about whether women should drive, or the morality of having children out of wedlock, or whatever. Your church gets to choose (and enforce its rules). You can practice whatever your church may preach. But if you operate a business, you shouldn’t be allowed to discriminate against people based on who they are, or whom they love.

OK, that is clear enough -- if you have a business that serves the public, you must accommodate all the public equally.  You can't decide not to do business with some group of people.  But this leaves me with a question -- many of the opponents of Indiana's RFRA, from Apple Computer to the NY Times editorial page to the governor of Connecticut (which has its own RFRA, lol) called for businesses to boycott the citizens of Indiana.  Why isn't such a boycott, essentially a refusal to do business with anyone from the state of Indiana irrespective of his or her position on the RFRA, illegal/immoral under exactly Marcus's logic?  Most folks see boycotts as an important first amendment right, a way to express displeasure with a group using the power of markets, without government coersion.  But it seems to be proscribed by Marcus's definition.   Am I missing something here?

I suppose supporters of the boycott would argue that it is OK to refuse business based on political opinions but not on race or gender or sexual orientation.  But supporting the legality of gay marriage is a political opinion.  Now what?

Try as I might, I can only think of two internally consistent positions on this issue:  1.  Businesses have the freedom to accommodate whomever they want; or 2.  All businesses, perhaps as a part of the state business license requirements, must accommodate all comers no matter what.  Number one leads to some ugly, but probably rare, incidents.  Number two causes a lot of friction with other first amendment rights such as speech and religion.

Any other position must take the form of "it is legal to refuse accommodation based on some things but illegal to refuse accommodation based on other things."  There is no way to derive a dividing line between the two based on first principles, so the line becomes a political football, with no viewpoint neutrality.   Basically, accommodation law is whatever the politician of the moment says it is.  Unfortunately, this seems to be what most folks are advocating.

Things I Didn't Know: Contact Congress by Fax

I am sending a letter to my Senator.  My attorney recommended the following:

you may want to send the letter by fax, because when you send it by mail it goes to a processing place first to make sure there is no white dust in the envelope and takes a long time to get the Senator’s office.

Things I Didn't Know, Baseball Edition

If I read this right, there apparently already is a rule in baseball that the pitcher must throw every 12 seconds.  If true, that has to be the most ignored rule since the 55 MPH speed limit.

According to this site the rule reads

When the bases are unoccupied, the pitcher shall deliver the ball to the batter within 12 seconds after he receives the ball. Each time the pitcher delays the game by violating this rule, the umpire shall call “Ball.”

 

Why Minimum Wage Increases are a Terrible Anti-Poverty Program

The other day when I expressed my (temporary) ennui about blogging, I said I was tired of posting about things like "why the minimum wage is a terrible anti-poverty program" and getting back one line comments such as "you hate poor people."  In looking back at that post, I realize I actually haven't put in one place my reasons why minimum wage increases are a bad way to fight poverty.  So here they are:

1.  Only a tiny minority of workers make the minimum wage.  Something like 5% of hourly workers, and 3% of all workers, are paid minimum wage or less.  This number is not quite right for two reasons.  One, many states have higher minimum wages than the Federal rate and this analysis by the BLS is done at the Federal rate only.  Thus this understates the number of minimum wage workers in those higher minimum wage states.  But, these numbers also exclude tips, which about half these workers receive.  If one reasonably includes tip income, these numbers are overstated.  On balance, if one looks carefully state by state and excludes workers who get tips, the percentage of all workers who make the minimum wage holds around 3%.

Further, about half (53% by the source above) of minimum wage earners are 24 years old and under.  These are not the folks activists generally picture when they say "A family cannot live on that wage..."   Thus only about 1.5% of all workers are people 25 and older making minimum wage.  The target for this "anti-poverty" program is thus truly tiny.

2.  Most minimum wage earners are not poor.  The vast majority of minimum wage jobs are held as second jobs or held by second earners in a household or by the kids of affluent households (source)

casselman-minwage

 

Most of the data I have seen points to about a third of minimum wage jobs held by earners in families below the poverty line.  So 2/3 of the increased wages from a minimum wage increase go to non-poor households (it is actually probably more than this given #4 below).

3.  Most people in poverty don't make the minimum wage.  In fact, the typically hourly income of the poor appears to be around $14 an hour.  The problem is not the hourly rate, the problem is the availability of work.  The poor are poor because they don't get enough job hours.

4. Minimum wage increases kill unskilled labor hours.  You can certainly find Leftish studies that point to niche situations where a minimum wage increase maybe kindof didn't hurt employment.  But in general I think most people understand that when you raise the price of something, people will use less of it.  In this case, businesses will find ways to hire less unskilled labor as the price of such labor rises with the minimum wage.  Even if businesses hire the same number of people after a minimum wage increase, they likely will demand and get more skilled and experienced employees for this money, which likely will leave the poor out in the cold just as much as if the job were eliminated.

minwage

 

If one replaces the words "minimum wage" with "starting wage for new unskilled workers", the problem becomes more obvious.

5. Minimum wage laws ignore substantial non-monetary benefits of entry-level jobs.   Many young workers or poor workers with a spotty work record need to build a reliable work history to get better work in the future, just as a young couple must build their credit history with small purchases before they can take out a mortgage.  Further, many folks without much experience in the job market are missing critical skills -- by these I am not talking about sophisticated things like CNC machine tool programming.   I am referring to prosaic skills you likely take for granted (check your privilege!) such as showing up reliably each day for work,  overcoming the typical frictions of working with diverse teammates, and working to achieve management-set goals via a defined process.  I wrote a lot more about these here.  By defining acceptable compensation of jobs only as dollars of pay rather than to include softer skills and such, these wages disproportionately discriminate against unskilled and inexperienced workers.

Electronic Medical Records: Last Year's Silver Bullet

I was skeptical in the extreme when President Obama and other PPACA supporters  claimed so much savings would come from electronic medical records.  While in theory good, portable records might prevent some accidents and streamline care in certain emergency situations where there might not be time to take a full history, my actual experience with these systems did not give me much confidence.  And it just sounded like yet another politician's silver bullet  (HMO's were another such bullet 20 years ago).

This was a pretty powerful article about medical records and patient care.

There is no point in trying to automate the diagnostic process with an expert system AND retain the 12-year-trained doctor in the room.  It strikes me as one or the other.  Perhaps these systems are close to working fine and doctors can see themselves getting automated out of a job and this type of job is their last-ditch attempt to stop them.  Or perhaps the systems really suck and add a lot of extra time and cost.  It will be interesting when this has a chance to be fully studied.

Thanks to Harry Reid

Harry Reid should be thanked for admitting the sort of behavior everyone knows exists but none will confess.  The amazing thing to me is what yawns this elicits from the media:

Harry Reid, the top Democrat in the Senate, was asked by CNN’s Dana Bash this week if he regretted his 2012 accusation on the Senate floor that GOP presidential nominee Mitt Romney “hasn’t paid taxes for ten years.” Reid presented no evidence at the time and claimed he didn’t need any: “I don’t think the burden should be on me. The burden should be on him. He’s the one I’ve alleged has not paid any taxes.”

Reid’s response in the interview was fascinating. When asked by Bash if his tactic was McCarthyite he visibly shrugged on camera, smiled, and said “Well, they can call it whatever they want. Romney didn’t win, did he?” White House spokesman Josh Earnest refused to criticize Reid for his comment because it “was three years old,” when in reality Reid’s televised reveling in it was only three days old.

This is Strangely Awesome