Posts tagged ‘England’

Average People Used To Understand That Protectionism Was Welfare for Special Interests That Hurt Consumers. When Did This Change?

I have been watching the second season of Victoria on PBS (quite good, I think) and much of it has covered the famines of the 1840's and the debate over the Corn Laws.  At the time, it seems that average people understood that the British tariffs on imported food were in place solely to protect the agricultural profits of aristocratic (and by definition well-connected) landowners while hurting the country as a whole by raising food prices for every consumer and contributing to the famines that were sweeping Ireland and parts of England.

Trump's proposed tariffs are simply a disaster.  A lot of the media seems to believe the biggest reason they are bad is that they will incite retaliatory tariffs from other countries, which they almost certainly will.  But even if no one retaliated, even if the tariffs were purely unilateral, they would still be bad.  In case after case, they are justified as increasing the welfare of a certain number of workers in targeted industries, but they hurt the welfare of perhaps 100x more people who consume or work for companies that consume the targeted products.  Prices will rise for everyone and choices will be narrowed. This is Bastiat's classic seen and unseen -- the beneficiaries (say in the steel industry) are easy to identify, but the individual consumers who change their purchasing plans or industries that change their investment plans are frequently invisible.  It is the height of childish public policy to pretend those hurt by this don't exist merely because they can't easily be interviewed on TV.

Well, not completely invisible:

 A proposed expansion of an Exxon Mobil Corp oil refinery could be impacted by the Trump administration’s plan to place a 25 percent tariff on imported steel, a source familiar with the matter said on Thursday.

Exxon has been considering increasing its North American crude refining capacity since at least 2014, the company has said, but has not disclosed a final decision. An Exxon spokeswoman was not available for immediate comment.

 The nation’s largest oil producer has been weighing adding new processing capacity to its 362,000 barrel-per-day Beaumont, Texas, plant that could make it the nation’s largest. (Reporting by Erwin Seba Editing by James Dalgleish)

My View on the Source of Wealth in the Modern World

About 15 years ago, I wrote something I wanted to repeat here just because I keep looking for it and a lot of my old Typepad blog era stuff is hard to find.  The original post is gone but I quoted from it in 2005.

Since 1700, the GDP per capita in places like the US has risen, in real terms, over 40 fold.  This is a real increase in total wealth, created by the human mind.  And it was unleashed because the world began to change in some fundamental ways around 1700 that allowed the human mind to truly flourish.  Among these changes, I will focus on two:

  1. There was a philosophical and intellectual change where questioning established beliefs and social patterns went from being heresy and unthinkable to being acceptable, and even in vogue.  In other words, men, at first just the elite but soon everyone, were urged to use their mind rather than just relying on established beliefs
  2. There were social and political changes that greatly increased the number of people capable of entrepreneurship.  Before this time, the vast vast majority of people were locked into social positions that allowed them no flexibility to act on a good idea, even if they had one.  By starting to create a large and free middle class, first in the Netherlands and England and then in the US, more people had the ability to use their mind to create new wealth.  Whereas before, perhaps 1% or less of any population really had the freedom to truly act on their ideas, after 1700 many more people began to have this freedom. 

So today's wealth, and everything that goes with it (from shorter work hours to longer life spans) is the result of more people using their minds more freely.

At the time, perhaps to my shame, I had never even heard of Deirdre McCloskey nor her work that has been published in three volumes called the Bourgeois Era explaining what she calls the "great enrichening" (which I am slowly plowing through).  My thinking when I wrote this seems reasonably consistent with her conclusions, though she has obviously been a lot more systematic in thinking about it.  This exchange with Gregory Waymire is a short but quite readable window on her thinking.  She writes in part:

You're adopting a conventional and somewhat silly view that the bourgeoisie were especially diligent, when it is not true as fact and is anyway not the character of the bourgeoisie that
mattered to the Great Enrichment (which by the way was a factor of 30 per capita in countries that fully adopted economic liberalism, not the factor of 10 you quote: look at the passage again, and read slower and longer). Weber sometimes got this right, sometimes wrong. But people tend to read him as saying that higher savings and more diligence, Ben Franklin style (and even Ben did not actually do it), is what made us rich.

One trouble which such a conventional argument is an economic one that Solow-type models (and Smith- and Marx- and Weber- type models) that reduce growth to savings and labor effort are radically mistaken. What matters is human creativity released from ancient trammels....

What made us rich, I argue at no doubt tedious and unreadable length in the Bourgeois Era trilogy, is imagination, ingenuity, radical ideas released. They were released in turn by liberalism, Smith's "liberal plan of [social] equality, [economic] liberty, and legal [justice]."

For the Record, I Fear Pure Majoritarian Democracy as Well

One of the themes of Nancy Maclean's new book on James Buchanan as the evil genius behind a conspiracy to unravel democracy in this county.  In critiquing her critique, I meant to also make it clear that whatever Buchanan may have believed on the subject, I am certainly skeptical of pure majoritarian democracy.  For me, protection of individual rights is the role of government, and populist majoritarianism can easily conflict with this goal (this is not a new finding, we pretty much figured this out after Julius Caesar, if not before.  Here was a piece I wrote years ago I will repeat here:

Every Memorial Day, I am assaulted with various quotes from people thanking the military for fighting and dying for our right to vote.  I would bet that a depressing number of people in this country, when asked what their most important freedom was, or what made America great, would answer "the right to vote."

Now, don't get me wrong, the right to vote in a representative democracy is great and has proven a moderately effective (but not perfect) check on creeping statism.  A democracy, however, in and of itself can still be tyrannical.  After all, Hitler was voted into power in Germany, and without checks, majorities in a democracy would be free to vote away anything it wanted from the minority - their property, their liberty, even their life.   Even in the US, majorities vote to curtail the rights of minorities all the time, even when those minorities are not impinging on anyone else.  In the US today, 51% of the population have voted to take money and property of the other 49%.

In my mind, there are at least three founding principles of the United States that are far more important than the right to vote:

  • The Rule of Law. For about 99% of human history, political power has been exercised at the unchecked capricious whim of a few individuals.  The great innovation of western countries like the US, and before it England and the Netherlands, has been to subjugate the power of individuals to the rule of law.  Criminal justice, adjudication of disputes, contracts, etc. all operate based on a set of laws known to all in advance.

Today the rule of law actually faces a number of threats in this country.  One of the most important aspects of the rule of law is that legality (and illegality) can be objectively determined in a repeatable manner from written and well-understood rules.  Unfortunately, the massive regulatory and tax code structure in this country have created a set of rules that are subject to change and interpretation constantly at the whim of the regulatory body.  Every day, hundreds of people and companies find themselves facing penalties due to an arbitrary interpretation of obscure regulations (examples I have seen personally here).

  • Sanctity and Protection of Individual Rights.  Laws, though, can be changed.  In a democracy, with a strong rule of law, we could still legally pass a law that said, say, that no one is allowed to criticize or hurt the feelings of a white person.  What prevents such laws from getting passed (except at major universities) is a protection of freedom of speech, or, more broadly, a recognition that individuals have certain rights that no law or vote may take away.  These rights are typically outlined in a Constitution, but are not worth the paper they are written on unless a society has the desire and will, not to mention the political processes in place, to protect these rights and make the Constitution real.

Today, even in the US, we do a pretty mixed job of protecting individual rights, strongly protecting some (like free speech) while letting others, such as property rights or freedom of association, slide.

  • Government is our servant.  The central, really very new concept on which this country was founded is that an individual's rights do not flow from government, but are inherent to man.  That government in fact only makes sense to the extent that it is our servant in the defense of our rights, rather than as the vessel from which these rights grudgingly flow.

Statists of all stripes have tried to challenge this assumption over the last 100 years.   While their exact details have varied, every statist has tried to create some larger entity to which the individual should be subjugated:  the Proletariat, the common good, God, the master race.  They all hold in common that the government's job is to sacrifice one group to another.  A common approach among modern statists is to create a myriad of new non-rights to dilute and replace our fundamental rights as individuals.  These new non-rights, such as the "right" to health care, a job, education, or even recreation, for god sakes, are meaningless in a free society, as they can't exist unless one person is harnessed involuntarily to provide them to another person. These non-rights are the exact opposite of freedom, and in fact require enslavement and sacrifice of one group to another.

I will add that pretty much everyone, including likely Ms. Maclean, opposes majoritarian rule on many issues.  People's fear of dis-empowering the majority tends to be situational on individual issues.

Global Temperature Update

I just updated my climate presentation with data through December of 2016, so given "hottest year evah" claims, I thought I would give a brief update with the data that the media seldom ever provides.  This is only a small part of my presentation, which I will reproduce for Youtube soon (though you can see it here at Claremont-McKenna).  In this post I will address four questions:

  • Is the world still warming?
  • Is global warming accelerating?
  • Is global warming "worse than expected"?
  • Coyote, How Is Your Temperature Prediction Model Doing?

Is the world still warming:  Yes

We will use two data sets.  The first is the land surface data set from the Hadley Center in England, the primary data set used by the IPCC.  Rather than average world absolute temperature, all these charts show the variation or "anomaly" of that absolute temperature from some historical average (the zero point of which is arbitrary).  The theory is that it is easier and more accurate to aggregate anomalies across the globe than it is to average the absolute temperature.  In all my temperature charts, unless otherwise noted, the dark blue is the monthly data and the orange is a centered 5-year moving average.

You can see the El Nino / PDO-driven spike last year.  Ocean cycles like El Nino are complicated, but in short, oceans hold an order of magnitude or two more heat than the atmosphere.  There are decadal cycles where oceans will liberate heat from their depths into the atmosphere, creating surface warming, and cycles where oceans bury more heat, cooling the surface.

The other major method for aggregating global temperatures is using satellites.  I use the data from University of Alabama, Huntsville.

On this scale, the el nino peaks in 1999 and 2017 are quite obvious.  Which method, surface or satellites, gets a better result is a matter of debate.  Satellites are able to measure a larger area, but are not actually measuring the surface, they are measuring temperatures in the lower tropospehere (the troposphere's depth varies but ranges from the surface to 5-12 miles above the surface).  However, since most climate models and the IPCC show man-made warming being greatest in the lower troposphere, it seems a good place to measure.  Surface temperature records, on the other hand, are measuring exactly where we live, but can be widely spaced and are subject to a variety of biases, such as the urban heat island effect.  The station below in Tucson, located in a parking lot and surrounded by buildings, was an official part of the global warming record until my picture became widely circulated and embarrassed them in to closing it.

This argument about dueling data sets goes on constantly, and I have not even mentioned the issues of manual adjustments in the surface data set that are nearly the size of the entire global warming signal.  But we will leave these all aside with the observation that all data sources show a global warming trend.

Is Global Warming Accelerating?  No

Go into google and search "global warming accelerating".  Or just click that link.  There are a half-million results about global warming accelerating.  Heck, Google even has one of those "fact" boxes at the top that say it is:

It is interesting by the way that Google is using political advocacy groups for its "facts" nowadays.

Anyway, if global warming is so obviously accelerating that Google can list it as a fact at the top of its search page, it should be obvious from the data, right?  Well let's look.  First, here is the satellite data since I honestly believe it to be of higher quality than the surface records:

This is what I call the cherry-picking chart.  Everyone can find a peak for one end of their time scale and a valley for the other and create whatever story they want.  In economic analysis, to deal with the noise and cyclicality, one will sometimes see economic growth measured peak-to-peak, meaning from cyclical peak to the next cyclical peak, as a simple way to filter out some of the cyclicality.  I have done the same here, taking my time period as about 18 years from the peak of the 1999 El Nino to 2017 and the peak of the recent El Nino.  The exact data used for the trend is show in darker blue.  You can decide if I have been fair.

The result for this time period is a Nino to Nino warming trend of 0.11C.  Now let's look at the years before this

So the trend for 36 years is 1.2C per century but the trend for the last half of this is just 0.11C.  That does not look like acceleration to me.  One might argue that it may again accelerate in the future, but I cannot see how so many people blithely treat it as a fact that global warming has been accelerating when it clearly has not.  But maybe its just because I picked those darn satellites.  Maybe the surface temperatures show acceleration?

Nope.  Though the slow down is less dramatic, the surface temperature data never-the-less shows the same total lack of acceleration.

Is Global Warming "Worse Than Expected"?  No

The other meme one hears a lot is that global warming is "worse than expected".  Again, try the google search I linked.  Even more results, over a million this time.

To tackle this one, we have to figure out what was "expected".  Al Gore had his crazy forecasts in his movie.  One sees all kinds of apocalyptic forecasts in the media.  The IPCC has forecasts, but it tends to change them every five years and seldom goes back and revisits them, so those are hard to use.  But we have one from James Hansen, often called the father of global warming and Al Gore's mentor, from way back in 1988.  His seminal testimony in that year in front of Congress really put man-made global warming on the political map.  Here is the forecast he presented:

Unfortunately, in his scenarios, he was moving two different variables (CO2 levels and volcanoes) so it is hard to tell which one applies best to the actual history since then, but we are almost certainly between his A and B forecasts.  A lot of folks have spent time trying to compare actual temperatures to these lines, but it is very hard.  The historical temperature record Hansen was using has been manually adjusted several times since, so the historical data does not match, and it is hard to get the right zero point.  But we can eliminate the centering issues altogether if we just look at slopes -- that is all we really care about anyway.  So I have reproduced Hanson's data in the chart on the left and calculated the warming slopes in his forecast:

As it turns out, it really does not matter whether we choose the A or B scenario from Hansen, because both have about the same slope -- between 2.8C and 3.1C per century of warming from 1986 (which appears to be the actual zero date of Hansen's forecast) and today.  Compare this to 1.8C of actual warming in the surface temperature record for this same period, and 1.2C in the satellite record.  While we have seen warming, it is well under the rates predicted by Hansen.

This is a consistent result to what the IPCC found in their last assessment when they evaluated past forecasts.  The colored areas are the IPCC forecast ranges from past forecasts, the grey area was the error bar (the IPCC is a bit inconsistent when it shows error bars, including error bands seemingly only when it helps their case).  The IPCC came to the same result as I did above:   that warming had continued but was well under the pace that was "expected" form past forecasts.

By the way, the reason that many people may think that global warming is accelerating is because media mentions of global warming and severe weather events has been accelerating, leaving the impression that things are changing faster than they truly are.  I wrote an article about this effect here at Forbes.  In that I began:

The media has two bad habits that make it virtually impossible for consumers of, say, television news to get a good understanding of trends

  1. They highlight events in the tail ends of the normal distribution and authoritatively declare that these data points represent some sort of trend or shift in the mean
  2. They mistake increases in their own coverage of certain phenomenon for an increase in the frequency of the phenomenon itself.

Coyote, How Is Your Temperature Prediction Model Doing?  Great, thanks for asking

Ten years ago, purely for fun, I attempted to model past temperatures using only three inputs:  A decadal cyclical sin wave, a long-term natural warming trend out of the little ice age (of 0.36 C per century), and a man-made warming trend really kicking in around 1950 (of 0.5C per century).  I used this regression as an attribution model, to see how much of past warming might be due to man (I concluded about half of 20th century warming may be due to manmade effects).  But I keep running it to test its accuracy, again just for fun, as a predictive tool.  Here is where we are as of December of 2016 (in this case the orange line is my forecast line):

Still hanging in there:  Despite the "hottest year evah" news, temperatures in December were exactly on my prediction line.  Here is the same forecast with the 5-year centered moving average added in light blue:

What Uber Drivers Seeking Minimum Wage Are Missing

Via Engadget:

Uber drivers have won an employment tribunal case in the UK, making them entitled to holiday pay, paid rest breaks and the National Minimum Wage. The ride-hailing company has long argued that its chauffeurs are self-employed contractors, not employees; the tribunal disagreed, however, setting a major precedent for the company and its relationship with workers. GMB, the union for professional drivers in the UK, initiated the two "test cases" in July. It's described the decision as a "monumental victory" that will impact "over 30,000 drivers" in England and Wales.

"Uber drivers and thousands of others caught in the bogus self-employment trap will now enjoy the same rights as employees," Maria Ludkin, GMB's legal director said. "This outcome will be good for passengers too. Properly rewarded drivers are the same side of the coin as drivers who are properly licensed and driving well maintained and insured vehicles."

This misses a couple of things

  1. This might well kill Uber, such that the only "victory" here is that drivers have one less employment option and choice of work style.  The latter is perhaps the most important -- why does every single job have to be punch-in-punch-out with standard benefits and holidays and work hours and work rules?  Why is there no room for a diversity of work experiences from which to choose?
  2. One of the things that many Uber drivers like about Uber is that there are no set work hours or productivity expectations.  Well, that goes out the window with these rules.  Today, if Uber pays drivers only based on what they work, they don't really care how hard they work or how many jobs they take or where they choose to cruise or even if they choose to cruise at unproductive hours, like 5AM.  Currently, if you want to drive back and forth on a country lane at 4:30AM waiting for a fare, you can go for it -- you are taking the risk.  But if the company is paying minimum wage per hour, everything changes.  Suddenly they must now demand minimum productivity expectations, which will include limits on working in unproductive locations or at unproductive hours.  The company will start to rank drivers and cut the lowest productivity / lowest activity ones.

I went into these issues in more depth here.

If Westerners can't do yoga and Cinco de Mayo parties, can we have our polio vaccines back?

With news that even yoga classes are being cancelled due to fears of Westerners appropriating from other cultures, I am led to wonder -- why don't these prohibitions go both ways?  If as a white western male, I can't do yoga or host a Cinco de Mayo party or play the blues on the guitar, why does everyone else get to feed greedily from the trough of western culture?  If I can't wear a sombrero, why do other cultures get to wear Lakers jerseys, use calculus, or even have polio vaccines?  Heck, all this angst tends to occur at Universities, which are a quintessentially western cultural invention.  Isn't the very act of attending Harvard a cultural appropriation for non-Westerners?

I say this all tongue in cheek just to demonstrate how stupid this whole thing is.  Some of the greatest advances, both of science and culture, have occurred when cultures cross-pollinate.  I have read several auto-biographies of musicians and artists and  they all boil down to "I was exposed to this art/music from a different culture and it sent me off in a new direction."  The British rock and roll invasion resulted from American black blues music being dropped into England, mutating for a few years, and coming back as the Beatles and the Rolling Stones.

Or here is an even better example:  the movie"A fistful of Dollars".  That was an American western with what has become a quintessentially American actor, Clint Eastwood.  However, it was originally an Italian movie by Italian director Sergio Leone (it was not released in the US until 3 years after its Italian release).   But Sergio Leone borrowed wholesale for this movie from famed Japanese director Akiro Kurosawa's Yojimbo.  But Kurosawa himself often borrowed from American sources, fusing it with Japanese culture and history to produce many of his famous movies.  While there is some debate on this, Yojimbo appears to be based on Dashiell Hammett's Red Harvest, a classic of American noir fiction.

Memo to Vox: You Know How This Prosperity Was Achieved? We Let it Happen.

Vox shares what is perhaps the greatest achievement in human history, the continuing disappearance of absolute poverty:

roser_poverty_shares

 

Readers of this blog will likely  have seen this before (though it may well be new to Vox readers).  Here is the amazing thing about the Vox article:  It never once mentions capitalism, trade, economic freedom, or any synonym.  Here is a sampling of the tone of the accompanying article:

There's still much work to be done: 14.4 percent of the world amounts to 1 billion people who still need to be lifted out of extreme poverty. And making sure everyone's making at least $1.25 a day isn't the end of the fight either. The world's median income is still only $3 to $4 a day. By comparison, the poverty line in the US for a family of four is $16.61 per person per day. Once under-$1.25-a-day poverty is eradicated, the world needs to set about eradicating under-$15-a-day poverty, which will be a substantially harder task.

Vox is treating this like it is the result of some top-down effort, using the same language one might use to describe the eradication of Yellow Fever in Panama.  As if this resulted (and as if future progress depended on) some all-hands-on-deck technocratic government program.

No one "set about" eradicating poverty.  It happened because governments, at least to some extent, got out of the way and didn't stop it.  China is a great example.  Mao "set about" trying to eliminate poverty using many of the approaches likely favored by the Vox staff, and killed a few tens of millions of people in the process.

Here is my theory of the world's accelerating wealth formation that I have written on a number of times before.  This chart largely results from:

  • There was a philosophical and intellectual change where questioning established beliefs and social patterns wentfrom being heresy and unthinkable to being acceptable, and even in vogue. In other words, men, at first just the elite but soon everyone, were urged to use their mind rather than just relying on established beliefs and appeals to authority.
  • There were social and political changes that greatly increased the number of people capable of entrepreneurship. Before this time, the vast vast majority of people were locked into social positions that allowed them no flexibility to act on a good idea, even if they had one. By starting to create a large and free middle class, first in the Netherlands and England and then in the US, more people had the ability to use their mind to create new wealth. Whereas before, perhaps 1% or
    less of any population really had the freedom to truly act on their ideas, after 1700 many more people began to have this freedom.

So today's wealth, and everything that goes with it (from shorter work hours to longer life spans) is the result of more people using their minds more freely.

So Given My German Ancestry, Is Anything Beyond Wearing Lederhosen and Invading France Cultural Appropration?

I will say that this story honestly loses me.  

Just when you think we’ve reached Peak Sensitivity, the scolds of social justice sprinkle more sand into their underpants. The Museum of Fine Arts in Boston is currently showing a superb exhibition of the art of Hokusai. As per common practice at scholarly institutions, it is displaying related material, including an exhibition of contemporary Japanese photographers responding to the devastating earthquake that hit the northern part of the country in 2011. It also rehung La Japonaise, an 1876 canvas in its collection by Claude Monet, depicting his wife Camille in a vermillion kimono.

Among the educational programming at the MFA was “Kimono Wednesdays,” an opportunity for museumgoers to try on replica of that kimono in the presence of Monet’s canvas. It was slated for Wednesday evenings, when the museum’s entrance fee is by donation, starting June 24 and running throughout the month of July. But it didn’t make it that far.

Demonstrators showed up at the first two events bearing posters accusing the participants of grave wrongdoing. “Try on the kimono; learn what it’s like to be a racist imperialist today!” exclaimed one. “Let’s dress up Orientalism with more Orientalism,” read another. The protest had been arranged through a Facebook group named Stand Against Yellow-Face @ the MFA (the discussions have moved to a Tumblr), where the principals and their supporters expressed great umbrage. “A willingness to engage in thoughtful dialogue (or not) with museum employees and visitors on the bullshit of this white supremacist ‘costume’ event are welcome,” wrote one of the organizers.

Eventually the museum caved and even apologized.  I can understand the caving -- as the author suggested, it simply was not a hill the museum needed to die on -- but these apologies for non-crimes have got to stop.  Someone has to show some backbone in the face of these absurd pogroms.

When my family was visiting castles in England, they  often had clothes for the kids to play dress-up in medieval garb.  When my son and his friends were at Octoberfest, they bought lederhosen to wear when they attended.  When I took Spanish for years in grade school, we often did projects that emulated various Spanish cultures we were studying (such as the Mexican tradition of leaving out decorated shoes for candy and gifts).  Are these all wrong now?

I suppose if the museum had a "dress like a Kamikaze pilot" promotion or "pretend to be a comfort girl" exhibit, I could see the problem.  But trying on a kimono?  Kimono's have gone through several cycles of being fashionable in the West over the last 200 years or so (in the James Bond books, Ian Fleming often noted that Bond preferred a kimono for sleeping).

Seriously, we Americans have little in the way of home grown culture - haven't we appropriated about everything?  And so what?  The opposite of cultural appropriation in my mind is cultural apartheid.   Which in fact seems to be what some progressives are advocating for on campus, coming full-circle and apparently asking for separate but equal facilities for women and certain ethnic groups so they won't be tainted by white maleness, or whatever.

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?

Subsidies Beget Subsidies

So after spending billions to subsidize the construction and operation of wind farms, Britain has discovered that their output variability is a problem and that they produce too much of their power at night (issues many of us predicted long before they were built).  So now England is facing the policy choice of either a) paying wind farm owners to NOT product power or b) paying factory owners to switch their operations to night time.  Seriously.  For most areas, wind is among the worst possible electricity source.

Raise Medicare Taxes

I have made this argument before -- your lifetime Medicare taxes cover only about a third of the benefits you will receive.   Social Security taxes are set about right -- to the extent we come up short on Social Security, it is only because a feckless Congress spent all the excess money in the good years and has none left for the lean years.

But Medicare is seriously mis-priced.  I have always argued that this is dangerous, because there is nothing that screws up the economy more than messed up price signals.  In particular, I have argued that a lot of the glowy hazy love of Medicare by Americans is likely due to the fact that it is seriously mis-priced.  Let's price the thing right, and then we can have a real debate about whether it needs reform or is worth it.

A recent study confirms my fear that the mispricing of Medicare is distorting perceptions of its utility.

As debate over the national debt and the federal budget deficit begins to heat up again, an analysis of national polls conducted in 2013 shows that, compared with recent government reports prepared by experts, the public has different views about the need to reduce future Medicare spending to deal with the federal budget deficit. Many experts believe that future Medicare spending will have to be reduced in order to lower the federal budget deficit [1] but polls show little support (10% to 36%) for major reductions in Medicare spending for this purpose. In fact, many Americans feel so strongly that they say they would vote against candidates who favor such reductions. Many experts see Medicare as a major contributor to the federal budget deficit today, but only about one-third (31%) of the public agrees.

This analysis appears as a Special Report in the September 12, 2013, issue of New England Journal of Medicine.

One reason that many Americans believe Medicare does not contribute to the deficit is that the majority thinks Medicare recipients pay or have prepaid the cost of their health care. Medicare beneficiaries on average pay about $1 for every $3 in benefits they receive. [2] However, about two-thirds of the public believe that most Medicare recipients get benefits worth about the same (27%) or less (41%) than what they have paid in payroll taxes during their working lives and in premiums for their current coverage.

Update:  Kevin Drum writes on the same study.  Oddly, he seems to blame the fact that Americans have been trained to expect something for nothing from the government on Conservatives.  I am happy to throw Conservatives under the bus for a lot of things but I think the Left gets a lot of the blame if Americans have been fooled into thinking expensive government freebies aren't really costing them anything.

The "They Will Not Assimilate" Argument Rising Yet Again From the Grave

How many times does an argument have to be wrong, and for how long, before it finally loses credibility?  I suppose the answer must be nearly infinite, because the "they will not assimilate" argument is rising again, despite being about 0 for 19 on the groups to which it has been applied.  Germans, Irish, Italians, Eastern Europeans, Chinese, Mexicans and now Chechnyans.   This argument always seems to be treated seriously in real time and then looks stupid 20 or 30 years later.  As an extreme example, here is Benjamin Franklin writing about Germans in 1751:

why should the Palatine Boors [ie Germans] be suffered to swarm into our Settlements, and by herding together establish their Language and Manners to the Exclusion of ours? Why should Pennsylvania, founded by the English, become a Colony of Aliens, who will shortly be so numerous as to Germanize us instead of our Anglifying them, and will never adopt our Language or Customs, any more than they can acquire our Complexion.

(By the way, if you want to retain an unadulterated rosy image of Franklin, who was a great man for many reasons, do not read the last paragraph at that link.  People are complicated and sometimes even great men could not shed all the prejudices of their day.)

The only good news is that the circle of those acceptable to the xenophobic keeps getting larger.  It used to be just the English, then it was Northern Europeans, then much later it was all Europe and today I would say it is Europe and parts of Asia.  So that's progress, I suppose.

Fun fact:  Ironically, the English King at the time Franklin wrote the quote above was George II.  He was actually a German immigrant, born in Germany before his father came to England as King George I, jumping over numerous better claimants who were Catholic.  His son actually assimilated very well, as George III spoke English as a first language, and his granddaughter Victoria practically defined English-ness.  By the way, Victoria would marry another German immigrant.

Prices in Healthcare

Had an interesting discussion with my favorite New England liberal this weekend about the Time Magazine article on Hospital pricing and charges.  We both found the articles to be excellent.  But drew completely different conclusions.  She saw this all as a failure of capitalism, a sign of the inherent corruption that occurs that demands more goverment intervention.  I saw it as a totally screwed up market, from the dominance of third party payers to government-enforced monopolies (e.g. certificates of need), that killed any incentive of consumers to shop. The entire pricing mechanism is broken, and simply replacing it with a set of fiat prices from the government is not going to make things better.

Megan McArdle has a good interview with Bart Wilson on this very topic.  Here is a small excerpt:

Megan: Okay, so let me ask the obvious question: if a whole lot of health care wonks think that government-rate setting would fix health care costs, why should I be skeptical?

Wilson: Who knows the conditions of who values what and the opportunity costs of supplying health care? What set of minds in the government has the knowledge needed to make tradeoffs, to know who is best to supply this service or that one?

The values and costs of healthcare have to be discovered.

Megan: The wonks who favor rate-setting argue that health care simply isn't like any other market. For one thing, there's an information problem: how do I know if I want a heart bypass or not?

Why not let an expert who has read all the studies on heart bypasses make that decision?

Wilson: Right now, the doctor recommends to the patient what the insurance company will pay for. What incentive does the patient have to find alternatives? (None.)

There is the assumption that an expert knows all the alternatives. Doctors are not interchangeable. They know different things.

The function of a market is let us learn who will serve us sufficiently well.

Megan: So let's step back even farther, to 30,000 feet or so, for a second. What does the price do in a market? Why should I want to put a price on my lung transplant?

Wilson: A price is like a symbol at any moment of what millions of people are willing and able to do. All of the technology and services of the doctors have to be weighed against whatever else they could be applied to.

The prices of alternatives to lung transplants are doing the same thing. The difficulty is assuming that a lung transplant is "inelastic". What a price system does is find what part of say, healthcare, is on the margin.

“Inelastic” means that I’m relatively indifferent to the price. The last glass of water in a desert is the quintessential inelastic good; people will pay all they have to get it. Things can be more or less inelastic, which is to say, that demand can be more or less responsive to changes in price. Health care is often thought to be very inelastic.

Megan: But this is precisely the argument that health care wonks make: when I need a lung transplant, I don't have the time, or the emotional ability, to comparison shop. So there's no price discovery mechanism.

Wilson: Does the government know or have the ability to comparison shop for me? Do they know my circumstances?

Also, for some healthcare services, you do have the ability to comparison shop. Those services will then discipline the healthcare market in general.

Statists Write History

In today's history lesson, we have something called the "Addled Parliament."  Surely that cannot be a good name to have, and in fact the name was given as a term of derision, very like how the Left describes the current Congress as obstructionist and ineffectual.

So why did it gain the name "addled"?  It turns out, for about the same reasons the current Congress comes under derision from Obama:  It did not give the King all the money he wanted.  Via Wikipedia:

The Addled Parliament was the second Parliament of England of the reign of James I of England (following his 1604-11 Parliament), which sat between 5 April and 7 June 1614. Its name alludes to its ineffectiveness: it lasted no more than eight weeks and failed to resolve the conflict between the king, who wished to raise money in the form of a 'Benevolence', a grant of £65,000 and the House of Commons (who were resisting further taxation). It was dissolved by the king.

Parliament also saw no reason for a further grant. They had agreed to raise £200,000 per annum as part of the Great Contract and as the war with Spain had reached its resolution with the 1604 Treaty of London, they saw the King's continued financial deficit as a result of his extravagance (especially on Scottish favourites such as Robert Carr) and saw no justification for continued high spending.

Moreover there remained the continuing hostility as a result of the kings move of setting impositions without consulting Parliament.

Wow, none of that sounds familiar, huh?  In fact, James was an awful spendthrift.  Henry the VII was fiscally prudent.  Henry the VIII was a train wreck.  Elizabeth was a cheapskate but got into expensive wars, particularly in her declining years, and handed out too many government monopolies to court favorites.  But James came in and bested the whole lot, tripling Elizabeth's war time spending in peace time, mainly to lavish wealth on family and court favorites, and running up debt over 3x annual government receipts.   History, I think, pretty clearly tells us that Parliament was absolutely correct to challenge James on spending and taxes, and given that it took another century, a civil war, a Glorious Revolution, a regal head removal, and a lot of other light and noise to finally sort this issue out, it should not be surprising that this pioneering Parliament failed.  Yet we call it "addled".

College Bleg, Wesleyan (CT) Edition

My son is being recruited, at a minimum, at Bowdoin, Vassar, Wesleyan, Haverford, Kenyon and possibly Amherst and Pomona to play baseball.  We have a pretty good handle on all these schools except Wesleyan in Connecticut, which we have visited but we are having a hard time getting a read on.

In the 2011 Insider's Guide to the Colleges, Wesleyan is described as an extreme example of a college dedicated to politically correct intolerance.  The book says that the classes tend to be mainly focused on teaching kids to be radical activists rather than any traditional subject matter.  Social life is portrayed as revolving around marijuana and hallucinogens.   It is by far the most negative review we have read (well, I suppose this would not be negative to some).

We are trying to get a read on the accuracy of this.    Any of you know this school or attend it?   Is there truth to this, or does the writer have an ax to grind?   He is not naive to what he will find politically at New England liberal arts colleges. The question is not whether there is a lot of leftish political correctness - that is a baseline in all such schools.  The question is whether this school is unusually extreme.  The book makes it sound like it is Kos Kidz Academy.    Comment or send me an email.

Update:  Hmm, based on the comments, I explained myself poorly.  Nic will likely never play pro ball.  If that were his goal, we would definitely be looking to ASU or Texas.  He has decided he wants to go to a small liberal arts college.  Baseball has two synergies - one, he would like to play in college.  Two, being recruited for sports helps in the admissions process at selective schools.

There is money set aside to pay for college, from a source such that it needs to be used for college, so arguments about price-value issues with college are not immediately relevant.

Milestone, Sort of

Last week in the race around New England colleges I missed a milestone of sorts - Coyote Blog crossed over 5 million visits.  I say "of sorts" because with feed readers, many readers of the blog do not hit the visit counter.  In fact, with over 2,000 feed subscribers who check this feed each day, that equates to about 3/4 million visits a year that don't hit the counter.

Nevertheless, all these numbers, however flawed, are far higher than I ever thought I would reach here (way back on September 29, 2004).  Thanks for the support.

PS-  Here was that first scintillating post 6-1/2 years ago:

This blog will often touch on the insanity that is the current American tort system. I don’t think there is any greater threat to capitalism, due process, or democracy than the growing power of the litigation bar.

Via Overlawyered.com, which should be an essential part of your daily blog browsing, comes this story. Apparently, after being sued by Okaloosa County for making defective police cars, Ford refused to sell the county any more of this type car. The County sued again, this time to force Ford to sell it more cars of the type it is suing Ford for being defective:

One of Morris’ attorneys, Don Barrett, has said the sheriff firmly believes the Police Interceptors are defective but he wants to buy new ones to replace aging cars because seeking other vehicles would be more costly.

lol. Unfortunately, in the service business, it is legally more difficult to exclude customers from the premises. We have several well-known customers who come to our campgrounds (plus Wal-mart and any other private retail establishment) desperately hoping to slip and fall and sue. In a future post, I will tell the story of a Florida campground that is being sued by a visitor for sexual dysfunction after the visitor allegedly stepped on a nail in their facility.

Out This Week

On a college visit trip in New England with my son.  We will be at Cornell, Amherst, Williams, Dartmouth, Bowdoin, Colby, Bates, Brown, Yale, Princeton.  If your best friend is admissions director or the baseball coach at any of these schools and is desperately searching for smart kids from Arizona who blog and hit for power, you are welcome to email me :=)

Italian Rail

After having my car hit 3 times in one week driving in Italy, I swore this time I would do it without the car.  So I tried rail.  I had almost as much trouble with rail as with driving.

First, never, ever, ever buy a Eurail pass for Italy.  It is way too expensive compared to the train fares.  Its a good deal in Switzerland, so I bought one for Italy before doing the research.  It became a running joke in Italy - every single Italian rail employee we had to show the pass to told us we should not have bought it.  So not only did I pay too much, but I got reminded of it twice a day.

Second, all but the smallest and shabbiest trains require advanced reservations, but these reservations are nearly impossible to make if you are not Italian, because the rail site has some kind of weird block on most all American credit cards (much about this around the Internet).  This means that I can't just have get-on-the train and go flexibility, I have to pick a train I want to use in the future and then stand in line at a rail station to purchase the ticket or reservation.    Lines do not move fast in Italian rail stations.

But the classic story comes from my minor infraction of rail policy that ended up costing me money.  I don't know if this is just government or if it they have a lot of problem with cheating.  Apparently, each day you are supposed to fill that days date in the next slot on your Eurail pass before you get on the train.  I forgot to on one trip, so the conductor insisted I owed a 50 euro fine.  Seriously.  I said, let me add the date right now, but she said no.  They had a couple guys lined up to throw us off in the next random Italian town if we did not hand over the money  (reminds me of this story in England).

I will say, once I calmed down, that in retrospect the lecture from the Italian state employee on why it is important to follow every single rule and to trust our betters in government that all the rules are for a good reason was almost worth the 50-euro price of admission.

It took me a while to figure out what they were afraid of -- I suppose if you did not write the date in advance, and the conductor never came by, you could get an extra day of travel.  Of course, I had paid extra money for a reservation on that particular train, so it was unlikely I was gaming the system (another reason not to get a Eurail pass in Italy, you still have to pay extra for nearly every train).  And it seemed odd that on a 2-hour train ride they thought it a real risk no conductor would come by, though on the very next day we took a 2-hour ride and there was no conductor, so I suppose it is possible.

In that latter case we were in a car where the AC failed on a hot day, and of course it was the only train we rode on the whole trip where the windows did not open.  No conductor took my ticket, but one did stand at the end of the car the whole trip turning away anyone who wanted to get an open seat in the next car -- after all, we were assigned a specific seat and sitting in another would be against the rules.

More on Wind

I was having a back and forth with a reader about wind power and how much fossil fuel capacity must be kept on standby to support grid reliability with wind.  Here are some excerpts of what I wrote:

Forget all of the studies for a moment.  I used to operate power plants.  Any traditional capacity (fossil fuel, nuclear) except perhaps gas turbines takes on the order of a day or more to start up - if you don't take that long, the thermal stresses alone will blow the whole place up.  During the whole startup and shutdown, and through any "standby" time, the plant is burning fuel.   Since we don't have a good wind energy storage system, some percentage of wind capacity must be backed up with hot standby, because it can disappear in an instant. We are learning now, contrary to earlier assumptions, that wind speeds can be correlated pretty highly over wide geographies, meaning that spreading the wind turbines out does not necessarily do a lot to reduce the standby needs.  And since plant startups take time, even gas turbines take some time to get running, the percentage of wind power that required hot backup is pretty high -- I would love to find this percentage.

I found at least one source for such a percentage, which posits that for England, the percentage of hot backup needed is as high as 80%:  http://www.ref.org.uk/Files/ref.for.decc.28.10.09.i.pdf

I quote from page 6-7:

On any view, including the square root rule of thumb referred to above, the result, imposed for purposes of maintaining adequate response and reserve requirements, implies that a high degree of conventional (dispatchable) plant capacity is retained in the system to support wind generation. Thus, for 25 GW of installed wind capacity only 5 GW of conventional plant can be replaced leaving 20 GW in the role of standby capacity (also known as "Spare" or "Shadow Capacity").3

So 80% of the expected production from wind has to be backed up with hot spares burning fossil fuels.  They go on to say that the percentage of required spare capacity may be lower if the grid area is substantially larger, but not a lot lower.  I had not considered hydro power, but apparently that can be used to provide some quick response to wind production changes.  The report also talks about diesel generators for standby since they can be started up quickly, but these are seriously inefficient devices.  Despite the report's conclusion that the situation might be a bit better on the continent with a larger and more diverse grid, a report of the largest German utility seems to argue that German experience may actually be worse:

As wind power capacity rises, the lower availability of the wind farms determines the reliability of the system as a whole to an ever increasing extent. Consequently the greater reliability of traditional power stations becomes increasingly eclipsed.

As a result, the relative contribution of wind power to the guaranteed capacity of our supply system up to the year 2020 will fall continuously to around 4% (FIGURE 7). In concrete terms, this means that in 2020, with a forecast wind power capacity of over 48,000MW (Source: dena grid study), 2,000MW of traditional power production can be replaced by these wind farms.

It is hard to tell, because 48,000 MW is the nameplate capacity which is virtually meaningless, but my guess is that they are not doing better than 80%.

My Mom Would Be Going Blind in England

Several new drugs have reversed my mom's macular degeneration, and are such a wonder that she is even willing to tolerate frequent injections into her eyeball, a concept that gives the rest of our family the willies.  Forget about it in England, though, where National Institute for Health and Clinical Excellence (NICE), which Obama wants to emulate in the US, does not allow these drugs:

3. In 2007, NICE restricted access to two drugs for macular degeneration, a cause of blindness. The drug Macugen was blocked outright. The other, Lucentis, was limited to a particular category of individuals with the disease, restricting it to about one in five sufferers. Even then, the drug was only approved for use in one eye, meaning those lucky enough to get it would still go blind in the other.

And by the way, is NICE an Orwellian name or what?

Postscript: Fortunately, we are unlikely to have a system that bans Americans from spending their own money on things the plan will not buy  (a bit of socialist egalitarianism that is practiced in a number of European countries).  Not for lack of trying by many Democrats, however.

Testing post by email

I really wanted to post by email in England but could not make it work. Trying again.

Update: So close, yet so far away. LOL. I will keep working on it.

Is It OK To Laugh At Your Kid?

Today I dropped my son off in England for summer school.  As background you need to know that he has lived in brand-new-out-of-the-shrinkwrap American suburbs all of his life.  So it was funny to me to see the look on his face when he was told at the college that his dorm room elevator was broken and might not be fixed for at least a month.  The "WTF?" look was priceless.  I could see him thinking that a one hour outage of infrastructure would be something to comment on back home, but a month??

But the really funny part was when the Dean asked him to check his rooming envelope to see his room number, and he realized the implication of the three digit number that started with "7."  As with most teenage boys, he wanted me gone anyway ASAP, and I was happy to leave him to his independence and avoid the trudge up to his room.  After I left, he still had a small voyage of discovery as he learns that "floor 7" in England is actually euqivilent to "floor 8" in the US.

What a Horrible Law

Via Reason:

Because, unbelievably, Cartwright had previously been served with an Anti-Social Behaviour Order (ASBO)"”a civil order that is used to control the minutiae of British people's behaviour"”that forbade her from making "excessive noise during sex" anywhere in England.

This case sheds harsh light not only on the Victorian-style petty prudishness of our rulers, who seriously believe they can make sexually expressive women timid again by dragging them to court, but on the tyranny of Anti-Social Behaviour Orders themselves. Introduced by our authoritarian Labour government in 1998, anyone can apply for an ASBO to stop anyone else from doing something that they find irritating, "alarming," or "threatening."

Local magistrates' courts issue the orders, sometimes on the basis of hearsay evidence (which is permissible in "ASBO cases"). In short, the applicant for an ASBO does not have to go through the normal rigors of the criminal justice system in order to get a civil ruling preventing someone he doesn't like from doing something that he finds "alarming" or "dangerous." Once you have been branded with an ASBO, if you break its conditions"”by having noisy sex in your own home, for example"”you are potentially guilty of a crime and can be imprisoned.

The ASBO system has turned much of Britain into a curtain-twitching, neighbor-watching, noise-policing gang of spies. The relative ease with which one can apply to the authorities for an ASBO positively invites people to use the system to punish their foes or the irritants who live in their neighborhoods.

I don't really have much time to comment on this, but is there any need?  And for those smug enough to think this will never happen in the US, just look on college campuses today, where a number of universities are coming awfully close to creating a right not to be offended, and allowing students to define crime as anything that offends them.  And it almost goes without saying that such standards tend to be enforced unevenly, depending on the ideology of those who happen to be in charge.

Vampiric Regeneration

How can you get free power?  Well, one way is to steal it from other people.  And if you steal it in small enough bites from a lot of people, they may never notice.

This seems to be the basic idea in this article in the Guardian, whose author clearly attended lots of journalism classes while studiously avoiding any class that might have made mention of the first law of thermodynamics.

"Green" speed bumps that will generate electricity as cars drive over them are to be introduced on Britain's roads. The hi-tech "sleeping policemen" will power street lights, traffic lights and road signs in a pilot scheme in London that could be rolled out nationwide.

Speed bumps have long been the bane of motorists' lives, but these will capture the kinetic energy of vehicles.

Peter Hughes, the designer behind the idea, said: "They are speed bumps, but they are not like conventional speed bumps. They don't damage your car or waste petrol when you drive over them - and they have the added advantage that they produce energy free of charge." An engineer who formerly advised the United Nations on renewable energy sources, Hughes added: "If it [the energy] wasn't harnessed by the speed bumps, it would go to waste."

The ramps - which cost between £20,000 and £55,000, depending on size - consist of a series of panels set in a pad virtually flush to the road. As the traffic passes over it, the panels go up and down, setting a cog in motion under the road. This then turns a motor, which produces mechanical energy. A steady stream of traffic passing over the bump can generate 10-36kW of power.

OK, I am willing to believe that you might be able to recover some net energy from a system with this kind of dynamic speed bump replacing an existing static bump  (but I am skeptical, and would want to see the math).  Of course, if you really have a road with a speed bump and so much traffic that it will generate this much power and repay a large investment, then you probably have a road/traffic design issue.

But the article seems to be positing that towns could install these as flat devices --"virtually flush to the road" --  that drivers would hardly notice.  Power from these devices would help the town power its lights and other devices.  But unless these guys have invented the perpetual motion machine, there is no free energy to be had here.  In fact, due to that nasty old spoil-sport, the second law of thermodynamics, there has to be a total system loss.  The device might only steal the equivalent energy of a thousandth of a gallon of gas from each driver, so the driver of each car won't really notice, but the total system expenditure of the thousands of drivers who power the device will still be there, just hidden.  This is a new stealth tax on drivers, dressed up in green clothing.

Next up:  Britain proposes to put windmills on the roofs of electric cars as a power source.  After all, when you are driving at 60 miles per hour, all that wind energy coming past your car is just lost, right?  Once you got the car up to speed, it would just generate its own electricity.  LOL.  I shouldn't laugh, there is probably a billion or so for this in Obama's stimulus bill.

via Tom Nelson.

Ecoterrorism Vindicated in England

Apparently 6 vandals who cause $60,000 damage to a power plant in England were acquitted solely on the argument that they were helping stop global warming -- in other words, they admitted their vandalism, but said it was in a higher cause.

It's been a pretty unusual ten days
but today has been truly extraordinary. At 3.20pm, the jury came back
into court and announced a majority verdict of not guilty! All six defendants - Kevin, Emily, Tim, Will, Ben and Huw - were acquitted of criminal damage.

To recap on how important this verdict is: the defendants
campaigners were accused of causing £30,000 of criminal damage to
Kingsnorth smokestack from painting. The defence was that they had 'lawful excuse' - because they were acting to protect property around the world "in immediate need of protection" from the impacts of climate change, caused in part by burning coal.

So the testimony centered not on whether they actually vandalized the power plant - they never denied it - but on whether the criminals were correct to fear global warming from power plants.  I don't know much about British law, but this seems to be a terrible precedent.  Or maybe not - does this mean that I can go and legally vandalize every Congressman's house for wasting my money?