Dispatches from District 48
Via Overlawyered, from here
Taiwan's Intellectual Property Office said it had disqualified Wu Chih-wei and asked him to return the medal and prize money he got for winning the "Protect Copyright" poster-design contest, after Wu admitted he had copied the design he submitted.
Kevin Drum is, by my description (I don't know what he would call himself) a leftish technocrat. My read on him is that he sees a beneficial role for government via smart people sitting at the top and optimizing systems (e.g. the economy, energy policy, climate, etc). This is a consistent with a century-old branch of American progressivism, that distrusts chaotic outcomes of individual action and believes top-down optimization is called for.
The problem with this approach (discussed by Hayek and many others) is such top down optimization is impossible for a variety of reasons, from information to incentives. There is simply a myriad of examples where supposedly smart government officials attempted such technocratic tinkering and only ended up with a mess. I always supposed folks who argue for more of the same simply mentally ignored these examples.
But here is Kevin Drum lamenting the insanity of ethanol subsidies (for which he should be praised). Ethanol subsidies are absolutely counter-productive, but have been central to our top down US energy policy for over a decade.
So what I can't understand is how he keeps these two ideas in his head simultaneously -- of this ideal of brilliant actors managing the economy from above and the reality of ethanol policy. I suppose he could argue, as many technocrats do, that if only his guys were in power, everything would be different. But his guys are in power, and in fact his guys have been the main drivers and supporters of ethanol subsidies.
I have written a number of times about why even smart guys fail to do smart things when plopped down in the government.
Two great examples:
1. Barney Frank is supposedly going to remake housing finance after having helped destroy it by his actions over the last 20 years. In particular, after his polititization of Fannie Mae's business goals over the last 20 years, and constant fight to prevent any kind of oversight of Fannie and Freddie, which has led to over a hundred billion dollars and perhaps as high as $400 billion in taxpayer losses, Barney is going to do more of the same with Frannie and Freddie now that the government has full control of these entities.
2. A NY state child protective services study shows that all their resources provide little real benefit to endangered children. The solution -- do even more of the same.
And don't forget the classic example, the 10x increase in public school funding to no apparent benefit:
I hate blog posts that begin this way, but I will do it anyway: Imagine that Wal-mart, Target and a hundred other major retailers all got together and agreed to an industry plan to hold down workers's wages. Anyone involved with even rudimentary economics training would know that there would be enormous incentives for individual retailers to "cheat", ie offer wages above the agreed to levels to try to get a particular advantage hiring the best employees. So imagine that the cartel actually forms an enforcement body, that goes around the country levying fines and punishments against any individual participant who breaks ranks and tries to share some of the largess with their workers.
Now imagine the NY Times rooting the enforcement body on, cheering it when it adopts a new get-tough stance on organizations that pay its workers too much. Hard to imagine, but that is exactly the case in this article, where the Times writes about the NCAA's new efforts to get tough on what it calls "recruiting violations" but in any other industry would be called "trying to pay the workers more than the cartel allows."
NCAA division I sports are made up of a 100+ mostly public institutions that make a fortune off of their athletic programs, particularly men's football and basketball. Large institutions like the University of Texas or Ohio State reap tens of millions each year in ticket sales, TV deals, merchandising sales, and Bowl/tournament winnings. One of the reasons this is so profitable is that they basically pay the key workers who generate this income close to zero. Sure, they give them a scholarship, but what is the marginal cost to, say, the University of Texas for providing a few hundred free educations on top of their 40,000 paid customers? This is roughly equivalent to McDonald's paying its employees nothing more than a couple of happy meals each day.
While many of these university's athletes will make nothing after college playing sports, the ones involved in these "violations" are typically athletes who are offered millions, even tens of millions of dollars the moment they leave college. In effect, these colleges are getting tens of millions of dollars of labor virtually for free, and so the incentives to cheat on their cartel deal are huge, which is why the cartel enforcers have to be so aggressive in stopping under-the-table payments to the grossly underpaid workers.
It is an ugly process, and one wonders why so many folks support it when they would be appalled at such practices in any other industry.
In a European-style corporate state, very large corporations (and their unions) get special protections, privileges, and exemptions, to the detriment of consumers, entrepreneurs, small businesses, and taxpayers. Here we go, via Russ Roberts:
Nearly a million workers won't get a consumer protection in the U.S. health reform law meant to cap insurance costs because the government exempted their employers.
Thirty companies and organizations, including McDonald's (MCD) and Jack in the Box (JACK), won't be required to raise the minimum annual benefit included in low-cost health plans, which are often used to cover part-time or low-wage employees.
The Department of Health and Human Services, which provided a list of exemptions, said it granted waivers in late September so workers with such plans wouldn't lose coverage from employers who might choose instead to drop health insurance altogether.
Without waivers, companies would have had to provide a minimum of $750,000 in coverage next year, increasing to $1.25 million in 2012, $2 million in 2013 and unlimited in 2014.
"The big political issue here is the president promised no one would lose the coverage they've got," says Robert Laszewski, chief executive officer of consulting company Health Policy and Strategy Associates. "Here we are a month before the election, and these companies represent 1 million people who would lose the coverage they've got."
Actually, the real political question is why McDonald's gets special treatment, but the folks who run the deli downstairs in my building, who effectively compete with McDonald's, does not get to operate under the same law, merely because they are not large enough to get the President's special attention.
My new Forbes column is up this week, and discusses the 10:10 video as a logical outcome of the years of ad hominem attacks hurled at skeptics.
For years, my observation has been that the perfect has been the enemy of the good in energy policy. Now, I don't support the feds making energy policy at all, but given that they do, too often the government has ignored the 80/20 solution that would get most of the desired benefits for a fraction of the cost of alternatives being considered.
For example, in California, the state could have made a ton more progress reducing vehicle emissions had they accepted a low emissions standard decades ago that allowed for things like compressed natural gas (CNG) as a vehicle fuel. However, environmentalists insisted on zero emissions, and thus only electric vehicles passed muster, and the technology simply has not been there (not to mention that at the margin, new electric vehicles in the state would at best be powered by natural gas and at worst by Arizona and Nevada coal plants, making the very concept of "zero-emissions" crazy).
I am thinking of this by looking at this chart from the EIA of CO2 emissions per BTU for various fuels (pounds per million BTU):
Coal (anthracite) 227 Coal (bituminous) 205 Coal (lignite) 215 Coal (subbituminous) 213 Diesel fuel & heating oil 161 Gasoline 156 Propane 139 Natural gas 117
Looking at this, and given the huge amounts of natural gas in this country, one might reasonably expect that a logical policy suggestion would be to try to provide incentives to substitute natural gas for coal and diesel fuel. The technology exists right now, today, to produce electricity with gas and to power large vehicles with CNG (and focusing on truck fleets eases the distribution issues with CNG).
But of course absolutely no one in the global warming movement is suggesting this (except for T. Boone Pickens, and he is involved in climate bills as a rent-seeker, not as an advocate). You see, we want "renewable" energy, and natural gas does not fit. Though for some reason ethanol does, despite the fact that ethanol probably creates more CO2 than it reduces.
No point here really, since I am not advocating any sort of energy policy. But it reinforced to me why no one should claim as a justification for energy policy that somehow the system will be more efficient if a few smart people design it top-down, when one of the most obvious 80/20 solutions to Co2 reduction is not even considered.
I am sure this will garner much sympathy from all of you
"[Attorney George Fleming] said he had worked too long and too hard for a lousy $41 million," said Jim Doyle, who left the firm after objecting to Fleming's unusual decision to include non-client expenses among those billed to clients.
Via Overlawyered. Fleming is accused of padding his expenses in a class action settlement.
A European-style corporate state is typically ruled by a troika of large favored corporations, industrial and public employee unions, and long-time political insiders. Most definitely excluded from power are consumers, entrepreneurs, small businesses, younger workers without seniority, and taxpayers.
I have argued that Obama is not a socialist, but is building a European-style corporate state. Here is a great indicator, from my Princeton classmate Henry Payne:
For the first time in more than two years, SUV sales account for more than half of the U.S. auto market. ...
The trend comes even as Washington issued a new edict that vehicles average an absurd 62 mpg by 2025. The current absurd standard -- 35 mpg by 2015 -- has forced manufacturers to invest billions in new small-car development.
Today, manufacturers are in defiance of their own customers -- their marketing departments churning out small-car ads touting their new green products. This puts automakers in a tough spot: Continue to make cars for the government, or listen to their customers.
For now, manufacturers are sticking with the government, telling the Detroit News that "with a slew of new cars coming out, such as the Chevrolet Cruze, the Ford Fiesta and a new Ford Focus early next year, car sales are likely to outpace truck sales in the coming months."
If you want a deeper look at how legislation is made in the corporate state, read this fascinating (but very long) New Yorker report on the efforts to pass a climate bill this past year. The author writes it in the spirit of lamenting lost opportunities, but I read it as a great inside view of the sausage factor. Do we really want to give these guys more power?
In the same spirit, I commented thus on Kevin Drum's post discussing the growth of campaign spending this year, and lamenting that it is going to the nasty old Coke team instead of the Pepsi team:
There is a really simple solution to this -- reduce the coercive power of government to break individuals or corporations or to hand them windfalls, and all this spending goes away.
The spending has not gone up because the rules changed, because the Supreme Court rules did not substantially affect this kind of campaign spending (there is a ton of sloppiness in the media on this point).
The spending has gone up because Obama & the Democratic Congress has put more of the US economy in play in their attempts to form a European-style corporate state. When Obama and Pelosi engage in populist public speeches vilifying whole sectors of the economy, groups are going to try to defend themselves from the onslaught, either by throwing the current office holders out or buying the favor of those they can't unseat.
Everyone seems to know who Gloria Allred is, though I have never heard of her. Apparently she is opposed to Meg Whitman getting elected (I am not even sure - is Whitman running for Senator or Governor?). But her approach is weird. She attacks Whitman for not identifying and firing an illegal immigrant fast enough. There is no way for this accusation to be true given the timeline Allred outlines unless Ms. Whitman's illegal immigrant maid at some point farbricated or falsified documents. In specific, Allred is claiming Whitman did not act fast enough when the Feds sent her a letter saying there was a problem with her maid's social security number. Implicit in all this is that Whitman's maid must have fabricated documentation and as a minimum provided a false or stolen social security number.
OK, all normal team pepsi - team coke political BS, except for this: Whitman's maid is Allred's legal client. Allred, in order to publicly score points on Whitman, is hanging her own client out to dry by as much as admitting her client engaged in identity theft. The maid's lawyer is complaining that her client was not fired fast enough. Unbelievable. Is this the true state of legal ethics today? And not a mention of this obvious ethical issue in the AP story.
I had the opportunity to go to the Oscars once, along with the Governor's Ball afterward (the year Eastwood won for Unforgiven). When asked what certain folks looked like (e.g. Sharon Stone at the next table), my answer was inevitably "not as good as in their pictures." Claudia Schiffer sat right in front of me in the theater and all I can remember is her huge bony anorexic spine sticking out like some kind of lizard.
The exception was Cindy Crawford. This may be unbelievable, but she looked even better than in pictures. I kid you not. Here is a sample of why she is the greatest, via Tom Kirkendall (he claims to just be blogging on the quality of the commercial - yeah right).
Greenwald on the ability of Presidents to have Americans assassinated:
During the Bush-era torture debates, I was never able to get past my initial incredulity that we were even having a "debate" over whether the President has the authority to torture people. Andrew Sullivan has responded to some of the questions I posed about his defense of Obama's assassination program, and I realize now that throughout this whole assassination debate, specific legal and factual issues aside, my overarching reaction is quite similar: I actually can't believe that there is even a "debate" over whether an American President -- without a shred of due process or oversight -- has the power to compile hit lists of American citizens whom he orders the CIA to kill far away from any battlefield. The notion that the President has such an unconstrained, unchecked power is such a blatant distortion of everything our political system is supposed to be -- such a pure embodiment of the very definition of tyrannical power -- that, no matter how many times I see it, it's still hard for me to believe there are people willing to expressly defend it.
The whole post is an excellent defense of Constitutional protections and limited government. If only he would treat the government's taking the product of peoples' labor with the same logic.
Check back at my post on the egregious 10:10 climate video. Lots of updates.
I am not trying to be a crotchety old guy, but sometimes the quality of blog comment is affected by the fact that bloggers are too freaking young. On any number of issues, from climate to politics, I see folks treating certain events as unprecedented that anyone with a memory of the seventies (or even the eighties) could put in much better context.
Here is a good example. Dumb girl creates fake thesis rating college boys she slept with, grading them on their sexual pros and cons. It inevitably gets in the wild and much angst and hilarity ensues.
But this kind of thing is old news. I remember for example, in the late seventies or early eighties (can't find a link) a couple of women from Yale published a book on the boys at Yale and their sexual pros and cons, including a star-rating system. And they published proudly and knowingly, no accidentally.
I suppose one cold say that climate alarmism jumped the shark years ago. But they have certainly moved to a new level, one for which there is not even a term, in this video. This video has everything - the government school teacher politically indoctrinating the kids, followed by bloody gory death dealt out to the kids who refuse to toe the government line. I am not kidding.
When I first saw it, I was sure it was a skeptic satire, ala Jonathon Swift's 'A Modest Proposal,' and I am still afraid that this may be some elaborate put-on because the video and its message -- that skeptics need to be killed -- is so obscene. But apparently, according to this article at the Guardian, it is totally for real and includes contributions from some fairly prominent artists, as well as funding from the UK government and the 10:10 program (a plea to reduce carbon emissions by 10% per year, eerily with a name probably purposely similar to 9-11).
Our friends at the 10:10 climate change campaign have given us the scoop on this highly explosive short film, written by Britain's top comedy screenwriter Richard Curtis, ahead of its general release....
Had a look? Well, I'm certain you'll agree that detonating school kids, footballers and movie stars into gory pulp for ignoring their carbon footprints is attention-grabbing. It's also got a decent sprinkling of stardust "“ Peter Crouch, Gillian Anderson, Radiohead and others. But it's pretty edgy, given 10:10's aim of asking people, businesses and organisations to take positive action against global warming by cutting their greenhouse gas emissions by 10% in a year, and thereby pressuring governments to act.
"Doing nothing about climate change is still a fairly common affliction, even in this day and age. What to do with those people, who are together threatening everybody's existence on this planet? Clearly we don't really think they should be blown up, that's just a joke for the mini-movie, but maybe a little amputating would be a good place to start?" jokes 10:10 founder and Age of Stupid film maker Franny Armstrong.
But why take such a risk of upsetting or alienating people, I ask her: "Because we have got about four years to stabilise global emissions and we are not anywhere near doing that. All our lives are at threat and if that's not worth jumping up and down about, I don't know what is."
The latter claim is hilarious. Over the next four years, CO2 levels will likely increase, if they stay on trend, from .0392% of the atmosphere to .0400% of the atmosphere. I would love to see these so-called science-based folks demonstrate how the next .0008% shift in atmospheric concentration triggers the point-of-no return tipping point. In actual fact, the have just latched onto the round number of 400ppm and declared, absolutely without evidence, that this number (which the Earth has crossed many times in the past) will somehow lead to a runaway chain reaction.
Anyway, I have teased it long enough, here is the video. Beware -- there is gore (no pun intended) here worthy of a zombie movie.
Wow, its sure good that the world has decided that skeptics are the mindless, thuggish, anti-science side of this debate, because if that had not already been made clear, we might think that key climate alarmism groups had lost their freaking minds. It will be interesting to see if this gets any play in the US media -- my guess is it will not. Magazines are happy to spend twenty pages dissecting the motives of the Koch family in funding skeptic and libertarian causes, but environmentalists get a free pass, even with stuff like this.
Lubos Motl is all over this, and has mirror sites for the video if (or more likely when) the video gets taken down. This is one of those propaganda offers that are the product of an echo chamber, with a group of like-minded people all patting themselves on the back only to be surprised at the inevitable public backlash.
I have mirrored the video here in case it gets a youtube takedown.
Update: As a reminder, this is not satire. It is made by a group of true believers. It was funded and approved and released by a climate alarmism group, which paid top dollar (including UK taxpayer funds) for a large professional team of actors, writers, and directors. All interviewed participants, including the first little actor blown up, have stated how proud they were of the film and its contribution to educating people on the need for immediate action on global warming.
For the last hour, I have sat and tried to think if, as a skeptic, I had wanted to make a satire critiquing the excesses of global warming alarmism, could I have made a better video. The only thing that might have made it better would have been if the final button-pusher was someone famous like James Cameron or Bono, who after then pushed the button climbed on their Gulfstream jet to fly home. But that's just a quibble. I have changed my opinion. This may be the greatest skeptic video ever, and the Koch family didn't even have to pay a dime for it. Thanks 10:10.
Update #2: This movie reminds me of nothing so much as Tarantino's Inglorious Bastards. It is clearly not reality, but the author's fantasy. Tarantino fantasizes about a group of jews kicking ass on the Nazi high command and ending the war early. 10:10 fantasizes about blowing up skeptics, in a video that, amazingly, is more blood-spattered than Tarantino's.
Update #3: The group pulls the video with a classic "I'm sorry you guys are so easily offended" apology.
Update #4: Unsurprisingly, Joe Romm (in the italics in this post) goes to the kindergarten argument of "he started it," arguing that the video is just the flip side of the stuff skeptics are doing all the time. In making his pitch, he shows the mindset that allowed this stupid film to get made.
I am not sure exactly what comparable films skeptics have produced that are similar, and the only example he can cite is Anthony Watt's blog post comments on the shooting of an eco-terrorist. I did not even go back and look at Watt's comments, but I generally think that lots of people are too gleeful when suspected criminals, who are innocent before the law, are gunned down by police.
Never-the-less, its seems a stretch to equate the offhand comments in real time of an independent blogger with a film involving probably a hundred people (including those who commissioned it in the 10:10 organization), commissioned in an official and thoughtful act (after all this had to be months in the works), and funded in part by the British government. He takes the opportunity of his team's screw-up to launch this broadside on people like me (in bold no less).
None of this excuses that disgusting video. But the difference is that those who are trying to preserve a livable climate and hence the health and well-being of our children and billions of people this century quickly denounce the few offensive over-reaches of those who claim to share our goals "†but those trying to destroy a livable climate, well, for them lies and hate speech are the modus operandi, so such behavior is not only tolerated, but encouraged.
Is anyone else getting tired of this working definition that "hate speech" is any speech by people who disagree with me, because I have the best interest of humanity in mind so clearly those who oppose me hate the human race?
Note you can see this right in his statement -- "for those trying to destroy a livable climate." That's absurd. Does he really think anyone is trying to destroy a livable climate? I could say that through CO2 controls he is trying to impoverish billions of poor people in lesser developed countries by halting development, but I don't think that is really his motive. I think that is an outcome of what he advocates, just as he thinks an unlivable climate is an outcome of what I advocate, but I can distinguish between motives and assumptions, but he apparently cannot. This attitude is EXACTLY what causes this kind of unfortunate video to be made -- it is only a small step from believing, as he says he does, that skeptics are "trying to destroy a liveable climate" to making a movie that jokes about killing them all (or, to be frank, to feeling justified in acts of eco-terrorism).
I encourage you to watch my climate video and decide if folks like me are trying to thoughtfully decipher nature or are engaging in hate speech.
Update #5: Funny -- Gillian Anderson, actress from the 10:10 video, warning of Y2K dangers.
Update #6: I guess this was inevitable, but all the rats in the 10:10 ship are claiming that they had no idea what the video would be like and were appalled when they saw it. Right. An organization funds a major film production, including any number of high profile participants, and no one asked to see a script, screened the video before release, or even asked for some kind of written treatment of the concept? Yeah, right. No one in the 10:10 organization or who funded the video even peeked at it before it was released to the entire planet? This is so utterly lame but will probably be enough of a fig leaf for most of the media to hide behind and allow them not to follow up on a video whose basic premises they likely agree with.
My new column is up at Forbes, and is on the Democratic push to raise the prices of Chinese goods (either through currency policy or tariffs). This has to be one of the craziest campaign themes of all time -- please, let us raise your prices.
We should be thrilled that the Chinese government and its people see fit to spend their own money to subsidize lower prices for American businesses and consumers. Last week, President Obama put substantial pressure on the Chinese prime minister to revalue Chinese currency, a revaluation that would have the effect of raising prices of all Chinese goods in the United States. What possible sense does such a move make, particularly in a recession?
Christian Broda and John Romalis, a pair of University of Chicago economists, have been doing work on income distribution. A couple of years ago they published a paper that showed how our measures of income inequality may be exaggerated because the metrics assume that both rich and poor experience the same rate of inflation. In fact, the researches found, over the last decade or so the poor have seen much lower rates of inflation than the rich, in large part due to goods of the type imported by China and sold at Wal-Mart (another institution Democrats like to demagogue against).
Sadly, prices for low-income Americans could be even lower were it not for past protectionist measures. When one looks at the goods that have the highest import tariffs, one sees the very same goods that typically make up a disproportionate share of the poor's purchases: Tobacco, clothing, tires, auto parts, fruits and vegetables. All of these have their prices raised 20-350 percent by import tariffs.
This means that at the same time Democrats have again raised issues of rising income inequality, they are trying to stop some of the most powerful forces at work mitigating these income differences. There is no question that if Democrats are successful in changing China's currency policy and/or imposing new tariffs (taxes) on Chinese goods, prices will rise for all Americans, but particularly so for the lower income brackets that are supposedly the Democrats' constituency.
The most frustrating part of this whole effort is that it is aimed at a myth: the declining American manufacturing base. In fact, American manufacturing output continues to hit new all-time highs "” despite the current recession, American manufacturing output today is still 40% higher than it was in 1990.
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.
Consider this story in the context of my previous post on the poor having a lower inflation rate due in part of the effects of Wal-Mart and Chinese -made goods:
President Obama increased pressure on China to immediately revalue its currency on Thursday, devoting most of a two-hour meeting with China's prime minister to the issue and sending the message, according to one of his top aides, that if "the Chinese don't take actions, we have other means of protecting U.S. interests."...
The unusual focus on this single issue at such a high level was clearly an effort by the White House to make the case that Mr. Obama was putting American jobs and competitiveness at the top of the agenda in a relationship that has endured strains in recent weeks on everything from territorial disputes to sanctions against Iran and North Korea.
Democrats in Congress are threatening to pass legislation before the midterm elections that would slap huge tariffs on Chinese goods to undermine the advantages Beijing has enjoyed from a currency, the renminbi, that experts say is artificially weakened by 20 to 25 percent.
Somehow this was written with words like "competitiveness" and "artificially weakened" to hide the fact that what we are talking about is raising prices to American consumers (by as much as 20-25%, one infers from the last paragraph). Not only would this make Chinese goods more expensive, but it would reduce the downward price pressure on goods made elsewhere.
Which of course is the whole point, because this is a narrow special interest issue putting a few vocal industries interests over those of the broader group of American consumers. How many of us are consumers? How many of us work for service and manufacturing and retail businesses that buy Chinese goods? Now, how many of us work for a product business that competes directly with Chinese manufacturers? The first two groups dwarf the second, but Obama is just as beholden to these interests as was Bush.
My column in Forbes is up for the week, and discusses the failure of light rail. In particular, it focuses on Phoenix light rail, which has been hailed by the intelligentsia as a stirring success. Which it is ... if you are willing to completely ignore its costs. Saying that Phoenix light rail represents an example to be emulated is roughly equivalent to saying that an Aston Martin makes a sensible middle class family car.
One reason Phoenix is a particularly bad candidate for a light rail line is that our population is so dispersed, and there are not any obvious commuting routes. Our downtown is a destination for very few, but even here the commutes, as shown on this distribution map, are from all over, hardly very good fodder for rail (the downtown is near the "phoenix" label). More importantly, people work all over, so taking a suburban zip code, look at where people are commuting to from suburban 85032. Again, all over. Notice how few are going downtown (where the light rail line is -- downtown is toward the south about where the "phoenix" map label is). In other words, people in Phoenix are driving from all over to all over.
Update: Now here is my idea of rail running in the streets, via Shorpy
I thought this was an incredibly cool image, showing the changing path of the Mississippi River (in this case where it meets the Ohio). (via Flowing Data)
When I was a kid, I was fascinated by water flow and erosion. I remember spending a whole day on a woodside hill watching the evolution of an ad hoc stream of water, playing around with damming it in some places, creating new channels, etc. When I went to the beach, I never built castles but attempted to build walls and channels to shape the way the tide flowed. Since I am free associating, I also remember visiting a huge model of the Mississippi, I think near Vicksburg, that I thought at the time was the coolest thing on Earth. Not even sure today if it still exists.
Just when I was climbing on top of any number of issues at work, and was ready to start blogging again in earnest, Civ 5 was released yesterday. Yes, it has all the time destruction potential of its older versions. Some quick thoughts from a few hours of play
First, I have not doubt that income inequality-- in whatever way the folks who care about such things measure it -- has increased. The analysis that has been making the rounds of liberal blogs show the rich "capturing a higher share" of total output. The very terminology here reveals their faulty core assumption, treating wealth as a zero-sum that must be grabbed and fought for and can only be gained to someone else's disadvantage. They always write about incomes as if GDP is a sort of natural fountain in the desert, and the piggy rich crowd in too close to get more than their fair share of water from the fountain.
This is silly. Wealth is created from the minds of human beings, and there are human minds that create far more wealth than others, and are able to keep some of that wealth for themselves as a reward. I say "some" because even the richest people tend to keep only a small percentage of the wealth they create. Sum up the benefits we all get from our iPods and iPhones and iPads, and the total number dwarfs what Apple shareholders have made from these devices.
Anyway, the actual point of this post was to revisit the notion that there are different inflation rates for the rich and poor (via Carpe Diem) that may be skewing income inequality numbers
Using scanner data on household consumption of non-durable goods between 1994 and 2005, we document that the relative prices of low-quality products that are consumed disproportionately by low-income households were falling over this period. This implies that non-durable inflation for the 10th percentile of the income distribution has only been 4.3 percent between 1994 and 2005 (0.4 percent per annum), while the non-durable inflation for the 90th percentile has been 11.9 percent (1.0 percent annually), and 13.4 percent (1.2 percent annually) for the richest 5 percent of households in the sample (see chart above)."...
"A large literature has focused on the rising inequality observed in official statistics, but have mostly abstracted from the fact that these official measures are based on a single price index for a representative consumer. This assumption is not crucial in a world with a stationary relative price distribution or where an identical basket of goods is consumed by different income groups. However, using household data on non-durable consumption, we document that the relative prices of low-quality products that are consumed disproportionately by low-income consumers have been falling over this period.
This fact implies that measured against the prices of products that poorer consumers actually buy, their "real" incomes have been rising steadily. As a consequence, we find that around half of the increase in conventional inequality measures during 1994"“2005 is the result of using the same price index for non-durable goods across different income groups. Moreover, given that the increase in price dispersion does not seem to be specific to our sample or time period, the overstatement in the increases in inequality from official measures can be even more significant, changing our view of how progress has been distributed in recent decades substantially."
The price of a night at the Four Seasons has gone up more than the price of a shirt at Wal-Mart.
I will be on the radio today between 3-4 Arizona time (6-7pm Eastern time) talking about climate change. Folks in Arizona can find it at 1100AM or listen streaming here.