Courage is rightly esteemed the first of human qualities because it is the quality which guarantees all others.—Churchill

Tuesday, September 13, 2005

Great News from Germany

Germany has not been known for great technological advances in recent decades, so the following Reuters report is a very hopeful sign that the nation has overcome its doldrums:

A German brewer has concocted what he says is the world's strongest beer, a potent drink with an alcohol content of 25.4 percent that is served in a shot glass.

"Everyone who has tried it is enthusiastic. It tastes like a quirky mixture of beer and sherry," said Bavarian brewer Harald Schneider.

Schneider, who lives in southern Germany where beer is a tradition, said his beer fermented for 12 weeks for an alcohol content twice that of Germany's other strongest beers.

"People will only be able to drink two or three glasses, otherwise they'll drop like flies," he said.

Schneider expects the holders of the world's strongest beer, the Boston Beer Company, to put up a fight.

"I'm pretty sure the Americans have something up their sleeve."

I'm certain he's right. Sad to say, Reuters droppped the ball in failing to answer the most important question—"Where can Mr. S. T. Karnick purchase some of this miraculous elixir?"—but we cannot fault them for concentrating on the big picture. This is the kind of international economic competition that makes the world a much better place. To Herr Schneider and his crack team, we say, Sehr gut!

Are FT Reporters Well-Oiled?

I declare, I don't know what the Financial Times will come up with next.

Search for Oil Stepped Up as Prices Rise

I am all astonishment. Whoever would have thought that if petroleum prices rose, oil producers would locate, pump, and refine more oil? I suppose next they'll be spinning some fairy-story about consumers buying less gasoline when prices rise, or gas prices falling when consumers reduce their demand. How gullible do they think we are?

Whose History?

The current prevailing meme among black Americans is that slavery in America was far worse than its African equivalent---the black slaves of sub-Saharan Africa were often captives from other tribes but were often presented with the opportunity of freedom and full integration with the host society.

This in contradistinction to American "chattel" slavery, where the slave and his (more importantly her) descendants were property from cradle to grave, from generation to generation in perpetuity.

There's not much on the internet to dispute this view, but this month's Smithsonian Magazine reports, chapter and verse, on chattel slavery in Africa, today, in 2005. Perhaps Africa has been watching reruns of Roots, but it stands more to reason that chattel slavery was not exactly a New World invention.

I don't think there are many in this country who are interested in the truth about America's and humanity's history of slavery---it is repugnant, and to universalize it rings of excuse-making.

Still, if you google "chattel" and "America," you'll get a sense of how deep this perception runs, that the Black Experience in America was heinously unique.

Will go just a bit further with me? Google "Willie Lynch."

It's no small secret among black Americans that in 1712, a white slaveowner gave a speech to other slaveowners on how to control their slaves, the Black Man, and Lynch's principles are used even today to (and this is a key idiomatic term here) "divide and conquer."

The tragedy is that "Willie Lynch" is a hoax, and so is his "speech." But a majority, I think, of Black America really has no way of knowing that. His "words" ring true enough today that it really makes no difference.

I write this as an FYI for white Americans who are puzzled by the recent breakdown of American society in New Orleans. In that heart of the deepest South, unknown to most of us Weekly Standard, Fox News and NR readers, and even NYT and Daily Kos contributors, American society as we understand it has never existed.

I will add briefly that although I think all's fair in love, war and politics, the Democratic Party's demagoguery of the race issue has done far more damage to our republic than a bit of partisan fun and games. It is not good that our black citizens believe that half their nation, the Republican half and in today's case their president, wants them dead or at least wouldn't mind seeing their corpses floating out into the Gulf of Mexico.

And to my Republican friends, keep foremost in your minds that when the GOP accepted the Dixiecrats, Nixon's Southern Strategy, and all the white votes that came with them, we also took on Willie Lynch's karma, even if that sonofabitch never even existed.

As Mr. Homnick notes in verse below, a society needs its history. Black History is American History, but many of us who aren't black are unaware of how egregiously it's been hijacked. This is just a sampler.

Monday, September 12, 2005

She Has Gone Among the Angels

The story of Susan Torres blanketed the local DC media for most of the summer. On May 7 of this year Mrs. Torres, aged 26, suffered a stroke caused by malignant melanoma and was pronounced brain dead. At that time, she was 17 weeks pregnant. There was absolutely no hope that Mrs. Torres would recover, but her family decided to continue life support in the hope that she could be kept alive long enough to safely deliver her unborn daughter. That daughter, named Susan Anne Catherine, was delivered on August 2nd, and Mrs. Torres died a day later after being removed from life support. Susan Anne Catherine was still more than two months premature, weighed less than two pounds, and although as healthy as could be expected under the circumstances, was still in a precarious state.

Insurance for the Torres family didn't begin to cover Mrs. Torres's hospital bill, never mind the costs of neo-natal intensive care once Susan Anne Catherine was delivered. In the face of initial estimates that $400,000 in unreimbursed costs would be incurred, a blogosphere-driven fund drive raised $600,000.

Susan Anne Catherine Torres died yesterday, when her heart failed after emergency surgery to repair a perforated intestine. She was five weeks old. May she rest in peace, in company with her mother and all the saints and angels, in the eternal light of God.

The Torres case is an extreme example of a facet of American medicine that is widely misunderstood. We are constantly criticized for spending more than other countries on health care, yet our infant mortality rate is higher. Nick Kristof's been beating this drum for months; first we were lagging behind Cuba and China, then he couldn't even write about Hurricane Katrina without dragging the dead babies back into it. But consider this: when this year's health expenditures are totalled up, they will be a couple of million dollars higher, and when this year's infant mortality statistics are calculated, there will be one more infant in the numerator, all because the Torres family, and their friends and supporters, cared so much about one unborn child that they expended every resource they could muster to give her one unlikely chance at life, a chance that ultimately failed.

Susan Anne Catherine Torres is just one case, but according to the CDC, not an isolated one: when asked to investigate the reason that infant mortality increased in 2002, for the first time in several decades, they discovered that the number of extremely-low-birth-weight infants born alive has increased dramatically. In most countries, these children would be stillborn. Here, they usually die soon after birth, despite our best efforts. It makes no sense to unfavorably compare a country that tries to save lives with those who give up without trying.

Federal Budget Bloat

In a forthcoming article in the October issue of Budget and Tax News (of which this author is senior editor), published by The Heartland Institute, Chris Edwards of the Cato Institute provides an excellent analysis of the causes behind the rapidly increasing federal expenditures of the Bush years, beyond the response to 9/11 and the War in Iraq. After documenting the extent of the increases, Edwards correctly places the responsibility directly on the Republicans in control of both Houses of Congress:

The number of federal pork projects increased from fewer than 2,000 annually in the mid-1990s to almost 14,000 in 2005, as measured by Citizens Against Government Waste. Other data indicate the number of federal “earmarks” increased from 4,155 in 1994 to 15,584 in 2005. . . .

In the past, the Kings of Pork were mainly Democrats such as Senator Robert Byrd of West Virginia and former Representatives Tom Bevill of Alabama and Jamie Whitten of Mississippi.

Today, the leading pork spenders are Republicans such as Senator Ted Stevens and Representative Don Young of Alaska, and Senators Trent Lott and Thad Cochran of Mississippi. Republicans promised to cut wasteful spending when they were elected to the majority in 1994. But today few seem embarrassed by the record levels of pork.

This year Congress will dish out $426 billion on grants to lower levels of government for a myriad of local activities in 2005, according to the Fiscal 2006 budget.

Most earmarks fund activities that are properly the responsibility of state and local governments or the private sector. . . .

The problem starts at the top: Republican leaders have shown no personal restraint on the budget. House Speaker Dennis Hastert is a champion at bringing pork home to Illinois. The Washington Post noted in a July 17, 2004, article that Hastert “makes a habit of helping Illinois-based corporations,” such as Boeing, Caterpillar, and United Airlines.

Hastert’s giveaways have included trying to get United Air Lines a $1.6 billion loan guarantee and adding $250,000 to a defense bill for a candy company in his hometown to study chewing gum. The lack of principled GOP leadership has a corrosive effect on members who may be willing to support restraint but who will not put their necks on the line without sacrifice at the top. Why should rank-and-file Republicans restrain themselves when their leader is the porker-in-chief? . . .

. . . [T]he pork explosion highlights the need for Congress to overhaul its budgeting structures to get a grip on the overspending that has created huge deficits.

Republican members should insist that party leaders stop undermining restraint by using their positions for parochial gain. They ought to stop supporting leaders who call themselves conservatives just because they favor tax cuts. The real litmus test for fiscal conservatism is leadership on spending cuts and a willingness to forgo pork to set a good example for the rest of Congress.

The Benefits of Blogging

Thanks to the Reform Club, I met a couple of professors online who also blog: Michael DeBow of Samford University (Law and Economics) and Joseph Knippenberg of Oglethorpe University (Political Theory). DeBow blogs at Southern Appeal and Knippenberg blogs for the Ashbrook Center's No Left Turns. These are happy alliances for an aspiring academic.

Professor DeBow will be lecturing at Oglethorpe in Atlanta today as part of the Constitution Day festivities. I'll be there to meet the profs in the flesh for the first time. If there are any Reform Club or Southern Appeal readers who will be attending, be sure to say "Hi."

Sunday, September 11, 2005


There are those who say quite rightly
That we ought to tell tales nightly
To all who are young and spritely
With a tone that may feather lightly
Through the ears and into the heart,
So they find even in life's fresh start
Their moment plays in history a part
Whether through craft or inspired art.
That God with Nature does distribute
To each alone their unique attribute
So they may to the world contribute
All for His ultimate glory and tribute.
Oh, kings of yore mightily clashed
Great civilizations duly smashed
Pretenders like lightning flashed
Dreamers found ambition slashed.
The line of progress did relentless move
Today's rut had been yesterday's groove
Only what helped all the world improve
Did its virtue by hardy endurance prove.

Friday, September 09, 2005

Stuck in the Crowd

I've been thinking a lot about those people in the Superdome who have now become a human herd moved from one massive venue to the next.

I agree with those who say that the trouble these people have endured is a scandal and a terrible comment on race relations. No question about it. However, the discomfort caused means we have to wonder what is wrong with this picture.

Think about it. We are looking at a group of people who literally were unable to get out of town. Many of them may have no family ties outside of the city. Many have probably lived in a welfare culture for decades, born and raised. Such persons have been robbed of their basic human dignity. This is a group of people who have been socially engineered into passivity and helplessness. The possibilities for sociological study are astounding. How many of them have ever held a job, have ever left the city of New Orleans, have ever left their state, have ever drawn a check from any entity other than a government agency? How many have any family member in a position to help?

Once you consider it, this is an unacceptable existence for anyone and we should not settle for it. Before 9-11, we were hearing story after story of the amazing successes due to welfare reform. We heard about people who held jobs for the first time, people who had pride in accomplishing something on their own for the first time, and children who could view their parents as role models for living a broader life for the first time. We heard about former Clinton officials who resigned in protest over welfare reform and now strongly endorsed it.

We have got to get back to addressing this situation. The War on Poverty failed -- possibly made things much worse -- and we must once again get people out of this institutional lifestyle where they are so terribly encapsuled in hopelessness and passivity.It's time to bring welfare reform and school choice back out of the closet. We've seen the cost of not moving forward with a better solution.

Credit Where Cash Is Overdue

One of the legacies of Katrina will be a great deal of quality writing, often inspired and passionate. If I may, I confess to taking some pride in my own four published articles at The American Spectator, covering the hurricane from different viewpoints and aspects.

Today I try to focus on the people who did the best job of all and started the earliest - the boys of our Coast Guard. They made us very proud with their performance in New Orleans.

EMT Promises

Bravo to my former landsmen from Cincinnati, who served as EMTs in the horror of the New Orleans Superdome. Please honor their work by reading this story.

And we must educate ourselves to what was, and what must never be again, by reading this horrific account by two other EMTs who happened to be at a New Orleans hotel for a conference when Katrina dropped by.

Thursday, September 08, 2005

TRC---FEMA For Existentialists

Below, my colleague Hunter Baker, with a little help from the devastatingly logical Dr. Francis Beckwith and an astute Classical Liberal (persons manifestly of no little learning in these things), attempts a Socratic dialogue with a product of the Western educational system and thereby its wellspring and guiding light, modern philosophy.

But I fear the classical reference here is to the Myth of Sisyphus (well-appropriated by the modernist/failed sentimentalist Albert Camus) where the cosmically condemned pushes a boulder up a hill only to have it roll down the other side, ad eternum ad infinitum.

I consulted a really cool guy named Mortimer Adler on this and he had already given it some thought. (Like they say, read the whole thing.)

If we're going to get retro about it (there is an amnesia in the modern academy from Plato [c. 400 BCE] to the Enlightenment [c. 1400-1800 CE]), philosophy's first question, its First Thing, was to ask, "What is Good?"

In a Socratic dialogue, everybody hanging with Socrates was asking the same question. They had a common purpose. But this is not the case in 2000+ CE. We are all solipsists, each at the center of our own universe. To seek wisdom and the resonances of a higher moral order and purpose is no longer our joint enterprise. Everyman for himself.

Adler points out that the modern philosophical enterprise shuns First Things, metaphysics and the question of what is good, and skips to Second Things, science and empiricism, that which we can measure and prove, and epistemology, how we know that we know.

For those of us who seek those ineffable First Things (and the ancient Greeks and today's Buddhists did and do that, without the aid of "revelation"), the discussion of Second Things is kindergarten, and hardly worth the sense of occasion that vivifies those nights with that party animal Socrates and made them worth preserving for 2400 years.

I mean, the name of God is on the lips of every drunk, but a night with Sisyphus, even if you're trying to help, is a lot like work. A gathering of the Socrateans was always a party. Right now, The Reform Club's Second Things charity case is caught in No Man's Land, appealing to First Things even as he denies their existence. The question in the original post continues to beg itself---What is Good? That it can be asked at all provides its own answer. Good exists.


(This occasionally humble correspondent has been MIA of late due to illness in the family. My thanks for the gentle encouragement of those who wrote me, and to those who would have if they'd have known. Received good news tonight---recovery is coming, albeit slowly. I suppose that if my family were of the Peter Singer/Second Things mold, we'd have flushed her over dependence and quality of life issues. But she ain't heavy, she's my mother.)

After The Flood

A very fine young writer---with whom I'm unfamiliar---a certain Jay D. Homnick, takes beaucoup right-wing abuse over his recent article over at The American Spectator about the president's failure to inspire the populace in the first few post-Katrina days.

Homnick is, of course, correct. PR is the Bush Administration's Achilles heel (like the attempt to use Armstrong Williams, the Uncle Tom's Uncle Tom, to promote "No Child Left Behind" to Black America). Karl Rove may be a consummate political operator, but he's no Dick Morris. Morris would have had a poll done before the first breeze stirred and a media blitz underway before the first raindrop reached the ground.

But it is essentially a failure, or let's say an imperfection, in Bush's own constitution; our quarterback has flaws and he fumbled this snap. Why?

Dubya won every "Least Likely To" poll until he experienced a spiritual conversion later in his adult life. Politics ended up seeking him out, rather than the other way around. He remains unpolished in the showbiz aspect of the game, unlike Bill Clinton, Al Gore, and John F. Kerry, who knew before they reached the age of majority that their destiny was the presidency.

Bush could no sooner say "I feel your pain" with a straight face than we could likewise listen to him say it. It just ain't him. His loss in his first election for Congress, where he put on the false skin of the Harvard-educated professional pol, made him resolve to never be untrue to himself again.

I've noticed that in our interpersonal relationships, we don't want the truth, we want to be handled. We want the other person to understand our vulnerabilities, and treat us accordingly. This isn't a bad thing; kindness and mercy, Aquinas' white lie as it were, are of higher moral value than truth. But our friends on the Loud Left to the contrary, for Bush to BS us is false to him, even if it is what we demand or even require.

And require it, we all do, and I mean that without sarcasm. Unfortunately, Bush is not up to that task. We are all faint of heart, and a little ill-founded optimism has turned the tide oftentimes in world history.

But this is a democracy, and a democracy of The Information Age. We shall each learn the facts on our own, and we shall each be responsible for our own spirits. If we are to believe the polls, this nation, or at least most of it, understands that. Good on us. Perhaps we're growing up after all.

Next Supreme Court Justice

Manuel Miranda, former counsel to U.S. Senate Majority Leader Bill Frist and founder and chairman of the Third Branch Conference, a coalition of grassroots organizations following judicial issues, has been doing some excellent analyses for Opinion Journal.

In his latest article, he examines the likely contenders to replace Justice O'Connor on the Supreme Court. Miranda looks at three categories of judges, each having political pluses and minuses. The interesting thing is that he identifes numerous strong jurists who fit Bush's criteria for judicial philosophy and temperament, which means that political and confirmability considerations may well be a very large factor in the president's decision-making process.

Most interesting was the mention of three Senators who could do the job but would not fit the perceived need for an additional woman to be named to the Court with the current choice. Bush went outside the original expected candidates in previously choosing John Roberts for O'Connor's vacating seat, and a surprise candidate remains a possibility. The list Miranda compiles, however, is plausible, as are his comments on the candidates. Read it here.

Discussion Thread: Universal Moral Values

In the last post, one commenter (Tlaloc) came down hard on the tobacco companies. Another commenter (Classical Liberal Anonymous) asked Tlaloc whether he was engaging in a moral argument. This was interesting because Tlaloc has generally thrown bombs at notions of foundational morality despite frequently engaging in moral argument. Tlaloc, perhaps sensing the implications, carefully distinguished his moral argument from any endorsement of universal moral values.

So, let's work it out. The basic allegation by Tlaloc seems to be that the tobacco companies have immorally lied for profit and have sold an addictive drug for profit. The basic rules being put forth seem to be:

1. It is wrong to lie without a compelling justification (such as to save a life -- e.g. lying to the Nazi S.S. about the Jew hiding in your closet). Lying for mere monetary profit is particularly bad.

2. It is wrong to subject others to the harm of unhealthy addiction for the sake of personal enrichment. It is further wrong to lie about the fact that one is doing that.

Now, here's the money question. Why wouldn't these rules stand up as universal moral values? When would it ever be right to lie for profit without any compelling justification? When would it ever be right to subject others to addiction for no better reason than to get rich?

Tuesday, September 06, 2005

No Fertilizer Needed for The Constant Gardener

Well, my wife prevailed upon me to see The Constant Gardener this weekend. How can I say this gently: Don’t waste your money. A new tuberculosis strain is wreaking havoc across Africa, you see, and a corrupt pharmaceutical firm has developed an effective treatment that, sadly, has the unfortunate side effect of killing many of those taking the drug. We know this because UN aid workers in Kenya, using only the most rigorous of statistical analytic tools, say so. And so the poor Africans killed by this drug are secretly buried in lime pits, while the official records of their lives are expunged. Only Soviet-style airbrushing of photos failed to have been included. Meanwhile, the starlet---Ms. Rachel Weisz, aka Tessa Quayle in the film---learns that the evil pharmaceutical firm, aided by some corrupt British officials, is covering up the obvious evidence of the drug’s deadly effects because fixing the formula would cost millions and take considerable time, during which the firm’s competitors could create their own effective drugs that would not kill people, thus cutting into the corrupt firm’s profits, etc., etc. And this perfidy makes sense because the epidemic is likely to spread worldwide, creating a large demand for the drug, and suppression of the deadly side effects will guarantee a huge market in Asia and the West. It’s all about the money, you see.

Got that? Anyway, the evil pharmaceutical firm through its allies in Kenya arranges for the murder of the fair Tessa and her ally, a Kenyan doctor both humanitarian and seemingly the only man in the country both unpoor and uncorrupt, before they can expose the plot. After all, that is not the kind of direct-to-consumer advertising that sells medicine. And so Tessa’s loving husband Justin picks up the torch, exposes the evildoers for what they are, and then allows himself to be murdered by the same nefarious forces so that he can be together again with his beloved Tessa in heaven. Who says that Hollywood is not religious?

Well, if Big Pharma is motivated only by money, why would they expose themselves so crudely to the plaintiff’s bar in the West? After all, people would start dying in the West also; can we even imagine the sums that the juries would award in such cases? And would the FDA and the other regulatory agencies in Europe simply accept the results of such African “clinical trials?” And what about the brand name capital of the offending pharmaceutical firm? Does it not have a profit motive to protect it by marketing only drugs the benefits of which justify the downside risks?

This flick is so silly—-so Michael Moore-like in its excess and mendacity—-that the pharmaceutical industry has little to fear from it in terms of adverse p.r. It’s good thing, as Martha might put it, when those out to destroy capitalism prove themselves so crude.

Surviving a Housing Bust

Returning to the highly controversial topic of the housing boom and potential bust in some areas, as in all good conscience I simply must, yea must, we find a very good article on the housing price situation and what to do about it, from by way of Yahoo! finance. The article points out that certain areas of the country really are in line for price corrections, then it gives several good tips about how to weather any changes:

Whenever you're upside down on a car because you owe more than it is worth, the cure-all is to literally drive your way out of it by keeping the car until the loan balance falls below the market value. Be prepared to do the same with a new-home purchase. If your feeling is that you're going to move in three years, it is time to make plans for other contingencies. Can you afford a mortgage that offers a fixed rate for a longer period, such as a 10/1 ARM or a 30-year fixed-rate mortgage? If not, continue renting. The transaction costs of buying and selling are steep, and any downturn in price over such a short holding period will clobber the unsuspecting buyer.

The home is first and foremost where you live. Get past the "my home is an investment" mentality to protect against the bursting bubble. The home is indeed an investment, but a long-term investment.

I think that the idea of paying off principle as quickly as possible is vitally important. If, when you find that you must or strongly wish to sell your house, the rise in value turns out to be less than you might have hoped, you will benefit greatly by having real equity built up. Shorter terms, such as ten or fifteen years, are much better than longer ones, as you pay the financing institution much less in interest, which means that more of your money is going into buying the house instead of renting money. In addition, stay away from adjustable rate mortgates, as the article warns (in contradiction to Fed chairman Alan Greenspan's advice), as they cause you to have to pay the most when the value of your house is rising most slowly or declining

Some people can make a nice profit by buying a scrotty house, fixing it up, and selling it at a profit, but that is not the same as riding value waves. The former is real investment, whereas the latter is speculation. One can succeed at the latter, but it is dependent more on luck than on skill. A real investment is one that a person puts work into.

Monday, September 05, 2005

A 1978 perspective on Jude Wanniski (who just died)

Review of The Way the World Works, by Jude Wanniski. Basic Books. 319 pp. $ 12.95.
from The Public Interest, Fall 1978:

“Reality in One Lesson”


The marvelous audacity of the title The Way the World Workswill attract some, repel others. Amazingly, it is appropriate. This actually is an attempt to explain political and economic events throughout the ancient and modern world in terms of a manage-able number of general principles. Even more remarkable, this heroic effort is frequently successful-illuminating many of the mysteries of history, from the decline of Rome to the stock market crash of 1929 and today's global stagflation.

The book is deceptively easy to read, which may cause those who associate economic wisdom with impenetrable prose mistakenly to interpret its clarity as a lack of depth. As his unsigned Wall Street Journal editorials attest, Wanniski is a master of illustration, and each piece of the political-economic model he propounds is carefully interwoven with folksy examples, then amply documented with rigorous historical evidence.

Wanniski's economic model is simply brilliant and brilliantly simple. The starting point is to examine the supply side of an economy -to ask what motivates people to add to the quantity and quality of marketed goods and services. The answer builds upon a broad definition of work as a complex combination of physical and intellectual effort. Most work is in the barter economy-housework, do-it-yourself projects, trading tasks with family or friends. Smith the carpenter and Jones the plumber will exchange services with each other in the marketplace only "when it is easier to trade their work for somebody else's in the public economy." Otherwise, Smith will fix his own sink and Jones his own kitchen cabinet, each thus depriving the other of a job.

There are enormous efficiencies in specialization and additional gains from using money to expand the scope of possible exchanges within, and even beyond, national boundaries. But entering the public economy to specialize makes the transaction visible and therefore subject to government taxes, tariffs, and regulations. When the government imposes too heavy a burden on transactions in the public economy, people drop back into the inefficient private barter economy (friends, "do=it-yourself," and casual labor for cash), or they substitute leisure for taxed income.

This brings us to the "wedge model," attributed to Professor Arthur Laffer of the University of Southern California, which explains how a variety of taxes and regulations form a wedge between what employers pay for workers and what employees ultimately receive in after-tax income. Reducing this wedge makes it cheaper for employers to offer jobs and more lucrative for employees to accept and retain jobs. A similar wedge between what business pays for capital and what suppliers of capital (investors) ultimately receive in after-tax income reduces savings, investment, and economic growth.

According to Wanniski, the practice of taxing additions to income at sharply increasing rates-the progressive income tax-has a particularly demoralizing effect on personal effort and specialization. "Workers now have less incentive to become skilled workers or foremen, foremen have less incentive to become salespeople, sales-men have less incentive to become managers, and managers less incentive to become entrepreneurs." This effect has been com-pounded by inflation, which pushes unreal increases in incomes into higher and higher marginal tax brackets, thus discouraging supply and producing the apparent paradox of "stagflation."

"The only way government can increase production," concludes Wanniski, "is by making work more attractive than non-work." The Soviet Union accomplishes this task with the least generous welfare, retirement, and unemployment benefits in the civilized world. They use the stick to replace the carrot. Western countries, however, have tended to forget the stick and tax the carrot with policies that discourage work and subsidize non-work, with the predictable result that we are getting less effort and more "leisure."

The most famous illustration of the model, the "Laffer Curve," rests on the crucial distinction between tax rates and tax revenues: "There are always two tax rates that yield the same revenues." A zero rate yields zero revenue, and so does a 100-percent rate (be-cause the taxed activity would cease). Between these extremes lies an optimal point "at which the electorate desires to be taxed." Raising tax rates beyond that point lowers both the public economy's output and the government's revenue. The optimal tax rate can be very high during war time, but high rates at other times will normally generate wholesale tax evasion and a reversion to inefficient, unspecialized barter.

A chapter on the Crash of 1929 meshes the theory with some truly original historical research. The stock market always reflects the best available information about the future course of the economy, Wanniski argues, and therefore could not have been grossly overpriced at the 1929 peak. The market's fall must instead have reflected a previously unexpected increase in the political cost of doing business (the "wedge").

Treasury Secretary Andrew Mellon emerges as the principal political hero of the book for slashing back the income-tax rates several times from 1921 through 1929 (rates ranged from 4 percent to 73 percent in 1920, 0.4 percent to 24 percent in 1929) while simultaneously running budget surpluses. The much-maligned Coolidge era provided five years of 3.5-percent unemployment and 0.5-percent annual inflation-a combination that is impossible in Keynesian theory (especially with budget surpluses), and certainly unmatched in Keynesian practice.

If the Coolidge tax cuts were such a successful application of Wanniski's model, what brought on the market's crash? By sifting through newspapers of the day, Wanniski demonstrates beyond reasonable doubt that the stock market crash of 1929 ensued be-cause of the growing likelihood of passage of the Smoot-Hawley Tariff Act of 1930. A domestic tax is "a wedge between the trading of Jones and Smith. The tariff is a wedge between the trading of Jones, a national, and Schmidt, a foreigner. The effects on commerce are precisely the same."

To make matters worse, income taxes were increased again and again during the 1930's (ranging from 4 percent to 79 percent by1936), and became particularly punitive toward people worth high incomes by virtue of their ability to add value to enterprises. The politics of the day liked employment but hated employers, a situation that wasn't really improved until another of the book's heroes, President Kennedy, cut tariffs and slashed tax rates (from a 20-percent to 91-percent range to a more moderate 14-percent to 70-percent range), while simultaneously reducing Federal spending and borrowing.

Wanniski goes too far, however, in denying that the collapse of the banking system and the related destruction of a third of the U.S. money stock had any effect in prolonging the Great Depression. "If prices could have risen by one third," he says, "there would have been no need for the banking collapse." But it was the banking collapse that produced the falling prices, and it could have been prevented.

Those of us who have labored under the accusation of employing "19th-century economics" will enjoy Wanniski's clever uses of 18th-century, classical economics to browbeat the current intellectual fashions.

Marx is accused of a fixation on economic contraction, which requires "submerging individualism into collectivism, because it is the untrammeled individual who is viewed as driving the capitalist system toward overproduction, boom and bust." Each worker is supposed to work harder in Marxist economies simply because of the ideological promise that others will do the same.
Like the Marxist model, says Wanniski, the Keynesian model is primarily a rationale for redistributing income (sharing misery) during periods of economic decline. Keynesian theory rests uneasily on "bond illusion"-people's presumed failure to recognize that an increase in government debt must require higher taxes in the future to repay or pay interest on that debt. Deficit spending just replaces present taxes with future taxes, and people will not "work for bonds, under the illusion that they can be exchanged for real goods."

If Keynesians base their theory on "bond illusion," monetarists stand indicted for peddling "money illusion"-"the notion that people will work for `money' as a form of wealth, whether or not there is anything that money can buy." Some monetarists do argue that an unanticipated inflation can briefly reduce unemployment (because prices rise faster than wages), but only until adjustments are made. Indeed, the "rational expectations" school of monetarism even goes further than Wanniski in denying illusion, since Wanniski remarks that "creditors suffer and debtors benefit by an unanticipated switch in coin by the government." If lenders never suffered even temporary money illusion, then interest rates would always be high enough to compensate for any loss of purchasing power.

The real problem, of course, is long-term contracts in a changing world. If employers agree to pay 10-percent annual wage increases for three years in the expectation of being able to raise prices by 7 percent a year, a lower than anticipated monetary inflation will toss them into a cost-price squeeze, requiring layoffs. Imperfect foresight isn't really a matter of illusion, as Wanniski suggests, any more than the stock market suffered illusion in 1929 before the news about tariffs changed so quickly.
In Wanniski's model, it would apparently make no difference if there were a 100-percent inflation one day and a 100-percent deflation the next, except insofar as it distorted the tax structure. All prices and wages not only adjust to changing money growth, but do so evenly and instantaneously. Expectations are not only rational, in the sense of incorporating each day's best information, but also perfectly correct in anticipating future policy shifts. This is a useful simplification for some purposes, notably in drawing attention to the real factors that ultimately determine long-run economic growth, but it is not sufficiently precise to erase even temporary links between money, spending, and production.

If there is a prime villain of the book, a Darth Vader, it must be Professor Nicholas Kaldor of Cambridge University. Kaldor has been a principal exponent of the notion that developing nations must impose draconian taxes in order to extract the "savings" to finance grandiose government "investments" (uneconomic steel mills and other monuments).

Wanniski traces the Kaldor theme back to mid-19th-century India, where British railroad builders plied their trade at the cost of an onerous debt burden on Indian taxpayers. Economic imperial-ism is thus nearly defined as "the exploitation of the underdeveloped world by pushing it beyond its capacity to develop, in the process burdening the masses of people in the Third World with indebtedness and taxes."

Wanniski's documentation here is devastating. We find that be-fore recent tax cuts, taxpayers in stagnant Asian countries faced 65-to 75-percent tax rates on incomes of around $7,000. In the booming Ivory Coast, marginal rates stop at 37.5 percent above $20,000, while in the similar but sluggish economy of Ghana tax rates hit 75 percent at $12,500. Anyone can pick the most troubled economies out of an extensive list by simply looking at the steepest taxes.

Economics in the real world is rarely divorced from politics, and what links the two, according to Wanniski, is the electorate's understanding of economics, which is acquired from childhood through dealings with others. "The only way an economist can know something his fellow human beings do not ... is if people them-selves do not know why they produce, distribute, and consume." It is one thing, however, to demonstrate that people understand their own economic circumstances, and quite another to claim that the electorate possesses the sorts of analytical skills and economic information needed to make political actions conform to their shared interests. Because each vote carries little weight, voters have no incentive to be as well-informed about politically determined economic issues as they are about something that affects their interests directly (such as the choice of employment or stereo components).

Some decisions nonetheless do have to be reached by political consensus: "When four people go out to dine, the wine selection requires a political decision because four tastes must be satisfied with one bottle." To solve such problems on a larger scale,the global electorate is seen pushing, at every opportunity, in the direction of systems capable of producing superior politicians. This political process has as its ultimate aim a solution to the basic economic problem that for all time has confronted the global electorate, which is the tension between income growth and income distribution.... No individual can possibly be as wise as the electorate, the consensus, in discerning the preferred tastes of all the individuals who compose the electorate.... [Every election] is the optimum reflection of the national or local interest, given the choices available to the electorate.

People know what they want, and cannot be induced to want something else, but that is not to say that politicians are not some-times mistaken or misled about the electorate's desires. When politicians lose touch with the people, the electorate is forced to find ways outside the normal political process to communicate with the politicians: revolution, religion, nationalism, and even, at times, assassination.

Unfortunately, Wanniski fails here to differentiate adequately among kinds of political action, and is left therefore with a formulation that amounts to saying that what is not upheaval is contentment.

These strained simplifications of political life are best illustrated by Wanniski's curiously charitable view of the Soviet Union's "democratic experiment." Communist systems apparently have the sup-port of their electorates, Wanniski says, "for if they did not we would expect to see more visible signs of internal dissension." But that is why such systems nationalize the means of dissent (news-papers, television, guns), so it is very difficult for outsiders-and even for other citizens-to see "visible signs" of dissension.

Wanniski's economic lessons appropriately concentrate on the political barriers to trade-tariffs and taxes-that diminish the market's efficiency in producing what is wanted. His analogy between political and economic markets would be greatly improved if it were likewise explicitly acknowledged that there are particularly formidable barriers to political "competition." These barriers make political decision making inherently less competitive and efficient than voluntary market transactions.

Still, the book offers quite a lot of anecdotal evidence that following the Laffer/Wanniski economic model is good politics-even given the great dissimilarities in traditions and expectations among people of different nations and cultures. Those who overtax the people eventually lose power, one way or another. In this sense, the political model may help to explain how the electorate pushes, albeit glacially, toward responsive government. For in the end, governments can't distribute goods and services that are not produced, or tax transactions and activities that do not take place. Production depends on the quantity and quality of work and capital, which, in turn, depend on the after-tax real rewards to productive effort and investment. When the creation and spending of money outrun production, you just get inflation. Government debt is not a source of real wealth. If The Way the World Works did nothing more than push a handful of political entrepreneurs toward such fundamental realities, as it already may have done, it would rank among the most influential books since the 1930's.

When this was published in 1978, Alan Reynolds [now a senior fellow at the Cato Institute] was Vice President of the First National Bank of Chicago, and editor of First Chicago World Report.

Sunday, September 04, 2005

Judge Rehnquist Is Dead

After 33 amazing years on the bench, in which he went from a lonely voice to a strong Chief Justice, William Rehnquist died last night. I've always wondered what Supreme Court justices, with the power they have wielded, think about as they die. I like to think Rehnquist was at peace with his responsibility to the gift/burden of authority he was given.
Once again, Jennifer Tilly has won a major poker tournament, her second in a few months. But she has only been playing for one year, since her boyfriend has been Phil Laak, the poker great. It is absolutely stunning to reach this level of dominance in a sport whose participants take it deadly seriously - and in such a short time. This is real quality insight into a person's intelligence and ability, something no publicist can fake.

Of course it helps that she is unbelievably wealthy, since she received a percentage of The Simpsons in her divorce from its creator, Sam Simon. Still, that may make you a cooler bettor, but you can't be a consistent champion like this without spectacular skills.

Brava, Jennifer!

Friday, September 02, 2005

New New Orleans

Louisiana native Fred Smith, the man who combined free market policy analysis with performance art to create the Competitive Enterprise Institute, offers some wise words on the rebuilding of New Orleans.

Personal note: I've been a member of a lot of odd sets, from the International Brotherhood of Electrical Workers to Our Lady's Rosary Makers. One of the most enjoyable and rewarding, and certainly the one with the most eminent fellow members, is "People Who Used to Work for Fred Smith." Only there can I presume to have something substantially in common with the likes of Jonathan Adler, Sasha Volokh, and Michael Fumento.

Global Warming and Tropical Storms

In today's edition of Tech Central Station, Dr. Roy Spencer, Principal Research Scientist at the University of Alabama and one of the world's top climatologists, considers the arguments that global warming is causing more frequent and intense tropical storms:

There is some recent research that suggests that of all Atlantic and West Pacific tropical cyclones measured since the 1970's, a warming trend in sea surface temperatures has been accompanied by stronger and longer-lived storms. In fact, the increase in the total power generated by the storms that the study computed was actually much larger than could be accounted for by theory, suggesting changes in wind shear or other processes are operating in addition to just increased temperatures. (Unpublished results by the same researcher suggests, however, that this trend was not apparent in land falling hurricanes since the 1970's).

Given the recent work, how should we view the role of global warming? First, we know that category 4, and even category 5, storms have always occurred, and will continue to occur, with or without the help of humans, as the above examples demonstrate. Therefore, if we are prepared for what nature can throw at us, we will be prepared for the possible small increase in hurricane activity that some studies have suggested could occur with man-made global warming. To suggest that Katrina was caused by mankind is not only grossly misleading, it also obscures the real issues that need to be addressed, even in the absence of global warming. From a practical point of view, there is little that we can do in the near term to avert much if any future warming anyway, no matter what you believe that warming will be, including participating in the Kyoto Protocol. So why even bring it up (other than through political, philosophical, or financial motivation)?

Texas Tea, Baby. But Not in Texas.

Rich! We're rich I tell ya!

That is, if the enviro-donkies don't prevent us from tapping the vein.

Here's a little taste of the big story:

The United States has an oil reserve at least three times that of Saudi Arabia locked in oil-shale deposits beneath federal land in Colorado, Utah and Wyoming, according to a study released yesterday.

(HT: Instapundit)

Thursday, September 01, 2005

A Tale Of No City (Anymore)

Dereliction of my duty, you say? Perhaps you are right.

I have been remiss in not alerting my friends to the story that I reported in today's American Spectator. It takes us out a half-step ahead of the loop, while TV is still walking us through the gasping-but-not-grasping stage of gawking at the events. The stories usually emerge some time later, as selves are progressively collected. Here is a tale of woe, of awe, of horror, of desperation and, eventually of courage and heroism, even flashes of joy.

A human episode.


What was the big deal with Copernicus and Galileo, really? I mean, if you live on the Earth's surface, what difference does it make if the earth or the sun or some other spot is the center of the universe? What difference does it make if the sun and planets move around the Earth in epicycles on crystal spheres or if Tycho Brahe was right and Kepler was wrong. You can hold these views and still explain anything you'd be likely to observe. Stick ellipses on Tycho and you can even explain the phases of Venus. There really is no reason for such a person to prefer modern cosmology to Ptolemy, is there?

In fact, there's a good reason for such a person to reject modern cosmology. The Ptolemaic system doesn't require you to accept the obviously ludicrous notion that the earth is moving. Only some ivory tower mooncalf, with no knowledge of the real world, could possibly believe a theory that requires the obviously still and solid world to be hurtling through space.

Now replace "Copernicus and Galileo" with "modern economists" and "Ptolemy" with "certain commenters in the 'I Am Speechless' threads" and I think you'll see where I'm going.

There is, really, no reason for the vast majority of people, even successful business people, to think in the way economists think. It is not necessary for them to interpret the world with our concepts in order to make and sell products. They can happily take as given and fixed all the information that economists know is being constantly generated and recalibrated through interactions in the market. They can make decisions using this information, without being aware of their own role in changing and generating new information.

They can even believe they are putting one over on their customers -- that they are, for instance, selling them goods purposely designed to wear out "too fast" and thereby sell more and earn more than if they made the sturdy, quality products the customers really want. They can believe this even while the relative prices for durable and disposable goods are reflecting consumers' time preferences and discount rates with exquisite precision, leading the businessman to supply exactly the mix of goods the consumers desired.

I've never quite understood, though, what was the point of getting so shirty when economists explain what's really going on. But then, Galileo got a few goats in his day too.

"Just Give Them What They Want, and They'll Stop Fighting"

In his latest column, the Boston Globe's Jeff Jacoby writes about the conclusion of Israel's withdrawal from Gaza, and what it means:

[I]f Sharon and the supporters of unilateral withdrawal are right, the departure from Gaza should mean fewer terrorist attacks like the one that cost Elkanah Gubi his life. No longer obliged to defend a Jewish presence there, physically separated from the Palestinians by a security fence, Israelis ought to be more secure without Gaza than they ever were with it.

For years, Israel has been told much the same thing by its critics: Since the "occupation" of Gaza and the West Bank is the cause of Arab terrorism, the way to end Palestinian terrorism is to end Israel's presence in the territories.

But far from reducing the terrorists' bloodlust, Israel's retreat from Gaza has only inflamed it. In just the past two weeks, a Palestinian knifed a Jewish student to death in Jerusalem's Old City, an Israeli policemen was stabbed in the throat by an Arab in Hebron, Kassam rockets were fired from Gaza into the southern Israeli town of Sderot, a suicide bomber blew himself up in Beersheba's crowded bus station, a Katyusha missile launched from Lebanon exploded in the Israeli village of Margaliot, a firebomb was thrown at an Israeli vehicle on a highway outside Jerusalem, and a 14-year-old boy from Nablus was caught with three bombs.

In a videotape circulated by Hamas this week, archterrorist Mohammed Deif vowed that Israel's departure from Gaza would mean more of the same.

"Today you leave Gaza in humiliation," he taunted the Israelis. "You are leaving hell. We promise that tomorrow, with Allah's help, all of Palestine will be hell for you." For the umpteenth time, an Israeli government spokesman urged the Palestinian Authority to disarm and dismantle Hamas, as required by the international "road map" it has agreed to.

If Jacoby is correct, as I believe him to be, the implications regarding U.S. efforts in Iraq are clear.

Widespread Dissatisfaction

The recovery of survivors from New Orleans has left a lot to be desired. A friend wrote me outraged that babies are dying for lack of adequate food, shelter, etc. How can this be in the richest, most creative, most powerful nation in the world?

I think the answer is as follows: We haven't had a disaster like this in a long, long time and when it happened in the past, the vast majority of victims died rather than surviving. We have not been faced with something of this magnitude spread over such a great geographic area, probably ever. Certainly, we haven't seen a major inner city area suddenly and violently reclaimed by nature.

FEMA probably had enough water, food, drugs, and bandages ready, but not the kind of massive mobilization of search and rescue workers needed for a disaster like this. It was simply incomprehensible.

We don't keep an army of rescue workers waiting around for something like Katrina. I'm not sure we could even afford to do so. But the situation is grave and what must be considered is something new. We can't let the victims die. We have to mobilize. That means it may be time to consider conscription of boats, buses, helicopters, etc. Maybe even the conscription of men if volunteers can't be found. I know I'm offending libertarians. But it may be time to think on those lines. Actually, it simply is time.

The End of New Orleans?

Throughout the coverage of the disaster that has befallen New Orleans, it seems one thing has been assumed throughout: the rebuilding of New Orleans. Much depends on how long it will take to get rid of the water, engage in massive repair and new construction, and how much of the city's tax base sticks around.

The reality is that the entire professional class or a large portion thereof will relocate because they are unable to wait for the new city to rise. Many businesses will take a hard look at the New Orleans operation and decide they can't let resources like fallow that long. Expect a major migration of many branch offices and probably some headquarters locations.

Even the poor citizens of the town whom we have seen engaged in remarkable suffering as all rescue efforts pale before their plight may never come back to town. As many of them are long term clients of government programs, they will probably have the option to spend time in ultra-ultilitarian state and federal camps or to resettle elsewhere with the help of social workers and/or family members in other cities.

Unless someone can show me otherwise, I don't think there should be any assumption that New Orleans is going to continue as a major metropolitan area in the United States. It may just be a ghost living a marginal existence. Galveston never truly recovered from the great hurricane that leveled the town and killed so many. New Orleans may not rise even so high as the old Wall Street of the West on the Texas coast.

The Way the World Worked

As Hunter Baker posted below, Jude Wanniski unexpectedly passed away Monday afternoon after he suffered a massive heart attack. I've heard our esteemed co-blogger Alan Reynolds tell many stories about Mr. Wanniski and Polyconomics, but I'll let Alan tell those stories himself if he's so inclined. I want to tell a story about the effect a small group of men, including Alan and Jude, had on my generation of economists, social scientists, and policymakers.

When I started graduate school in the fall of 1980, it looked very much as though the country would be run by Jimmy Carter for four more years. When I looked back over my life from what then seemed the impossibly mature vantage point of 22 years on earth, I saw little but anxiety, conflict, and pessimism. I started paying attention to the outside world at about age ten, so my memories were bookended by Soviet tanks in Czechoslovakia and Soviet tanks in Afghanistan. Sandwiched in between were domestic political assassinations, oil embargoes, hostages in Iran, Watergate, double digit inflation, double digit unemployment, and the bankruptcy of New York City. I don't even remember now why I wanted to be an economist then. Economists were responsible for the splitting of ever smaller pies at home, and negotiating surrender to whichever economy would overtake us abroad.

Then Reagan beat Carter at the last minute. And we discovered that some of our professors were closet free market libertarians. Austrian School, even, a couple of them. They started lobbing ideas among themselves, and then at us, that first seemed silly, and then subversive. Critiques of Keynes, Samuelson, Kuznets, and Myrdal that undermined everything we’d learned as undergrads. Hints that macroeconomics would never be intellectually solid until it was reintegrated with microeconomics. Proposals that all sorts of behavior, not just commerce, could be explained with economic principles.

We starting passing a few books around among ourselves, on the QT; we were a little abashed that we were studying popular works instead of articles from JPE and Econometrica. But the stuff made sense, and kept on making sense the farther we pushed it: Thomas Sowell’s Knowledge and Decisions. George Gilder’s Wealth and Poverty. Julian Simon’s The Ultimate Resource. But before all those, anticipating them and paving the way, was Jude Wanniski’s The Way the World Works. These books opened our eyes to an economics that was hopeful and exuberant, that placed human creativity at the center of wealth creation, and that gave the economist something valuable to do: help arrange civil society so that creative force can be free to make things better.

And things did get better, all through the 1980s. It was men like Alan Reynolds and Larry Kudlow who gave us the proof that Sowell and Gilder and Wanniski were right, by putting those ideas to work during the Reagan years.

Twenty-odd years later, even though I've spent few of those intervening years working as a professional economist, I've never again forgotten why I wanted to be an economist in the first place. Rest in peace, Jude Wanniski. Your place in this world is secure, go forth into the next.

Wednesday, August 31, 2005

Glassman: Exploiting Disasters for Political Gain Is "Disgusting"

In today's edition of TechCentralStation (a site for which this author writes regularly), James Glassman, who lived in New Orleans for several years and has strong ties to the community (including family members living there), writes about the efforts of some writers and public advocates to tie Hurricane Katrina to their political agenda:

[T]he response of environmental extremists fills me with what only can be called disgust. They have decided to exploit the death and devastation to win support for the failed Kyoto Protocol, which requires massive cutbacks in energy use to reduce, by a few tenths of a degree, surface warming projected 100 years from now.

Katrina has nothing to do with global warming. Nothing. It has everything to do with the immense forces of nature that have been unleashed many, many times before and the inability of humans, even the most brilliant engineers, to tame these forces.

After recounting some of the activists' statements, which have received much attention in the news, Glassman addresses their claims directly:

The Kyoto advocates point to warmer ocean temperatures, but they ought to read their own favorite newspaper, The New York Times, which reported yesterday:

"Because hurricanes form over warm ocean water, it is easy to assume that the recent rise in their number and ferocity is because of global warming. But that is not the case, scientists say. Instead, the severity of hurricane seasons changes with cycles of temperatures of several decades in the Atlantic Ocean. The recent onslaught 'is very much natural,' said William M. Gray, a professor of atmospheric science at Colorado State University who issues forecasts for the hurricane season.'"

Finally, Glassman points out that the very premise that tropical storms are increasing in intensity is entirely unsupported:

[T]here is no evidence that hurricanes are intensifying anyway. For the North Atlantic as a whole, according to the United Nations Environment Programme of the World Meteorological Organization: "Reliable data…since the 1940s indicate that the peak strength of the strongest hurricanes has not changed, and the mean maximum intensity of all hurricanes has decreased."

Yes, decreased.

Not only has the intensity of hurricanes fallen, but, as George H. Taylor, the state climatologist of Oregon has pointed out, so has the frequency of hailstorms in the U.S. (see Changnon and Changnon) and cyclones throughout the world (Gulev, et al.).

Glassman makes a powerful case. Read it here.

Jude the Not So Obscure

Jude Wanniski has died. He was one of the great names of modern conservatism and will be remembered in the canon of that movement as long as it exists. I didn't know him, but our Alan Reynolds did and apparently quite well according to this article by James Glassman.

The Rev. RFK, Jr.

According to RFK, Jr.: God Hates Haley Barbour

You see, because Haley was insufficiently invested in environmental regulation, the Lord redirected Katrina from New Orleans and decided to slam Mississippi.

Look out, Haley. Greenpeace has a direct line to heaven.

Because the politician in question's last name is Kennedy (and you know that's not as in D. James Kennedy), he will receive somewhat different treatment for this pithy statement than he would have if he were surnamed Falwell or Robertson.

Tuesday, August 30, 2005

I Am Speechless Still

Sigh. Do we really need to teach Economics 1 here at Reform Club University Graduate School? Well, I see that indeed we do, as certain of our stalwarts seem to have swallowed various versions of the Broken Window fallacy (see my post below) whole, washed down with the old "planned obsolescence" chestnut.

Disasters cannot yield economic growth (that is, a bigger economy, or to say the same thing, greater aggregate wealth) because the resources used to repair the attendant physical damage---put aside the human suffering that cannot be redeemed at all---otherwise would have been used to produce other goods valued by individuals. Accordingly: Disasters must make the economy smaller in the aggregate. Yes, certain sectors (e.g., construction) will be bigger, and owners of inputs (labor and capital) in those sectors will be wealthier than otherwise would have been the case; but other sectors will be smaller, owners of inputs in those sectors will be poorer, and it is unambiguously the case that the losses exceed the gains, because in the absence of the disaster we would have both the housing and other physical capital as well as the other goods. Period. And please note that while owners of inputs in such sectors as construction might become wealthier, that does not mean that they are made better off (or happier) by the disaster, in that they might lose loved ones as well.

The "planned obsolescence" argument---as old as it is silly---assumes away the marginal cost of added quality, in this case added longevity. Consider the simple case of a razor blade that lasts forever; if we ignore such irrelevant complications as present value calculations (more on this below), risk aversion, and the like, consumers would be willing to pay for an infinite-life razor blade the expected lifetime purchase cost of ordinary razor blades. If the marginal ("extra") cost of producing such a blade is less than (or in the simple case, equal to) the added value of the blade to consumers, then profit-maximizing firms will produce the blade. If it is not, then the firms will not produce it, and that outcome is wholly efficient, that is, consistent with the interests of consumers, because the extra resources needed to produce the infinite-life blade would yield greater value for consumers in the production of other goods.

Only if the discount rate used by producers to calculate present values is higher than that applied by consumers might some version of the planned obsolescence argument make any sense at all, and that outcome would not necessarily be inefficient. And, anyway, I rather doubt that the "planned obsolescence" crowd has anything quite so sophisticated in mind; their goal is to attack capitalism, however mindlessly. Precisely why would producers discount the future more heavily than consumers (on the margin)? The only plausible argument is the corporation income tax, which in a nutshell forces the corporate sector to discount the future more heavily than other sectors. Is the "planned obsolescence" argument really a left-wing call for fundamental tax reform? Please...

I Am Speechless

Well, not literally speechless; that would be so not Zycher. But in today's Wall Street Journal we are informed by some poor soul---oops, a journalist---writing about Hurricane Katrina that "amid the grief and heartbreak, it should be noted that growth often follows such catastrophe. Hurricanes Andrew in 1992 and Floyd in 1999, for example, both ended up boosting local and national growth rates as rebuilding efforts created jobs and increased spending."

If this is not the classic manifestation of the old broken-window fallacy, I know not what is. Why not nuke the whole eastern seaboard---I'd say California, but I live there---so that we can expand employment and spending in a rebuilding effort? Is this guy a moron? Or does he merely need to fill up twenty column inches with, well, whatever? That modern journalists are the political equivalent of hurricanes destroying public discourse everywhere they set foot would be amusing were their ignorance not so appalling.

The Political Usefulness of Disasters

One of the major techniques of modern politics is to take every important event and tie it to the back of one's own particular hobby horse. One of the more ludicrous examples was the utterly absurd claims that the Asian tsunami was caused by global warming. Hence it was inevitable that we would begin to see articles today with titles such as "Brace for more Katrinas, say experts," from today's edition of Agence Press France. The anonymous author correctly observes that hurricane activity has intensified and looks likely to remain so for a while:

"Earlier this month, Tropical Storm Risk, a London-based consortium of experts, predicted that the region would see 22 tropical storms during the six-month June-November season, the most ever recorded and more than twice the average annual tally since records began in 1851."

The piece also notes,

"Already, 2004 and 2003 were exceptional years: they marked the highest two-year totals ever recorded for overall hurricane activity in the North Atlantic."

That is all quite true. Then the article moves on to consider a possible relationship to global warming, as has been posited by advocates of controls over greenhouse gas emissions:

"This increase has also coincided with a big rise in Earth's surface temperature in recent years, driven by greenhouse gases that cause the Sun's heat to be stored in the sea, land and air rather than radiate back out to space."

The characterization of the rise in the planet's surface temperature in recent years as "big" is certainly an exaggeration. However, the article does go on to point out that hurricane activity is cyclical and almost certainly always has been:

"But experts are cautious, also noting that hurricane numbers seem to undergo swings, over decades.

"About 90 tropical storms -- a term that includes hurricanes and their Asian counterparts, typhoons -- occur each year.

"The global total seems to be stable, although regional tallies vary a lot, and in particular seem to be influenced by the El Nino weather pattern in the Western Pacific."

These are very important observations. The article then outlines, at some length, the arguments of global-warming advocates who claim that g.w. is creating more intense hurricanes, if not more such storms overall:

"On the other hand, more and more scientists estimate that global warming, while not necessarily making hurricanes more frequent or likelier to make landfall, is making them more vicious."

The evidence the article adduces for this argument is coincidental and not causal, however, and is clearly highly speculative at this point. The piece says, for example, "'The intensity of and rainfalls from hurricanes are probably increasing, even if this increase cannot yet be proven with a formal statistical test,' Trenberth wrote in the US journal Science in June. He said computer models 'suggest a shift' toward the extreme in in hurricane intensities." That is to say, Trenberth believes it although there is no statistical evidence for it.

The article ends on that note, which is a pity because there is more to the story than that. Readers are not told, for example, that as an article in the forthcoming October issue of Environment and Climate News mentions, a group of prominent climatologists and other experts on climate change has noted, "according to a century of National Hurricane Center reports, the decade with the largest number of hurricanes to come ashore in the United States was the 1940s, and that hurricane frequency has declined since then. They also cited data from the United Nations Environment Programme of the World Meteorological Association that hurricane frequency has declined since the the 1940s."

The ECN story, unlike the APF one, quotes the environmental scientists as observing that "centuries-old evidence, as well as computer models, suggest warmer periods may actually generate a decline in the number or severity of such storms."

The ECN story quotes James J. O’Brien, director of the Center for Ocean-Atmospheric Prediction Studies at Florida State University, as arguing that "the more likely cause of hurricane frequency might be found in variations in the Atlantic Ocean Conveyer, the movement of the warm Gulf Stream whose waters, taken from the South Atlantic, replace the cooler, sinking water in the North Atlantic.

"When the Conveyer is strong, O’Brien said, historic records have shown an increase in Atlantic hurricanes; when it is weak, so are the hurricane seasons. For a hurricane to grow stronger, it must keep moving over waters warmer than 80 degrees F, which leads some people to link global warming and the storms. But, he said, there’s no scientific evidence to show that such areas of warm water are increasing in size."

Casting a Spell

Hoosiers cannot win for losing with the mainstream press. The Washington Post et al. have been making fun of Dan Quayle for thirteen years because he can't spell. Now the New York Times is making fun of John Roberts because he spells too well.

And just in case being a Grammar Nazi isn't enough to derail the Roberts nomination, the Washington Post has decoded a 20-year-old first draft to conclude that Roberts is a crypto-secessionist (Hat Tip: Bench Memos.) You could stand in rebel territory and hit the Washington Post Building with a well-pitched rock, so I'm surprised I have to inform the staffers that Southerners do not call the Civil War The War Between the States, they call it The War of Northern Aggression.

Monday, August 29, 2005

Store My Article

For those cavemen (and women) whose club is Reform, here is a preview of my man-on-the-spot report on Katrina's Florida vacation.

Assault (And Searing Battery) On Good Taste

In possibly the most tasteless and inappropriate pun of all time, Jefferson County Parish President Aaron Broussard said of those who refused to evacuate New Orleans in the face of Hurricane Katrina: "I'm expecting some of the die-hards to die hard."

Sunday, August 28, 2005

Here Comes the Real News

The Cindy Sheehan story reached its official terminus a few hours ago.

I remember Krugman saying Enron would be a bigger story than Sept. 11. Enron is going to be a footnote compared to Hurricane Katrina.

The Dictatorship of the Enlightened

Now listen up. This is some major league B.S. censorship nanny-state crapola.

The University of California system is refusing to take students from a Christian high school that teaches unorthodox views of biology and history. They say the students will be "unprepared."

I'm not sure when I've heard anything quite so insincere. It doesn't matter whether you slept through biology in high school, you will be aware of Darwin. In fact, these Christian students will have heard of Darwin and his theory, if only in the manner of refutation. Having been taught the "correct" version of the theory of origins has zero to do with one's eventual performance at the university.

Imagine this scenario: Benighted, fundamentalist Christian student goes to a school teaching a highly Christocentric version of history, science, etc. He also happens to be quite intelligent and trots out an SAT score around 1450.

Question: Will this young man have any trouble putting up A's in the University of Californa institutions? Noooooooooooooooooooooo.

Given that is the case, there can be only one reason for the policy recently announced. Intimidation. Welcome to secular totalitarianism lite.

(HT: Ted Olsen at Christianity Today on the web)

Friday, August 26, 2005

London's Human Zoo

The Times of London reports that the London Zoo has begun a new exhibit called the Human Zoo, in which eight people wearing scanty costumes lounge around in the institution's Bear Mountain enclosure and attempt to act like apes—rather amateurishly if the photos accompanying the article are any indication.

This is the kind of thing that seems like a pathetically silly gimmick on the face of it, but of course the zookeepers have a suitably serious and intensely political explanation, according to the Times article:

"We have set up this exhibit to highlight the spread of man as a plague species and to communicate the importance of man's place in the planet's ecosystem," London Zoo said.

I can certainly agree that some human beings are a plague. Fortunately, if we can lure the London zookeepers into the Bear Mountain exhibit, we can isolate a major strain of it.

Conservative War Critics' Dilemma

My post from yesterday on the antiwar movement of the right has been extensively rewritten as an article for FrontPage magazine and appears in today's issue. Here's a very brief excerpt:

[I]n arguing against Western projects of nation-building in the "developing world," conservatives such as Auster and Warren (and Buchanan and the like) face a huge dilemma: their belief in a common human nature (though one that certainly permits a wide variety of human customs and organizing beliefs) is a strong argument against radicalism of the left, but it is not useful in refuting the logic of projects based on a belief in a common human nature, which Bush's nation-building action in Iraq most certainly is.

I believe that the interaction between human nature and human culture is more complex, variable, and flexible than Auster and other antiwar conservatives tend to think. The acknowledgment of this truth is central to the classical liberal (and modern conservative) position. . . .

You may read the article here.

Thursday, August 25, 2005

Is Cheerleading Raunchy or Innocent: A National Debate

If you’ve seen half time at a pro-basketball or football game half clad cheerleaders have become a source of audience delectation. The girls are sexy and the movements often suggestive. This is the new America that shuns modesty.

Recently, a Democratic Texas legislator, Al Edwards, sponsored a bill dealing with cheerleaders at high school football games. Needless to say, these cheerleaders tend to emulate their grown-up counterparts.

Mr. Edwards said, “Girls can get out and do all of these sexual performances and we applaud them and that’s not right.” He goes on to argue that lascivious performances distract high school students and can result in “pregnancies, school drop-outs, the contraction of HIV, and herpes… cutting off their youthful life at an early age.” He adds: “Any adult that’s been involved with sex in their lives; they know it when they see it.”

Exposed midriffs and ever shorter skirts are de rigueur for cheerleaders, but, for many, this exposure is offensive. Of course not every Texas legislator shares Mr. Edwards’ views. In fact, some call his proposed legislation “stupid” or “ridiculous.”

It is interesting to examine the evolution of cheerleading. Originally cheerleading was a male dominated activity, a way for men to assist their comrades in athletic competition and a method for displaying leadership potential. During the Second World War, with so many men at war, women replaced males in what became a source of inspiration. For the first time cheerleading became a beauty-obsessed pastime.

By the 1970’s, led in large part by the success of the Dallas Cowboys, cheerleading became highly sexualized. What worked for the Cowboys became the standard for other professional teams. In less than a decade the fully clothed high school and college cheerleader looked and moved very much like her professional counterpart.

Is this a problem?

For these who remember a more innocent time when cheerleaders were covered down to their shins, contemporary standards are vulgar. That said, the vulgar has colonized every aspect of popular culture. Even cheerleading has gone from, “Go back, go back, go back into the woods, cause you haven’t got, you haven’t got, you haven’t got the goods” to “you’re dead, you’re dead, we’ll bop you on the head.”

Yes, this is all said in good humor, but the humor has an edge to it which has changed the nature of sportsmanship. Fans routinely shout obscenities at the opposition.

On the other side of the social ledger, it could be argued that the problem is in the eye of the beholder. Cheerleaders may emulate their elders, but that doesn’t necessarily suggest they are sexually charged.

The real issue is the spread of pornography into every cultural crevice from ads on buses, to television programming and popular music. It has become inescapable. What effect it is having may be difficult to determine, but I would submit, based on empirical evidence, it is having some effect.

Cheerleading may, in fact, be one manifestation of this trend and, in its way, among the more innocent manifestations. But the trend line is a matter of concern for any American who believes the levers of popular culture affect and enhance or undermine the nation’s character.

The Conservative Dilemma

In a letter to interested parties, the writer and attorney Spencer Warren sent us the following interesting exchange from Lawrence Auster's View from the Right blog, in which the anti-Iraq War advocate Auster and a correspondent argue against what Warren correctly calls "the PC mantra that all societies and cultures are equal":

VFR reader Barbara Gilbert, R.N., brings up another Muslim custom that shows the utter incompatibility between democracy and Islam:

There are more, much more, painful questions than polygamy about Muslims' culture and traditions. As a nurse, I feel it is important that people demand that women's rights everywhere must be extended to include protection from the common brutal Muslim practice of female genital mutilation. The simplest form involves only circumcision, but it can extend to horrible acts of mutilation, and even result in death. For in depth descriptions, I refer you to this article at wikipedia.

It is the act of savage barbarians. It is butchery. How can anyone believe that Muslim men will ever respect women or women's rights in a democratic society when they are permitted to commit this heinous act?

I wonder if Mr. Bush or Ms. Rice is aware of the practice?

My reply:

The key point you're making is, given the prevalence of these practices (not just in black Africa and Muslim Africa including Egypt, but in the Muslim Near East as well including Iraq), sexual inequality is profoundly—to a degree inconceivable to us—built into these societies. Therefore, if women's equality is, as President Bush says, a "non-negotiable" feature of democracy, then on that basis alone these societies can never have democracy.

Of course, you're making a different argument. You’re saying that FGM must be rooted out, both to end this horror in itself, and also to further the conditions for male respect for women and thus the possibility of women's rights. I'm all for people working to bring this monstrous evil to an end. But right now, and for hundreds of years past, it exists. And changing the deep-seated customs of a people is extremely difficult or even impossible short of totalitarian measures. For Bush and his supporters to think that peoples who believe in such things and practice them are essentially like us and that, above all else, they desire individual freedom (if only someone will deliver it to them), is the wildest fantasy.

Barbara Gilbert:

Quite correct. And having been brought here by immigrants, it is being practiced in this country to a greater degree than is realized. While working in ER departments and on an paramedic team, I witnessed other practices of that culture. Women are "attended" by several men when brought to an emergency facility, for instance, and not allowed a private examination by a physician. It is my personal belief that the men do not wish to have the secret revealed.

While it is openly practiced and acknowledged in many countries in Africa, the Arab nationals take great pains to hide it. It is being discovered in the emergency rooms and private offices of physicians who are sought out secretly. Individual freedom? For an Arab woman? Ridiculous!

They are so different from us that they will never integrate into our society because of cultural, religious or political differences. Their customs and traditions eliminate the very concept of democracy. I consider the Muslim women who immigrate as imported chattel. Not only will they never practice democracy in their own countries, they cannot practice it in ours.

Auster and Gilbert make an important point about the persistence of cultural habits. However, what Auster fails to consider here is the multitude of effects of something in which he strongly professes belief in cases other than arguments about the War in Iraq and immigration of Muslims and other non-Westerners into the United States: the common characteristics that all people share as a result of human nature.

It is these characteristics that the Bush administration means to depend on in liberating Iraq, and which are essential to any strategy of assimilating immigrants into American society. The administration and its friends may well be wrong to believe such a liberation of these persons' inner nature possible, but the arguments that Auster and his followers make regarding human nature certainly lend support to a classical liberal view of human possibilities.

I think that the interaction between human nature and human culture is more complex,variable, and fungible than either Auster or his enemies on the left tends to think. An acknowledgment of this truth is central to the classical liberal position.

After citing Auster's blog entry, Warren then adds some insightful comments of his own:

In addition to the above, there have been several press reports in London newspapers about the Muslim practice of revenge killings of Muslim women in Great Britain by their husbands or fathers if they are believed to have violated some Muslim "law." The British police try to cover up the religious nature of these murders because they contradict the PC mantra of multicultural equality.

Consider that PC mantra in light of these two examples, plus the evil Muslim attitude toward dogs, discussed previously.

The foregoing prompts thoughts about PC and History, and about Radical Equality and Our Cultural Crisis.

Please again consider the countless examples of systematic atrocities by Japanese armed forces in WWII, for which Japan to this day has refused to apologize. Three I omitted last time are: 1) during the Bataan Death March, in which about 10,000 U.S. and Filipino prisoners were murdered, one U.S. soldier was crucified with nails; 2) according to the book Flags of Our Fathers, by the son of one of the men who raised the flag on Iwo Jima in the famous photo, when one of those men was found killed on Iwo, after having been taken prisoner by the enemy, a certain organ of his body had been cut off by the enemy and placed in his mouth -- this is how his body was found; and 3) also according to that book, the Japanese made a regular practice in combat of first shooting our medics, who under the Geneva Convention were supposed to be spared in battle because they bore the Red Cross.

We are reminded of the relevance of this history to current debates by the NY Times review of the new film The Great Raid, about the 1945 liberation of a prison camp holding survivors of the Bataan Death March. The critic, Stephen Holden, complained that the film would revive wartime "stereotypes" of treacherous "Japs." Well, in light of the sneak attack on Pearl Harbor (as the enemy sailed into position for the attack, remember, two Japanese diplomats were in Washington to negotiate a peaceful settlement of differences), as well as the systematic atrocities detailed above and in my last comment, how else should they be described? Americans of that perilous time did not view events from the critic's luxurious perch.

Holden, a typical left/radical liberal working at the beacon of that faith, essentially is denying historical fact in order to promote the PC mantra that all societies and cultures are equal. Either drag us down to the enemy's level, or deny the enemy was any different from us. Deny our identity in order to eliminate differences from alien Enemies. Either way he is lying about the past. In 1984 George Orwell wrote that he who has the past has the future. That is why leftists are always attacking our history and rewriting the past. Remember the controversy about ten years ago concerning the Smithsonian Air and Space Museum's exhibit of part of the Enola Gay, the B-29 that dropped the first atomic bomb? The exhibit was filled with so many falsifications that protests forced it to be withdrawn and replaced with a simple, non-political description of the aircraft and crew. In the case of the NY Times movie review and the Enola Gay exhibit, the PC mantra of equality and abolishing differences went so far as to embrace our enemy in WWII!

The movie review and cancelled exhibition are two of countless examples of the insidious growth of what I call "soft" totalitarianism in our country -- falsifying facts and history, distorting human nature and traditions, to advance radical egalitarianism. (This is not the American tradition of equality of all individuals before the law, but of the absolute equality of result, custom and historical tradition, including absolute equality of every society and culture on Earth -- and the elimination of any differences dividing peoples.) Since such extreme equality that abolishes difference is not the natural order, state power, media power, or other power must be employed to coerce thinking in the "progressive" direction. After all, the goal of totally erasing all differences is so "moral", are not any means therefore justified to advance such an end?

In this respect, the NY Times movie review and the cancelled exhibition are illustrations -- minor, but noteworthy -- of communistic thinking. Note the word -- communistic -- an adjective. The drive toward coerced absolute equality has been the radical project for more than 200 years, since the French Revolution. It failed economically in the communist world (where the State waged a massive war on human nature and society) and led to its implosion and collapse. But a similar way of thinking and emotional/"moral" impulse is driving the PC movement in the West to remake our culture and society. State power is not being employed remotely on the scale of a communist dictatorship, but the way in which the courts are usurping legislative authority is also tyrannical (e.g. imposing homosexual "marriage"). And that State/judicial power is being supplemented by the left/liberal media and other private institutions. That is why Political Correctness is more correctly termed Cultural Marxism.

Ironically, this egalitarian view, in the broadest sense, is the premise of Pres. Bush's policy in Iraq -- that societies in that region -- including their religion -- are not so different from ours and can develop into free societies with some help and a good constitution. Time will tell. But the bizarre conjunction of this policy premise with the PC agenda demonstrates the profound contemporary influence of the radical egalitarian ideal.

Warren is perfectly correct to point out that some societies and ways of life are indeed better than others. In addition, he correctly shares Auster's concern about the persistence of cultural habits when Warren criticizes "the premise of Pres. Bush's policy in Iraq -- that societies in that region -- including their religion -- are not so different from ours and can develop into free societies with some help and a good constitution." Warren, however, improves on Auster's argument by acknowledging that the belief in total freedom from restraints of human nature is not a liberal idea but a radical one, and that the idea traces back to the beginnings of what has been commonly called the Enlightenment: "The drive toward coerced absolute equality has been the radical project for more than 200 years, since the French Revolution," Warren writes. (Full disclosure: Warren has borrowed this distinction from my article "The Origin of Modernity," published in the Summer 2005 issue of The National Interest.)

In arguing, from conservative premises, against Western projects of nation-building in the "developing world," conservatives such as Auster and Warren (and Buchanan, etc.) face a huge dilemma: their belief in a common human nature (though one that certainly permits a wide variety of human customs and organizing beliefs) is a strong argument against radicalism of the left, but it is not useful in refuting the logic of projects based on a belief in a common human nature, as Bush's nation-building action in Iraq most certainly is. From a classical liberal point of view (which is one that accepts the belief in human nature), it appears that antiwar conservatives would make much more headway by two means:

1. Accept the idea that the Bush administration is reasoning from what conservatives believe to be a valid premise (that all human beings share commonalities through what is called human nature) when the administration argues that the people of Iraq have the potential to live democratically. (By the way and to make it perfectly clear, I personally consider the commonalities of human nature to a rock-solid truth based on science, strongly confirmed by modern insights in sociobiology.)

2. Argue that the mission the administration has set itself conflicts with human nature, specifically the persistence of cultural notions that, however perversely, accomplish certain things necessary to human existence (such as the need for physical and emotional security, etc.).

I would be very interested in any such arguments.