26. January 2012 by Publius.

Well, suddenly it looks like Newt Gingrich might be the Republican nominee. So, just to get a leg up on how the 2012 election might shape up, lets examine the differences between the leftist Obama and the rightist (it obviously should be a word) Gingrich:

• On taxes:
  • Obama believes that Warren Buffet does not pay enough in taxes.
  • Gingrich believes that Mitt Romney does not pay enough in taxes.
• Cap and trade:
  • Obama: “Under my plan of a cap and trade system, electricity price would necessarily skyrocket … Because I’m capping greenhouse gases, coal power plants, natural gas—you name it—whatever the plants were, whatever the industry was, they would have to retrofit their operations. That will cost money. They will pass that money on to consumers.”
  • Gingrich: ”I think if you have mandatory carbon caps combined with a trading system, much like we did with sulfur, and if you have a tax-incentive program for investing in the solutions, that there’s a package there that’s very, very good. And frankly, it’s something I would strongly support.”
• Global warming:
  • Obama: “All across the world, in every kind of environment and region known to man, increasingly dangerous weather patterns and devastating storms are abruptly putting an end to the long-running debate over whether or not climate change is real. Not only is it real, it’s here, and its effects are giving rise to a frighteningly new global phenomenon: the man-made natural disaster.”
  • Gingrich: “We do agree. Our country must take action on climate change.”
• Paul Ryan budget:
  • Obama criticized the Ryan budget.
  • Gingrich: ”I don’t think right wing social engineering is any more desirable than left wing social engineering.”

So it is obvious that there are clear dif… Oh… wait… they are actually the same guy. Or at least sharing one brain.

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6. January 2012 by Publius.

From the Department of Labor (unmassaged numbers): (follow menu item 1 to see the numbers)
In December 2008 there were 135,254,000 people employed.
In December 2011 there were 132,721,000 people employed.
That means there has been a loss of 2,533,000 jobs in the last 3 years.

That much is fact. Now for some mathemagic…. U.S. population has historically grown at a rate of 1.3%/year. If that has held true for the last 3 years, then the population has grown by roughly 11,800,000 people. If you assume that the increase in uniform for all age groups, then the population between 18 and 65 then the growth of the population segment that is (theoretically) looking for a job has grown by 7,700,000 in the last three years.

Therefore the true increase in unemployment is 10,000,000!
Welcome to the obama recovery.

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1. January 2012 by ropsnobi.

I’ve been reading a book on home production of Biodiesel. I’m not going to mention which book yet, because I’m not very impressed. It’s just that it seems like such a good idea.

Unlike ethanol fuel, the energy budget is positive - you get more energy in the product than it takes to produce. That makes it, at least, a viable idea. It can also be made from feedstocks which do not take up prime farm land, therefore there is at least a chance that it will not drive up food prices. It remains to be seen, however, if a feedstock can be found that can produce large quantities of fuel without impacting food production.

And home production remains both feasible and economical. It does not suffer from the major problem that ethanol has - the government thinks it has the right to prevent people from producing ethanol at home, while, so far, the government does not restrict the production of oil.

In any case, as I explore the subject you can expect more posts.

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19. November 2011 by Publius.

In fact, these protesters making the claim that they represent 99% of the people is about the silliest thing I’ve ever heard. 54% of Americans own stock. While 1.5% of Americans belong to the National Rifle Association, between 35% to 50% own a gun. 20% of Americans smoke tobacco. 40% of high school seniors have used marijuana.

The only point I am trying to make is that this country is not 99% anything. You have to twist divisions out of all rationality to imply that kind of unity. 99% of Americans have eaten a tomato. The difference between that (imaginary) statistic and the claim of the 99ers is that eating a tomato is a binary event. Each person  either has eaten a tomato, or has not. Group membership is clear - perhaps there is a market for t-shirt makers here. Economic level, however, is a spectrum. There is no significant difference between someone in the top 1% of income earners and those in the top 2%, or top 5%. This whole thing is just a rhetorical tool used by hate mongers to imply some sort of justified class warfare. It’s baloney.

This movement is being orchestrated online. The advocates claim this as proof of democratization (note to self: a topic for another column), it is, rather, proof of their idiocy. How do people with smart phones and computers justify themselves as downtrodden? Neither is a necessity of life, neither is a right. These people are among the world’s elite - put there by the system they condemn.

And if they want to complain about inequality, I submit that there is a greater difference between the elite and the not-s0-elite under socialism than under capitalism. And, under socialism, the stratification is far more rigid than under capitalism.

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2. November 2011 by Publius.

Here is is, an entire year before the election, and I’m bored already.

Oh, I know how important it is, and I know how complicated the issues
are, but the rhetoric is just… so… flaming… stupid.

Obama keeps spouting Keynesian economic drivel while emasculating Congress
and gutting the Constitution. I realize that Executive Orders have been abused
long before Obama took office, but he is using them in new and innovative ways
to completely gut the checks and balances that were supposed to prevent this
type of power grab.

Of course, it’s not his fault alone. Congress is doing it’s best to help him.
The Super-Committee that is supposed to reduce spending, when the Congress cannot
(And does anyone seriously believe it stands a chance of working?) is the ultimate
abrogation of their authority - and they did it volunarily!

Maybe it’s not boredom, maybe it’s anger and frustration.

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2. October 2011 by Publius.

It is time to remember Carl Menger. He is usually noted for founding the Austrian school of economics. His critical discovery, however, was far more basic. His whole system was based on uncertainty; like Kurt Vonnegut in a later time, he believed that nobody knows what is really going on. The German economists, whom he opposed, followed the German philosophers Kant, Hegel, and Nietzsche and accepted their belief in the rational superman who could, in fact, know everything.

This is the fundamental difference in belief that leads, in those who follow Menger, to free markets while those who follow the Germans are inevitably lead to some form of socialism.

So, today this philosophical difference boils down to this: for the Keynesians to be correct, it must be possible for the rational superman to exist, and, in addition, our leaders must be numbered among them. Whatever you believe about the possible existence of supermen, I submit that you cannot possibly believe that the world leaders, whether political, social, or economic, are among them.

Menger’s solution, on the other hand, requires that economic decisions are essentially chaotic. Menger lived far before chaos theory was understood, or even proposed,  but had the mathematical tools been available to him, he would have embraced chaos theory. His belief in uncertainty led him to believe that it was best that economic decisions where best distributed over large numbers. Had he understood chaos, he would have understood that they must be so distributed.

Coming soon - the role of Nash equilibria in economic decisions.

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1. September 2011 by Publius.

You hear the word ‘fair’ bandied about a lot these days. And all good people want to be ‘fair’, right? Therefore if you are not in favor of being ‘fair’, you must not be a good person.

The problem is that ‘fair’ is an ambiguous word. It can mean many things. Here are three ways in which it is used:

Fair: synonym for equal; dividing the cake is fair if everybody’s slice is the same size.

Fair: synonym for earned; you get what you earn - eat your vegetables if you want dessert.

Fair: synonym for charity; your brother had a hard day in school today, you should give him your cake.

Political speech today is very fond of the word ‘fair’; it is very unpopular, however, to specify which of these meanings is meant. The reason is very simple. People will object to one or more of these uses in any given case, yet everyone wants to be ‘fair’.

The best solution would be to abolish the use of the word ‘fair’. Second best would be for everyone to realize that anybody using the word in political speech is consciously trying to cheat and to ignore whatever they are saying.

I’m almost tempted to say, “It’s only fair!”

Now, all that talk of cake has made me hungry. I’ve got to go.

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18. August 2011 by Publius.

This news report from the Government News Service has been found:

Washington DC (GNS) —

Tomorrow President Obama will finally make public his new job plan. President Obama will announce the formation of the Department of Jobs. The new DoJo (to distinguish it from the Department of Justice) will absorb the old Departments of Labor, HEW, Energy, EPA and Treasury.

By taking on the duties of the absorbed departments, DoJo will be responsible for seeing that every citizen contributes his fair share to the country. For each individual this contribution will be optimally allocated between financial contribution and labor. As part of this plan, every citizen will be provided with a job when they reach their 18^th birthday. In order to maximize the utilization of resources this job will be allocated by the Department of Jobs to whatever sector and whatever state DoJo determines to be in greatest needs. Waivers will be granted to the families of elected officials and any non-elected officials above GS-13.

By folding the functions of the old Environmental Protection Agency, DoJo gains the enforcement capability they need. Since CO₂ has already been determined to be a pollutant, if a citizen is determined to be unable to contribute their fair share, their license to produce CO₂ will be revoked.

Initial funding for the Department has been set at $1.3 trillion. The President warned, however, that this was merely an initial estimate and that it might have to be increased. His candor received enthusiastic applause from the Press Corps.

On the podium with President Obama while he announced the plan were Republican Senator John McCain and Representative John Boehner. Reports that Mr. Boehner was bound and gagged were dismissed by the White House.

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10. August 2011 by Publius.

Forget politics, forget economics, forget global warming.

This is the post that will make me widely hated.

Apple has reached the top of my “Hated Technology Companies” list. They’re ahead of Microsoft, ahead of Google, ahead of Oracle.

Why? Because they are abusing the patent system in worse ways than the others. Microsoft, in fact, is making an attempt, if half-hearted and disorganized, to come to terms with the open-source communities. Apple, on the other hand, has managed to get an injunction against Samsung based on drawings that look like a tablet. The problem is that the drawings were made 10 years after Microsoft demonstrated a working tablet.

So Apple wins the Egregious Use of Patents Award, and their place on the freedom wall of dishonor.

I suppose that, to be fair, the courts, lawyers, and legislators ought to join them, but they’ve got their own lists.

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9. August 2011 by Publius.

“Economics is the study of the use of scarce resources which have alternative uses.”—Lionel Robbins

This has nothing to do with the economic system in place. It is true under capitalism and under communism. Man has always existed with conditions of scarcity. Man will always exist with conditions of scarcity.

It is important to note the difference between scarcity and shortage. A commodity can be scarce without there being a shortage. In the United States today there is no shortage of food. Much of the country is fighting a battle with obesity instead. Yet there is a scarcity. This scarcity is localized – and that is what results in food being traded. Most people in this country do not grow enough food to feed themselves. Farmers, on the other hand, do not produce enough farm machinery to keep their farms growing. Both sides find it preferable to split the tasks of producing machinery and producing food and to engage in trade to reduce the scarcity of both commodities.

This is the basis of all economic activity.

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