Thursday, June 30, 2005

Happy birthday to two of my favorite economists

I almost forgot to make this entry!

Happy birthday to Frederic Bastiat, requiem en pace. And to Thomas Sowell, to whom may God grant many more years with us. Power Line has a wonderful little collection of tributes to Dr. Sowell.

Two great minds, two great men who believe in freedom. May we never cease to learn from them.

No regular post tonight

I left another comment in this entry on protectionism, replying to Rufus (whom I know through the comments at Larry Kudlow's blog).

I got home tonight about a quarter past 11, over five hours after leaving work. After walking to the subway station at 55th and Broadway, then taking a couple of subway lines, I arrived at Grand Central around 6:40. I quickly learned that all train service on the Metro-North Harlem Line (my route) north of North White Plains was suspended, because of flooding at the Valhalla station. Valhalla is one of the stations I need to go through. So I waited, and waited, and waited.

At 7:45 p.m., all the trains I'd take were still cancelled. So I took an 8 p.m. local (read: very slow) train up to White Plains, which is two stops short of Valhalla. I arrived at a quarter to 9. At worst, I figured, I could get a cab, though it might cost a few Andy Jacksons. But the ticket counter rep told us that if we took the next train to North White Plains, the MTA had buses to take us past the Valhalla and Pleasantville stations (the latter was also flooded), up to Chappaqua. Had I known that, I could have stayed on the train I came in on -- it was going to North White Plains. The next one didn't arrive until 9:15.

The North White Plains station was a nightmare. There were hundreds of people, perhaps a thousand, and we were all trying to get home. We could have been extras in a movie about refugees. We looked the part, tired and haggard, clutching our bags and parcels, standing in a long line as we waited for the school buses that the MTA had commandeered. It was a complete mess as the police officers and MTA employees sent off several buses that were only half or two-thirds full. We could see the many empty seats through the windows!

I finally boarded one at 10:15, which dropped us off at the Chappaqua station around 10:40. It was only several minutes before the train came, and I got to my stop a little past 11. In hindsight, I should have taken a cab from White Plains to home. Next time, I'll know better not to trust the MTA. It was a good idea, and fairly quick action to get the school buses, but we were herded around so inefficiently, and as I said, buses were being sent off before they were filled up.

Here's a New York Times article that explains the debacle with the buses. I was one of those it describes, holding a cellphone as I tried to get in touch with family or a taxi.

The flooding may not be cleared away by tomorrow morning, meaning I may not be able to go to my job in the city. I strictly refuse to risk my car in Manhattan, so I might wind up with the day off.

Wednesday, June 29, 2005

Is this liberty?

D.C. Battling Boom in Illegal Work on Homes

It's good to crack down on "illegal" activities, right? But that presupposes the government's definition of "illegal" is a true crime. The article defines what people are doing that is so criminal:
The District's skyrocketing real estate prices have fueled an increase in illegal construction as property owners across the city are building and renovating homes without obtaining the required permits, according to D.C. officials and a review of city records....

Many of the District's violators are homeowners building additions because they cannot afford to move to more spacious homes, while others are investors renovating properties in the hopes of selling them at a substantial profit, city officials and community activists say. The number of stop-work orders also reflects an aggressive crackdown by the D.C. regulatory agency, which once had a reputation for slipshod enforcement of building codes....

Patrick Canavan, the agency's new director, noted that the permit process is critical because it triggers inspections that show whether buildings meet safety standards and because improvements filed on the permits help determine property tax assessments....

A review of 300 stop-work orders citywide showed such violations as hanging drywall before the city has inspected electrical and plumbing work, and renovating kitchens and bathrooms without building permits. Officials said other cases involve property owners who obtain permits for small projects such as decks but instead build additions, and contractors constructing houses without proper approvals....

John Frye, a community activist, frequently cruises Deanwood, looking for illegal construction. "They're disrespecting the law," Frye said of some builders. "They're working with the stop-work orders posted where you can see them." ...

Edmund L. Peters, a permit expeditor, said it can take up to six months for homeowners and builders to get a building permit for a new house.

"The reason why people don't get permits is because the DCRA makes it very difficult for people to get them," Peters said.
Permits requiring fees are, of course, a form of taxation. The state wants it cut, but at the same time it obfuscates the real problem with housing "permits": they're an oxymoron, directly defying the "private" in "private property." To seek a permit is to petition the state for its permission to use the property you already own. Who owns it, you or the state? If you do, why must you seek the state's blessing? Applying a permit for your private property, in other words, is to acknowledge the state's superiority over your God-given rights. That is not freedom at all!

Previously I've detailed what Mugabe has done in Zimbabwe: he declared certain houses "illegal," then had his police forcibly evict the residents and destroy the houses. D.C. isn't destroying homes, but by issuing fines it's acting under the same principle as Mugabe: both demand that people seek its permission for their housing, otherwise their homes are "illegal."

It's worth quoting Ayn Rand's Atlas Shrugged again: "There's no way to rule innocent men. The only power any government has is the power to crack down on criminals. Well, when there aren't enough criminals, one makes them. One declares so many things to be a crime that it becomes impossible for men to live without breaking laws."

The permits and the government requiring them are what are criminal, not the families or developers. And why must big media give "developer" such a bad connotation? A developer is merely a Knightian entrepreneur, an economic actor who undertakes risk. True to that definition, real estate developers create (often good) jobs in their calculated quest for profit. Socialists and big media (often interchangeable terms) would have you believe it's evil for anyone to make a big profit, but as I've written, everyone else certainly benefits when the "rich" become wealthier, regardless of the proportion in which they spend or save. Developers, at least when they're not violating others' rights, benefit society by creating something new, or improving something, that someone in society is willing to buy. If a developer expands a $200,000 house (or constructs a house on an empty $50,000 lot), then sells it for $500,000, by definition the buyer valued it at more than $500,000. You pay a dollar for something only if it benefits you by more than a dollar.

Are permits necessary because unrestrained, willynilly construction can adversely affect the neighbors? Certainly there could be pollution, dirt and hazardous dust, and loud noise. But as I wrote a couple of nights ago, the Declaration of Independence defines the role of government as securing our rights to life, liberty and property; that does not mean preventing them from ever being infringed. Government can punish but not directly inhibit; that's simply the nature of true freedom.

A government permit in and of itself does nothing to help the homeowner anyway. That piece of paper does not assist in actual construction, it has never stopped the wrong house from being bulldozed, nor does it guarantee "safety" any more than the free market. The free market takes care of "safety" in two ways. A smart consumer does research as to which contractor is trustworthy and who is not. A higher charge can (but not necessarily) mean a better contractor, so that's why the consumer investigates his reputation. Second, the consumer can, if he wants, hire a third party to examine the workmanship. So there is no requirement here that government get involved, not even to prevent safety violations.

If your construction somehow injures your neighbor and/or damages his property, you can be held liable in both criminal and civil courts. That would happen even if you had a permit. If your plumbing or electrical wiring is faulty and affects the neighborhood, you can be liable for all damages: so you'd better hire someone competent, lest you have to sell your home to pay for damages to your neighbors' property. A prosecutor might even show evidence that you deliberately went with someone you knew did inferior work, which a jury might find is criminal negligence. The best motivation for ensuring good work turns out not to be concern for your own property, but that you don't want to damage your neighbors' property.

What if your construction is too loud? That's what a jury is for. A jury would likely determine construction at 2 a.m. is too much (and the judge can issue an injunction for certain hours of the day), but that during the middle of the day is "reasonable." You could also make arrangements with your neighbors to compensate them for noises. If one neighbor holds out, you could still proceed and trust that a jury will side with you.

Would this flood the court system? Certainly there would be an increase in cases, perhaps with neighbors suing out of spite. That's why I favor laws requiring plaintiffs to pay defendants' legal costs, if the judge rules the suit was "frivolous." Remember, though, that there's a big bureaucracy to issue the permits. It would disappear, as would a need for inspectors and increased police activity, so things would even out, and the people would have an increase in liberty. How can a rational person believe that renovating a bathroom should require waiting six months for a permit?

What galled me most in the news article wasn't how D.C. demands permits but takes forever to issue them (a topic Thomas Sowell has written about). What chafed me was reading about the busybody "citizen activist" who "cruises" around. Presumably that means a car, so unless he's physically handicapped, that means he's reporting "illegal" construction that is not near his own house. Therefore it's doubtful he's personally affected by the construction -- then what business is it of his? Let the neighbors adjacent to the construction, not him, file complaints about pollution, dust, noise, etc. Or is he like the environmental zealots that Dr. Sowell described, who inflict their visions of "the way things should be" on people who just want a home?

Tuesday, June 28, 2005

Protectionism is for losers

Literally, that is true. Only those who would lose in free market competition want protectionism. In this case, American Airlines can't compete against a certain discount carriers, so they have abused the power of government to make Southwest Airlines less competitive.
Battle at Love Field

As a sales executive for a San Diego software firm, Gary Sabin hops aboard a Southwest Airlines jet several times a month to visit clients. But when he wants to fly the discount carrier nonstop to Dallas, he's out of luck.

"It's very disappointing," said Sabin, 46, who laments that he has to fly to Dallas regularly "but can't on Southwest."

Instead, he pays more to take a full-service airline nonstop rather than taking Southwest and facing the hassle of connecting through another city such as Albuquerque or Houston.

It's a problem familiar to many who have tried to fly Southwest direct to Dallas. But it's not just some convoluted airline route logic. It's the law.

An arcane 1979 federal statute bars nonstop flights out of Southwest's home base at Dallas' Love Field unless they are bound to or from cities in Texas or one of seven nearby states. Fliers who want to avoid connection aggravations must use the larger — and more remote — Dallas-Fort Worth International Airport, where American Airlines dominates.

But the days of the so-called Wright Amendment may be numbered. Southwest, which stayed on the sidelines during past efforts to repeal the law, is now energetically spearheading the latest attempt in Congress to kill it. In the process, it has sparked a Texas-sized brawl with American Airlines, which is trying to block Southwest's effort and protect its Dallas-area franchise....

"Southwest is the largest carrier in Florida and California, and it can't fly to either state from Love Field," [Southwest Chairman Herb Kelleher] said. If the law is repealed, "fares would go down and the number of travelers would increase." ...

Because of its low fares, Southwest claims that lifting restrictions at Love would save travelers more than $700 million a year on flights to and from the Dallas-Fort Worth area, including $36 million in savings in the Los Angeles area alone.

Rival American Airlines, the nation's biggest carrier, disputes those claims, noting that airfares have been falling at Dallas-Fort Worth International in recent years and that Southwest's study failed to examine how it would affect fares at that airport if it moved there from Love.

But the airline has a history of pushing down fares wherever it launches service, a phenomenon known in the industry as the "Southwest effect." Steven Morrison, an economics professor at Northeastern University, says that when Southwest begins service on a particular route, rival carriers can be forced to cut their fares by as much as 50% to compete — bad news in an industry in which older carriers already are being squeezed by rising fuel costs and falling fares....

American contends that Dallas-Fort Worth and the North Texas area face disastrous economic damage if Southwest is free to fly anywhere from Love Field.

By seeking repeal, Southwest is trying to exploit its dominance of Love Field "after we, the community and others have continued to invest billions of dollars" at Dallas-Fort Worth, Gerard Arpey, chief executive of American and parent AMR Corp. told an investor conference this month.

The simple solution, he said, is for Southwest to shift all or part of its Dallas operations to Dallas-Fort Worth.

"They can start service tomorrow," Arpey said. Otherwise, "we will do everything we can to defeat" the law's repeal.

Besides American, Dallas-Fort Worth is pressuring Southwest to give up the fight and shift at least some of its service to the big airport. It has offered Southwest free rent for a year and $22 million in other incentives.

"We urge Southwest Airlines to abandon this divisive effort," Kevin Cox, Dallas-Fort Worth International's chief operating officer, said in a recent statement.

But Southwest said moving any of its operations there was a nonstarter. The airline prides itself on, in most cases, avoiding the biggest, most congested airports, a strategy it claims helps keep its costs — and fares — low....

For some travelers, the Wright Amendment is a moot point. "I won't fly Southwest," said Rod Nowicki as he waited at LAX for an American flight to Dallas. The 6-foot-tall computer consultant, who flies several times a month, belongs to American's frequent-flier club and prefers the airline's legroom and ambience over Southwest's.

But for fans of Southwest's low fares and reputation for quick airport turnarounds, the prospect of repealing the Wright Amendment is heartening.

"I'd rather fly Southwest," said Colette Thompson, a 59-year-old retired financial manager from Dallas, who also was waiting for an American flight at LAX. "Southwest is cheaper. They're faster with everything — getting you in, getting you out — everything."
What a mess!

The Wright Amendment is named after its sponsor, former House Speaker Jim Wright. As early as the late 1970s, American Airlines had to use Wright to protect their status in the airline industry, because Southwest was already so competitive. Like all other cases of protectionism, American Airlines abused the power of government to sustain high prices and its profits; meanwhile it has cost society far more than the profits made.

I don't doubt Southwest's figure that, if it could fly to and from Love Field without the legislated restrictions, passengers could save $700 million a year. Also consider the valuable time saved by not having to take connecting flights, and not having to fly through the Dallas-Fort Worth airport. This dwarfs the paltry concessions offered by the Dallas-Fort Worth airport: free rent for a year, and $22 million in other incentives. It turns out that this isn't a generous offer in the least; it's merely DFW executives' desperate hope that Southwest's executives are schnooks. Look here and scroll down to the 1/6/2005 entry, and you'll see DFW has offered the very same terms to anyone who will take over the 24 gates that Delta abandoned. DFW's offer to Southwest is nothing special at all!

That was back in January. It's now almost July, and since no airline has taken the deal, we can surmise it's a pretty crummy deal. Southwest wisely wants to avoid the antiquated, congested DFW, because that would wreck Southwest's business model of efficient flights and cheap fares. Furthermore, what does it matter that "billions" have been invested in DFW? That should not compel or encourage Southwest in the least to use it. After all, no rational person will patronize a new business just because a great deal of money was invested in it.

American Airline's argument essentially boils down to, "But Southwest will cause prices to fall!" More specifically, Southwest causes prices to fall so low that the airline dinosaurs, like American and United, cannot compete. Since when are lower prices, which Bastiat reminds us mean a greater abundance of goods, a bad thing? And did this Steven Morrison, an economics professor at Northeastern, really say it's "bad news" that Southwest's entry forces existing airlines to cut their prices to compete? Unless he meant it's "bad news" for the competitors, and not "bad news" in an absolute sense, he's a bad economist.

Similarly, American Airline's bad economics is to assert "disastrous economic damage" for DFW and north Texas if Southwest can use Love Field without restriction. The only damage would be American and DFW losing business. The gains would be in passengers saving approximately $700 million on fares -- remember that's just on flights to and from the Dallas-Fort Worth area. Not the DFW airport, but the vicinity.

In fact, it's unnecessary, and in fact illogical, that Southwest should have to perform a "study" of how it would impact ticket prices at Love Field. The only relevant "study" Southwest needs to do is if they can make a profit. American Airlines is merely grasping at straws, trying to pin any kind of blame on Southwest.

If you want a cheaper flight with exceedingly few frills, you can fly Southwest. Conversely, if you're willing to pay more for additional legroom, you can fly American Airlines. The fundamental issue is our freedom to choose, above and beyond what government thinks is "best" for us -- particularly when government is lobbied by a company seeking protectionism, because the company cannot compete.

Monday, June 27, 2005

The free market lets the best come out on top

To Replace Oil, U.S. Experts See Amber Waves of Plastic

Not a very good headline at all. It implies plastic replacing oil, when actually the article is about Cargill Inc. converting raw corn (instead of petroleum) into plastic. That's the beauty of the free market: if a popular commodity becomes too expensive, substitutes that were previously too expensive will become practical.

The Energy Department should stay completely out of this, however. It should scrap any of these goals, like "25% of chemical manufacturing to an agricultural base by 2030." These goals invariably necessitate subsidies and/or specialized tax breaks to promote new technology. Let the free market work its magic. I've said a few times, even just yesterday, how Hayek reminded us that knowledge is dispersed throughout society. It's impossible for a relative few government bureaucrats to know how society will change over 25 years; how can they predict all the market shifts and technological advancements? Corn-to-plastic could be completely obsolete by then.

Just 25 years ago, a VCR was a luxury item that people still bought on payments. Today, even low-income families can save a few dollars a week for a few months, then pay cash for a DVD player. How would things have developed if the Department of Commerce decided, "VCRs are the way to go, and we should subsidize them so that by the year 2000, every family that wants one can afford one"? Simply, future competitors like laser discs and DVDs would have been too costly to develop, because VCRs would always have a head start.

Imagine how the computer industry would be today if, instead of letting competition shape things, the Department of Commerce decided in 1977 to promote the Apple II. Again, competitors would have found it too expensive to develop rival technologies. Apple would have also found it very comfortable to keep producing Apple IIs, so curiously enough, they'd have found it too expensive to compete against themselves by developing new technology.

The best solution is the free market and its raw competition. If converting corn into plastic is practical and efficient, entrepreneurs like Cargill Inc. will seize upon it. Meanwhile, those who doubt the potential can rely on petroleum, or seek their own substitute technology.

The truth about Gitmo

This headline is an outright lie, and the rest of the article repeats lies of Gitmo prisoner and Koran "abuse." The Islamofascists are lucky we bothered to take them alive. I thought they were anxious to meet Allah?

Lawmakers: Guantanamo Conditions Improve

Improve? The fact is that that no one has found evidence of Gitmo prisoners being abused. The only "evidence" is made-up lies by anti-American groups like Amnesty International, the ACLU, and of course Al-Jazeera with the terrorists' blessings.

The members of Congress touring Gitmo learned that prisoners have been treated exceptionally well since the beginning. Via Confederate Yankee, try this story and this if you want truthful reporting. The only abuse at Gitmo, Lt. Col. Gordon Cucullu tells us, is committed by the prisoners on American troops. He went as part of a Department of Defense group to determine if prisoners were being treated too harshly, and he concluded just the opposite.

Daniel Pipes and Michelle Malkin have long since pointed out that we've released Gitmo prisoners only to meet them again on the battlefield. Power Line talks about the latest round, several Pakistanis who can't wait to return home to Afghanistan...to fight Americans.

For detaining "innocent people," we certainly have to fight a lot of them again.

One delegate too many

World Leaders Mark U.N.'s 60th Anniversary

Dozens of international leaders celebrated the 60th anniversary of the United Nations' birth, but warned that the organization must institute significant reforms to remain an effective global peacekeeper.

The Bush administration signaled its discontent with the world body by sending a single representative to the commemoration. Delegate Sichan Siv, who represents the U.S. on the U.N. Economic and Social Council, did not speak at the anniversary celebration.

While officials gave emotional addresses about human rights and the organization's successes in forging global peace, speakers emphasized that the U.N. must restructure and redefine its goals to counter terrorist threats.

Several delegates said it would be a mistake for the U.S. to give up on the world body at a time when the U.N. is poised to institute major reforms.

"In today's world, no state can protect itself alone," said Mary Robinson, former U.N. high commissioner for human rights and president of Ireland, in a speech at Grace Cathedral. "A transparent and accountable United Nations is in the United States' interest. We know the U.N. needs reform, but it also needs resources."
We shouldn't have sent any representatives at all. That would have been a message.

The U.S. does a far better job protecting itself on its own than with the UN's "assistance." If the UN had its way, Saddam would still be in power, with Kofi and his son getting kickbacks.

The article talks about people dressing in 1940s Red Cross clothes. In keeping with the anachronisms, did they have anyone play Alger Hiss, the Soviet spy who later presided over the UN as the first (albeit temporary) Secretary-General?

Real torture

Captain Ed links to Today's Independent, which recounts the story of a Tibetan nun who was tortured by agents of the Chinese government.

The Captain adds, "I point this out just in case anyone still doesn't understand the difference between systemic torture as policy and genocide as a state goal on one hand, and isolated cases of abuse by rogue personnel who get prosecuted for their actions on the other."

Another reason state lotteries are a bad idea

Texas Officials Admit Jackpots Inflated

Lottery officials admitted Friday they knew ticket sales would not cover an advertised $8 million Lotto Texas jackpot this month, meaning a winner would not have collected the full amount.

The Texas Lottery Commission used the inflated number for the June 8 drawing to generate interest and get more people to play even though staff reports estimated sales could only cover $6.5 million, manager Robert Tirloni told commissioners.

Tirloni said jackpots had fallen short of the advertised amounts twice before — once last October and again in February. Each involved an advertised $8 million jackpot that couldn't be supported by ticket sales. No winners emerged, however.
Wonderful, isn't it? I already opposed state lotteries because they're an incredibly bad way to raise revenue. They are a "stupidity tax," but a tax with extremely high overhead. Here in New York, lottery retailers are paid a 6% commission, and there are many executives collecting high salaries.

Then there are the millions spent on ads; the IRS does not need to advertise on TV and radio to get you to pay your taxes. New York's lottery ads are also extremely bad and annoying. Had Pepsi hired such an incompetent advertising agency back in 1985, we'd have switched to New Coke.

And they never once criticized Saddam

Nothing will stop our enemies from slandering our troops, falsely accusing them of atrocities, after remaining silent for years while Saddam committed these against Iraqis.
Witnesses at anti-war tribunal slam US actions in Iraq

The World Tribunal on Iraq (WTI), an anti-war grouping of non-governmental organisations (NGOs), intellectuals and writers, heard witnesses condemn the United States for rights abuses and the worsening plight of Iraqi women.

A former US Air Force pilot called on US troops in Iraq to "resist" the orders of their superior officers in an "illegal war".

"Today Iraq has been turned into a vast prison," lawyer Amal Sawadi told the hearing.

"They come to people's houses in the middle of the night, when everyone is asleep, blow in the door. They point their weapons in people's faces ... they search women in front of their families, they smash everything in the house."

She said lawyers had problems getting news of their imprisoned clients and spoke of rapes and humiliations which amounted to the "systematic practice of torture."

The only journalist present in the city of Fallujah when it was attacked in April and November 2004 said the assault on it amounted to "genocide".

Fadhil Al Bedrani, of the Al-Jazeera network, told how a 70-year-old man died for lack of medical supplies and of the stench of rotting bodies "abandoned in the streets and eaten by animals."

The plight of Iraqi women has worsened badly since the occupation, Hana Ibrahim, an Iraqi feminist said.

"From the day the occupation started there have been systematic violations of women's rights. They have been kidnapped, raped and even taken to other countries by criminal networks," she said.

She said 90 percent of women were out of work, women were now "almost non-existent in social life" while "prostitution was developing" and more and more women were reduced to begging....

About 200 non-governmental organziations -- including the environmentalist group Greenpeace, the anti-globalisation ATTAC and Vietnam Veterans Against the War -- as well as a number of prominent intellectuals such as US linguist Noam Chomsky and Egyptian sociologist Samir Amin are involved in the WTI.
Ah yes, Noam Chomsky, who's so cowardly anti-war that he'd have capitulated to France in 1870. And the Marxist Samir Amin, who also considers himself a Maoist? He's written a lot of tripe like this.

A police state that breaks into your house at night, women being raped, assault on an entire city, bodies being left in the open to rot...those were things done to Iraqi civilians by Saddam Hussein, not U.S. forces. Iraqis had their rights violated from the very first day of Saddam's "presidency" -- are the people cited and quoted in that article among Saddam's displaced loyalists, that they make such apologies for his regime?

How strange that not even the new Iraqi government accuses the U.S. of bringing this terrible fate upon them. "Only on al-Jazeera!" should sound to us like a National Enquirer advertisement.

Show no mercy

As you may have guessed, this weekend I'm catching up on my New York Post news.
'JUDGE-THREAT' TEEN BEGS FOR MERCY

June 22, 2005 -- A Queens teen, accused of making death threats against a federal judge, made a passionate plea for "mercy" as he unsuccessfully tried to be released on bail yesterday.

"I'm only 19. Please have mercy for me, please," wailed Wazir Khan at the hearing in Brooklyn federal court, where he pleaded not guilty to making threats over several weeks ending with his arrest on April 19.

The Guyanese teen allegedly was trying to close the courthouse so that his mother, Bibi Asgar, would not have to face trial for credit-card fraud.

Khan sent one envelope filled with a white powder — which turned out to be innocuous — and a letter threatening "a massacre of judges in the courthouse," authorities said.

He also allegedly threatened to blow up the courthouse and claimed to have smuggled a gun inside.
He's only 19? That's old enough to know that you don't do such stupid things.

He deliberately tried to interfere with the dispensation of justice. Let him wail all he wants -- in a cold prison cell.

PETA hypocrites

POOCH-KILLING PETA BANNED

June 25, 2005 -- THE canine-killing animal rights group, People for the Ethical Treatment of Animals, has been banned from two North Carolina counties after the corpses of 31 pooches were discarded in a convenience store dumpster. PAGE SIX reported on the hound slaughter last week. Local authorities were told PETA would try to find homes for the dogs, but it euthanized them just hours after collecting them. Documents filed with the state of Virginia showed that PETA exterminated about 6,100 domestic animals from 2001 to 2003. Daphna Nachminovitch, director of PETA's domestic animal and wildlife department, said she didn't know how many were from North Carolina. "Did we euthanize some animals who could have been adopted? Maybe," she admitted. "The point is that good homes are few and far between. Our aim here was to stop them from dying an agonizing death." The PETA operatives arrested last week, Adria Joy Hinkle, 27, Andrew Benjamin Cook, 24, both of Virginia, have a court hearing July 19 on charges of animal cruelty, disposal of dead animals and trespassing.

I love most animals, but PETA just goes too far. They claim it's "cruel" for us to raise animals despite useful purposes (food, leather, etc.), yet we see their hypocrisy and outright lies. And throwing the bodies in the trash?

Some years ago, the Salt Lake Tribune published an article on all the dogs and cats that Utah euthanizes. My father, who loved dogs, had to stop teary-eyed after only two paragraphs; I had to do the same. It's heartbreaking, but what is the alternative? This exemplifies what Thomas Sowell said: "There are no solutions. There are only trade-offs."

Securing our rights doesn't mean round-the-clock protection

The New York Post reports:
GAL GROWLS OVER DOG MAUL SUIT

June 25, 2005 -- A Manhattan woman cannot sue the city for its failure to rein in a pack of vicious dogs that nearly killed her beloved pooch, a judge has ruled.

"It's discouraging and it's frustrating and it makes me want to yell and scream," Rebecca Skloot said of Manhattan Supreme Court Justice Walter Tolub's decision to throw out her petition. "I want the city to be held accountable for what happened to my dog."

A friend of Skloot's was walking her dog Bonny near the writer's Hell's Kitchen apartment in 2003 when "a pack of junkyard dogs" set upon the 35-pound border collie mix....

The 15-year-old needed 87 stitches and more than $7,000 in veterinary care.

[Skloot] said she called various city agencies "to prevent further attacks," but they told her "they did not handle 'dog-on-dog' complaints" and "each agency referred her to another city agency," the judge's decision says.

Skloot sought permission to file a late notice of claim — the first step in filing suit — earlier this year charging the city was negligent for failing to protect Bonny.

In a decision made public yesterday, Tolub sided with the city, finding her claim "patently meritless" because the city agencies had "no special duty" to protect her.
Being cynical, I suspect she had a good lawyer behind her, telling her how she could turn this into a minor windfall. That aside, while it's certainly unfortunate her dog was attacked, the judge was correct: government is not required to prevent it from happening. What must we do, hire sufficient animal control personnel to roam all over, picking up all potentially dangerous strays? Where does "government's responsibility" end? Heaven forfend I should ever hit a deer while driving, up here in forested Westchester. If it did happen, should I then sue my county for not keeping deer reined in?

The Declaration of Independence reminds us that government is instituted to secure our rights to life, liberty and property. That does not mean that government is an ever-watchful constable who prevents our rights from ever being infringed. It's economically and logistically impossible for government to act as a personal bodyguard, short of destroying the economy by employing a policeman for every square block.

The law and government cannot prevent our rights from being violated: they can only punish those who do. Police can deter crime to varying degrees, though not always. Hence deterrence is their secondary effect, their main purpose being the apprehension of criminals and suspects. It's a slippery slope when we start thinking that government must take measures to prevent any infringement of our rights, because that opens up the huge problem of liability: "Well, there should have been a policeman there." The tiniest slip-up, and it will eventually happen, leaves government more and more liable to a citizen who can blame government for "not doing enough." Yet it should be evident that government cannot anticipate, let alone control, every circumstance. Hayek taught us in "The Use of Knowlege in Society" that knowledge is also of time and place, not just scientific facts. Since it is dispersed throughout society, no government can hope to plan an economy better than a whole society. I add that it also cannot do enough to prevent crime better than individual citizens.

And after all, we, as individuals, have a much greater motivation to protect our own persons and property than anyone the state hires for that purpose. We also have a better window of time to defend ourselves. Consider this also: who is more watchful when part of government violates our rights, we or the rest of government? But there's a big problem when the state inhibits us in our self-defense...

My friend Charlie had that excellent point when we talked about this on the phone: how ironic that Ms. Skloot is prevented from fully defending herself and her dog. I concur: there is some blame to be laid upon the state, just not in how she claims. The same state that disclaims responsibility simultaneously prevents her and her friend from owning handguns, with which they could easily kill any wild dogs threatening them or their pets.

This falls back into the "prevention" notion. Government thinks that passing laws against certain things will reduce them, like gun control will make it harder for criminals to commit crimes. Then why are crimes using guns so much more prevalent in New York, D.C. and other cities with the stringent gun control laws, and extremely low in states like Utah that have far fewer gun restrictions? Moreover, it makes people less able to defend themselves from criminals, and more dependent on the state that disavows any responsibility of protecting them.

Saturday, June 25, 2005

What's the real problem?

Also from the New York Post:
1 IN 4 FARE 'SWIPES' GETTING YOU NOWHERE

June 22, 2005 -- More than one-quarter of all subway MetroCard swipes have failed since the MTA kicked off its fare-card program, according to a report by the city Public Advocate's Office.

The report, which will be made public today, also says that nearly half of all swipes fail in low-income neighborhoods, said Anat Jacobson, a spokeswoman for Public Advocate Betsy Gotbaum.

One of the worst stations to swipe the cards is the 116th Street stop on the B and C lines in Harlem....

Neysa Pranger, campaign coordinator of the Straphangers Campaign, said the MTA should do a better job making sure MetroCard readers work properly.

"Part of the problem is people who just begin to use MetroCards have higher cases of miss-swipes, so the longer the program is around, the less you will have that problem," she added.

Gotbaum's report, "Stuck at the Turnstile," is to be released two days after the City Council's Committee on Oversight and Investigation issued a report critical of the cash-strapped MTA that said more than half of the city's subway stations are filthy — and the dirtiest are in some of the Big Apple's poorest neighborhoods.
So what are they saying, that the MTA is so racist that it puts more faulty machines in bad neighborhoods? And how can Neysa Pranger blame the equipment in one breath, then people in the next?

Is it also surprising that the poorest neighborhoods have the filthiest stations? It's not from a lack of cleaning. It's because they have greater numbers of drug addicts, alcoholics and vagrants, who'll litter the subways and use them as bathrooms.

As a daily passenger on the NYC subways, one who's used subway stations from Wall Street to Pelham Park, I can safely say that MetroCard readers have no more trouble than retail stores' credit card devices; I've actually had more trouble getting my credit card read at a certain Metro-North ticket machine. MetroCards have a magnetic strip, so take care to swipe flat. I frequently see people who are clearly in a rush, swiping over and over, but they hold the back corner so elevated that they'll never get a good swipe.

The MetroCard was a great idea. Tokens were just disgusting, especially when you consider that "turnstile jumpers" would pour battery acid, soda pop and even urine into the slots.

For the birds

From the New York Post:
TWEET AND SOUR

June 23, 2005 -- East Hampton Village has been forced to postpone its popular Fourth of July weekend fireworks extravaganza — until four newly hatched birds are able to celebrate their own Independence Day.

The birds, piping plover chicks, were discovered on Monday nesting with their parents on the village's popular Main Beach — near the very spot the fireworks were going to be sent rocketing skyward at the planned July 2 pyrotechnic spectacular.

Because the plovers are a federally protected endangered species, village officials had to put off their razzle-dazzle display until Labor Day — making it necessary for countless summer folk to call off their beach-house fireworks galas, the first big blasts of the season....

Under federal regulations, fireworks can't be launched anywhere within three-quarters of a mile of a plover nesting area.

"We were going to move to another spot, but there was another nest there," said Dede Flannery of Bay Fireworks....

The plovers have been given their own private stretch of sand — cordoned off with a fence to keep other beachgoers out — until they learn to fly and leave the area. That should happen before Labor Day, Cantwell said.
What rubbish! Don't be surprised, though. It's another example of rabid environmentalists hijacking your property rights. The next step is that people won't be allowed to build houses somewhere, or set aside some of their acreage, because of endangered species. Whoops, too late, as Walter Williams reminded us a few years ago:
You say: "What do you mean, Williams? The government didn't take their property; the people still hold title." Holding title to private property, all by itself, doesn't mean very much. For example, suppose the government recognizes that you can hold title to your house but forbids you from living in it. The fact that you hold title to the house would be meaningless because the government has restricted your options. By decree the government has reduced the value of your property, and as such it is a "taking" of property without just compensation in violation of the U.S. Constitution.

Let's look at Oregon's Board of Forestry forcing the Seiber family to set aside 37 acres of their 200-acre plot to protect the northern spotted owl. It just might be that protecting the spotted owl is vital to the national interests. But the burden and cost of protecting the spotted owl should be borne by all Americans, not fall on particular Americans -- Mr. and Mrs. Seiber. Justice and fairness require that the Seibers be compensated for the loss in value of their property from having to set aside 37 acres.

Just compensation doesn't go over big with environmentalist wackos, simply because it would reveal the cost of their agenda. They achieve their agenda better simply by getting federal, state and local governments to run roughshod over people's rights. They pick us off one at a time. The rest of us don't know how our neighbors are being victimized and, if we did, I doubt whether there'd be many of us who'd care and be willing to help defend our fellow citizen.

We should all pause and remember that if the government can rip off one citizen, what's to say one of us won't be next?

They deserve the death penalty

Perhaps it's because the news is focusing on it, but there seem to be a lot of hit-and-run drivers in the NYC metro area lately. I mentioned one in my previous blog entry. There was another where a woman backed up her Jaguar, went over the curb, and pinned another woman against a brick wall. She fled the scene but turned herself in after a couple of days. The victim, as I recall reading, had to have her leg amputated.

This heroin addict killed two bicyclists, driving 1000 feet with one of them stuck in his windshield. Apparently he wasn't going to stop; it took another motorist cutting him off!

This drunk driver severely injured one boy and killed another -- yet he'll likely get a plea deal where he'll serve only 60 days in jail. Under the law at the time he committed the crime, he could be charged only with misdemeanor DWI. Why was this drunk driver not charged with, at the least, manslaughter? The law never specifically addressed his actions, but he killed another human being. The families' only recourse is to sue the bastard, if he has anything.

This is precisely why legal positivism (something Friedrich Hayek criticized in several of his writings, including "The Results of Human Action but not of Human Design") is wrong. In essence, legal positivism declares there can be no law without a legislative act. For the same reason, a greater sentence for a "hate crime" is also stupid. Was not that action already a crime? By the same token, the Senate was stupid to apologize for failing to pass laws against lynching. Was not lynching already murder? Nevertheless, morons like those at the Louisiana Weekly think that anti-lynching laws would have stopped them. I'm sure. Just like gun control has prevented crime in NYC, D.C., Chicago, Oakland, L.A., and elsewhere, right?

The blame is not that there are no specific laws to make those actions a crime. The blame lies in prosecutors who do not use existing laws against murder, manslaughter, etc., to charge those who committed the crimes.

Over in California, a woman with four previous drunk driving convictions was sentenced to 30 years to life for running over two children on a sidewalk. Again, that's not harsh enough. The consumption of alcohol and drugs is not a natural act, nor is it done quickly. It requires will and cognizance. Someone aware that alcohol has gotten her into trouble before, then gets intoxicated anyway and uses a multi-thousand-pound weapon to kill people, doesn't deserve the gift of life that she took away from those children.

Someone had observed her drinking alcohol earlier that day, but she claimed her driving was from painkillers and muscle relaxants. Even so, that in no wise excuses her from the responsibility of being aware that she ingests reflex-inhibiting substances. I'm glad the jury and judge didn't buy her baloney.

"The government doesn't give me enough"

Part of my commute involves taking the subway "shuttle" between Times Square and Grand Central Terminal. There's a middle-aged man who rides it, peddling a newspaper that he claims is "put out to help the homeless and the jobless." There are three shuttles running at any given time, each with several cars, so I've seen him only a few times.

"Good evening, ladies and gentleman," he always begins in monotone. He asks $1 for a copy of the newspaper, explaining that he does this to support his 6-year-old daughter, because "the government doesn't give me enough." That last part I'd never heard him say until yesterday. It's probably new, because I would have noticed it before.

"The government doesn't give me enough" may as well have echoed surreally. I couldn't believe my ears. Obviously he meant it as a way to elicit pity, but to those of us who do genuine work for a living, he'd be more effective if he didn't dress in an expensive sports jersey and jacket. Why doesn't he dress in $2 T-shirt and jeans so that he can better afford to support his alleged daughter?

Part of me wanted to get up, wag a finger in his face and say, "How dare you accuse the government of not giving you enough! Do you know where the government gets the money? From millions of hard-working Americans like me who go out there and work at real jobs! Then leeches like you elect bleeding heart liberals, knowing they'll take a third of our money and give it to you, so that you can ride the ******* subway all day long and tell us our taxes aren't enough to provide you with a living! How about simple advice on how to support your daughter: get a job!"

But I was tired and didn't feel like a confrontation, especially when he'd likely just call me a racist. Didn't you know? It's now "racist" and "selfish" for the majority of us to want to keep the fruits of our labor, after working hard all day. It's "unchristian" because we want full control over any charitable recipients of our money.

Earlier I saw a panhandler on the corner of 54th and Broadway. In one hand, he held a cup filled with coins, which he'd shake at people passing by. With his other hand, he munched down on a cheeseburger. Like the one on the subway, his appearance hardly elicited pity from me.

Contrast them with a very nice family I met yesterday evening on the train. They live much further north than I do. The husband's train ride to the city is 90 minutes each way, and that doesn't include taking the subway and walking. The wife and their two children often travel down to meet him at Grand Central, so they can have a little more time together.

Initially I thought, "Gee, that can't be worth it. Why doesn't he take a job closer?" Then it hit me: unlike the two bums, the father is doing what it takes. By definition, despite the long commute, his city job is better than what he can find closer to home, even after the costs associated: two monthly passes (I believe children under 5 ride for free) and, of course, his time.

They'd also rather live upstate, where it's clean and quiet with less drugs and crime, and where the risk is far less of a serial rapist climbing through their windows. They'll also worry less about their children being run over. New York City has had a recent spate, at least in the news, of hit-and-run drivers.

Friday, June 24, 2005

What would Bastiat say? "The law perverted!"

The law perverted! And the police powers of the state perverted along with it! The law, I say, not only turned from its proper purpose but made to follow an entirely contrary purpose! The law become the weapon of every kind of greed! Instead of checking crime, the law itself guilty of the evils it is supposed to punish!

If this is true, it is a serious fact, and moral duty requires me to call the attention of my fellow-citizens to it.


Down to each individual phrase, Bastiat's dramatic commencement of The Law is precisely what happened on Thursday with the Supreme Court's decision in Kelo v. New London.

Could we have just seen the most despicable Supreme Court ruling yet? Last March, I warned that if they ruled against the New London homeowners, "we'll know the Bill of Rights is finally dead." Then on Thursday, five of the nine justices did it: they finished killing the Bill of Rights by effectively declaring that private property rights exist only insofar as government permits. Government may now declare "eminent domain" and give you "just compensation," but according to whose valuation? Moreover, the Fifth Amendment's phrase "public use" has been officially convoluted into "public purpose."

There's really nothing left. The last couple of untouched Amendments could fall at any time, now that government has an ability to deny people the core right to private property. Mises, among others, said private property is the basis of civilization. He got it wrong, though, by reducing property to "a human device" and "not sacred" -- if it is a human invention, then other humans can destroy it. That's why our Founding Fathers reminded us that life, liberty and property are gifts from God, which no man has the right to take away.

The key parts of the majority decision are:
Held: The city's proposed disposition of petitioners' property qualifies as a "public use" within the meaning of the Takings Clause. Pp. 6–20.

(a) Though the city could not take petitioners' land simply to confer a private benefit on a particular private party...the takings at issue here would be executed pursuant to a carefully considered development plan, which was not adopted "to benefit a particular class of identifiable individuals," ibid. Moreover, while the city is not planning to open the condemned land—at least not in its entirety—to use by the general public, this "Court long ago rejected any literal requirement that condemned property be put into use for the...public." Id., at 244. Rather, it has embraced the broader and more natural interpretation of public use as "public purpose." ... Without exception, the Court has defined that concept broadly, reflecting its longstanding policy of deference to legislative judgments as to what public needs justify the use of the takings power.

(b) The city's determination that the area at issue was sufficiently distressed to justify a program of economic rejuvenation is entitled to deference....

(c) Petitioners' proposal that the Court adopt a new bright-line rule that economic development does not qualify as a public use is supported by neither precedent nor logic....The Court declines to second-guess the wisdom of the means the city has selected to effectuate its plan....
The part that leapt out at me was "literal requirement." Literal? What is the Constitution worth, then, if we are not to take it literally? Well, the majority ruling explained it immediately following: "broader and more natural interpretation," i.e. the Constitution means what they want. It gets worse, giving "deference" to a government that thinks it will succeed, disagreeing with the petitioners (though the dissenting opinions cite court cases that support the petitioners), and refusing to question the government's plan!

Every part of the majority ruling is completely contrary and repugnant to the true meaning of the Fifth Amendment:
...nor shall any person be subject for the same offence to be twice put in jeopardy of life or limb; nor shall be compelled in any criminal case to be a witness against himself, nor be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.
Isn't that exceedingly clear language? You'd think that Stevens, Kennedy, Breyer, Ginsberg and Souter never read the Fifth Amendment, or that they can't understand plain English. Stevens might as well have prefaced the majority decision with, "The last remnants of the old Republic have been swept away."

I couldn't believe my ears when a caller to Sean Hannity's radio show claimed that the homeowners had in fact been given due process. Technically, yes, they did, but only by government's mere declaration, not by the Constitution's standards. Others, like a Columbia law professor quoted here, have downplayed the ruling because cities must still "be careful and conduct hearings." Nonsense. The SCOTUS ruling makes such hearings mere formalities. Cities know they are now empowered by federal precedent, based on nonsensical interpretations of the Constitution.

That's the crux, isn't it? The five justices said, "This is how the Constitution was meant to be broadly interpreted." The four dissenters said, "No, this is what the Constitution actually says!"

O'Connor's dissent (starting on page 27 of the PDF) correctly began by citing the Calder v. Bull ruling of 1798: "[A] law that takes property from A. and gives it to B: It is against all reason and justice, for a people to entrust a Legislature with SUCH powers; and, therefore, it cannot be presumed that they have done it." No level of government has the right to force private property owners to sell to other private individuals, with rare and extremely specific exceptions like liens, and genuine cases of eminent domain. New London and the private developers, however, have no true claims against the homeowners. Their use of "eminent domain" is based on goals of "economic revitalization" in New London.

Justice Thomas joined her dissent but filed one of his own (starting on page 40 of the PDF):
I do not believe that this Court can eliminate liberties expressly enumerated in the Constitution and therefore join her dissenting opinion. Regrettably, however, the Court's error runs deeper than this. Today's decision is simply the latest in a string of our cases construing the Public Use Clause to be a virtual nullity, without the slightest nod to its original meaning. In my view, the Public Use Clause, originally understood, is a meaningful limit on the government's eminent domain power. Our cases have strayed from the Clause's original meaning, and I would reconsider them....

Though one component of the protection provided by the Takings Clause is that the government can take private property only if it provides "just compensation" for the taking, the Takings Clause also prohibits the government from taking property except "for public use." Were it otherwise, the Takings Clause would either be meaningless or empty. If the Public Use Clause served no function other than to state that the government may take property through its eminent domain power—for public or private uses—then it would be surplusage.
Don Luskin called it a "sick decision" and said further, "As reader Dave Duval asked me, can you imagine the outcry if the conservatives on the court had backed this decision? 'Conservatives deliver the little guy to greedy businessmen.' Well, that's just what has happened -- and the liberals did it. Where's the outcry? There will be none. Nowadays it's not what you do. It's who does it."

Via Professor Bainbridge (who has always had an insightful perspective on this issue), Will Collier at VodkaPundit is spot-on:
...the price even a willing seller would be able to get from his property just took a huge hit. All a developer has to do now is make a lowball offer and threaten to involve a bought-and-paid-for politician to take the property away if the owner doesn't acquiesce.
This Supreme Court decision will facilitate incredible business bargains. Businesses only have to pay "fair market value" for someone else's private property (remember that Connecticut actually began by condemning the homes, so how much is condemned property really worth?). The state and local governments will benefit from greater tax revenue. Supporters of this perverted "eminent domain" farce would have us believe that it's all hunky-dory, because a majority of people will benefit. It doesn't matter that it's at the expense of a few.

This is literally two wolves and a lamb deciding on lunch.

Welcome to the Empire, my fellow Americans. Aren't you glad to know that today's ruling is in accordance with Article 17, section 1, of the UN Declaration of Human Rights?
Everyone has the right to own property alone as well as in association with others.
There we go. You may no longer own the property yourself, but you still own it as a member of society. After all, if "public use" now means "private use with broad public benefit," then private ownership can be similarly redefined.

You will be further happy to know, fellow subjects of the Empire, that we're well on our way to fulfilling the first plank of Marx's Communist Manifesto: abolishment of all private property.

Wednesday, June 22, 2005

When will HP, et al, cry "Unfair competition!"

Dell launches sub-$100 laser printer

Dell has unveiled a black-and-white laser printer priced at $99--low enough, possibly, to kick off a price war in the home and small-office printer market.

The computing giant introduced its Dell Laser Printer 1100 on Tuesday. The device handles up to 15 pages a minute with a resolution of 600 dpi. Analysts predict competitors ranging from Hewlett-Packard to Lexmark will feel the pressure to offer something comparable, given that their low-end monochrome lasers start at roughly twice that price.

"Dell's laser is a disruptive price," said Charles Wolf, an analyst with Needham & Co., adding, "This could cause more consumers to shift over to laser."
Not to put words into their mouth, but I'm waiting for Dell's competitors to realize they can't compete, then accuse Dell of "anti-competitive tactics" just because it offers more for less.

Isn't that the New American Way Of Doing Business? If you can't compete, sue; or go the FTC. If Dell gains too much market share (often confused with "market power"), perhaps Compaq-HP and IBM could have the federal government investigate breaking Dell up into smaller, completely separate companies. One would involve Dell's base of desktops and servers, a second would be about monitors and home consumer electronics, and a third would produce printers.

Why is this such a stretch? After all, it's what Microsoft's competitors and the feds tried to do. Basically what they argued is that it's "anti-competitive" to compete.

When government seizes money

That's what this basically amounts to. From the New York Times:
The toxic algae that has shut down shellfishing operations from Maine to Massachusetts has left Connecticut's crop untouched and business booming. The red tide taints shellfish like clams and mussels, making them unsafe for consumption by people or animals. Since May, Maine and Massachusetts have asked for federal disaster relief for the shellfishing industry. But the outbreak has had little effect on the seafood supply from Long Island Sound and has opened up some sales in the Boston area, Connecticut fishermen say.
"Federal disaster relief" means cash payouts to the fishermen. Cash payouts so they can earn a living and not work. What would Bastiat say? This isn't just the consumption spending transfer he described in "What Is Seen" -- in The Law, he described the crime of redistributing property:
But how is this legal plunder to be identified? Quite simply. See if the law takes from some persons what belongs to them, and gives it to other persons to whom it does not belong. See if the law benefits one citizen at the expense of another by doing what the citizen himself cannot do without committing a crime.

Then abolish this law without delay, for it is not only an evil itself, but also it is a fertile source for further evils because it invites reprisals. If such a law—which may be an isolated case—is not abolished immediately, it will spread, multiply, and develop into a system.

The person who profits from this law will complain bitterly, defending his acquired rights. He will claim that the state is obligated to protect and encourage his particular industry; that this procedure enriches the state because the protected industry is thus able to spend more and to pay higher wages to the poor workingmen.

Do not listen to this sophistry by vested interests. The acceptance of these arguments will build legal plunder into a whole system. In fact, this has already occurred. The present-day delusion is an attempt to enrich everyone at the expense of everyone else; to make plunder universal under the pretense of organizing it.
If you can't find the job you want, or new work in something you've always done, you have two choices, and two only: change jobs, or move. It's flatly immoral to think of using government's power to make the rest of society to bail you out.

"But it's only a few pennies per American," the protectionists will argue. Yes, but those few pennies will add up; it's quite irrelevant that the cost is borne by many, because the requisite "equal and opposite reaction" must be considered as a whole. Bastiat reminds us in "What Is Seen" that if government gives taxpayers' money to someone, that's a transfer of spending, at best. But in this case, society actually loses the money, because the fisherman is producing little or nothing. People would literally labor only to have that money confiscated by government, meanwhile receiving no goods or services at all in return. Government has given the money to someone else to spend.

Protectionists could argue that at least the money is being spent, generating economic activity. Bastiat's "broken windows" tore down that fallacy: his whole point was that the original (legitimate) holders of the money were already going to spend it. So if people know that they can labor more only to have government take more, as it is with a progressive tax system, why would most of them want to work harder in the first place? They wouldn't, and thus the economy could never reach its full potential.

Tuesday, June 21, 2005

The Mugabe Diet

Now I've seen everything.

Mugabe's new ultimate weight loss program is directed at tourists, who can lose weight by working on Zimbabwe's farms.

All the labor in the world won't help when there isn't enough farmland. In my entry last night, I mentioned that Mugabe stole farms from white owners. Many of the black recipients built houses on the land instead of working the farms, which drastically cut Zimbabwe's food production and still threatens millions of people with starvation.

The latest round at LKMP on free trade

My latest comment over at Larry Kudlow's Money Politic$ (see the first round here, and the second here). I don't want to flame, but some people don't get it. However, he did unintentionally flatter me by accusing me of being Kudlow, posting anonymously:
IMPT, why don't you just declare that it's your party and you'll cry if you want to? Your real name isn't "Stanley," is it? Because if anyone's a tool here, you are.

For heaven's sake. I hope you were joking, because you're bordering on paranoid delusion. Larry is not my father, but I'd have been proud to be his son. Moreover, don't you think he has better things to do than make anonymous comments on his own blog? Had you bothered to spend 30 seconds and do a quick comparison of writing styles, you'd see he and I are not the same person. Never mind that clicking on my name would take you to my blogger profile, with a link to my own blog. There's a picture of me there, and somehow I doubt Larry would create that, or have an employee or friend set up an entire blog for your fantasial facade?

A rational person would conclude that Larry has better things to do than fake an entire persona, let alone an up-and-coming blog he doesn't even link to. Then again, a rational person wouldn't have accused me of being Larry in disguise.

I've never met Larry, let alone had dinner with him, but I'd have the thrill of my life to have lunch with him and, say, Donald Luskin the next time he's in NYC.

It's a relatively simple matter to check Larry's Townhall.com archive. Don't you know how to do research?

Apparently not, because you're evidently not aware of the several major studies about the steel tariffs, both pro and con, which concluded just about the same numbers. Even the most pessimistic ones estimated $100 per car, and a few bucks per refrigerator -- and they did account for additional feedback from the initial levying of tariffs. I read these studies.

When you yourself start reading economic studies, you'll find that opposing studies on the same issue sometimes reach the same numerical conclusions. That's because the figures aren't as important as the interpretation: which is preferable, x or y?

Economics teaches that there's always a tradeoff. Is an extra $100 per car worth paying so a few steel workers can keep their jobs, though the total cost to society is more than what those jobs produce? Protectionists argue that the jobs have greater value than their tangible output. I happen to believe otherwise.

You claim that two senators are powerless to get anything passed. Actually, it only takes one -- one to sponsor a bill and drum up support. How do you think Robert Byrd gets so much federal money for West Virginia? (Taxfoundation.org calculates that West Virginia receives over $1.80 for every $1 that its citizens send to the federal government.) I suggest you look up "logrolling" and think about its prevalance in Congress. Do you think Byrd, or Ted Stevens, get support for their respective states' projects because the other senators are altruistic?

How do you think the atrocious McCain-Feingold "campaign finance reform" got passed, including with Bush's signature? Because that, and tariffs, are two of several issues that can easily become political blackmail. If you don't support "campaign finance reform," even if it's a bad law like we have today, your opponent in the next election will portray you as supported by special interests. If you don't support a tariff, your opponent will pull a John Kerry, accusing you of willfully denying jobs to Americans.

At least you're correct that much of Congress wants "a level playing field." That's also what Hoover and Congress wanted in 1930. There's no such thing, nor should we attempt a "level playing field." Stephen Roach complains incessantly about "global imbalances" that must be corrected, when in fact it's imbalances that push an economy forward. It's our differences, on an individual and national basis, that allow someone to do a task better than another.

Take the Schumpeterian entrepreneur as an example. He sees an opportunity that will create an imbalance in his favor, because he's not satisfied with the status quo, and he thinks he can earn a living that way.

You just can't deny that Larry opposed Bush's steel tariffs from the beginning. That's the bottom line. You made an allegation that turned out to be untrue. Do you enjoy the taste of your toes that much? Because I see your foot's in your mouth again.

As far as "too much time," I work long hours but still manage to balance family, friends and my blog. A few minutes a day helps keep the mind sharp.

Monday, June 20, 2005

Mugabe's assault on the poor

[Update: I must have accidentally "cut" part of the paragraph talking about foreign aid sent to Africa. It's been corrected.]

Mugabe is officially Roman Catholic, but his heart is so black that there is no doubt a special place in hell for him. Truly we're hard-pressed to find such raw evil. At her Senate confirmation hearings, Secretary of State Condoleeza Rice was absolutely correct to list Zimbabwe among the world's "outposts of tyranny."

UN agencies have apparently "condemned" Mugabe's new assault on Zimbabwe's poor, which began four weeks ago. However, their criticism has been quiet enough that I've only seen brief mentions of it in the news. The White House and EU have denounced what Mugabe is doing. Zimbabwe's Roman Catholic leaders have denounced it. Tony Blair is being pressured. Paul Wolfowitz has denounced it, but not strongly enough.
Wolfowitz says Zimbabwe evictions 'a tragedy'

Zimbabwe is in "pretty bad shape and getting worse," new World Bank President Paul Wolfowitz said on Saturday, adding that reports of thousands being driven from informal settlements was a "tragedy." ...

Aid workers say around 200,000 Zimbabweans have been made homeless by a recent blitz by President Robert Mugabe's government on informal settlements and stalls, hurting a population already hit by AIDS and bad harvests.

"These latest reports of hundreds and thousands of people driven out of their homes is both inhuman and it must do enormous damage to development prospects for the country," he said. "It's a tragedy."
These people are not only sleeping in the street, but they're sleeping unprotected in wintertime. (Zimbabwe is in the Southern Hemisphere, which has winter while the Northern Hemisphere has summer.) I ask myself, "What is wrong with us?" when our Western news obsesses about Abu Ghraib, Gitmo prisoners and Michael Jackson (that is the only time you will see me reference him on my blog), ignoring this tragedy where babies freeze to death, amidst cholera outbreaks.

Besides the people who have lost their homes, over 32,000 people have been arrested. On what charges? "Illegal" commerce, but the "crimes" are flea markets and informal merchants -- people who are simply trying to eke out a living. Mugabe has defended the destruction, insisting that these urban shanty towns are illegal and overrun with "criminals." If he's looking for criminals, he should first look at himself. Then again, he's technically right: he has made it a crime to seek out an honest living that is not "blessed" by his government. The previous "criminals" were the white farmers, whose sole "crime" was retaining ownership of the farms that their forefathers had started.

Ayn Rand was right. She wrote in Atlas Shrugged, "There's no way to rule innocent men. The only power any government has is the power to crack down on criminals. Well, when there aren't enough criminals, one makes them. One declares so many things to be a crime that it becomes impossible for men to live without breaking laws."

Mugabe used the white farmers as a scapegoat for Zimbabwe's economic woes. His "land grab" made things even worse: white-owned farmland was given to blacks, who often built homes on the land instead of continuing farming, and Zimbabwe's agricultural output plummeted. Meanwhile, Mugabe's government seized any other land it wanted, allowing his cronies to enrich themselves off Zimbabwe's tremendous mineral wealth. Now he needs someone new to blame, and sadly, it's these urban poor and their "informal" economy.

Zimbabwe's unemployment rate is over 80% (contrast that with the last U.S. recession, when we didn't even hit 7%). Since four-fifths of Zimbabweans cannot find jobs (not stable jobs as we know them), they must do what they can to sell goods and services to each other. Yet Mugabe accused them of "sabotaging" Zimbabwe's economy. How can people engaging in voluntary, peaceful economic activity, and not inhibiting others from doing the same, cause any harm to the economy? They're the ones generating economic activity, unlike Mugabe, who is destroying it. But as an avowed Marxist, Mugabe won't allow any economic activity that isn't under his government's auspices.

ZWNews.com explains that part of Mugabe's plan is "destroying informal 'flea markets' in order to tighten its control of the economy." Therefore, he must destroy any commerce not sanctioned by his government, and any merchants who won't give in to his tyranny. This extends to centralizing all foreign currency, which people are using for the simple reason that Zimbabwe's dollar is practically worthless. When people lose confidence in the soundness of their national currency, they must find a stable medium of exchange. It's another manifestation of individual liberty that Mugabe cannot permit to continue.

One estimate is that possibly 1.5 million people are now homeless. A Sunday Herald article said two million, also noting why Mugabe is really doing this: urban dwellers were big supporters of the opposition party in the parliamentary elections earlier this year. This is literally his revenge. Independent Online echoes that and also points out that Mugabe is blocking aid to these people, who are basically refugees. His actions are so criminal that "Even some non-governmental organisations who don't normally criticise the government publicly, such as the Zimbabwe Doctors for Human Rights (ZDHR) and the Zimbabwe Teachers Association (Zimta), have been forced to speak out because of the magnitude of the crisis." The ZDHR estimates between 1 and 2 million people are homeless, far higher than what relief agencies are reporting.

Another ZWNews.com article bemoans the fate of those who won't sell their souls to Mugabe:
Thousands of Zimbabweans made homeless in the government's ruthless clean-up campaign are being herded into re-education camps and told they can have a housing plot only if they swear allegiance to the party of President Robert Mugabe. Those who refuse are loaded into trucks and dumped in remote rural areas, far from their own homes, where food is scarce. Human rights workers say they are being left to die in what they believe is a deliberate strategy by the Mugabe regime to exterminate opponents....

...Yesterday police rampaged through Harare, setting fire to the few remaining belongings that many homeless people had salvaged, and warning them against taking refuge in churches. So brutalised is the population that some torched their own possessions on police instructions. A Harare police commander was reported to have authorised the use of live ammunition against people resisting eviction. "I need reports on my desk saying we have shot people," he was said to told his officers. "The president has given his full support for this operation so there is nothing to fear. You should treat (it) as a war."
That's not all. The extent of Mugabe's tyranny is such that other Zimbabweans are afraid to protest against him, lest they incur the wrath of his police.

What can we do? Western nations for years have sent food and money to Zimbabwe, always with the same result: Mugabe and his henchmen seize most of the food and money for themselves, distribute some to their supporters, and prevent all relief efforts from reaching the intended recipients. It should be noted that this happens with many African nations, as well as Iraq under Saddam Hussein.

Einstein reputedly said, "Insanity: doing the same thing over and over again and expecting different results." So what's left?

Should "some nation" send in covert agents to assassinate Mugabe and his top leaders, I question whether Zimbabwe would be worse off with the pursuant social chaos and possible civil war. At least they'd be free to fight for true freedom.

The best option would be what the Second Continental Congress adopted on July 4, 1776:
We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness. --That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, --That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness. Prudence, indeed, will dictate that Governments long established should not be changed for light and transient causes; and accordingly all experience hath shewn, that mankind are more disposed to suffer, while evils are sufferable, than to right themselves by abolishing the forms to which they are accustomed. But when a long train of abuses and usurpations, pursuing invariably the same Object evinces a design to reduce them under absolute Despotism, it is their right, it is their duty, to throw off such Government, and to provide new Guards for their future security.
This is not possible, however, while Zimbabweans are deprived of firearms to protect themselves from tyrannical government. This is what Noah Webster noted:
Before a standing army can rule, the people must be disarmed; as they are in almost every kingdom of Europe. The supremepower in America cannot enforce unjust laws by the sword; because the whole body of the people are armed, and constitute a force superior to any bands of regular troops that can be, on any pretense, raised in the United States.
Now consider what Shogun Toyotomi Hideyoshi reportedly said in 1558:
The people of the various provinces are strictly forbidden to have in their possession any swords, bows, spears, firearms, or other types of arms. The possession of these elements makes difficult the collection of taxes and dues, and tends to permit uprising. Therefore, the heads of provinces, official agents, and deputies are ordered to collect all the weapons mentioned above and turn them over to the government.
The last sounds a bit apocryphal to me, but it's still the same principle.

Saturday, June 18, 2005

More on free trade and unemployment statistics

My blogging last night was a republication of my comments at Larry Kudlow's Money Politic$ blog. I made three follow-up comments tonight:

The first is to one of the regular trolls:
IMPT, it's amazing how you hurl accusations of "spinning" and "being selective" in citing data, then turn around and do the same thing yourself. That's pure hypocrisy, besides the fact that, even if Larry has a "weak" argument, you have none at all.

The fact remains that Bush's steel tariffs were incredibly mild. Bad in principle, yes, but they added only a few dollars to the end cost of a refrigerator, and $100 to a new car (about 0.6%). You can't say the same thing about your beloved Schumer and Graham's tariffs, which will target a lot of cheap foreign textiles and disproportionately affect the poor. You cannot compare Bush's steel tariffs to 27% across-the-board textile tariffs that will make BVDs, shirts and other Chinese-made cotton goods surge by far more than 0.6% in price.

By demanding "all right or all wrong," you're effectively comparing someone who stole an apple with Dennis Kozlowski (who today was finally convicted). Both are wrong, and nobody is arguing otherwise, but the degrees are far different.

You still cannot admit that Larry criticized the Bush tariffs. Remember that LKMP started only last year, so you can't rely on just here. So here you go, I'll do you a favor. Have you ever done a little research on what someone said, or do you always act like a New York Times op-ed writer?

"But as Newt Gingrich showed in 1994, it helps enormously when Republicans have a positive national message that clearly distinguishes them from Democrats. Going on the offensive with a pro-growth message and pro-investor tax cuts would draw more voters than a defense of second-year Bush mistakes -- a longer-than-expected list that includes tariffs on steel and a free-spending education bill." August 22, 2002

"What's more, after getting off on the wrong foot with steel and lumber tariffs, the administration won trade promotion authority in Congress and is now embarked on a tariff-ending global free-trade plan that has economic growth written all over it." January 2, 2003

"The steel tariffs were stupid, although they'll hopefully be repealed in the next few weeks." Nov. 11, 2003

"For some reason, the dollar fell on this good employment news. But not even an incredibly strong report on factory orders (non-defense capital-goods orders jumped 34 percent at an annual rate over the past three months) could halt the dollar's falling momentum. Nor could the president's decision to end steel tariffs (although this was a strong pro-growth move on its own merits)." December 12, 2003

You're the one spinning, "pal." You just don't have a clue about the accusations you hurl. Heaven help the justice system if prosecutors approached cases like you're doing here.
The second is to a very reasonable fellow, expanding on what I'd said about free trade:
Unbeliever, Walter Williams has said some enlightening things about why "unfair" trading practices are misnamed. I used to think retaliatory tariffs and other punitive measures were justified, but Dr. Williams puts it this way: if you and another person are at opposite ends of a canoe, and the other shoots a hole in his end, why do the same to your own? That's what retaliatory tariffs do.

Let the Chinese dump all the cheap textiles they want. Let the French sell us all the subsidized wine they want. (Although with the exception of Chateau Margaux, Lafite-Rothschild and other premiere cru, I prefer a more reasonably priced Australian wine, or a crisp New Zealand sauvignon blanc.) It doesn't hurt the buyer if foreign companies "dump" their products, facilitated by money from their own governments. That nation is only hurting itself: their citizens pay higher taxes to support the subsidies, and meanwhile we get goods for cheaper than we can make.

Some protest that a nation will raise its prices once our domestic industries are out of business, but this has never happened. It is true that our domestic industries have disappeared, but if you read what Ed Leamer of UCLA has written, technology destroys far more jobs than trade competition.

The situation is akin to this: an elderly person can hire one of two high school boys to mow the lawn. The first asks $X per hour. The second offers to take the job for $(X-1) per hour, even though that isn't worth his time; he can afford to because, secretly, his parents really want him to have that job, and they'll cover that $1 per hour difference. So the second boy is hired. The employer (who is a purchaser of labor) benefits. The hired boy, of course, benefits, but his family is left worse off.

Frederic Bastiat wisely wrote in his "Candlestick Petition" that if someone can sell us the same or equivalent product for a cheaper price, regardless of how, then the seller is giving us the difference as a "gratuitous gift." A gift, in the strictest sense, is something that you give to someone with no reciprocal benefit. If the Chinese subsidize their industries, they're only shooting their own end of the canoe. It still costs their total economy the same amount to produce the good, but we get the goods for less than we should. Why is that a bad thing?
The third is to someone more reasonable than IMPT, but he still believes the myth about people dropping out of the labor force:
LFC, what "average rate" are you talking about? From when to when? If you're talking about the current rate of 66.1%, that's a percentage, not an average. Right now we're beginning a new upswing in the labor rate, after a bottoming out early this year. Yet at the same time (check bls.gov) we still added net jobs to the economy. That's what's driving unemployment down, not people becoming "discouraged" and giving up finding work.

You should pull up more than just the default data. For example, look at everything, 1948 to today. Notice that we had lower civilian labor force participation during times of extremely low unemployment, like 1952. It goes to show that one indicator isn't the end-all-be-all, which I never claimed anyway. But it disproves Krugman's myth of "discouraged" workers.

monkeydarts is absolutely correct to question how can people afford to become "discouraged" and just drop out of the workforce. If they can afford to do that, and stay out of the workforce permanently (so excluding those who drop out of college because of job opportunities, get laid off, and return to college), they're not long-term Several decades ago, people couldn't afford to be discouraged. Today, with generous unemployment insurance benefits, people can afford to be picky about a new job. Check out this Econopundit entry, where Steve Antler discussed unemployment (including my comment that Krugman is confusing cause and effect).

Friday, June 17, 2005

A couple of things I posted at Kudlow's Money Politics

I'm really tired after a 17-hour day of running around Manhattan in early morning hours, then working until dark. It's one of those days where I wanted to blog about something, but I can't remember it right now.

For tonight, I'll repost a couple of comments that I made on Larry Kudlow's Money Politic$ blog. I was really annoyed at these two liberals who have a form of economics, but deny the common sense thereof.
Well, well, well. The Krugmanites are coming out of the woodwork.

That's an appropriate term to call you, IMPT and KTS, because you have no understanding of what you talk about.

First, you're ignorant, or just plain lazy to do research on your groundless accusations. Larry has not shied away from criticizing Bush's tariffs. For example:

Steel tariffs were a big policy miscue, but fortunately they were rolled back. Now trade liberalization, a growth-generating policy, is back on track.

Second, you're following in the footsteps of your discredited, ever-pessimistic hero, Paul Krugman. (One of the entries that Don Luskin linked to there is by yours truly, and Econopundit liked it enough to link to it as well. You'd both do well to read it, .)

Since at least 2002, Krugman has propagated the myth that "unemployment went down because people stopped looking for work." He used it even before unemployment's last peak in 2003. Krugman was effectively saying, "Unemployment should have gone up even more, but people are dropping out of the labor force."

Krugman was wrong then, and his statement remains wrong today, by both measures of how many people are employed.

Civilian labor force participation rate

Employment-population ratio

These are straight from the Bureau of Labor Statistics. What they show is that, for the last several months, unemployment is falling, but the labor force participation rate by both measures is also going up. Employment is actually improving better than the unemployment rate alone indicates.

The later 1990s had unsustainably high employment; it was bound to fall sooner or later. Many entered the labor force who previously had no intention of ever working. However, Clinton and the media not hyped up all the new tech jobs, and these new workers wanted to get a piece. Those jobs proved transient, and many were counted as newly unemployed.

There were housewives, retirees (like my mother's ex-boyfriend) and others who re-entered the labor force. A lot of college students, myself included, dropped out to take advantage of the high-paying jobs. Lots of us were laid off, but had the unsustainably hot economy not lured us out of school, we'd never have been counted as unemployed. We didn't immediately leave "job seeker" status because we had optimism about finding replacement jobs. After my dotcom layoff, I spent two years doing IT contract work before I returned to college.

Austrian economics correctly identifies recessions not as a bad thing, but a necessary correction of an overheated market. That's exactly what happened starting in 2000. A 67%+ labor force participation rate is too high to continue forever.

So now who's spinning? It's not Larry, nor I.
(second comment)
And by the way, to you Chicken Littles who think the dollar will crash, think again.

Do you think China, Japan, South Korea and Europe, with all their dollar-denominated investments, will let the dollar lose a lot of value? Of course not; they'd be idiots to. Ninety percent of U.S. debt is denominated in dollars. We don't have a lot of debt that we must repay with yen, yuan, won or euros.

I wrote this back in March: Why China won't let the dollar slide too far

Walter Williams wrote this recently, with the same points I did about why the dollar won't crash: Our trade deficit

I'm in good company, having used the grocer analogy myself. The only thing that matters is that you can afford the groceries you want, whether by income or borrowing. It doesn't matter, in the short term, if you have a trade balance with that trading partner -- or even all of your trading partners.

It's key to remember that China runs a very small trade surplus overall. Sure, China has a huge trade surplus with us, but that allows it to buy goods and services (especially raw materials) from other countries. China gets all these dollars by selling us high-quality yet inexpensive textiles and plastics. China then uses the dollars to buy crude oil, or it converts them easily into yen, euros, etc., to buy goods and services from its other trading partners.

When China, Japan and Europe have unspent dollars, they like to invest them in U.S. Treasury bonds (which funds our federal budget deficit). Or they invest in U.S. companies, permitting American consumers to save less and spend more. This means we enjoy a higher standard of living today, at the cost of losing ownership in our own companies. Even so, it does not matter what nationalities "own" a company, so long as the company exists in our country and provides jobs. Do American auto workers complain about "having to work" for Japanese-owned auto companies here in the U.S.?