Quotulatiousness

May 26, 2017

Toronto-London high speed train plan – “many Ontarians wouldn’t trust the Liberals to see an HO-scale model of this plan to fruition on time or on budget”

Filed under: Cancon, Government, Railways — Tags: , , — Nicholas @ 04:00

Chris Selley discusses the weak-but-barely-plausible high speed train plans announced by the Ontario government the other day:

High-speed rail is expensive — to build, certainly, and more on that shortly, but just as importantly to ride. It’s 202 kilometres from Le Mans to Gare Montparnasse in Paris. The first TGV of the morning takes 58 minutes — total average speed, 208 km/h — and will set you back €45. It’s 180 kilometres from Frankfurt’s Hauptbanhof to Cologne’s Hauptbanhof. The 7:27 a.m. ICE train takes 65 minutes — average speed: 167 km/h — and Deutsche Bahn wants €60 for the privilege. Brussels to Amsterdam’s Schiphol Airport is 195 kilometres. The Thalys will get you there in 92 minutes tomorrow morning, at a relatively modest average speed of 127 km/h and for the eye-watering sum of €82.

This is the sort of distance Ontario’s Liberal government says it plans to cover with high-speed rail — from Union Station in Toronto to London via Pearson Airport, Guelph and Kitchener-Waterloo. A report and “preliminary business case” by former federal transport minister David Collenette, released Friday, envisions 185 kilometres of track with a maximum speed of 300 km/h in one scenario and 250 km/h in the other, and by 2025.

The London-to-Toronto trip would take 66 minutes in the faster scenario and 73 in the slower, for a total average speed of between 152 and 168 km/h. Either would represent genuine high-speed rail, and it would come at genuine high-speed rail prices: somewhere between $4 billion and $11 billion under the 250 km/h scenario; somewhere between $15 billion and $44 billion at 300 km/h.

[…]

So it’s a bit of a conundrum for the Liberals. This is a big offer — just the sort of thing people in the GTA say they want when they come back from Cologne, Paris and Amsterdam. It ought to be a reasonably compelling plank of an election platform.

But many Ontarians wouldn’t trust the Liberals to see an HO-scale model of this plan to fruition on time or on budget. It’s vulnerable to the sort of grievance-mongering and populism that sometimes makes it hard to tell a New Democrat from a Tory these days. We haven’t even gotten into the technical details. And ultimately, I’m just not really convinced people want this to happen as much as they say they do — not unless it’s free, and stops just the right distance from their back yards.

On the technical details, here’s a very brief overview from a post I wrote several years back, at the time California was beginning their insane high speed rail project:

The best place to build a high speed rail system for the US would be the Boston-New York-Washington corridor (aka “Bosnywash”, for the assumed urban agglomeration that would occur as the cities reach toward one another). It has the necessary population density to potentially turn an HSR system into a practical, possibly even profitable, part of the transportation solution. The problem is that without an enormous eminent domain land-grab to cheat every land-owner of the fair value of their property, it just can’t be done. Buying enough contiguous sections of land to connect these cities would be so expensive that scrapping and replacing the entire navy every year would be a bargain in comparison.

The American railway system is built around freight: passenger traffic is a tiny sliver of the whole picture. Ordinary passenger trains cause traffic and scheduling difficulties because they travel at higher speeds, but require more frequent stops than freight trains, and their schedules have to be adjusted to passenger needs (passenger traffic peaks early to mid-morning and early to mid-evening). The frequency of passenger trains can “crowd out” the freight traffic the railway actually earns money on.

Most railway companies prefer to avoid having the complications of carrying passengers at all — that’s why Amtrak (and VIA Rail in Canada) was set up in the first place, to take the burden of money-losing passenger services off the shoulders of deeply indebted railways. Even after the new entity lopped off huge numbers of passenger trains from its schedule, it couldn’t turn a profit on the scaled-down services it was offering.

Ordinary passenger trains can, at a stretch, share rail with freight traffic, but high speed trains cannot. At higher speeds, the actual construction of the track has to change to deal with the physical problem of safely guiding the fast passenger trains along the rail. Signalling must also change to suit the far-higher speeds — and the matching far-longer safe braking distances. High speed rail lines cannot be interrupted with grade crossings, for the safety of passengers and bystanders, so additional bridges and tunnels must be built to avoid bringing road vehicles and pedestrians too close to the trains.

In other words, a high speed railway line is far from being just a faster version of what we already have: it would have to be built separately, to much higher standards of construction.

May 18, 2017

QotD: The state as “hero”

Filed under: Government, Politics, Quotations — Tags: , , — Nicholas @ 01:00

Ever since Hegel or maybe Plato, statists have been telling a story about government in which government itself is the hero in an epic struggle. At least for Hegel, the state was the mechanism by which God worked out His will. For Marx, the state was an expression of cold immutable forces. For the socialists who followed, control of the state was a kind of MacGuffin but over time it became the hero itself.

When Obama talks about the moral arc of the universe bending towards justice, the physical manifestation of that pie-eyed treacle is always government. When liberals talk about the progress we’ve made as a society, the hero is always the state (and the heroic individuals who bent it to their will). It doesn’t matter that the market, non-state institutions, and heroic individuals tend to solve most of the problems in life; the government is always shoe-horned in as the indispensable author of beneficence.

Of course, the often unstated heroes are the people who put their faith in government. When Obama says, “Government is us,” what he’s really saying is that we can be heroic on the cheap by letting the government do what liberals want. That’s the real moral of their story. And conservatives need to get better at telling a better one.

Jonah Goldberg, “The Goldberg File”, 2015-09-11.

May 15, 2017

Chorley Park, Ontario’s lost viceregal mansion

Filed under: Cancon, Government, History — Tags: , — Nicholas @ 03:00

Chris Bateman on the odd history of Ontario’s fourth official home of the Lieutenant Governor:

Lieutenant Governor of Ontario Elizabeth Dowdeswell is one of four Canadian viceregal representatives to be (officially) homeless. Toronto pulled down its last government house, an astonishingly opulent mansion even among its Rosedale neighbours, in 1959 in the name of cost saving.

Just over a century ago, on 15 November 1915, the first official guests were welcomed inside the grand hall of Ontario’s million dollar palace. Twenty years later it was be derelict. Chorley Park is now largely forgotten, save for the small piece of it that remains on the edge of the Don Valley.

[…]

The province, however, had other ideas. It rejected Gage’s offer and forged ahead with the Rosedale site, known as Chorley Park, after the town of Chorley in Lancashire, England, the birthplace of Toronto alderman John Hallam.

The final design for the grand residence was drawn up by Francis R. Heakes – the province’s official architect also responsible for the Whitney Block on Queen’s Park Crescent – in the style of a French Loire Valley château.

Heakes’ blueprint borrowed heavily from submissions to the 1911 design competition, including many of the exterior details and the floor plan, and was limited to a budget of $215,000.

Chorley Park in Rosedale

[…]

The ongoing cost of maintaining the ostentatious mansion proved to be its eventual undoing. The Conservative provincial government found the cost even harder to justify as the Depression began to take hold in the 1920s.

Despite voices calling for the house to be abandoned, it lingered on as the official home of Ontario’s lieutenant-governor until 1937 when the fine furnishings and fixtures were stripped out and sold at auction.

When world war two began, the gutted interior was converted into a military hospital for wounded soldiers.

Chorley Park met its eventual end in 1959 when, with the last of the patients gone and a brief period as a refuge for Hungarian immigrants fleeing the revolution over, the Metro government under Fred Gardiner ordered the building torn down.

QotD: Local government

Filed under: Britain, Bureaucracy, Government, Quotations — Tags: — Nicholas @ 01:00

If, that is, you believe it’s a council’s job to be lecturing takeaways shops, cafes and the like what should and shouldn’t be on the menu. Which personally, I don’t. Surely, if you’re forking out hundreds of pounds every year for your council tax, it ought to be things you actually want and need like regular dustbin collection, not for the services of some nannyish, finger-wagging lecturer treating you like a small child who refuses to eat his Brussels sprouts.

When I read that Rochdale Council employed a Healthier Choices Manager, I assumed at first it was a joke. But no: the job exists and it’s currently held by someone called Clare McNicol. Well I’m sure she’s a nice, caring, well-meaning person and she’s clearly very persuasive to have got all those chippies to participate in this ludicrous scheme. Really, though. Oughtn’t the council to have more urgent priorities than creating such busybodying non-jobs?

For example, three years ago, Rochdale was at the centre of an ugly, grooming gang scandal when a group of Pakistanis were jailed for 30 ‘horrific’ counts of child rape. With its limited budget, wouldn’t the council be better off beefing its apparently lacklustre Children’s Services Department, rather than trying to decide the local fish and chip shop menu? Isn’t the safety of vulnerable girls maybe a bit more important than the danger that someone, somewhere might put on a few more inches as a result of too many ill-advised takeaways?

Councils are always telling us how underfunded they are, how they’re expected to do more and more with less and less money. But I suspect that this is at least partly a problem of their own making. If they stuck to the basics – schools, street-cleaning, lighting and so on – and cut out all the dispensable luxuries like recycling awareness, sustainability, lesbian outreach, diet fascism, and so on, then I’m sure they’d find it much easier to live within their means. I expect most council taxpayers would be a lot happier too.

My fear, though, is that councils, especially those in inner-city Labour strongholds like Rochdale, really aren’t so interested in the dull but essential bread-and-butter stuff. (Let alone in confronting issues like the growth of intolerant Islamism). Rather they see it as their holy mission to mould the whole world in their progressive image. Hence, that multitude of different coloured bags you’re expected to sort your rubbish into, each week: they want to teach you that recycling as an act of religious devotion.

James Delingpole, “I prefer my cod in batter, thanks very much”, James Delingpole, 2015-08-15.

May 14, 2017

QotD: Big business, crony capitalism and regulatory capture

Now, Pope Francis has the beginnings of a point about large “private corporations” (note the oxymoron), which in their wealth may grow (though only temporarily) to a size rivalling the smaller national governments. And I would add, they become nearly as centralized and monopolistic (through “regulatory capture”), and faceless and bureaucratic as the agencies of State. Whenupon, unlike the self-perpetuating agencies of the State, they begin to disintegrate from their own lack of enterprise.

It is not enough, as the libertarians suppose, to leave them to their fate, in the knowledge that if they are inefficient they’ll be gone tomorrow. For new large corporations rise to take their place, and at every moment the great majority of people are reduced to wage-slaves of one large corporation or another. Indeed, part of the power of large corporations comes from their scale as employers. A democratic government which tries to stand up to them will quickly relent, and switch to subsidies instead, when they threaten to create mass unemployment.

The question must be asked: What makes vast, morally obtuse, centralized corporations possible? And the answer should be easy to see. It is vast, morally obtuse, centralized governments, which command regulatory regimes that are consistent over huge areas. That has actually become our model for global “free trade”: making regulations and taxation consistent not only across nations, but across continents. This creates an order which large corporations, and only large corporations, are well-equipped to exploit.

Imagine instead they were to face different regulatory regimes, parish by parish. They could still operate, but would have to adapt each franchise to local conditions, as defined by the sovereign local authority. This immediately flips the onus, and gives the local merchant or producer the advantage over his multinational competitor, in being on the spot. It reduces that competitor’s economy of scale, while also imposing upon him a new model of corporate governance, as network, that must of necessity become decentralized and responsive (just as creatures in nature) to every single environmental niche.

The re-focusing on what is local, and what is doable locally, would have tremendous ramifications on “the environment” at large — overwhelmingly positive, given some time. Yet it would also have the happy effect of disempowering the ecological whack cases.

David Warren, “Five thousand max”, Essays in Idleness, 2015-06-19.

May 9, 2017

QotD: Wage floors and rent ceilings

Filed under: Economics, Government, Quotations, USA — Tags: , , , , — Nicholas @ 01:00

[Progressives] tend to favor policies such as New York City’s rent controls, and the new $15 minimum wage being gradually phased in in some western cities. I like to think of these policies as engines of meanness. They are constructed in such a way that they almost guarantee that Americans will become less polite to each other.

In New York City, landlords with rent controlled units know that the rent is being artificially held far below market, and thus that they would have no trouble finding new tenants if the existing tenant is unhappy. So then have no incentive to upgrade the quality of the apartment, or to quickly fix problems. They do have an incentive to discriminate against minorities that, on average, are more likely to become unemployed, and hence unable to pay the rent. Or young people, who might damage the unit with wild parties.

Wage floors present the same sort of problem as rent ceilings, except that now it’s the demanders who become meaner, not the supplier. Firms that demand labor in Los Angeles in the year 2020 will be able to treat their employees very poorly, and still find lots of people willing to work for $15/hour.

Scott Sumner, “How bad government policies make us meaner”, Library of Economics and Liberty, 2015-08-25.

May 8, 2017

“Have libertarians — and the broader right and/or classical-liberal movement — really lost the ‘culture wars’?”

Filed under: Business, Economics, Government, Liberty, USA — Tags: , — Nicholas @ 09:14

Nick Gillespie on the outcome of the most recent battles in the culture wars:

Spoiler alert: I think libertarians have already won the culture war in the most important ways possible. Whether it’s businesses like Whole Foods, Overstock, and Amazon; the massive and ongoing proliferation of platforms such as Netflix, YouTube, and Twitter; or gig-economy titans such as Uber and Airbnb, capitalism and entrepreneurship has been recast as an innovative, disruptive, liberatory system that allows us all to produce and consume whatever we want under increasingly personalized and individualized circumstances. What we need to do next to nail down what Matt Welch and I have dubbed The Libertarian Moment is to articulate the ways in which our society’s cultural, economic, and even political operating system has already bought into the idea that decentralization, individualism, innovation, and freedom to experiment.

If the medium is the message (all props to Marshall McLuhan) — if an operating system is more important than any specific content generated within that system — what has been abjured as “late capitalism” for decades has effectively ended all debates about how libertarian policies and mind-sets have freed us from bland top-downism in all parts of our lives. This isn’t to suggest that we are in any way living a utopian dream. It’s simply to point out that even after 15 years of drowsy economic growth and a massive expansion of state (and in many ways, corporate) power, our living standards continue to rise. Add to that huge advances in tolerance and change when it comes to racial, ethnic, and gender disparities and transformative shifts on topics as varied as drug policy, sexual orientation, criminal-justice reform, and gun rights too.

Cultural and political pessimism isn’t just a losing strategy, it’s a misimpression. Again, that’s not to say that massive problems don’t exist and need to be confronted. Will we ever see an actual federal budget again, much less that cuts government spending? U.S. foreign policy remains a shameful, disastrous, and destructive hodgepodge of hubris and stupidity. Speech and expression are under attacks from the right and the left, and the bipartisan turn against free trade and the easy movement of people across borders needs to be beaten back. As the late, great Arthur Ekirch explained in his neglected masterpiece The Decline of American Liberalism, forces of decentralization and centralization — of liberation and authoritarianism, of individualism and collectivism, of choice and coercion — have been slugging out in the United States since before there was a United States. The question is whether we are moving generally in a direction of more autonomy and less restriction on how we live our lives.

May 1, 2017

Math is hard … and in Oregon it can lead to hard time

Filed under: Bureaucracy, Government, Law, Liberty, USA — Tags: , , , , — Nicholas @ 05:00

Did you know that you have to be certified by an Oregon regulatory agency to do certain kinds of math? Mats Järlström has discovered just how draconian the state can be about unauthorized mathematizing:

After exploring the math behind traffic light timing, Järlström concluded that the formula, created in 1959, accounted for only two yellow light scenarios: driving straight through the intersection, or stopping.

So Järlström decided to try to improve the math managing the transition time from yellow to red, in order to allow a driver traveling through an intersection with a yellow light to slow down and turn without being flagged for a red light violation. And in early 2015 he shared his proposal with the media, policymakers, and those interested in the traffic technology.

“It’s not rocket science,” Järlström said in a phone interview with The Register. “It took me about 40 minutes to figure it out.”

For communicating his findings in five emails, the Oregon State Board of Examiners for Engineering and Land Surveying in March, 2015 opened an investigation. In August 2016, the rules body found [PDF] that Järlström had engaged in unlicensed engineering and assessed a $500 fine.

Even better, if he persists, he may even face jail time for his unlicensed mathematical crime spree.

Järlström paid the fine but fears his ongoing interest in traffic light timing will lead to further penalties. Violating the Act could subject him to $1,000 in civil penalties, $6,250 in criminal fines, and as much as a year in jail.

QotD: How to negotiate badly (unless you’re in a movie)

Filed under: Europe, Government, Media, Politics, Quotations, USA — Tags: , , — Nicholas @ 01:00

Does the [Republican congressional] caucus nominate a leader who will be itching for more such fights? This would be bad for America’s already dilapidated political institutions and civil society. It would also, I must point out, be bad for the Republican Party, which still shows lingering signs of infection by the dreaded “Ask for the Stars, You’ll Get the Moon” bargaining strategy. (Ever notice that’s so beloved by Hollywood, and by almost no one who actually has to negotiate deals for a living?)

The idea behind this is that you will eventually settle for something about halfway between your initial demands, and what the other side is asking for. The winning strategy is therefore to ask for enormous concessions, include unrealistic demands as bargaining chips, and convince the other side that you’re just crazy enough to walk away if they won’t make a deal.

As it happens, we have just had a demonstration of this technique — a live drama, no Hollywood effects: Greek Prime Minister Alexis Tsipras tried it with the EU. This strategy worked so well that he ended up with a worse deal than the original offer, plus a banking crisis that is still unspooling. Somehow, this never happens in Hollywood movies.

It’s easy to see why Hollywood loves this strategy: It’s really easy to explain without chewing up screen time, and it’s dramatic. Why don’t real-world negotiators more often do this?

Megan McArdle, “Let’s See What Republicans Learn From Losing Boehner”, Bloomberg View, 2015-09-25.

April 19, 2017

Voting against “Father Turk”‘s legacy

Filed under: Europe, Government, Religion — Tags: , , , — Nicholas @ 04:00

The secular Turkish Republic is fading fast, as the results of the Turkish referendum amount to a concentration of vast powers in the hands of Recep Tayyip Erdoğan. We sometimes joke that Vladimir Putin is the new Tsar, but it’s less funny to refer to Erdoğan as the new Sultan … because it’s much closer to being true:

On Jan. 20, 1921, the Turkish Grand National Assembly passed the Teşkilât-ı Esasîye Kanunu, or the Law on Fundamental Organization. It would be almost three years until Mustafa Kemal — known more commonly as Ataturk, or “Father Turk” — proclaimed the Republic of Turkey, but the legislation was a critical marker of the new order taking shape in Anatolia.

The new country called Turkey, quite unlike the Ottoman Empire, was structured along modern lines. It was to be administered by executive and legislative branches, as well as a Council of Ministers composed of elected representatives of the parliament. What had once been the authority of the sultan, who ruled alone with political and ecclesiastic legitimacy, was placed in the hands of legislators who represented the sovereignty of the people.

More than any other reform, the Law on Fundamental Organization represented a path from dynastic rule to the modern era. And it was this change that was at stake in Turkey’s referendum over the weekend. Much of the attention on Sunday’s vote was focused on the fact that it was a referendum on the power of the Turkish presidency and the polarizing politician who occupies that office, Recep Tayyip Erdogan. Yet it was actually much more.

Whether they understood it or not, when Turks voted “Yes”, they were registering their opposition to the Teşkilât-ı Esasîye Kanunu and the version of modernity that Ataturk imagined and represented. Though the opposition is still disputing the final vote tallies, the Turkish public seems to have given Erdogan and the AKP license to reorganize the Turkish state and in the process raze the values on which it was built. Even if they are demoralized in their defeat, Erdogan’s project will arouse significant resistance among the various “No” camps. The predictable result will be the continuation of the purge that has been going on since even before last July’s failed coup including more arrests and the additional delegitimization of Erdogan’s parliamentary opposition. All of this will further destabilize Turkish politics.

[…]

The AKP and supporters of the “yes” vote argue that the criticism of the constitutional amendments was unfair. They point out that the changes do not undermine a popularly elected parliament and president as well as an independent (at least formally) judiciary. This is all true, but it is also an exceedingly narrow description of the political system that Erdogan envisions. Rather, the powers that would be afforded to the executive presidency are vast, including the ability to appoint judges without input from parliament, issue decrees with the force of law, and dissolve parliament. The president would also have the sole prerogative over all senior appointments in the bureaucracy and exercise exclusive control of the armed forces. The amendments obviate the need for the post of prime minister, which would be abolished. The Grand National Assembly does retain some oversight and legislative powers, but if the president and the majority are from the same political party, the power of the presidency will be unconstrained. With massive imbalances and virtually no checks on the head of state, who will now also be the head of government, the constitutional amendments render the Law on Fundamental Organization and all subsequent efforts to emulate the organizational principles of a modern state moot. It turns out that Erdogan, who would wield power not vested in Turkish leaders since the sultans, is actually a neo-Ottoman.

Mark Steyn says “I told you so”:

As they used to say way back when in the long Ottoman twilight, the Turk is the sick man of Europe. Following this weekend’s Caliph-for-Life referendum, the Turk is sicker than ever. But he’s no longer of Europe, and instead is exiting for a destination dark and catastrophic for almost all his neighbors.

Sultan Erdoğan – who, a mere 15 years ago, was banned from holding political office – has now succeeded in dismantling almost every defining element of the Kemalist republic. What replaces it will be a crude strongman state in service of Islamic imperialism. I have read a lot of commentary this morning, starting with Douglas Murray’s “Turkish Democracy Has Just Died” and moving on to Yavuz Baydar’s “The End Of Turkey As We Know It” via Alex Alexiev’s “Who Lost Turkey?” And several readers have been kind enough to inquire where’s my own “Who Lost Turkey?” piece. Well, the truth is I published it exactly ten years ago, to the day of Erdoğan’s referendum. From the April 16th 2007 edition of National Review, “De-Boning Turkey“:

    The modern secular Muslim state – a country that gave women the vote before Britain did and was Israel’s best friend in an otherwise hostile region – certainly, that Turkey seems to be being de-boned by the hour: it now has an Islamist government whose Prime Minister has canceled trade deals with Israel, denounced the Iraqi elections, and frosted out the US Ambassador because he was Jewish; a new edition of Mein Kampf is prominently displayed at the airport bookstore. In other words, the Zionist Entity’s best pal is starting to look like just another cookie-cutter death-to-the-Great-Satan stan-of-the-month.

In fairness to the new Caliph, ever since he emerged from his semi-pro footballing career to run for Mayor of Istanbul, he’s played a more cunning game than the stan-of-the-month loons. As he said in one of his most famous soundbites, democracy is a bus you ride to the stop you want – and then you get off. And he was quite happy to take the scenic route, stop by stop by stop. In the two or three years after he came to power, I was assured that he was a “moderate Islamist” not merely by the all the foreign-policy think-tank “experts” but even by his political rivals in the previous Kemalist government. […]

Here’s a third graphic – yesterday’s referendum results. The Kurdish south-east, the old secular Rumelian west – and in between the vast green carpet of a new post-Kemalist caliphate:

Turkish referendum results, “yes” voting areas in green, “no” in red.

Overlay the fertility rates on the electoral results: demography proved destiny. As you’ll recall, Kemal Atatürk was born Mustafa Kemal. The new moniker was a title bestowed on him by the post-Ottoman parliament. Atatürk means “Father of the Turks”. Alas, he wasn’t father of enough of them. And the men who were had other ideas about Turkey’s future. We’ve all met charming, urbane, witty, secular Turks. I worked with one recently, and enjoyed his company immensely. But on that ever expanding big green Islamic carpet from east to west there’s no place for them.

A graphical representation of the difference between the US federal deficit and the debt

Filed under: Economics, Government, USA — Tags: , , — Nicholas @ 03:00

In USA Today, Jon Gabriel shows why it’s important to know the difference between a deficit and a debt, especially when discussing the US federal government:

It’s an imperfect analogy, but imagine the green is your salary, the yellow is the amount you’re spending over your salary, and the red is your credit card statement. Then tell your spouse, “Don’t worry, dear, I just increased our debt ceiling with a new Visa card!”

The chart is brutally bipartisan. Debt increased under Republican presidents and Democratic presidents. It increased under Democratic congresses and Republican congresses. In war and in peace, in boom times and in busts, after tax hikes and tax cuts, the Potomac flowed ever deeper with red ink.

Our leaders like to talk about sustainability. Forget sustainable — how is this sane?

Yet when any politician hesitates before increasing spending, he’s portrayed as a madman. When Paul Ryan, R–Wis., offered a thoughtful plan to reduce the debt over decades, he was pushing grannies into the Grand Canyon and pantsing park rangers on the way out.

I’m sure that my chart will be criticized. A few on the right will say it’s too tough on the GOP while those on the left will claim it doesn’t matter or it’s all a big lie.

Wonks will say the chart should be weighted for this variable and have lines showing that trend. All are free to create their own charts to better fit their narrative, and I’m sure they will. But the numbers shown can’t be spun by either side.

All the figures come directly from the federal government, and math doesn’t care about fairness or good intentions. Spending vastly more than you have, decade after decade, is foolish when done by a Republican or a Democrat. Two plus two doesn’t equal 33.2317 after you factor in a secret “social justice” multiplier.

And my chart doesn’t mention future projections due to exploding entitlements, which Trump didn’t touch. Turn to the much scarier Congressional Budget Office chart for that.

April 18, 2017

QotD: Rent control

Filed under: Business, Economics, Government, Quotations — Tags: , , , , — Nicholas @ 01:00

To someone ignorant of economic reasoning, rent control seems like a great policy. It appears instantly to provide “affordable housing” to poor tenants, while the only apparent downside is a reduction in the income flowing to the fat-cat landlords, people who literally own buildings in major cities and who thus aren’t going to miss that money much. Who could object to such a policy?

First, we should define our terms. When a city government imposes rent control, it means the city makes it illegal for landlords to charge tenants rent above a ceiling price. Sometimes that price can vary, but only on specified factors. For the law to have any teeth — and for the politicians who passed it to curry favor with the public — the maximum rent-controlled price will be significantly lower than the free-market price.

The most obvious problem is that rent control immediately leads to a shortage of apartments, meaning that there are potential tenants who would love to move into a new place at the going (rent-controlled) rate, but they can’t find any vacancies. At a lower rental price, more tenants will try to rent apartment units, and at a higher rental price, landlords will try to rent out more apartment units. These two claims are specific instances of the law of demand and law of supply, respectively.

[…]

In the long run, a permanent policy of rent control restricts the construction of new apartment buildings, because potential investors realize that their revenues on such projects will be artificially capped. Building a movie theater or shopping center is more attractive on the margin.

There are further, more insidious problems with rent control. With a long line of potential tenants eager to move in at the official ceiling price, landlords do not have much incentive to maintain the building. They don’t need to put on new coats of paint, change the light bulbs in the hallways, keep the elevator in working order, or get out of bed at 5:00 a.m. when a tenant complains that the water heater is busted. If there is a rash of robberies in and around the building, the owner won’t feel a financial motivation to install lights, cameras, buzz-in gates, a guard, or other (costly) measures to protect his customers. Furthermore, if a tenant falls behind on the rent, there is less incentive for the landlord to cut her some slack, because he knows he can replace her right away after eviction. In other words, all of the behavior we associate with the term “slumlord” is due to the government’s policy of rent control; it is not the “free market in action.”

Robert P. Murphy, “The Case Against Rent Control: Bad housing policy harms lower-income people most”, The Freeman, 2014-11-12

April 17, 2017

QotD: The dubious “value add” of the LCBO

Filed under: Business, Cancon, Government, Quotations — Tags: , , , , — Nicholas @ 01:00

The liquor board’s cocktail recipe of the month, offered on its website, is for “gin and lemonade,” which you make with a shot of gin and some lemonade. The gin is cherry, so there’s that. Its three recommended beers of the month are themed for the hockey playoffs. They are — I am not kidding — Molson Canadian in a bottle, Molson Canadian in a can, and Molson Canadian in a larger can. The value the LCBO’s adding that a private retailer couldn’t is not obvious.

David Reevely, “LCBO union uses government’s rhetoric against it in brewing labour battle”, National Post, 2017-04-06.

April 13, 2017

Words & Numbers: Even Economists Can’t Do Their Own Taxes

Filed under: Economics, Government, USA — Tags: — Nicholas @ 04:00

Published on 12 Apr 2017

In honor of Tax Day, Antony Davies & James R. Harrigan talk about the absurdity of the US tax code. If your tax situation is more complicated or more uncomfortable than you like dealing with, you can pay another human being to do your taxes so you don’t have to. There are dependents, mortgages, deductions from energy-efficient household additions, charity, student loan interest … even with a Ph.D. in economics, it’s hard to understand!

April 7, 2017

Unintended consequences of “good” policies

Filed under: Economics, Government, Health — Tags: , , — Nicholas @ 04:00

Megan McArdle discusses when some otherwise nice-seeming policy changes have not-so-nice unforeseen side effects:

What happens when you suddenly offer parents generous family leave benefits, paid at the expense of the government? You can probably think of dozens of outcomes. But here’s one you might not have been expecting: people die.

That’s the finding of Benjamin Friedrich and Martin Hackmann, in a new working paper at the National Bureau of Economic Research. The culprit? Nurses, who skew female, provide a lot of vital health care, and made heavy use of Denmark’s new paid family leave benefit when it passed in 1994. Since the supply of nurses was limited, and their skills could not easily be replaced, hospital readmissions went up, and more troublingly, mortality spiked among elderly patients in nursing homes.

Advocates of paid parental leave are no doubt bristling at the implication that their favorite benefit might kill people. But that’s not quite the right implication to take away from this paper. What it really highlights is how difficult it is to know how a given policy will turn out. Had officials understood that in advance, they might have taken steps to mitigate the effects — such as training extra nurses beforehand. The problem, in other words, wasn’t necessarily family leave policy, but the limited visibility policymakers have into the outcomes of their plans.

To see why, consider what the paper actually found. When parental leave came along, it reduced the supply of nurses. But that impact wasn’t felt evenly. In hospitals, where doctors make more of the medical decisions, it seems to have been costly to patient health. But in nursing homes, where nursing staff have more power over daily operations, it seems to have made a much bigger difference. Meanwhile, nursing assistants seem to have been little impacted by the change in leave policy; while they were also likely to make generous use of the leave, health-care facilities seem to have had little difficulty replacing them.

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