Quotulatiousness

October 25, 2010

In praise of Sir Wilfrid Laurier

Filed under: Cancon, Economics, Government, History, Liberty — Tags: , — Nicholas @ 09:04

One of the few Canadian prime ministers I can admit a genuine fondness for, Sir Wilfrid Laurier, gets a bit of recognition:

Last May in a casual dinner conversation with Canadian libertarians in Vancouver, I named the better presidents and prime ministers, respectively, of the United States and Great Britain. It suddenly occurred to me that I couldn’t name a single Canadian counterpart.

So I asked my dinner friends, “Among Canada’s political leaders, did you ever have a Grover Cleveland or a William Ewert Gladstone, a prime minister who believed in liberty and defended it?”

One name emerged, almost in unison: Sir Wilfrid Laurier. Embarrassed by my ignorance, I had to admit I had never heard of him. Never mind that he’s the guy with the bushy hair on the Canadian five-dollar bill; I just never noticed. Now that I’ve done a little research, I’m a fan.

Laurier’s political resume is impressive: fourth-longest-serving prime minister in Canada’s history (1896–1911, the longest unbroken term of office of all 22 PMs). Forty-five years in the House of Commons, an all-time record. Longest-serving leader of any Canadian political party (almost 32 years). Across Canada to this day, he is widely regarded as one of the country’s greatest statesmen.

It’s not his tenure in government that makes Laurier an admirable figure. It’s what he stood for while he was there. He really meant it when he declared, “Canada is free and freedom is its nationality” and “Nothing will prevent me from continuing my task of preserving at all cost our civil liberty.”

Laurier was the last Liberal leader who actually believed in “classic” liberalism, not the warmed-over socialism of later and current Liberal thought. We could use another Laurier today.

Studying bureaucratic bias

Filed under: Bureaucracy, Economics, Government — Tags: , — Nicholas @ 08:56

I’ve always thought that behaviour patterns of bureaucrats are fairly easy to predict: it all hinges on risk/reward. A bureaucrat with expectation of retiring at the peak of pension eligibility will have a very high aversion to risk — but not quite what most people refer to as risk. A bureaucrat has a built-in bias to “stay the course”, to avoid “rocking the boat”, and to prevent the kind of change that will introduce exceptions to normal process.

Expecting a bureaucrat to react like an entrepreneur is unrealistic, because the bureaucrat’s risks (loss of promotion opportunities, loss of status, but not usually loss of job) do not scale well against the possible rewards — except in particularly corrupt jurisdictions, bureaucrats do not directly benefit from making risky decisions.

Given that, is it any surprise that bureaucrats, as a whole, are quite unwilling to step outside “normal practice” or to allow variances, exceptions, or (sometimes) even common sense solutions?

I should be careful (except that I’m a blogger, where “careful” really just means “avoiding lawsuits”), because there’s a risk I’m suffering from one of the traits identified in behavioural economics, the illusion of competence in my preceding horseback judgement:

There is a fashionable new science — behavioral economics, they call it — which applies the insights of psychology to how people make economic decisions. It tries to explain, for instance, the herd instinct that led people during the recent bubble to override common sense and believe things about asset values because others did: the “bandwagon effect.” And it labels as “hindsight bias” the all-too-common tendency during the recent bust to imagine that past events were more predictable than they were. Behavioral economics has also brought us notions like “loss aversion”: how we hate giving up a dollar we have far more than forgoing a dollar we have not yet got.

But while there is a lot of interest in the psychology and neuroscience of markets, there is much less in the psychology and neuroscience of government. Slavisa Tasic, of the University of Kiev, wrote a paper recently for the Istituto Bruno Leoni in Italy about this omission. He argues that market participants are not the only ones who make mistakes, yet he notes drily that “in the mainstream economic literature there is a near complete absence of concern that regulatory design might suffer from lack of competence.” Public servants are human, too.

Mr. Tasic identifies five mistakes that government regulators often make: action bias, motivated reasoning, the focusing illusion, the affect heuristic and illusions of competence.

In the last case, psychologists have shown that we systematically overestimate how much we understand about the causes and mechanisms of things we half understand.

October 24, 2010

How the contents of your closet helped you get through the recession

Filed under: Economics, Randomness, USA — Tags: , , , — Nicholas @ 10:31

Virginia Postrel reveals how the glut of western “stuff” we’ve been accumulating over the last decade may have helped ease us through the recession:

In today’s sour economy, however, what once seemed like waste is starting to look like wealth: assets to draw on when times get tough (and not just because of all those ads promising top dollar for your gold jewelry). Material abundance, it turns out, produces economic resilience. Even if today’s recession approached Great Depression levels of unemployment, the hardship wouldn’t be as severe, because today’s consumers aren’t living as close to the edge.

Take clothes. In 2008, Americans owned an average of 92 items of clothing, not counting underwear, bras and pajamas, according to Cotton Inc.’s Lifestyle Monitor survey, which includes consumers, age 13 to 70. The typical wardrobe contained, among other garments, 16 T-shirts, 12 casual shirts, seven dress shirts, seven pairs of jeans, five pairs of casual slacks, four pairs of dress pants, and two suits — a clothing cornucopia.

Then the economy crashed. Consumers drew down their inventories instead of replacing clothes that wore out or no longer fit. In the 2009 survey, the average wardrobe had shrunk — to a still-abundant 88 items. We may not be shopping like we used to, but we aren’t exactly going threadbare. Bad news for customer-hungry retailers, and perhaps for economic recovery, is good news for our standard of living.

By contrast, consider a middle-class worker’s wardrobe during the Great Depression. Instead of roughly 90 items, it contained fewer than 15. For the typical white-collar clerk in the San Francisco Bay Area, those garments included three suits, eight shirts (of all types), and one extra pair of pants. A unionized streetcar operator would own a uniform, a suit, six shirts, an extra pair of pants, and a set of overalls. Their wives and children had similarly spare wardrobes. Based on how rarely items were replaced, a 1933 study concluded that this “clothing must have been worn until it was fairly shabby.” Cutting a wardrobe like that by four items — from six shirts to two, for instance — would cause real pain. And these were middle-class wage earners with fairly secure jobs.

October 21, 2010

I still think they should call it the “milliVolt”

Filed under: Economics, Environment, Politics, Technology — Tags: , , , , , — Nicholas @ 12:06

The much-less-than-promised Chevy Volt goes on sale next month. If it had been a private company delivering so few of their promises, lawsuits or regulatory sanctions would be forthcoming. Because it’s a product of Government Motors, we’re being told that the “Electric Edsel” is not fraud, it’s fantastic:

Government Motors’ all-electric car isn’t all-electric and doesn’t get near the touted hundreds of miles per gallon. Like “shovel-ready” jobs, maybe there’s no such thing as “plug-ready” cars either.

The Chevy Volt, hailed by the Obama administration as the electric savior of the auto industry and the planet, makes its debut in showrooms next month, but it’s already being rolled out for test drives by journalists. It appears we’re all being taken for a ride.

[. . .]

So it’s not an all-electric car, but rather a pricey $41,000 hybrid that requires a taxpayer-funded $7,500 subsidy to get car shoppers to look at it. But gee, even despite the false advertising about the powertrain, isn’t a car that gets 230 miles per gallon of gas worth it?

We heard GM’s then-CEO Fritz Henderson claim the Volt would get 230 miles per gallon in city conditions. Popular Mechanics found the Volt to get about 37.5 mpg in city driving, and Motor Trend reports: “Without any plugging in, (a weeklong trip to Grandma’s house) should return fuel economy in the high 30s to low 40s.”

Car and Driver reported that “getting on the nearest highway and commuting with the 80-mph flow of traffic — basically the worst-case scenario — yielded 26 miles; a fairly spirited backroad loop netted 31; and a carefully modulated cruise below 60 mph pushed the figure into the upper 30s.”

As I said in an earlier post:

I’m very much in favour of an economical electric car: the Volt doesn’t meet that definition. It’s been rushed to market for political, not for economic reasons. It’ll be kept in the market regardless of sales figures for the same reason: it allows Barack Obama and senate leaders to point at the Volt as tangible proof that they care about the environment and reducing American dependence on foreign oil.

October 19, 2010

UK defence cuts announced

Filed under: Britain, Economics, Military — Tags: , , , , , , , — Nicholas @ 12:57

As I blogged yesterday, quoting a Guardian article, the British government will be cutting their armed forces substantially:

I want to be clear there is no cut whatsoever in the support for our forces in Afghanistan.

The funding for our operations in Afghanistan comes not from the budget of the Ministry of Defence but instead from the Treasury Special Reserve.

So the changes to the Ministry of Defence that result from today’s Review will not affect this funding.

That will help the morale of the troops on the ground in Afghanistan, but the army overall is still being reduced.

Our ground forces will continue to have a vital operational role so we will retain a large well-equipped Army, numbering around 95,500 by 2015 that is 7,000 less than today.

We will continue to be one of very few countries able to deploy a self-sustaining properly equipped Brigade-sized force anywhere around the world and sustain it indefinitely if needs be.

And we will be able to put 30,000 into the field for a major, one off operation.

In terms of the return from Germany half our personnel should be back by 2015 and the remainder by 2020.

And tanks and heavy artillery numbers will be reduced by around 40%.

The garrison in Germany is a relic of the Cold War, and it’s amazing that they’ll still be there until 2020.

We will complete the production of six Type 45 destroyers one of the most effective multi-role destroyers in the world.

But we will also start a new programme to develop less expensive, more flexible, modern frigates.

Total naval manpower will reduce to around 30,000 by 2015.

And by 2020 the total number of frigates and destroyers will reduce from 23 to 19 but the fleet as a whole will be better able to take on today’s tasks from tackling drug trafficking and piracy to counter-terrorism.

Those are the same Type 45’s that haven’t actually had effective main armament, according to The Register.

We have decided to retire the Harrier which has served this country so well for 40 years.

The Harrier is a remarkably flexible aircraft but the military advice is that we should sustain the Tornado fleet as that aircraft is more capable and better able to sustain operations in Afghanistan.

RAF manpower will also reduce to around 33,000 by 2015.

Inevitably this will mean changes in the way in which some RAF bases are used but some are likely to be required by the Army as forces return from Germany.

The retirement of the Harrier is a simultaneous victory for the RAF against their two most dangerous enemies: the army and the Fleet Air Arm. The Harrier was the one aircraft that could provide both naval and ground support, and was therefore considered readily dispensible by the fighter jocks in the Royal Air Force.

We will build both carriers, but hold one in extended readiness.

We will fit the “cats and traps” — the catapults and arrestor gear to the operational carrier.

This will allow our allies to operate from our operational carrier and allow us to buy the carrier version of the Joint Strike Fighter which is more capable, less expensive, has a longer range and carries more weapons.

We will also aim to bring the planes and carriers in at the same time.

That is probably finis for carrier operations in the Royal Navy: but expect both of these ships to show up again in the fleet of India within 5-10 years.

. . . we will retain and renew the ultimate insurance policy — our independent nuclear deterrent, which guards this country round the clock every day of the year.

[. . .]

…extend the life of the Vanguard class so that the first replacement submarine is not required until 2028;
…reduce the number of operational launch tubes on those new submarines from 12 to eight…
…reduce the number of warheads on our submarine at sea from 48 to 40…..
…and reduce our stockpile of operational warheads from less than 160 to fewer than 120.

The less-visible effects of workplace demographic changes

Filed under: Economics, History, USA — Tags: , , , , , , — Nicholas @ 12:12

Monty points out that we’ve passed a significant equilibrium point in employment statistics:

Women are vital to the American workforce, and have been since at least the 1940’s, but this recession may have shifted the balance of economic power decisively to women. Men have been the traditional household “breadwinners”, with the wife’s income being seen as augmenting the male’s income, but this recession has hit men disproportionately harder than women. Women are far more likely to work in industries (like services and healthcare) that are more insulated from the downturn, whereas men are far more likely to work in the hard-hit trades and manufacturing sectors. Women also have many more protections — both regulatory and social/cultural — than men do. There are many deep ramifications to this change — the impact of long-term male unemployment on the family; the loss of status, power and prestige that goes with being unemployed; the male self-image and value to society. (Studies of unemployed men during the Great Depression are not happy reading — many of the chronically unemployed males left their families rather than assume a lower status in the family, and were also far more likely to be dictatorial and violent towards their wives and children.)

Social support agencies are not well-equipped to deal with this change, and it will continue to disrupt “normal” life for years to come, unless the economy is allowed to right itself — yet another excellent reason to tell the politicians to stop meddling.

Another valuable observation from the same post:

This is a point I’ve made many times: the economic demographic most impacted by immigrant labor are teens. Low-end “starter” jobs tend to be low-skill, low-paying, part-time jobs, and adult immigrants are often favored over teens for these jobs by employers (they often have families to support, are considered more reliable, etc.). This means that the teen labor-participation percentage has fallen from 50% in 1970 to 25% today. (And even 25% is probably too high.) When faced with this lack of job opportunities, teens often opt to go back to school — but this in turn saddles them with a lot of debt for (in many cases) not much gain. For many teens, it’s simply a way of deferring adulthood, not a way to gain additional skills or knowledge. (I had my first paying job at 14; my first “real” W2 job at 16. I worked nearly full-time all the way through college, and worked full-time during the summers. I wonder how rare this is now?) Another interesting aspect to the immigrant/teen issue: the language barrier. If you’re a teen who doesn’t speak Spanish, just try and get a landscaping or construction job in the Southwest. The same goes for many fast-food crews and oil-change/tire-repair places. Still, we’re not the only ones with immigrant troubles.

Another side to the increasing longevity of western culture is the delayed start to “adult” life: now that a college diploma or university degree has about the same relevance that a high school diploma did a generation ago, young folks are entering the workforce several years later than earlier generations. This delays family formation, children, home-buying, and all the other aspects of independent-from-the-parents life.

No wonder so many of the “rules” no longer seem to apply with so many things changing.

October 17, 2010

P.J. O’Rourke interview

Filed under: Economics, Liberty, Politics, USA — Tags: , , , , , — Nicholas @ 12:01

Parts 2 and 3 are at Liberty Pundits.

New laws aim to reduce military corruption in China

Filed under: China, Economics, Military — Tags: , , — Nicholas @ 11:39

Strategy Page looks at the latest attempt to curb military corruption:

China is enacting new laws that puts additional pressure on the military to maintain quality standards (in the construction and use of military equipment). Why should something like this be thought necessary? It’s all because of corruption, an ancient, and growing, problem in China. There, it is taken as a given that, if you get a government job, you have a license to steal. In the military, this means weapons are built in substandard ways, and equipment is not properly maintained. Military corruption is an ancient Chinese custom, and accounts for most of the poor military performance in the past.

For over a decade, the government has worked to eliminate the worst of the theft and moonlighting by the troops. The most outrageous examples of this have been curbed. Thus military officers no longer use cash from the defense budget to set up weapons factories they run and profit from. Big chunks of procurement cash no longer disappear into the offshore bank accounts of generals and admirals.

It’ll take more than new laws and a few high-profile prosecutions to tackle a problem that has been endemic for generations.

October 14, 2010

The anomaly was the “nuclear family” era, not today

Filed under: Economics, Education, USA — Tags: , , — Nicholas @ 07:57

In so many stories about adult children moving back home after college, the default attitude seems to be that this is “not normal”. This is false: for most of human history, the default living situation has been multiple generations living in the same dwelling. The “nuclear family” era was the break with everything that had gone before. That being said, this should be no surprise:

Getting a degree used to be a stepping stone to limitless career opportunities. Now it’s more of a hiatus from living under your parents’ roof.

Stubbornly high unemployment — nearly 15% for those ages 20-24 — has made finding a job nearly impossible. And without a job, there’s nowhere for these young adults to go but back to their old bedrooms, curfews and chore charts. Meet the boomerangers.

“This recession has hit young adults particularly hard,” according to Rich Morin, senior editor at the Pew Research Center in DC.

So hard that a whopping 85% of college seniors planned to move back home with their parents after graduation last May, according to a poll by Twentysomething Inc., a marketing and research firm based in Philadelphia. That rate has steadily risen from 67% in 2006.

October 13, 2010

Bernier calls for an end to transfer payments

Filed under: Cancon, Economics, Government, Politics — Tags: , , — Nicholas @ 12:24

If there’s one member of the federal Conservatives that can be said to both have ideas and be willing to express them publicly, it would have to be Maxime Bernier:

Maxime Bernier is carving out a pronounced niche for himself as the one-man Libertarian wing of the Conservative Party.

He appears also to have made a conscious decision to say what he thinks, and risk the consequences. Having been kicked out of Cabinet and survived, he may have discovered a way to turn lemons into lemonade. The most that can happen to him now is that he gets ejected from caucus as well, but given his stature as a high-profile MP in a prized riding in Quebec, would the Tory high command risk anything so self-defeating?

So what does our one-man Libertarian wing call for now?

Mr. Bernier wants Ottawa to get out of the business of subsidizing provincial programs that aren’t federal responsibility. Rather than send $40 billion a year to the provinces to pay for health and social programs, Ottawa should just chop its taxes and let the provinces take up the slack, paying for their own programs.

Yeah, I somehow don’t see Messrs. Harper, Ignatieff, or Layton coming on board with this notion. Give up taxing power to the provinces who are constitutionally responsible for the services? What do you think we are, some sort of confederation?

Other interesting snippets from his speech to the Albany Club in Toronto:

Wilfrid Laurier was another of our greatest prime ministers. He was a classical liberal, not a liberal in the modern sense. He was a supporter of individual freedom, free trade and free markets. I think if he were alive today, he would probably be a Conservative!

Yes, except he’d be in the same outsider/pariah position as Mr. Bernier finds himself in the Harper version of Conservatism.

In a speech before the Quebec Legislative Assembly in 1871, Laurier said:

“If the federal system is to avoid becoming a hollow concept, if it is to produce the results called for, the legislatures must be independent, not just in the law, but also in fact. The local legislature must especially be completely sheltered from control by the federal legislature.

If in any way the federal legislature exercises the slightest control over the local legislature, then the reality is no longer a federal union, but rather a legislative union in federal form.”

Now, it’s obvious that what Laurier feared has unfortunately come true. Ottawa exercises a lot more than “the slightest control” over local legislatures. The federal government today intervenes massively in provincial jurisdictions, and in particular in health and education, two areas where it has no constitutional legitimacy whatsoever.

As I’ve said before, I don’t know how long Bernier will be tolerated in the tightly controlled and PMO-stage-managed Conservative party, but I do enjoy the spectacle of someone actually pushing these ideas. I hope he continues to do so.

Update: Don Martin also seems to think that “Mad Max” is a breath of fresh air:

They share a party label, but Deficit Jim and Mad Max sit in polar opposite corners of the big blue tent.

The day after Finance Minister Jim Flaherty released an update which would make a left-lurching Liberal blush at the historic high tide in a red fiscal sea, Maxime Bernier delivered a jolt of hard-right policy to remind true blue Conservatives they have at least one voice on the government’s backbenches.

Flaherty is my local MP. He ran for parliament with the Conservatives, but appears to be operating in office as a Liberal.

Maverick Max went rogue again in a Toronto speech on Wednesday by advocating Ottawa get out of transfer payments to provinces while giving legislatures more tax room to finance the health, social welfare and education services they are constitutionally obliged to deliver.

For Jim Flaherty, who rolled out a blueprint on Tuesday showing continued growth in the social transfer envelope well into the next government’s mandate, the notion of surrendering $40 billion worth of fiscal clout over the provinces is a severely alien concept.

Martin has a nice article here, even if he incorrectly refers to Laurier as our first Liberal PM . . . unless he means our first (and only) “classic liberal” PM. Perhaps Bernier will be our second?

QotD: Economic misconceptions

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

Students typically come to an economics class with many misconceptions, not just random errors but systematic biases.

Bill Goffe recently (2009) surveyed one of his macro principles classes and found, for example, that the median student believes that 35% of workers earn the minimum wage and a substantial fraction think that a majority of workers earn the minimum wage (Actual rate in 2007: 2.3% of hourly-paid workers and a smaller share of all workers earn the minimum wage, rates are probably somewhat higher today since the min. wage has risen and wages have not).

When asked about profits as a percentage of sales the median student guessed 30% (actual rate, closer to 4%).

When asked about the inflation rate over the last year (survey was in 2009) the median student guessed 11%. Actual rate: much closer to 0%. Note, how important such misconceptions could be to policy.

When asked by how much has income per person in the United States changed since 1950 (after adjusting for inflation) the median student said an increase of 25%. Actual rate an increase of about 248%, thus the median student was off by a factor of 10.

Alex Tabarrok, “Economic Misconceptions”, Marginal Revolution, 2010-10-11

October 12, 2010

Monty on structural unemployment

Filed under: Economics, Education, Technology, USA — Tags: , , , — Nicholas @ 12:07

Monty is still too busy with real life to do a daily Financial Briefing, but he’s dropping by a few times a week with his insightful-and-acidic thoughts at Ace of Spades HQ:

Welding jobs may be plentiful, but that’s no help to you if you’re not a welder. This is called “structural unemployment”, and it has no real short-term solution. It results from a disconnect between current worker skills and employer requirements. It’s really a form of malinvestment. Students train in subjects like Postmodernist Literary Theory and The Hermeneutics of Lesbian Cinema, but the job market is asking for engineers and plumbers. Workers in fading industries won’t or can’t retrain. The last time this problem cropped up was during the 1982 recession: the old manufacturing jobs were gone, and the hundreds of thousands of Rust Belt factory workers — many now middle-aged, with high union wages and benefits packages they didn’t want to lose — either could not or would not re-train into other fields. This led to a long cycle of stagnation in which the American upper midwest remains mired to this very day. Pull quote:

Victor Calix Cruz, 51, has been job hunting for two years after being laid off from construction work in Miami. He, his wife and their two teenage children are “surviving” on his wife’s disability and his unemployment payments, he said. While he heard of openings at hotels, he hasn’t applied because the pay and benefits aren’t as good as what he had before.

I don’t imagine that your unemployment check matches what you were making before either, Chief. It’s like the old Rolling Stones song: you can’t always get what you want.

October 9, 2010

QotD: The American car

Filed under: Economics, Environment, Liberty, Quotations, Technology — Tags: , , — Nicholas @ 11:03

In making automobiles more safe and ecologically friendly, we’ve often lost sight of the basic cost benefit factor — I think this is probably more true in the safety than in ecology — and one of the things that is precious about the American automobile industry is that it provided a cheap and reliable means of transportation for practically everyone in society, and then when those vehicles became used vehicles, it gave cheap and mostly reliable transportation to everybody, to the point where the Oakies in the dust bowl were in Model T fords and not on foot. When we undertake to make the automobile this humming, electronic device that provides a perfect egg of safety and closure and creates no adverse externalities (as people like to say these days) we lose sight of the purpose of the damn thing in the first place. And the purpose was to allow freedom — freedom and horizontal mobility to the masses. That’s why cash for clunkers was just sinful. You’re taking a bunch of perfectly good vehicles, inexpensive vehicles that could be used by people without much in the way of material means, and crushing them. If someone took a valuable resource — something that could really be useful to people — and destroyed it, they’d be in jail if they were private citizens.

P.J. O’Rourke, “P.J. O’Rourke Likes Puppies and America, Dislikes Flip Flops at the Airport [Texas Book Festival Interview]”, Austinist.com, 2010-10-08

October 8, 2010

QotD: Green power play

Filed under: Cancon, Economics, Environment, Quotations — Tags: , , , , , — Nicholas @ 14:23

The Swedish retail giant IKEA announced yesterday it will invest $4.6-million to install 3,790 solar panels on three Toronto area stores, giving IKEA the electric-power-producing capacity of 960,000 kilowatt hours (kWh) per year. According to IKEA, that’s enough electricity to power 100 homes. Amazing development. Even more amazing is the economics of this project. Under the Ontario government’s feed-in-tariff solar power scheme, IKEA will receive 71.3¢ for each kilowatt of power produced, which works out to about $6,800 a year for each of the 100 hypothetical homes. Since the average Toronto home currently pays about $1,200 for the same quantity of electricity, that implies that IKEA is being overpaid by $5,400 per home equivalent.

Welcome to the wonderful world of green economics and the magical business of carbon emission reduction. Each year, IKEA will receive $684,408 under Premier Dalton McGuinty’s green energy monster — for power that today retails for about $115,000. At that rate, IKEA will recoup $4.6-million in less than seven years — not bad for an investment that can be amortized over 20.

No wonder solar power is such a hot industry. No wonder, too, that the province of Ontario is in a headlong rush into a likely economic crisis brought on by skyrocketing electricity prices. To make up the money paid to IKEA to promote itself as a carbon-free zone, Ontario consumers and industries are on their way to experiencing the highest electricity rates in North America, if not most of the world.

Terence Corcoran, “Power Failure”, Financial Post, 2010-10-08

October 7, 2010

The sad tale of the used book hunter

Filed under: Books, Economics, Media — Tags: , — Nicholas @ 00:04

By way of Walter Olson’s Twitter feed, a story of real life arbitrage — the Confessions of a Used Book Salesman:

I make a living buying and selling used books. I browse the racks of thrift stores and library book sales using an electronic bar-code scanner. I push the button, a red laser hops about, and an LCD screen lights up with the resale values. It feels like being God in his own tiny recreational casino; my judgments are sure and simple, and I always win because I have foreknowledge of all bad bets. The software I use tells me the going price, on Amazon Marketplace, of the title I just scanned, along with the all-important sales rank, so I know the book’s prospects immediately. I turn a profit every time.

I’m pretty sure I first heard about the practice of shopping for books with laser scanners in a story on NPR, which, as I recall it, disparaged their use as classless. And, really, it is precisely this. The book merchant of the high-cultural imagination is a literate compleat and serves the literate. He doesn’t need a scanner, because he knows more than the scanner knows. I fill a different niche — I deal in collectible or meaningful books only by accident. I’m not deep, but I am broad. My customer is anyone who needs a book that I happen to find and can make money from.

My economics side says this is a good thing: connecting buyers with their desired purchases. My bibliophile side says this is somehow morally wrong . . . or if not precisely wrong, then tainted or shady. I’m not sure how to reconcile my feelings.

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