Quotulatiousness

June 12, 2024

“Consumption inequality” really has fallen significantly since Orwell’s day

Filed under: Books, Britain, Economics, History, USA — Tags: , , , — Nicholas @ 04:00

Tim Worstall on some of the points raised by Christopher Snowdon’s new introduction to Orwell’s Nineteen Eighty-Four:

Eric (“George Orwell”) Blair’s press card portrait, 1943

Eric Blair, the useful one, once pointed out that:

    In a world in which everyone worked short hours, had enough to eat, lived in a house with a bathroom and a refrigerator, and possessed a motor-car or even an aeroplane, the most obvious and perhaps the most important form of inequality would already have disappeared. If it once became general, wealth would confer no distinction.

That’s from Chris Snowdon’s new intro to 1984 – you should buy a copy.

Not that Eric knew enough economics to know this but what he’s talking about is consumption inequality.

Sure, we’ve Oxfam squealing that wealth inequality is rising summat fearsome. It ain’t — they fail to account for what we already do to reduce wealth inequality. Many tell us that income inequality is rising summat fearsome. It ain’t. Global income inequality has been falling this past 40 years and as all men are indeed brothers it’s the global number that matters.

But the one that’s really fallen like a stone is that consumption inequality. Consumption is also really the only one of the three that matters. Sure, a world in which there are those without three squares and a crib is not a good one. But once all do have three squares etc. then whatever other inequality there is is, well, it’s not actually all that important is it?

[…]

We really have got to what Orwell thought would be equality. In 1930s England (which was his mental reference point) all of these things – all – were signifiers of significant wealth or income:

As a poorer country the UK was a little behind on these things but my best guess would be that we’re ahead of the US on washing machines today (the US still has a habit of communal machines in apartment blocks). And it amuses that central heating isn’t even on the list. This was something very middle class indeed in the 1960s, really only became “normal” in the UK in the late 70s into the 80s. As with double glazing. These days you’re defined as being in fuel poverty if you cannot heat your house, always and all of it, to a level that no one at all could before that central heating. No, really, coal fire heated houses might average 10oC in winter and that would only be in rooms with an actual fire — others would be at 0oC.

This is not to get into a Four Yorkshiremen but people would be astonished at how cold houses were 1970s and earlier. My own arrival in the US in 1981 had me wondering how they had heating systems that heated all the house, properly, all winter. How could anyone afford that?

June 10, 2024

South Africa’s “Rainbow Nation” falters

Filed under: Africa, Economics, Government, History, Media, Politics — Tags: , , , , , — Nicholas @ 05:00

Niccolo Soldo’s weekly roundup included a lengthy section on the recent election results in South Africa and what they might mean for the nation’s short- and medium-term stability:

Being a teen, the issue of South African Apartheid didn’t really fit all that well within the overarching Cold War paradigm. Unlike most other global issues, this one didn’t break down cleanly between the “freedom-loving West” and the “dictatorial, oppressive communist bloc”, as the push to dismantle the regime came from western liberals who were in agreement with the reds.

This slight bit of complexity did not faze most people, as Apartheid was seen as a relic of an older world, one to be consigned to the proverbial dustbin of history. It’s elimination did fit well enough into the Post-Berlin Wall world, one in which freedom and democracy were to reign supreme. This was more than enough reason for almost all people to cheer the release of Nelson Mandela and applaud South Africa’s embrace of western liberal democracy.

In the early 1990s, men once again dared to flirt with utopian ideas, and South Africa’s “Rainbow Nation” was to be its centrepiece: out with authoritarianism, racism, ethnocentrism, etc., and in with multiracialism, multiethnicity, democracy and individual liberty. We could all leave the past where it belonged (in the past) and live in peace and harmony, as democracy would defend it, secure it, and preserve it. South Africa would lead the way, and would in fact teach us westerners how it is to be done.

Oddly enough, South Africa quickly fell off of the radar of mainstream media in the West when it failed to live up to these lofty goals. Rather than living up to the hype of being the “Rainbow Nation”, it instead was quickly mired in the politics of corruption and race, showing itself to be all too human, just like the rest of us. South Africa had failed to immediately resolve its inherent internal tensions, whether they be racial, economic, ethnic, or ideological, and by extension it had failed to deliver its promise to western liberals. “Out of sight, out of mind” became the best practice, replacing the utopianism of the first half of the 1990s.

Granted, a lot of grace was given to South Africa by western media so long as Nelson Mandela remained in office (and even after that), but the failures were plainly evident to see: an explosion in crime and in corruption were its most obvious characteristics, ones that could not be brushed under the carpet. The African National Congress (ANC), the party that would deliver the promise of the Rainbow Nation, was instead shown to be little more than a powerful engine of corruption and patronage. Luckily for the ANC, it was fueled in large part by the legacy of Mandela and the goodwill that he had accumulated over the years while he sat in prison.

The post-Mandela era has not been kind to the ANC (nor to South Africa as a whole), as the party could no longer hide behind his fading legacy, and could no longer cash in on the goodwill that came from it. It could “put up”, and would it not “shut up”. The ANC over time became a lumbering beast, too big to slay, but too slow to destroy its opposition when compared to its nimble youth.

What has the party delivered in its three decades of power? It did help dismantle Apartheid, but it did not deliver economic prosperity and opportunity to all. Instead, it simply swapped out elites where it could, preferring to keep the new ones in house. An inability to tame crime and to keep the national power grid running has turned the country into a bit of a joke, especially when it is lumped into the BRICS group alongside Brazil, Russia, India, and China. Despite its abundance of natural wealth, South Africa has been economically mismanaged.

South Africa is an important country to watch for the simple reason that there is so much tinder lying around, ready to be set ablaze. Luckily for South Africans, dire projections of widespread civil strife have not come to pass. Unluckily for South Africans, their national trajectory is headed in the wrong direction. Last week’s national elections saw the ANC lose their parliamentary majority for the first time ever, and the only way to read the results is to conclude that no matter how one may feel about this very corrupt party, it is an ominous sign.

Elite contempt for democracy is fuelling anti-immigration “far right” sentiment in the west

Filed under: Britain, Cancon, Economics, Government, Media, Politics, USA — Tags: , , , , , , , , — Nicholas @ 04:00

Even for people who are generally happy with robust immigration, the numbers being recorded (or, more likely, under-recorded) in Canada, the United States and Europe are far too high to pretend that the new arrivals will quickly integrate into their new countries, and they are generally not being encouraged to do so anyway. Complaints to the people who have enabled these massive inflows — at best — are waved off or ignored, but often are seized upon as examples of hateful far-right xenophobia to be punished and suppressed:

Not so long ago, as many of us reeled from the political earthquakes of Brexit and Trump, it seemed sensible for responsible mainstream political parties to adopt tighter immigration control to keep the populist right at bay. Mass migration in Europe had led to a far-right resurgence; in the US and UK, Trump and the Johnson-era Tories seemed to grasp this and moved to co-opt the anti-immigrant fervor. Democracy was working to accommodate a shift in the public mood.

Or so it seemed. Nearly a decade later, something else has happened: an immigration explosion. In response to a volatile public mood, Western elites actually intensified their policy of importing millions of people from the developing world to replace their insufficiently diverse and declining domestic populations.

The recent figures from the US, UK and Canada are mind-blowing. The graphs all look like a hockey stick, with a massive spike in the last three years alone. Under Trump, the average number of illegal crossings a year was around 500,000; under Biden, that has quadrupled to two million a year — from a much more diverse group, from Africa, China and India. To add insult to injury, Biden has also all but shut down immigration enforcement in the interior; and abused his parole power to usher in nearly 1.3 million illegal migrants in 2023 alone. The number of undetained illegal migrants living in the US has thereby ballooned under Biden: from 3.7 million in 2021 to 6.2 million in 2023, according to ICE. If a fraction of those millions turns up for asylum hearings, I’ll be gob-smacked.

Canada has seen something similar. For much of the 21st century, Canada had around 200,000 to 300,000 immigrants a year; but in the last two years, this has nearly doubled. In Britain, the same story. In 2015, the year before Brexit, net migration (the numbers of people immigrating minus the number emigrating) was 329,000; in the last two years, it has more than doubled to over 700,000. And whereas most immigration before Brexit was from the EU, today, immigrants from the developing world outnumber European immigrants by almost 10 to 1. For those Brits who voted for Brexit to lower the number of foreigners in the country, it’s been surreal.

If you want to understand why Biden keeps trailing in the swing states, why the Tories are about to be wiped out in a historic collapse, and why Trudeau is at all-time low in approval at 28 percent, this seems to me to be key. As the public tried to express a desire to slow down the pace of demographic change, elites in London, Ottawa, and Washington chose to massively accelerate it. It’s as if they saw the rise in the popularity of the far right and said to themselves: well now, how can we really get it to take off?

This week, CNN ran a poll on Biden and immigration. Here’s what they found: in May 2020, only one percent of Americans put immigration as their top concern — in 15th place among issues; in May 2024, 18 percent put it first. In 2020, Biden edged Trump by one percent on who was best to tackle the border crisis; four years later, Trump is ahead on the issue by 27 points. As a coup de grâce, CNN also found that foreign-born Americans preferred Trump to Biden on immigration by 47 to 44 percent. Turns out that this immigrant’s worries are widely shared by my fellow new Americans.

Biden, of course, is now desperately scrambling to salvage something from this disaster. This week, he contradicted himself by saying he has the unilateral capacity as president to shut down the border, and attempted to blame the GOP for the problem. Yes, the GOP was unhelpful and cynically political earlier this year — but that won’t muddy the waters for most voters who have been conscious for the past three years. But I am grateful nonetheless to hear the president echo what the Dish has been saying for years now, and for which I was routinely called a racist:

    To protect America as a land that welcomes immigrants, we must first secure the border and secure it now. The simple truth is there is a worldwide migrant crisis, and if the United States doesn’t secure our border, there is no limit to the number of people who may try to come here, because there is no better place on the planet than the United States of America.

Now that didn’t hurt, did it? But why did he keep telling us there was no crisis for the last three and a half years? And why would anyone trust a re-elected Biden to enact this if he had a Congressional majority? I sure don’t.

Even under Biden’s “crackdown”, he is still prepared to admit at least 1.75 million illegal immigrants a year! Last week, Chuck Schumer declared that the ultimate goal was to legalize every single illegal immigrant — because Americans are not having enough children. Without open borders, of course, our economy wouldn’t look so good: in the last year, according to the Bureau of Labor Statistics, foreign-born workers gained 600,000 new jobs, while native-born Americans lost 300,000. But don’t you dare mention the “Great Replacement Theory“!

June 8, 2024

El Loco, Argentina’s “skunk at the garden party”

Filed under: Americas, Bureaucracy, Economics, Government, Liberty — Tags: , , , , — Nicholas @ 04:00

In The Free Press, Bari Weiss talks to Argentinian President Javier Milei (through a translator) about his first six months in office:

At the start of the twentieth century, Argentina was one of the wealthiest countries in the world. The capital, Buenos Aires, was known as “the Paris of South America”.

A lot can happen in a hundred years.

Argentina today is in grave crisis. It has defaulted on its sovereign debt three times since 2001, and a few months ago, it faced an annualized inflation rate of over 200 percent — one of the highest in the world.

Why? What happened?

Argentina’s new president says it’s simple: socialism.

When Javier Milei took office in December 2023, he became the world’s first libertarian head of state. During his campaign, he made his views clear: “Let it all blow up, let the economy blow up, and take this entire garbage political caste down with it”. In case the chainsaw he wielded on the campaign trail left any question about his intentions, during his victory speech last year, he reiterated his vision: “Argentina’s situation is critical. The changes our country needs are drastic. There is no room for gradualism, no room for lukewarm measures.”

There is nothing gradual about what Milei is now doing.

He’s eliminating government ministries and services, cutting regulations, privatizing state-run companies, and purposely creating a recession to curb the out-of-control inflation.

This is why people voted for him: change. They saw someone who could shake things up in a way that could turn out to be lifesaving for the country — even if it meant short-term economic pain.

But will it work? Not all Argentines think so. And not everyone is willing or able to wait for things to improve. In April, with food prices rising and poverty up 10 percent, tens of thousands of Argentines took to the streets to protest Milei’s aggressive austerity measures.

Milei is a strange and idiosyncratic creature. There are the obvious things: He says he doesn’t comb his hair (and he doesn’t appear to). He has four cloned mastiffs that he refers to as his “four-legged children“, and which he’s named for his favorite free-market economists. He was raised Catholic, but studies the Torah. (He even quoted a Midrash during our conversation.) He used to play in a Rolling Stones cover band. And he has been known since grade school in the ’80s as El Loco, on account of his animated outbursts, which would later bring him stardom as a TV, radio, and social media celebrity.

But that’s all the superficial stuff. What really makes Milei unusual is that he is the ultimate skunk at the garden party. In a world of liberals and conservatives, he doesn’t represent either side. He is ultra-liberal on economics, but right-wing and populist on rhetoric. He is anti-abortion, but favors the legalization of prostitution. He wants to deregulate the gun market and legalize the organ trade.

He calls himself an anarcho-capitalist, which basically means he believes the state, as he told me, is “a violent organization that lives from a coercive source which is taxes”. Essentially, he’s a head of state who really doesn’t believe in states. Or at least, not theoretically.

In January, Milei showed up at Davos, the Alpine mountain resort that hosts the annual World Economic Forum. This is traditionally a place where people who all think the same way go to drink champagne and tell each other how smart they are. Milei arrived, flying commercial, and blew up that comfortable consensus: “Today, I’m here to tell you that the Western world is in danger. And it is in danger because those who are supposed to have defended the values of the West are co-opted by a vision of the world that inexorably leads to socialism and thereby to poverty.”

All of this is why I was eager to talk to Milei and put some of these questions to him: How long will it take for things to improve in Argentina? Why does he believe the Western world is in danger? What’s the difference between social justice and socialism? Can the free market really solve all of our civic problems? And how does he feel about being the skunk at the garden party? (Spoiler: He loves it.)

And despite having called journalists “extortionists”, “liars”, “imbeciles”, “freeloaders”, and “donkeys”, for some reason, he agreed to sit down with me.

June 7, 2024

Since 2015, the Trudeau Liberals have done a fantastic job of suppressing the Canadian economy

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

If Canadians elected Justin Trudeau and the Liberal Party to make major changes from what had gone on under Stephen Harper’s Conservatives, then they got their wish in so many different ways, but especially economically:

Reports of Canada’s dismal economic outcomes seem never to end. Why should they? For years Canadians have had the same federal government delivering the same deleterious economic policies and the same expansion in regulatory initiatives and spending that have invariably depressed economies and reduced standards of living whenever and wherever they are imposed. Therefore, until the federal government or its policies change, we should not expect the miserable results to materially improve.

The latest negative report is the release of Canada’s 2024-Q1 GDP numbers on Friday, which again showed sluggish growth relative to population, resulting in yet another quarterly decline in real GDP per capita. Relative to 2015-Q3, the last full quarter before the Trudeau government took office, cumulative real GDP per capita is up only about 0.7 per cent. A recent RBC Economics analysis showed from around 1991 to 2015, cumulative real GDP per capita growth in Canada approximately tracked with the U.S., but not since Justin Trudeau took office. Compared to 0.7 per cent growth in Canada from 2015-Q3 to 2024-Q1, real GDP per capita is up 15.7 per cent in the U.S. in the same time period.

Where the 0.7 per cent comes from matters, too. In real per capita terms, some components of GDP — mainly government — expanded while others contracted. Alarmingly, business investment, which drives productivity and standards of living, is down 13.9 per cent. This includes real per capita reductions of 15.2 per cent in residential structures, 18.4 per cent in machinery and equipment, and 19.3 per cent in non-residential structures, with an increase in intellectual property investment not nearly enough to offset the reductions in other categories.

To understand why business investment and economic performance in Canada are so poor under the Trudeau government, let us consider the following representative example of its economic strategy.

The government believes many families struggle with the cost of caring for young children, which is a legitimate concern. A reasonable solution, which the Harper government implemented in 2006, is to send money to families with young children and let parents buy for their children what they need. After the Liberals expanded that program, they could have left it at that, but what have they done instead? The government initiated a national takeover of child care, effectively expropriating child care entrepreneurs’ businesses by flooding their sector with public money and then controlling private companies’ revenues and operations. The result is child care entrepreneurs’ investments have been wiped out or severely reduced, control of their business operations have been wrestled away by government, and they are unable to properly serve their customers (the families), as evidenced by the drastic reduction in parental options and widespread shortages.

June 5, 2024

“Stop viewing every inconvenience discovered in the economy as a market failure needing government intervention”

Filed under: Americas, Economics — Tags: , , , — Nicholas @ 03:00

Argentine President Javier Milei visited the Hoover Institution at Stanford and spoke about his approach to addressing Argentina’s many economic issues during his first six-months in office:

Milei recalled his years as an economist with HSBC Argentina and work advising a large pension fund. He explained how he had to remain adaptable to changing market conditions and new ideas and not make assumptions based on static economic models.

“Reality is complex, but when the model doesn’t match reality, you get rid of it,” he said. “You don’t get angry with reality.”

Milei argued that many twenty-first-century leaders see every failure of an economic model as proof of a market failure warranting government intervention.

He added that the state interventions are slowly strangling our ability to generate economic growth.

“Let us not allow the fatally conceited to destroy our lives with regulations.”

Throughout his speech of more than one hour, Milei brought up luminaries who’ve shaped his worldview, including Adam Smith, Friedrich von Hayek, Milton Friedman, Henry Hazlitt, and Murray N. Rothbard. He described how they influenced his view that everything should flow from the promotion of private enterprise and maximum possible growth, and that state intervention often only exacerbates the problem it was intended to solve.

Milei described himself as a libertarian and a minarchist who believes the role of the state is only to protect individuals and their property from aggression.

While talking about the challenges of governing and the Austrian school of economists who influenced his worldview, he suggested that it may have been his love of conflict that brought him away from work as an economist and television commentator and into the position he finds himself today.

“That’s probably why I got into politics. I love conflict.”

Milei said that his government is working to tame inflation and get public spending under control, and he applauded his economy minister, Luis Caputo, sitting in the audience.

“He’s in charge of the chainsaw operation,” Milei said, alluding to the chainsaw he brought with him to campaign rallies to symbolize his anti-spending agenda. “We are getting rid of a whole lot of things.”

“I am very happy when my economy minister gets applause. He’s making the greatest adjustment not only in the history of Argentina but in the whole history of humanity. We have already adjusted by 13 percent of GDP.”

He then turned to confront those he called “statists” and “regulators” who oppose his efforts in Argentina.

“They’re sitting in an office, and they create regulation just to justify their own existence,” he said. “This has a direct impact on innovation … They regulate just out of ignorance or just to justify the chair [they sit on], and they’re ruining our lives.”

He argued that most people in economics can’t even articulate where the state ends and the market begins.

“The market is ourselves,” he said. “When there’s talk of the market, we are the market.”

He described the market as a “social cooperation process” where “property rights are voluntarily exchanged”. He contrasted this with interaction with the state, where participants are compelled to act in a certain way.

“State intervention is always bad, because it’s based on coercion, on force, and nothing based on coercion can be good.”

June 4, 2024

QotD: “Let the market handle it”

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

The argument is quite common. It’s also wrong. Its error is that it incorrectly identifies the set of choices for dealing with problems (and with “problems”).

Rodrik’s argument appears to be the height of reasonableness. “It is dogmatic and dangerous,” the argument’s champions rightly note, “to assume that one solution or one approach is the answer to every problem. Some problems call for the use of screwdrivers, others call for the use of hammers. Only a benighted fool insists on using a screwdriver to hammer in nails and on using a hammer to insert screws. The wise, non-ideological, enlightened, open-minded, reasonable, and scientifically aware person sometimes uses a screwdriver and other times uses a hammer. What could be more reasonable?!”

The error in this formulation is that markets are many tools. Markets are a toolkit with far more tools in it than government has access to. While government has only a few tools – mostly hammers (some sledge), saws, and clamps – the market is filled with many, almost countless, tools. And the market’s tools are much more varied, nuanced, specialized, and creative than are the government’s simple set of tools.

Put differently, to say “Let the market handle it” is just a shorthand way of saying “Let whoever is most willing, most able, most experienced, most knowledgeable, and best equipped be free to try his or her hand at dealing with each specific problem.” And to say “Let the market always handle it” is not – contrary to what Rodrik’s argument suggests – to propose a single, simple fix for all problems; it is to propose that the field be left open for as many fixes as are feasible to be tried. To say “Let the market always handle it” is to warn that using government as a fix crowds out – prevents – experimentation with many other possible fixes.

In short, the choice is not between only two alternative possible fixes: the market or the government. Instead, the choice is between a gigantically large and varied set of possible fixes (the market, with its many detailed specialized carpenters and master builders) or a tiny set featuring one possible fix (the government, with its hammering, sawing, and clamping officials, none of whom – unlike the case with market participants – can be reasonably presumed to know enough of the finer details of any of the problems that they are called upon to “fix”).

The truly reasonable person – the one who understands the benefits of having access to as many “solutions” to problems as possible – supports the market because he or she knows that to turn to government solutions is to drastically reduce the number of “solutions” that will be tried.

Don Boudreaux, “Very Bad Framing, or In Defense of ‘Let the Market Handle It'”, Café Hayek, 2016-08-12.

June 3, 2024

QotD: Economic feedback

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

Well, now I think about it, most feedback is annoying.

Economics is full of it — as are other economic systems — and humans find it so annoying they have devised various means of shutting it down, and then become puzzled and do crazy stuff when the system goes out of control.

Take price controls. They deliberately shut down feedback. The idea is “people need to eat and the essentials should be cheap”. We went tons of rounds on this in the seventies in Portugal. It was FUN — not — and responsible for empty grocery shelves and problems getting the essentials. Because when cooking oil was dirt cheap by price control, everyone who had ridden this pony before (with bread, with toilet paper, with …) would buy everything in the grocery shelves. Meanwhile, because it was impossible for merchants to make a profit on the thing, they didn’t stock it. Which was okay, because the factories that made it couldn’t afford to at that price, so they stopped. And all the way down the line.

This is because what the idiot politicians were shutting down was the feedback. Prices are many things — and sometimes annoying when you really want a good pair of noise-cancelling headphones but your bank account is crying, to use a totally random example — but MOSTLY? They’re information. They’re feedback.

Because, yes, people work for profit, and profit — things that Warren and Sanders will never get — is not dirty, it’s what people live on, when prices go up — meaning there’s more demand than supply — people go “hey, you can make a profit in this” and start making more, until the supply and demand match, and you can’t make as much money, so people wander off to do other stuff.

You shut down the signal, and things go insane. You keep it shut down long enough while handing down lists of things that the government wants you to make, and vast famines sweep the land but you have a surplus of size 35 shoes for the left foot only. Because the directive handed the factory made that the easiest thing to do.

But it is not just in economics (though eh, everything is a branch of economics, as my reading in my 30s informed me. Which means that’s probably when I started going insane) that humans love shutting down feedback.

The truth is we don’t like reality very much, and are more or less perpetually at war with it.

We have this image of how things should be, and because we imagine it so clearly we think it’s a moral imperative.

Sarah Hoyt, “Shutting Off Feedback or How We Got Into This Fine Mess”, According to Hoyt, 2019-11-04.

May 31, 2024

“You only support that because it’s in your self-interest to do so”

Filed under: Economics, Education, Liberty, Media, Politics — Tags: , , , , — Nicholas @ 04:00

Helen Dale considers the painful notion that political ideas that work for the “elite” (defined in various ways) may not work at all for people unlike members of any given “elite”:

When I reviewed Rob Henderson’s Troubled for Law & Liberty at Liberty Fund, I made this observation:

    The reality that classical liberalism — the closest to my own political views, I admit — has at least a whiff of the luxury belief around it stings. It’s discomforting to acknowledge that what goes by the name of paternalism has its own intellectual pedigree, while liberalism can be a system developed by the clever, for the clever. “Highly educated and affluent people are more economically conservative and socially liberal,” Henderson says. “This doesn’t make sense. The position is roughly that people shouldn’t have to adhere to norms and if/when they inevitably hurt themselves or others, then there should be no safety net available. It’s a luxury belief.”

[…]

Joseph Heath […] uses the phrase “self-control aristocracy” to describe those who really do benefit from maximal freedom. These are people who can make better choices for themselves than any authority could make on their behalf. When the state or large corporates boss them (us) around, they (we) get really bloody annoyed. They (we) know better!

Heath’s phrase is simply a layman’s term for the personality trait various formal tests measure, and which overlaps with executive function to a considerable but as yet unknown degree.

    Because I am self-conscious about my membership in the self-control aristocracy, I am acutely aware of the fact that, when I think about questions of “individual liberty” in society, I come to it with a particular set of class interests. That is because I stand to benefit much more from an expansion of the space of individual liberty than the average person does – because I have greater self-control. So I recognize that, while a 24-hour beer store would be great for me, it would be a mixed blessing for others […]

    What does this have to do with libertarianism? It is important because every academic proponent of libertarianism – understood loosely, as any doctrine that assigns individual liberty priority over other political values – is a member of the self-control aristocracy. As a result, they are advancing a political ideal that benefits themselves to a much greater extent than it benefits other people. In most cases, however, they do so naively, because they do not recognize themselves as members of an elite, socially-dominant group, that stands to benefit disproportionately. They think of liberty as something that creates an equal benefit for all.

My response to reading Professor Heath’s piece was simplicity itself: I feel seen. I’ve even done the night school thing while working full-time. I’ve written books and chosen to play sports that require a long time and lots of skill to master. I retired at 45.

Politically, I’m not a libertarian. Libertarianism is a distinctive and largely American ideology (as the recent and bonkers fracas at its US Convention indicates) with philosophically unusual deontological roots. I am, however, within the British and French tradition of classical liberalism (which does assign individual liberty priority over other political values). And like many classical liberals I’ve been blind to problems of laws and governance for people unlike me.

I disclose this because I’ve worked in policy development in both devolved and national parliaments. I’ve probably given politicians and civil servants alike dud advice. There is almost certainly a shit policy out there (in either Scotland or Australia) with my name on it. However, this mind-blindness doesn’t only apply to people who advocate libertarian politics. I think it applies to a significant number of political ideologies just as strongly as it does to libertarianism.

That is, the ideology serves the inherited personality traits of those who promote it. “You only support that because it’s in your self-interest to do so” always struck me as a genuinely mean criticism of people who were involved in politics and policy (I may have been one of those people, natch). The problem — as I’ve been forced to accept — is that it’s true.

May 27, 2024

“Product recommendations broke Google, and ate the Internet in the process”

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

Ted Gioia says the algorithms are broken and we need a way to get out of the online hellscape our techbro overlords have created for us:

Have you tried to get information on a product or service from Google recently? Good luck with that.

“Product recommendations broke Google,” declares tech journalist John Herrman, “and ate the Internet in the process.”

That sounds like an extreme claim. But it’s painfully true. If you doubt it, just try finding something — anything! — on the dominant search engine.

No matter what you search for, you end up in a polluted swamp of misleading links. The more you scroll, the more garbage you see:

  • Bogus product reviews
  • Fake articles that are really advertisements
  • Consumer guides that are just infomercials in disguise
  • Hucksters pretending to be experts
  • And every scam you can imagine (and some that never existed before) empowered by deepfakes or AI or some other innovative new tech

The Google algorithm deliberately makes it difficult to find reliable information. That’s because there’s more money made from promoting garbage, and forcing users to scroll through oceans of crap.

So why should Google offer a quick, easy answer to anything?

Everybody is now playing the same dirty game.

Even (previously) respected media outlets have launched their own recommendation programs as a way to monetize captured clients (= you and me). Everybody from Associated Press to Rolling Stone is doing it, and who can blame them?

Silicon Valley sets the dirty rules and everybody else just plays the game.

Welcome to the exciting world of algorithms. They were supposed to serve us, but now they control us—for the benefit of companies who impose them on every sphere of our lives.

And you can’t opt out.

For example, when I listen to music on a streaming platform, the algorithm takes over as soon as I stop intervening—insisting I listen to what it imposes on me. Where’s the switch to turn it off?

I can’t find it.

That option should be required by law. At a minimum, I should be allowed to opt out of the algorithm. Even better, they shouldn’t force the algorithm on me unless I opt in to begin with.

If this tech really aimed to serve me, opting in and opting out would be an obvious part of the system. The fact that I don’t get to choose tells you the real situation: These algorithms are not for our benefit.

Do you expect the coming wave of AI to be any different?

[…]

The shills who want us to lick the (virtual) boots of the algorithms keep using the word progress. That’s another warning sign.

I don’t think that word progress means what they think it means.

If it makes our lives worse, it isn’t progress. If it forces me into servitude, it isn’t progress. If it gets worse over time — much worse! — it isn’t progress.

All the spin and lobbying dollars in the world can’t change that.

So that’s why I became a conscientious objector in the world of algorithms. They give more unwanted advice than any person in history, even your mom.

At least mom has your best interests at heart. Can we say the same for Silicon Valley?

May 24, 2024

“Great Britain is not yet a basket case. But we do a rather good impression of a failing state.”

Filed under: Britain, Bureaucracy, Business, Economics, Media, Politics — Tags: , , , , , — Nicholas @ 05:00

Christopher Gage considers the plight of modern day Britain in the context of Rishi Sunak’s political suicide note election call:

Rishi Sunak shortly after becoming Chancellor of the Exchequer in 2020.

The ambition for things to get better is a bar so low it’s a carpet. A favoured genre of meme here centres on the dysfunction and general farce of a country with “Great” in its name. That lofty adjective edges perilously close to hilarity, akin to those countries prefixed by “People’s Democratic Republic”. The excitable kind with an AK-47 printed on its flag.

Call the doctor’s surgery at 8 a.m. An automated voice will reveal you are number 49 in the queue. When you eventually wade through, a soft-centred receptionist assures you in therapeutic tones that there’re no appointments left today. Sorry.

Book a same-day train ticket from London to Newcastle. Without a hint of contrition, the train company demands £786.80. That’s a week or two in warmer, healthier, saner Sevilla or three hours and eleven minutes on a train in Great Britain.

House prices and rents are akin to the board game Monopoly, in which your coked-up crypto-addled mate has lined up hotels on Mayfair.

Go to the supermarket. Olive oil, a civilising elixir which once threatened to heave the primitive British palate out of the Mesolithic era, is prohibitively expensive. If modern Britain were a film scene, it would be that of Ray Liotta in Goodfellas: Fuck you. Pay me.

This all-encompassing one-footed waltz feels like the finale of a political satire. Since the 1980s, we’ve parodied America. We’ve nailed the social pathology but not the prosperity. Essentially, Great Britain is an advertising agency with a nuclear submarine.

This election pits two tribes against each other. One tribe pines for 1997. The other yearns for 1979.

For a sizeable swathe of the population, everything is awful, and nothing will ever change. And thank God for that.

Here, a natural law dictates that anyone under 45 who dares suggest things could be better is to be consumed by a radioactive flood of sadistic nostalgia. The mere whiff of dissent conjures through the pavement a battalion of nostalgians who lament the end of Polio.

“You don’t remember the Seventies!” warn those who yearn for the Seventies. ‘Bodies uncollected! Rubbish piled up in the streets!’. In that fateful decade, striking union workers allowed garbage to pile up in the streets. To this hazy memory, the rest of us are serfs to economic juju.

Whenever I point out that a first-time buyer in London must save for 31 years just for a house deposit, a familiar chorus of denial debunks the theory of free will. “You waste your money on flat whites and trips to Rome!” goes the wearisome riposte.

During the 1970s, that prelapsarian idyll when rubbish piled in the streets, when adults caned children at random, and when Bullseye was on the telly, the average house cost four times the average wage. Today, it’s twelve to one.

To point out mathematical reality invokes spasms of uniquely British nostalgia. It’s a negative nostalgia which glories in just how bad everything was.

Churchill was right. The British people are the only people who like to be told how bad things are, who like to be told the worst. Memory-mongers paint postcards of perfect penury. Back then, children didn’t talk back. There were no phones or elbows on the table. Back then, that famed sense of community slapped any ribbon of dissent out of those who dared dream bigger than the suffocating confines of community life. The past is a foreign country in which children could count their ribs but they was happy.

Such nostalgia serves two purposes. The first indulges one’s triumph over wistfully disfigured adversity. The other bleaches the parlous state of modern Britain with a mop soaked in a very British version of nostalgie de la boue. Nostalgia, truth be told, is a polite form of dementia.

May 23, 2024

“[O]fficial justifications for mass migration often have a creepy, post-hoc flavour about them”

Filed under: Economics, Europe, Government, Politics — Tags: , , , , , — Nicholas @ 05:00

While it sometimes seems that there can’t possibly be mass migration issues other than here in Canada and along the US southern border, eugyppius reminds us that all of the Kakistocrats in western countries are fully in favour of more, and more, and even more inflow without restriction:

An asylum seeker, crossing the US-Canadian border illegally from the end of Roxham Road in Champlain, NY, is directed to the nearby processing centre by a Mountie on 14 August, 2017.
Photo by Daniel Case via Wikimedia Commons.

You might have noticed that mass migration to the West is a huge problem.

It is very bad for native Westerners, because it promises to transform our societies utterly, in permanent ways and not for the better. Curiously, it is also far from great for the centre-left political establishment responsible for promoting mass migration, because it has inspired a vast wave of popular opposition and filled the sails of right-leaning, migration restrictionist parties with new wind. Mass migration is also bad for taxpayers, for domestic security, for the welfare state, for many other aspects of the postwar liberal agenda and for our own future prospects. In short, mass migration is bad for almost everybody and everything.

There is a reason that nations have borders, and this is much the same reason that we have skin and that cells have membranes. You won’t survive for very long if you can’t control what enters you.

Despite the obvious fact that mass migration is bad, our rulers cling to migrationism like grim death. Given a choice between disincentivising asylees and intimidating, browbeating and harassing the millions of anti-migrationists among their own citizens, our governments generally choose the latter path, even though it is obviously the worse of the two.

Additionally unsettling, is the fact that official justifications for mass migration often have a creepy, post-hoc flavour about them. They sound much more like excuses dreamed up after the borders had already been opened, rather than any kind of reason mass migration must occur. When the migrationists really started to go crazy in 2015, for example, we were told that border security was simply impossible in the modern world and that infinity migrants were a force of nature we would have to deal with. That didn’t sound right even at the time, and since the pandemic border closures we no longer hear the inevitability narrative very much, although – and this is very bizarre to type – there is some evidence that high political figures like Angela Merkel believed it at the time. It is well worth thinking about why that might have been the case.

Another excuse that doesn’t make very much sense, is what I’ll call the refugee thesis. We’re told that millions of poor people are forced to endure terrible conditions in the developing world and that it is our moral burden to improve their lot by granting them residence in our countries. That might convince a few teenage girls, but it cannot withstand scrutiny among the rest of us. To begin with, the population of global unfortunates is enormous; the millions of refugees we have already accepted, and the millions that our politicians hope to welcome in the coming years, represent but a vanishing minority – a rounding error – compared to the vast sea of human suffering. It is like trying to solve homelessness by demanding that those in the wealthiest neighbourhoods make their spare bedrooms available to the indigent. Even more telling, however, is that the push to welcome migrants comes precisely as conditions in the developing world have dramatically improved. When things were much worse, we sealed our borders against the global south; now that they are much better, we hear all about how unacceptably inhumane it is to leave the migrants in their native lands.

Other post-hoc arguments, especially those falling in the yay-multiculturalism category, are even less serious. That we need more diversity to “spark innovation” (whatever that means) or that our local cuisines stand to benefit from the spices of the disadvantaged, are excuses of such towering stupidity, that you will lose brain cells thinking about them. As with the refugee narrative, nobody said crazy stuff like this until the migrants had already begun arriving on our shores. And there is another thing to notice about the multiculticult too. This is its blatant flippancy. The premise seems to be that migration is no big deal bro, but also too there are these cool exciting and totally random upsides, like improved local Ethiopian food offerings. It is the very definition of damning with faint praise.

The rest, sadly, is behind the paywall.

May 22, 2024

If you re-define it carefully, you can make any statistical measure look hopeful

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

In his Substack, Tim Worstall jokingly called this piece “Larry Summers Explains Why Americans Hate Joe Biden”:

As a good Democrat of course Larry Summers would never put things in quite that headline way. But the implication of this latest paper with others is to explain why Americans really aren’t as happy as they should be given the economic numbers. The answer being that the economic numbers we all look at to explain how happy folk are aren’t the right economic numbers to explain how happy people are.

We can also make — possibly rightly, possibly wrongly, this might be me projecting more than is merited — a further claim. That Americans simply aren’t as rich as those standard economic numbers suggest either. Which would also neatly explain the general down in the dumps attitude toward the economy.

So, the new paper:

    Unemployment is low and inflation is falling, but consumer sentiment remains depressed. This has confounded economists, who historically rely on these two variables to gauge how consumers feel about the economy. We propose that borrowing costs, which have grown at rates they had not reached in decades, do much to explain this gap. The cost of money is not currently included in traditional price indexes, indicating a disconnect between the measures favored by economists and the effective costs borne by consumers. We show that the lows in US consumer sentiment that cannot be explained by unemployment and official inflation are strongly correlated with borrowing costs and consumer credit supply. Concerns over borrowing costs, which have historically tracked the cost of money, are at their highest levels since the Volcker-era. We then develop alternative measures of inflation that include borrowing costs and can account for almost three quarters of the gap in US consumer sentiment in 2023. Global evidence shows that consumer sentiment gaps across countries are also strongly correlated with changes in interest rates. Proposed U.S.-specific factors do not find much supportive evidence abroad.

OK, or as explained by the Telegraph:

    In it, the authors made a shocking claim: if inflation was measured in the same way that it was measured during the last bout of price rises in the 1970s, data showed that it peaked at 18pc in November 2022. This is far higher than the 9.1pc peak inflation shown by the official data.

    The reason for this discrepancy is that, since the 1970s, economists have removed the cost of borrowing from the Consumer Price Index (CPI). The motivations here were not nefarious. The reasoning of the statisticians had something to it.

And, OK, if inflation peaked at 18%, not 9%, then that would explain why folk are pissed. Sure it would.

[…]

OK. But that means that if inflation was higher than we’ve been using then the deflation of nominal to real GDP is also wrong. Just that one year of 9% recorded but 18% by this new measure is damn near a 10% difference. That’s how much we’re over-estimating real GDP by right now. Add in a couple of years of lower levels of that and being 20% out wouldn’t surprise.

Which would mean that — if this were true and I might be overegging it — Americans are in fact 20% poorer than the Biden Admin keeps saying they are. And yes, that would piss the voters off, wouldn’t it?

Gaslighting has been a staple of the legacy media for quite some time now, going into high gear during the 2016 US Presidential elections and then into overdrive during the pandemic. They probably don’t even realize they’re doing it any more, because it feels “normal” to them. Yet they wonder why their popularity and public trust in their pronouncements continues to drop.

May 21, 2024

Idi Amin would have loved MMT

Filed under: Africa, Economics, History — Tags: , , , , , , — Nicholas @ 05:00

Jon Miltimore talks about the economic disaster of Idi Amin’s Uganda after Amin and his predecessor decided to nationalize most big businesses in the country and then to print money to cover the government shortfalls in revenue that resulted:

Ugandan dictator Idi Amin at the United Nations, October 1975.
Detail of a photo by Bernard Gotfryd via Wikimedia Commons.

Idi Amin (1923-2003) was one of the most ruthless and oppressive dictators of the 20th Century.

Many will remember Amin from the 2006 movie The Last King of Scotland, a historical drama that netted Forest Whitaker an Academy Award for Best Actor for his depiction of the Ugandan president.

While Western media often mocked Amin, who ruled Uganda from 1971 to 1979, as a self-aggrandizing buffoon, they tended to overlook the atrocities he inflicted on his people. He murdered an estimated 300,000 Ugandans, many of them in brutal fashion. One such victim is believed to be Amin’s fourth wife, Kay, whose body was found decapitated and dismembered in a car trunk in 1974, shortly after the couple divorced.

While historians and journalists have tended to focus on Amin’s dismal record on human rights, his economic policies are atrocities in their own right and also deserve attention.

A Brief History of Uganda

Uganda, a landlocked country in the eastern part of Central Africa, received its independence from the United Kingdom on Oct. 9, 1962 (though Queen Elizabeth remained the official head of state). The nation’s earliest years were turbulent.

Uganda was ruled by Dr. Apollo Milton Obote — first as prime minister and then as president — until January 1971, when an upstart general who had served in the British Colonial Army, Idi Amin Dada Oumee, seized control and set himself up as a dictator. (The coup was launched before Amin, a lavish spender, could be arrested for misappropriation of army funds.)

Among Amin’s first moves as dictator was to complete the nationalization of businesses that had begun under his predecessor Obote, who had announced an order allowing the state to assume a 60 percent stake in the nation’s top industries and banks. Obote’s announcement, The New York Times reported at the time, had resulted in a surge of capital flight and “brought new investment to a virtual stand still”. But instead of reversing the order, Amin cemented and expanded it, announcing he was taking a 49 percent stake in 11 additional companies.

Amin was just getting started, however. The following year he issued an order expelling some 50,000 Indians with British passports from the country, which had a devastating economic impact on the country.

“‘These Ugandan ‘Asians’ were entrepreneurial, talented and hard-working people, skilled in business, and they formed the backbone of the economy,” Madsen Pirie, President of the UK’s Adam Smith Institute, wrote in an article on Amin’s expulsion order. “However, Idi Amin favoured people from his own ethnic background, and arbitrarily expelled them anyway, giving their property and businesses to his cronies, who promptly ran them into the ground through incompetence and mismanagement.”

Even as he was nationalizing private industry and expelling Ugandan Asians, Amin was busy rapidly expanding the country’s public sector.

The Ugandan economy was soon in shambles. Amin’s financial advisors were naturally frightened to share this news with Amin, but in his book Talk of the Devil: Encounters With Seven Dictators, journalist Riccardo Orizio says one finance minister did just that, informing Amin “the government coffers were empty”.

The response from Amin is telling.

“Why [do] you ministers always come nagging to President Amin?” he said. “You are stupid. If we have no money, the solution is very simple: you should print more money.”

May 20, 2024

The first post-privacy generation in human history

Filed under: Economics, Liberty, Media, Technology, USA — Tags: , , , , — Nicholas @ 05:00

You may have mixed feelings about the Zoomers — even if you happen to be a Zoomer — but it’s beyond argument that they are the first generation who have grown up in a zero-privacy world:

“Privacy” by g4ll4is is licensed under CC BY 2.0 .

Zoomers are the first post-privacy generation in human existence. They will never know a world in which they can try to lose themselves without somehow being tracked. Roughly three years ago, I was speaking with the CEO and founder of a commercial digital advertising company from NYC. He told me that their technology was so powerful that they were able to figure out when people were getting up from their couches to go into another room simply via their own digital advertising software.

It’s very tough to wrap our heads around the complete loss of privacy. For me, I have trouble remembering how it was to be out of instantaneous reach via mobile phone. Pre-mass adoption of cell phones, people would effectively be out of reach i.e. disappear for hours at a time, as the only way to contact them was to call them at home (inb4 beepers, as I never had one). We are constantly tracked and monitored, and our personal data is sold by data brokers all over the globe. One customer of personal ad tracking data is the CIA, as Matthew Petti explains:

    For years, the U.S. government has bought information on private citizens from commercial data brokers. Now, for the first time ever, American spymasters are admitting that this data is sensitive—but they’re leaving it up to the spy agencies on how to use it.

    Last week, Director of National Intelligence (DNI) Avril Haines released a “Policy Framework for Commercially Available Information.” Her office oversees 18 agencies in the “intelligence community“, including the CIA, the FBI, the National Security Agency (NSA), and all military intelligence branches.

    In the 2018 case Carpenter v. United States, the Supreme Court ruled that police need a warrant to obtain mobile phone location data from phone companies. (During the case, the Reason Foundation filed an amicus brief against warrantless snooping.) As a workaround, the feds instead started buying data from third-party brokers.

    Haines’ new framework claims that “additional clarity” on the government’s policies will help protect Americans’ privacy. Yet the document is vague about the specific limits. It orders the agencies themselves to come up with “safeguards that are tailored to the sensitivity of the information” and write an annual report on how they use this data.

more:

    As national security journalist Spencer Ackerman points out in his Forever Wars newsletter, the framework doesn’t require the feds to delete old purchased data. Earlier this year, Sen. Ron Wyden (D–Ore.) called on the NSA to purge all data that it bought without a warrant and without following the Federal Trade Commission’s privacy policies.

    “The framework’s absence of clear rules about what commercially available information can and cannot be purchased by the intelligence community reinforces the need for Congress to pass legislation protecting the rights of Americans,” Wyden tells Reason. “The DNI’s framework is nonetheless an important step forward in starting to bring the intelligence community under a set of principles and policies, and in documenting all the various programs so that they can be overseen.”

Case in point:

    Wyden has been aggressively pushing for transparency on data purchases over the past few years. In 2021, he uncovered that the Defense Intelligence Agency was buying Americans’ smartphone location data. That same year, he sent a letter to Haines and CIA Director Bill Burns complaining about a secretive CIA data collection program. (In an Orwellian turn, the letter itself was classified until 2022.) This year, Wyden revealed more details on NSA data purchases.

    Some of this data is collected and sold directly by the apps. For example, an intelligence company called X-Mode once paid MuslimPro, an app that offers a daily prayer calendar and a compass pointing towards Mecca, to include a few lines of location tracking code. X-Mode then sold the data to U.S. government agencies. MuslimPro claims that it did not intend to sell the data to the government and ended the arrangement after the story broke.

So, yeah … app maker will sell your personal data to a buyer like the CIA.

    In other cases, the data is siphoned from advertising markets. Every time a user opens a website with paid advertisements, their location and attributes appear on a real-time bidding (RTB) exchange, a virtual auction where companies buy ad space. Data brokers posing as advertisers scrape the listings for information on users.

    “Any government with a halfway decent cyber intelligence program is participating in these RTB exchanges, because it’s such an immensely valuable source of data,” says Byron Tau, author of Means of Control: How the Hidden Alliance of Tech and Government Is Creating a New American Surveillance State.

    As a demonstration of how powerful RTB data is, an intelligence contractor used data from the dating app Grindr to track gay government employees from their offices to their homes, Tau reported in his book.

The IRS is in on it too:

    Lawyers for the Internal Revenue Service, on the other hand, have argued that users voluntarily handed over the information, so the government is free to use it. Tau points out that users don’t really know how their data is being resold, and even the RTB exchanges themselves aren’t supposed to be used for data scraping.

    “A lot of these companies that are collecting data from the global population don’t have a real consumer relationship” with the people they’re spying on, Tau says. “Unless you know how to decompile software and you’re technically savvy, you can’t even make informed choices.”

In an increasingly digitized world, the right to privacy becomes wholly unworkable. Think digital payments by way of credit and debit cards vs. cash.

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