Quotulatiousness

July 27, 2022

Baghdad Biden speaks

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

Chris Bray recounts the story of a local government attempting and — for a while — succeeding with the Baghdad Bob blanket denial strategy:

In the Deep Blue suburban town where I live, our city government has been stumbling through a series of crises. For a couple of years, employees fled from City Hall like the building was on fire, and nowhere was the crisis more acute than in the finance department — where we had five directors in a little over two years, and lost most of the other staff, including one who sued the city over her departure. There was a year when we couldn’t pass a budget, because the budget proposal was such a shambles, and a discussion at a meeting of an advisory commission in which a commissioner asked one of the many finance directors if the numbers in the city’s bank accounts matched the numbers in the city ledger. (Try to guess the answer.)

Recently, an ad hoc committee of local citizens — all finance professionals — wrote a report on the period of crisis, and presented our city council with a recommendation that they hire someone to do a forensic audit of the city’s accounting during those years. The council scheduled the report as a “receive and file” item, placing it on a 28-item agenda as, you’ll never guess, item #28. Then, in a brief discussion that began after midnight, they said that the report was nonsense and hearsay. The end.

So, yes, there was no financial crisis in our city during the years when we had five finance directors, when “permanent” finance directors left after a few months, when we lost most of the finance department staff, when we couldn’t pass a budget, and when we had no idea how much money we were actually supposed to have in the bank. Our city council says so. “These are not the ‘droids you are looking for.”

Meanwhile, we’re not in a recession, or even facing the risk of a recession, because that’s not Joe Biden’s view, and because the technical definition of a recession is very complicated.

Also, the inflation of 2021 was transitory. Zipped right by! Also, Joe Biden has a plan to shut down the virus.

The war in Ukraine is SHUT UP SHUT UP SHUT UP, the economy is SHUT UP SHUT UP SHUT UP, the continuing Covid-19 “emergency” is SHUT UP SHUT UP SHUT UP, and the mRNA injections are REALLY REALLY SHUT UP. Actually, the way experts measure this is really complicated, and technically …

July 5, 2022

Dijon mustard … made from Canadian and Ukrainian mustard seeds

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

In the New English Review, Theodore Dalrymple explains why Europeans have been experiencing higher shelf prices and shortages for Dijon mustard recently, over and above the ordinary supply chain disruptions of the pandemic years we’ve all had to get used to:

Among myriad smaller consequences of that war is an acute mustard shortage in France. Mustard has all but disappeared from supermarket shelves, having first increased in price dramatically. This has surprised everyone who lazily assumed that Dijon mustard came from Dijon. Why should a war waged in Ukraine lead to the disappearance of mustard throughout France? After all, the famous brands, familiar to everyone, proudly announce on their labels that they are Dijon mustard. Can there be anything more French than Dijon mustard?

Perhaps the mustard is elaborated in Dijon, but the mustard seed, it turns out to everyone’s surprise, is imported from Canada and Ukraine. Apparently, Canada has seen a disastrous harvest of mustard seed, while there is no need to explain the shortage in Ukraine. Dijon mustard is about as local to Dijon as a modern soccer team is local to the city in which it has its stadium.

What is striking about this mustard crisis, unimportant except to those trying to make a proper vinaigrette or lapin à la moutarde, is its revelation of a perennial aspect of social psychology: namely, a resort to conspiracy theory. For some say that there is not really any mustard shortage at all — that mustard has disappeared from supermarket shelves because the supermarket chains are hoarding it, that they have a plentiful supply in their warehouses and will release it little by little, thereby profiteering by the resultant high prices. The war in Ukraine is only a pretext.

This is an old, indeed medieval, trope in times of shortage. There may well have been times, of course, when people really did hoard for the purposes of profiteering, but people rarely hoard something that is in abundant supply.

Yet many people require no evidence or proof to believe in the hoarding story. Does it not, after all, stand to reason? Do not merchants try to maximize their profits, and is hoarding not an easy way to do so? Practically all the mustard in France is sold in supermarkets — themselves a cartel that could easily agree to remove the product from the shelves. Surely no further evidence is needed.

QotD: The Great Enrichment

Filed under: Economics, Europe, History, Liberty, Quotations — Tags: , , , — Nicholas @ 01:00

The explanation of the Great Enrichment is people. Paul Romer says so, as do a few others, among whom are some students I did not teach price theory to at the University of Chicago. On the other hand, Paul sets it down to economies of scale, which mysteriously drop down on England in the 18th century and gradually on us all. Yet China had peace, science, and enormous cities when Europeans were huddled in small groups inside town walls, or isolated villae.

In particular, it is ideas that people have for commercially tested betterment that matter. Consider alternating-current electricity, cardboard boxes, the little black dress, The Pill, cheap food, literacy, antibiotics, airplanes, steam engines, screw-making machines, railways, universities, cheap steel, sewers, plate glass, forward markets, universal literacy, running water, science, reinforced concrete, secret voting, bicycles, automobiles, limited access highways, free speech, washing machines, detergents, air conditioning, containerization, free trade, computers, the cloud, smart phones, and Bob Gordon’s favorite, window screens. …

And the Great Enrichment depended on the less famous [but] crucial multitudes of free lunches prepared by the alert worker and the liberated shopkeeper rushing about, each with her own little project for profit and pleasure. Sometimes, unexpectedly, the little projects became big projects, such as John Mackey’s one Whole Foods store in Austin, Texas resulting in 479 stores in the U.S. and the U.K., or Jim Walton’s one Walmart in Bentonville, Arkansas resulting in 11,718 stores worldwide.

Letting people “have a go” to implement such ideas for commercially tested betterment is the crux. It comes, in turn, from liberalism, Adam Smith’s “obvious and simple system of natural liberty”, “the liberal plan of [social] equality, [economic] liberty, and [legal] justice”. Liberalism permitted, encouraged, honored an ideology of “innovism” — a word preferable to the highly misleading word “capitalism,” with its erroneous suggestion that the modern world was and is initiated by piling up bricks and bachelors’ degrees.

Dierdre McCloskey, “How Growth Happens: Liberalism, Innovism, and the Great Enrichment (Preliminary version)” [PDF], 2018-11-29.

July 4, 2022

(Very expensive) roads, bridges, and railways to nowhere

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

In Palladium, Brian Balkus wonders why American can’t build anything any more:

Construction of the Fresno River Viaduct in January 2016. The bridge is the first permanent structure being constructed as part of California High-Speed Rail. The BNSF Railway bridge is visible in the background.
Photo by the California High-Speed Rail Authority via Wikimedia Commons.

Sepulveda’s cost and schedule overrun aren’t even the worst of it. Just as unattainable as a shortened commute is the Californian dream of building a bullet train that could take you from Los Angeles to San Francisco in under three hours. In 2008, a year before the Sepulveda project began, the state tried to turn this dream into a reality after voters approved a 512-mile high-speed rail (HSR) project. Amid failing overseas wars and financial crises, at the time it could’ve become a symbol of renewal not just for California but the entire country. Instead, it came to exemplify a dysfunctional government that lacks the capacity to build.

At the time California began accelerating the development of its HSR system it only had 10 employees dedicated to overseeing what was the most expensive infrastructure project in U.S. history. It ended up 14 years (and counting) behind schedule and $44 billion over budget. Incredibly, the state has not laid a single mile of track and it still lacks 10 percent of the land parcels it needs to do so. Half of the project still hasn’t achieved the environmental clearance needed to begin construction. The dream of a Japanese-style bullet train crisscrossing the state is now all but dead due to political opposition, litigation, and a lack of funding.

Despite its failure, the HSR project inaugurated the U.S.’s megaproject era. Once a rare type of project, by 2018 megaprojects comprised 33 percent of the value of all U.S. construction project starts. An alarming number of these have spiraled out of control for many of the same reasons that killed the California bullet train. The decade that followed the financial crisis was a kind of inflection point in the industry; this was when construction projects became noticeably worse and when the long-term implications could no longer be ignored. One of the most cited studies of the U.S.’s declining ability to build reviewed 180 transit megaprojects across the country, revealing that today, U.S. projects take longer to complete and cost nearly 50 percent more on average than those in Europe and Canada.

Having joined Kiewit in 2010, I witnessed these changes first-hand. I have since moved on, but have remained in the broader industry, including working on what are called “strategic pursuits” — the process by which companies compete for megaprojects. This experience has provided insight into the mechanics of how these projects are awarded and why they so frequently fail.

Even if the construction had proceded close to schedule, the economic justification for California’s high speed rail line was never strong … and it’s unlikely the service would have come close to breaking even. It almost certainly would have added significant ongoing costs to Californian taxpayers, and due to the nature of high speed rail services, been effectively a subsidy from working-class Californians to the laptop elites of Los Angeles and the San Francisco Bay area.

All of that, however, are merely additional reasons to believe the project was doomed from inception. Broadly speaking, all major infrastructure projects in the United States are struggling with paperwork and compliance requirements mostly driven by state and federal environmental regulations passed with the best possible intentions (as the saying goes):

Sepulveda’s numerous lawsuits and stakeholder conflicts are an example of a phenomenon that can be traced back to the passage of the National Environmental Policy Act (NEPA) in 1969. NEPA mandates developers to provide environmental impact statements before they can obtain the permits necessary for construction on huge swathes of infrastructure.

Shortly following the passage of NEPA, California’s then-governor Ronald Reagan signed the California Environmental Quality Act (CEQA) into law, which required additional environmental impact analysis. Unlike NEPA, it requires adopting all feasible measures to mitigate these impacts. Interest groups wield CEQA and NEPA like weapons. One study found that 85 percent of CEQA lawsuits were filed by groups with no history of environmental advocacy. The NIMBY attitude of these groups has crippled the ability of California to build anything. As California Governor Gavin Newsom succinctly put it, “NIMBYism is destroying the state”.

It is also destroying the U.S.’s ability to build nationally. The economist Eli Dourado reported in The New York Times that “per-mile spending on the Interstate System of Highways tripled between the 1960’s and 1980’s.” This directly correlates with the passage of NEPA. If anything, the problem has gotten worse over time. Projects receiving funding through the $837 billion stimulus plan passed by Congress in the aftermath of the financial crises were subject to over 192,000 NEPA reviews.

The NEPA/CEQA process incentivizes the public agencies to seek what is often termed a “bulletproof” environmental compliance document to head off future legal challenges. This takes time, with the average EIS taking 4.5 years to complete. Some have taken longer than a decade. A cottage industry of consultants is devoted to completing these documents, earning themselves millions in fees.

July 1, 2022

Trust “the experts”

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

Chris Bray on the appalling track record of so many of our modern-day “experts”:

So the public health experts are baffled by the consistent failure of their predictive models, and the economic experts are baffled by the consistent failure of their predictive models. It’s like a chef who keeps trying to grill a steak, only to find that he’s burnt another lemon pie. “I SWEAR TO GOD I THOUGHT THIS ONE WAS A BEEF THING.”

These people aren’t stupid, but they’re stupid in practice because they show up to the game with the weight of what they know people in their position are supposed to say and think. Fashionable experts, in-group leaders in their status-compliant position in a field, aren’t reviewing the evidence — ever — but are instead reviewing a performative checklist dotted with social status land mines.

They’re on a team, so they say the team slogans.

[…]

If that’s how expertise works, we no longer have have any. We have actors who play the brow-furrowing expert role, but have no real job beyond intoning the message of the day. It says on this card that we recommend even more Covid vaccines for everyone. Let’s break for lunch!

But, mercifully, that’s not invariably how expertise works. And this is why politicians and trend-policing media figures are so completely baffled by experts like Robert Malone or Ryan Cole, or Geert Vanden Bossche or Clare Craig or Peter McCullough, experts who follow the evidence wherever it goes. Tone and social reception tells you a lot: Does an expert say things that aren’t comforting, that sound a little … not on the team? That person clears the first barrier, and you can start assessing the specifics of what they say. Look for journalists who are offended and triggered, and try to find the person who hurt their feelings. That person may turn out to be wrong, but he won’t turn out to be Paul Krugman wrong.

QotD: The CBC doesn’t want to do economic journalism

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

[The] CBC’s attitude towards economics journalism is the same as a teenager’s attitude towards household chores: If they do it badly enough, they won’t be asked to do it again.

Stephen F. Gordon, Twitter, 2019-05-06.

June 28, 2022

QotD: The economic pie fallacy

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

A surprising number of people retain from childhood the idea that there is a fixed amount of wealth in the world. There is, in any normal family, a fixed amount of money at any moment. But that’s not the same thing.

When wealth is talked about in this context, it is often described as a pie. “You can’t make the pie larger,” say politicians. When you’re talking about the amount of money in one family’s bank account, or the amount available to a government from one year’s tax revenue, this is true. If one person gets more, someone else has to get less.

I can remember believing, as a child, that if a few rich people had all the money, it left less for everyone else. Many people seem to continue to believe something like this well into adulthood. This fallacy is usually there in the background when you hear someone talking about how x percent of the population have y percent of the wealth. If you plan to start a startup, then whether you realize it or not, you’re planning to disprove the Pie Fallacy.

What leads people astray here is the abstraction of money. Money is not wealth. It’s just something we use to move wealth around. So although there may be, in certain specific moments (like your family, this month) a fixed amount of money available to trade with other people for things you want, there is not a fixed amount of wealth in the world. You can make more wealth. Wealth has been getting created and destroyed (but on balance, created) for all of human history.

Suppose you own a beat-up old car. Instead of sitting on your butt next summer, you could spend the time restoring your car to pristine condition. In doing so you create wealth. The world is — and you specifically are — one pristine old car the richer. And not just in some metaphorical way. If you sell your car, you’ll get more for it.

In restoring your old car you have made yourself richer. You haven’t made anyone else poorer. So there is obviously not a fixed pie. And in fact, when you look at it this way, you wonder why anyone would think there was. *

Kids know, without knowing they know, that they can create wealth. If you need to give someone a present and don’t have any money, you make one. But kids are so bad at making things that they consider home-made presents to be a distinct, inferior, sort of thing to store-bought ones — a mere expression of the proverbial thought that counts. And indeed, the lumpy ashtrays we made for our parents did not have much of a resale market.

    * In the average car restoration you probably do make everyone else microscopically poorer, by doing a small amount of damage to the environment. While environmental costs should be taken into account, they don’t make wealth a zero-sum game. For example, if you repair a machine that’s broken because a part has come unscrewed, you create wealth with no environmental cost.

Paul Graham, “How to Make Wealth”, Paul Graham, 2004-04.

June 25, 2022

The Public Choice Model in … grand strategy?

Filed under: Books, Economics — Tags: , , , — Nicholas @ 05:00

One of the readers of Scott Alexander’s Astral Codex Ten has contributed a review of Public Choice Theory and the Illusion of Grand Strategy by Richard Hanania. This is one of perhaps a dozen or so anonymous reviews that Scott publishes every year with the readers voting for the best review and the names of the contributors withheld until after the voting is finished:

[In Public Choice Theory And The Illusion Of Grand Strategy], Richard Hanania details how a public choice model (imported from public choice theory in economics) can explain the United States’ incoherent foreign policy much better than the unitary actor model (imported from rational choice theory in economics) that underlies the illusion of American grand strategy in international relations (IR), in particular the dominant school of realism. As the subtitle “How Generals, Weapons Manufacturers, and Foreign Governments Shape American Foreign Policy” suggests, American foreign policy is driven by special interest groups, which results in millions of deaths for no good reason.

In the unitary actor model, the primary unit of analysis of inter-state relations is the state as a monolithic agent capable of making rational decisions (forming coherent, long-term “grand strategy”) from cost-benefit analysis based on preference ranking and expected “national interest” maximisation.

In the public choice model, small special-interest groups that reap a large proportion of the benefits from a policy (concentrated interests) are much more incentivised to lobby for a policy than the general public who pay for a negligible portion of the cost of the policy (diffused interests) are incentivised to lobby against. The former can coordinate much easier than the latter that has to overcome rational ignorance (the cost of educating oneself about foreign policy outweighs any benefit an one can expect to gain as individual citizens cannot affect foreign policy) and the society-wide collective action problem (irrational for every citizen to cooperate in the prisoner’s dilemma especially if individual gain is negligible) resulting in inefficient (not-public-good-maximising) policymaking i.e. government failure.

And more specifically on the use of Public Choice Theory:

Public choice theory was developed to understand domestic politics, but Hanania argues that public choice is actually even more useful in understanding foreign policy.

First, national defence is “the quintessential public good” in that the taxpayers who pay for “national security” compose a diffuse interest group, while those who profit from it form concentrated interests. This calls into question the assumption that American national security is directly proportional to its military spending (America spends more on defence than most of the rest of the world combined).

Second, the public is ignorant of foreign affairs, so those who control the flow of information have excess influence. Even politicians and bureaucrats are ignorant, for example most(!) counterterrorism officials — the chief of the FBI’s national security branch and a seven-term congressman then serving as the vice chairman of a House intelligence subcommittee, did not know the difference between Sunnis and Shiites. The same favoured interests exert influence at all levels of society, including at the top, for example intelligence agencies are discounted if they contradict what leaders think they know through personal contacts and publicly available material, as was the case in the run-up to the Iraq War.

Third, unlike policy areas like education, it is legitimate for governments to declare certain foreign affairs information to be classified i.e. the public has no right to know. Top officials leaking classified information to the press is normal practice, so they can be extremely selective in manipulating public knowledge.

Fourth, it’s difficult to know who possesses genuine expertise, so foreign policy discourse is prone to capture by special interests. History runs only once — the cause and effect in foreign policy are hard to generalise into measurable forecasts; as demonstrated by Tetlock’s superforecasters, geopolitical experts are worse than informed laymen at predicting world events. Unlike those who have fought the tobacco companies that denied the harms of smoking, or oil companies that denied global warming, the opponents of interventionists may never be able to muster evidence clear enough to win against those in power with special interests backing.

Hanania’s special interest groups are the usual suspects: government contractors (weapons manufacturers [1]), the national security establishment (the Pentagon [2]), and foreign governments [3] (not limited to electoral intervention).

What doesn’t have comparable influence is business interests as argued by IR theorists. Unlike weapons manufacturers, other business interests have to overcome the collective action problem, especially when some businesses benefit from protectionism. By interfering in a foreign state, the US may build a stable capitalist system propitious for multinationals, but can conversely cause a greater degree of instability and make it impossible to do business there; when business interests are unsure what the impact of a foreign policy will be for their bottom line, they should be more likely to focus their lobbying efforts elsewhere.

June 16, 2022

QotD: The Guardian and “capitalism”

Filed under: Britain, Economics, Humour, Media, Quotations — Tags: , — Nicholas @ 01:00

The displacement of responsibility is a Guardian staple, with society or capitalism (or “late capitalism”, or “neoliberalism” or whatever) being blamed for the columnist’s own hang-ups and incontinence. Tanya Gold did it two or three times during her time at the paper, as did Madeleine Bunting, Oliver James, VJD Smith and God knows how many others. Diane Abbott once claimed that capitalism is the reason she got fat, and still is.

It’s practically a rule. If a Guardian contributor drinks too much, eats too much, buys too many shoes … well, obviously, they’re the victim because consumerist peer pressure somehow made them do it against their will, such as it is. The premise is generally “capitalism made me fat”, followed by “capitalism made me anxious about being fat”, followed by “tax such-and-such to buggery, or ban it altogether, and then I’ll be thin”.

David Thompson, from the comments to “Reheated (55)”, DavidThompson.com, 2019-04-01.

June 15, 2022

QotD: The gobsmacking magnitude of “The Great Enrichment”

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

Serious growth happened only after 1800, at first in northwestern Europe, 2% per capita in PPP [purchasing power parity] conventionally adjusted for inflation, as in the USA 1800–present, and now the world. Its magnitude is enormous, the Great Enrichment. It was a rise from $2 or $3 a day to over $100, a factor of 30. (I recently had to explain to a justly famous anthropologist that [(30–1) / 1] x 100 is 2,900%, or about 3,000%. He said that he could believe a factor of 30 … but not 3,000%.)

The exactitude, of course, is inessential. In Japan and Finland it was roughly the factor of 30. But it could be the worldwide factor since 1800 of 10 only, about $2 or $3 to $30 a day (to $10,000 a year, the level of Brazil now, to fix ideas), and still be utterly novel. As a Brit might say, the Great Enrichment was gobsmacking.

The enrichment was actually much greater than the factor of 30, because price indices, especially recently, do not adequately reflect improvements in quality, as was determined in the early 1990s by the Boskin Commission … Consider your cell phone, your auto tires, your medical treatment — all greatly better, recently. Even economic facts and analyses are better. (Well, sometimes.) The downward bias from inadequately deflating money prices for improved quality is not far from 2% per year, which would double recent growth rates in the rich countries.

Its magnitude, novelty, recency, and location are all crucial to explaining the Great Enrichment, because together they strongly suggest that there was something deeply peculiar about Britain in the 18th century, and that afterwards the peculiarity spread to the rest of the world. Such facts make “run-up” theories such as in Stephen Broadberry et alii look implausible, because they depend on a metaphor of an airplane taking off, with little else by way of explanation for why the Industrial Revolution (a factor of 2) happened or, especially, its follow-on the Great Enrichment (a factor of 20 or 30). Likewise, it is dubious to attach the Great Enrichment to remote causes within Europe, such as the Black Death — which originated in China, with similar terrors, and yet yielded no Great Enrichment there. Also dubious is the Eurocentric belief, prominent in conservative circles, of some ancient superiority of melanin-challenged Volk back in the Black Forest. (Did you know, for example, that all European countries had common law in the Middle Ages, that is, judge-found-and-made, not legislated or codified?)

The Great Enrichment is the second most important secular event in human history, second only to the domestication of plants and animals making for cities and literacy.

Dierdre McCloskey, “How Growth Happens: Liberalism, Innovism, and the Great Enrichment (Preliminary version)” [PDF], 2018-11-29.

June 14, 2022

QotD: Generation snowflake

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

Think of all the traits and characteristics, most of them negative, associated with the Millennials in the popular mind. They are said to be unrealistic and have both the inflated expectations of life and the inflated perceptions of selves. They think the world owes them a living – a good one too – though without necessarily too much effort. Things came very easily to them when they were growing up; when that suddenly stops – when the reality finally intrudes – they get angry, frustrated, lost: the world is deeply unfair and is conspiring against them. They are narcissistic, self-possessed and self-obsessed. They expect instant rewards and instant gratification. Having been told their whole lives how special they are, they tend to be over-sensitive and find it difficult to cope with criticism or obstacles. They’re lazy, flighty and easily distracted. Remember: these are all generalisations, but stereotypes stick because they ring true.

So no, no surprises here. Their collective personality makes the Millennials unusually suited for the flirtation with socialism. They are a great match; if this was Tinder, Marx would be getting super liked all the time.

Socialism is the response of a spoiled child when faced with the world that does not genuflect to its every wish the way their parents did – the world as it is must therefore be evil and has to be changed to something radically different. Gen Y, of course, did not just magically became the way they are – they were brought up like that, so we all bear the blame and the responsibility for a generation who resents not being managers in their 20s and not being recognised as special anymore by all their elders. Clearly, the capitalism has failed when I’m not showered down with money after I graduate from my double in media and gender studies.

Arthur Chrenkoff, “Socialism as a Millennial religion”, The Daily Chrenk, 2019-02-19.

June 11, 2022

QotD: Modern disposable clothing

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

Rich Americans – or even middle-class Americans – excel at throwing things away, and the richer we become, the bigger the mounds of cast-off clothing swell. The Salvation Army at one time tried to sell all of the clothing in its stores or to give it away, but the supply now so far outstrips domestic demand that only a fraction of the clothing collected by the Salvation Army stays in the United States. There are nowhere near enough poor people in America to absorb the mountains of castoffs, even if they were given away.

Pietra Rivoli, The Travels of a T-Shirt in the Global Economy, 2015.

June 10, 2022

Don’t think of it as “Shrinkflation” … think of it as corporations helpfully trying to help you lose weight (at the same or higher prices)

Filed under: Business, Economics, USA — Tags: , — Nicholas @ 05:00

Companies have several different ways to cope with rising input prices, including just swallowing the increases without passing them on to consumers … stop laughing, I mean it’s at least theoretically possible, right? They can also just hike retail prices, which we’ve seen a fair bit of already, but that sometimes agitates consumers enough to materially depress sales. A sneakier way, which we’re also seeing a lot of, is to shrink the product but sell it for the same price. Sometimes, it will take a while for people to notice they’re getting less than they used to:

Original image from www.marpat.co.uk

The rise in consumer prices has rightly received a great deal of attention, as inflation hovers around 40-year highs. Everyone can see that virtually everything is getting more expensive, but fewer have noticed that many items are also getting smaller.

On Wednesday the Associated Press ran an article under the headline “No, you’re not imagining it — package sizes are shrinking.”

The AP spoke to one shopper, Alex Aspacher, who does a lot of shopping for his family of four in Ohio. He noticed he was still paying $9.99 for Swiss cheese even though the package had shrunk from a pound to 12 ounces.

“I was prepared for it to a degree, but there hasn’t been a limit to it so far,” Aspacher told the AP. “I hope we find that ceiling pretty soon.”

This phenomenon — known as “shrinkflation” — is nothing new, of course. It’s just more pronounced now than in any time in recent memory because inflation is much higher.

But what exactly is shrinkflation? As economist Peter Jacobsen explained last year, it’s simply a different kind of inflation.

“Shrinkflation is a form of inflation because you’d have to spend more money to get the same quantity or quality as you did in a previous year,” he explained. “The prices have remained the same, but the products are worse.”

The only difference is, instead of raising the price of an item or service, businesses are reducing the quantity or quality of it while keeping the price the same.

Edgar Dworsky, a consumer advocate who has tracked shrinkflation for decades, told the AP shrinkflation is rampant at the moment because of the underlying economic conditions.

“It comes in waves,” said Dworsky. “We happen to be in a tidal wave at the moment because of inflation.”

June 4, 2022

Bill C-18 might as well be called the “Keep legacy media alive at all costs, even if nobody wants it anymore” act

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

The Line‘s Jen Gerson lays out the case against the federal government’s plans for permanent corporate welfare for the big Canadian legacy media organizations:

How Jen Gerson might visualize Torstar and Postmedia during the lobbying effort for Bill C-18.
“Zombie nuns” by Michael Cavén is licensed under CC BY-NC-SA 2.0

This week, The Line signed on to a campaign put together by a coalition of independent media publishers calling for amendments to the panda trash fodder piece of legislation known as C-18. To be fair, I mostly signed on; my co-founder Matt Gurney had some reservations, and I figured it would be best to hash them out in full here.

The bill is a hot mess created by a clearly well-intentioned government that appears to have been bamboozled by a group of media industry lobbyists helmed by organizations like Postmedia and Torstar — companies that despite extraordinary history and resources have largely failed to sustainably transition to a digital media environment. These large outlets are now using the last of their dying power and influence to champion legislation that will force big technology companies like Facebook and Google to compensate them for linking to their content.

This is a straightforward case of regulatory capture, the very thing we would condemn in any other industry; big media companies are using their credibility and political power to pressure the government into forcing “Big Tech” to sustain their dying business models — the very “Big Tech” that they’ve spent years deriding and defaming in their very own newspapers and outlets.

This whole process is corrupt. I don’t say that lightly. Perhaps inevitably, I’ve grown totally disillusioned with the industry to which I have devoted all of my adult life. We used to consider journalism a calling or a vocation — manipulative terms that justified the low pay, harassment, and sometimes abusive management. How can the church of journalism and its holy mandate to preserve democracy continue to take itself seriously when the very catechism of the craft are nowhere present in its own self-created lobbying arm, New Media Canada?

I think the leaders of this initiative have convinced themselves that the business model they enjoyed in the ’80s and ’90s is so totally central to the survival of democracy and liberal values that they’ve committed to keeping it afloat by any means necessary regardless of the ethical and philosophical cost. In doing so, I believe that they’re only ensuring their own failure.

By driving legislation in this way, they are not proving their worth to the broader public. Rather, they are conceding that what they produce has so little value that they need to evolve into parasites of the state. It demonstrates that commitment to democracy and accountability is secondary to their primary functions; running a business. They have stockholders to please and interest on loans to pay. Big loans.

Meanwhile, the legacy media they have managed is little more than a zombie in nun’s drag. It is in a state of terminal decline, and keeping it alive poisons the earth for the generations to come after.

June 2, 2022

“Like many problems in American history, recycling began as a moral panic”

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

Jon Miltimore recounts the seminal event that kicked off the recycling pseudo-religion in North America:

The frenzy began in the spring of 1987 when a massive barge carrying more than 3,000 tons of garbage — the Mobro 4000 — was turned away from a North Carolina port because rumor had it the barge was carrying toxic waste. (It wasn’t.)

“Thus began one of the biggest garbage sagas in modern history,” Vice News reported in a feature published a quarter-century later, “a picaresque journey of a small boat overflowing with stuff no one wanted, a flotilla of waste, a trashier version of the Flying Dutchman, that ghost ship doomed to never make port.”

The Mobro was simply seeking a landfill to dump the garbage, but everywhere the barge went it was turned away. After North Carolina, the captain tried Louisiana. Nope. Then the Mobro tried Belize, then Mexico, then the Bahamas. No dice.

“The Mobro ended up spending six months at sea trying to find a place that would take its trash,” Kite & Key Media notes.

America became obsessed with the story. In 1987 there was no Netflix, smartphones, or Twitter, so apparently everyone just decided to watch this barge carrying tons of trash for entertainment. The Mobro became, in the words of Vice, “the most watched load of garbage in the memory of man.”

The Mobro also became perhaps the most consequential load of garbage in history.

“The Mobro had two big and related effects,” Kite & Key Media explains. “First, the media reporting around it convinced Americans that we were running out of landfill space to dispose of our trash. Second, it convinced them the solution was recycling.”

Neither claim, however, was true.

The idea that the US was running out of landfill space is a myth. The urban legend likely stems from the consolidation of landfills in the 1980s, which saw many waste depots retired because they were small and inefficient, not because of a national shortage. In fact, researchers estimate that if you take just the land the US uses for grazing in the Great Plains region, and use one-tenth of one percent of it, you’d have enough space for America’s garbage for the next thousand years. (This is not to say that regional problems do not exist, Slate points out.

The widespread imposition of recycling mandates across North America was probably an inevitable reaction to the voyage of the Mobro. For many people, this was the end of the story, as things that were previously just buried in landfill sites would now be safely and efficiently put back into the economy as re-used, re-purposed, or actual recycled products. Win-win, right?

Sadly, the economic case for recycling many items is weak to non-existant. The demand for recycled materials was lower than predicted and often only maintained through subsidies and hidden incentives that couldn’t last forever. Once the incentives went away, so did much of the created demand. Worse, the way a lot of the stream of recyclable materials was handled was by shipping it off to China or certain developing nations — in effect, paying them to take the problem off the hands of western governments. This resulted in even more problems:

Americans who’ve spent the last few decades recycling might think their hands are clean. Alas, they are not. As the Sierra Club noted in 2019, for decades Americans’ recycling bins have held “a dirty secret”.

“Half the plastic and much of the paper you put into it did not go to your local recycling center. Instead, it was stuffed onto giant container ships and sold to China,” journalist Edward Humes wrote. “There, the dirty bales of mixed paper and plastic were processed under the laxest of environmental controls. Much of it was simply dumped, washing down rivers to feed the crisis of ocean plastic pollution.”

It’s almost too hard to believe. We paid China to take our recycled trash. China used some and dumped the rest. All that washing, rinsing, and packaging of recyclables Americans were doing for decades — and much of it was simply being thrown into the water instead of into the ground.

The gig was up in 2017 when China announced they were done taking the world’s garbage through its oddly-named program, Operation National Sword. This made recycling much more expensive, which is why hundreds of cities began to scrap and scale back operations.

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