Quotulatiousness

January 14, 2022

Industry with 1% profit margins accused of earning “record profits”

Filed under: Business, Economics, Media, Politics, USA — Tags: , , , — Nicholas @ 03:00

Joe Lancaster on Senator Elizabeth Warren’s renewed assault on the top-hatted, monocle-wearing robber barons of the grocery business:

“Piggly Wiggly” by afiler is licensed under CC BY-SA 2.0

… Warren could hardly have picked a worse industry to use as an example: Grocery stores consistently have among the lowest profit margins of any economic sector. According to data compiled this month by New York University finance professor Aswath Damodaran, the entire retail grocery industry currently averages barely more than 1 percent in net profit. In its most recent quarter, Kroger reported a profit margin of 0.75 percent, during a time in which Warren claims that the chain was “expanding profits” due to its “market dominance.”

In actuality, for much of the last year, grocery stores have seen enormous boosts in revenue, but not increased profitability, for the simple reason that everything has been costing more: not just products, but transportation, employee compensation, and all the extra logistical steps needed to adapt to shopping during a pandemic. Couple that with persistent inflation — which Warren also recently blamed on “price gouging” — and it is no wonder that things seem a bit out of balance.

Warren has had an itchy trigger finger for antitrust laws for some time. In 2019, as part of her presidential platform, she called for using the laws to forbid retailers from selling their own products. This would affect industry leaders like Amazon and Walmart, but ironically, it would have a devastating impact on grocery stores as well: Grocers increasingly rely on their own proprietary goods to stock cheaper alternatives alongside name brands. This provides not only less expensive options for consumers, but lower costs to the stores themselves. Store brands also help fill gaps created by external supply shortages.

January 12, 2022

QotD: Baumol’s cost disease in architecture and furniture

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

Remember, the Baumol effect [Wiki] happens when new technology makes some industries more productive. Since the high-tech industries are so lucrative, wages go up. Then low-tech industries have to raise their wages so that their workers don’t all desert them for the high-tech industries. But since low-tech industries aren’t improving their productivity, they just because more expensive, full stop.

If stonemasonry is a low-tech industry, and new high-tech industries are arising all around it, stonemason wages could get prohibitively high (compared to everything else) until nobody wants to hire them anymore. This would create pressure for architectural styles that require as little masonry (or, generalized, human labor) as possible.

This has gotten me thinking about furniture.

I got a new place recently and have been looking for furnishings. Sometimes I look at people’s furniture Pinterests. If Pinterest is any kind of representative window into the soul of the modern furniture-enthusiast, people really like Art Nouveau. […] As far as I can tell, you can’t buy any of these anywhere — they’re a combination of antiques and concept pieces. The people who pin these and pine after these end up getting minimalist Scandinavian furniture with names like UJLIBLÖK, just like everyone else.

Anything that even comes close to the above costs high four to five digits. I don’t know if this is because it’s antique, because it requires more labor, or both.

I’m harping on furniture because it avoids a lot of the complicating factors in architecture. There isn’t some vague collection of “elites” making our furniture decisions. It’s a pretty free market! There are lots of normal middle-class people spending big chunks of money on furniture, lots of them really really like the old stuff, and the old stuff is still either unavailable or unaffordable. It seems like it used to be affordable — it wasn’t just kings and dukes who had the old Art Nouveau stuff — but for some reason that’s changed. I think Baumol effects offer a tidy explanation here, and if we use them to explain furniture, then they start looking really attractive for architecture.

I want this one to be true, because it exonerates our civilization. If we could make things like the Art Nouveau furniture above, or the Taj Mahal, relatively cheaply and easily, then the question of why we aren’t doing that demands an answer. If it’s just a quirk of basic economics, then our civilization is fine, and maybe we can hope that stoneworking technology advances to the point where we can do this kind of thing again cheaply.

Scott Alexander, “Highlights From The Comments On Modern Architecture”, Astral Codex Ten, 2021-10-04.

January 6, 2022

QotD: The centre cannot hold … because there’s barely any “centre” remaining

… check out Kevin Drum’s analysis of asymmetric polarization these past few decades. He shows relentlessly that over the past few decades, it’s Democrats who have veered most decisively to the extremes on policy on cultural issues since the 1990s. Not Republicans. Democrats.

On immigration, Republicans have moved around five points to the right; the Democrats 35 points to the left. On abortion, Republicans who advocate a total ban have increased their numbers a couple of points since 1994; Democrats who favor legality in every instance has risen 20 points. On guns, the GOP has moved ten points right; Dems 20 points left.

It is also no accident that, as Drum notes and as David Shor has shown: “white academic theories of racism — and probably the whole woke movement in general — have turned off many moderate Black and Hispanic voters.” This is why even a huge economic boom may not be enough to keep the Democrats in power next year.

We are going through the greatest radicalization of the elites since the 1960s. This isn’t coming from the ground up. It’s being imposed ruthlessly from above, marshaled with a fusillade of constant MSM propaganda, and its victims are often the poor and the black and the brown.

Andrew Sullivan, “What Happened To You?”, The Weekly Dish, 2021-07-09.

January 2, 2022

Eat the bugs, peasants! Leave the meat for your betters!

Andrew Orlowski on the self-imagined elite attitudes to the environment and — as a direct result — the growing chorus of journalists pushing the idea of substituting plant-based synthetics and/or insects in place of meat for us proles:

In recent years, media messaging has been emphatically bossy about what we should eat. State micromanagement of taste has increased, too. After government intervention, British staples ranging from sticky-toffee pudding to Sugar Puffs have been reformulated beyond recognition. But the anti-meat crusade demands that something far more radical should happen – it seeks to stigmatise something central to many of our lives, and demands a shift in how we regard nature. As part of this, our media now seek to normalise lab-grown Frankenmeats, and strangest of all, adopt entomophagy – the practice of eating insects.

So what’s behind the war on meat? The apparent justification is the political elite’s great preoccupation of our time – climate change. We’re told that rearing livestock for meat is bad for the environment, and that cows are the worst offenders of all. That’s the assumption behind hit YouTube videos like Mark Rober’s “Feeding Bill Gates a fake burger (to save the world)”, a promotional video for Gates’ synthetic-meat investments, which has racked up nearly 46million views.

But the environmental argument doesn’t look so robust on closer examination. Agricultural CO2 emissions are small – so small that if the United States turned entirely vegan this decade, it would lower US emissions by just 2.6 per cent. In reality, a cow is a highly efficient protein-conversion system, turning protein that we can’t eat into protein that we love to eat. Three quarters of livestock, on balance, improve the environment, enhancing the yield of the land through fertiliser, which would otherwise need to be made synthetically. For example, one of the crimes regularly levelled against beef is water consumption. But the cow loses most of this water the same day – it’s returned to nature. So with environmental claims so weak, there must be some other rationale for the war on meat.

Much of today’s war on meat appears to be driven by venture capitalists, and their client journalists in the media. Ever eager for the next dot-com boom, Silicon Valley has made a bet on lab-grown, synthetic meat. This requires an industrial bioreactor – an expensive chemical process. But lab-grown meat doesn’t seem to be going anywhere. Business Insider recently reported that scepticism about the sector is growing, as costs remain higher than those for real meat – and this is before one single laboratory-meat formula has received regulatory approval, let alone passed the consumer test.

Another factor driving the war on meat is the academic blob. For example, Professor Peter Smith, an environmental scientist at Aberdeen University and a leading contributor to the UN’s Intergovernmental Panel on Climate Change (IPCC), likes to insist that “we’re not telling people to stop eating meat”, before adding that “it’s obvious that in the West we’re eating far too much”. Have a guess who defines what is “too much”. It’s Smith and his colleagues, not you or me making informed consumer choices.

But the oddest spectacle of all is the relentless promotion of entomophagy at the posh end of the media. The posher the paper, the keener they are on normalising bug-eating.

This is a campaign that has a high hurdle to overcome in most markets, where insects are associated with disease. “Deeply embedded in the Western psyche is a view of insects as dirty, disgusting and dangerous”, a group of academics found in 2014. Many bugs, such as cockroaches, carry disease. Flies like shit, as the saying goes. “Individuals vary in their sensitivity to disgust”, another academic paper acknowledges. “This sensitivity extends to three dimensions of disgust: core, animal reminder and contamination.” Only seven per cent of the US population would countenance the idea of eating insects, even in powdered form, according to one academic study in 2018. Processing insects also raises practical problems, with e-coli and salmonella. “Spore-forming bacteria and enterobacteriaceae have been reported in mealworms and crickets, with higher levels found in insects that had been crushed – likely due to the release of bacteria from the gut”, another study found. It’s easier to clean a cow’s stomach than a cockroach’s.

It should be no surprise, then, that the edible-insect movement has hit a few snags. Blythman recalls the startup, Eat Grub (geddit?), providing the snacks for an insect pop-up in London’s hipster East End. On the menu were “Thai-inspired” creations such as spicy cricket rice cakes and buffalo worms wrapped in betel leaf. “It tasted disgusting, and so I swallowed it whole. Then the legs stuck in my throat”, she recalls. The pop-up hasn’t returned. The following year, Sainsbury’s tapped Eat Grub for its first range of insect products – barbeque-flavoured crickets. Today, the only crickets you can buy at Sainsbury’s are cigarette lighters.

December 29, 2021

Theodore Dalrymple reviews the latest work from Thomas Piketty, Time for Socialism

Filed under: Books, Economics, Europe, France, Government — Tags: , , , , — Nicholas @ 03:00

Thomas Piketty has been a big name among progressives since his first book hit the bestseller lists, so the release of his latest work calls for some consideration from Theodore Dalrymple:

Piketty still writes clearly, though without much imaginative verve, and he has obviously consulted a lot of data. He is intelligent, knowledgeable, and decent, with a very firm grasp of unreality. He believes in a world in which economic levers act frictionlessly, or to borrow the description a doctor of my acquaintance has used with regard to his own medico-legal reports: “You turn the handle and the sausage comes out.”

There is no difference in his world between investment and expenditure. Thus, when he correctly ascribes low productivity in Britain to the low educational level of the general population (such that, in a predominantly service economy, much of it is unable even to answer the telephone properly or with reasonable courtesy), he ascribes it to lack of expenditure on education. If only this were the case! But lack of expenditure cannot possibly explain why about a fifth of children leave school barely literate. Incidentally, France seems to be progressing, if that is quite the word, in this direction.

We read that “Research in the social sciences, of which economics is an integral part, whatever some may think, is and always will be hesitant and imperfect. It is not designed to produce ready-made certainties … we have to examine patiently to endeavour to draw some provisional and uncertain lessons.” Amen to that! But modesty or tentativeness is not Professor Piketty’s main characteristic, nor does prudence once enter into his proposals.

There is no awareness that deterioration is possible as well as improvement, or of the fragility of things. Nothing counts for him but equality. He is to taxation policy what Le Corbusier was to architecture: he wants to prescribe (and proscribe) for the whole world. Above all, no variation! He would tell us how much we may possess, how much we may leave to our descendants or receive from our ancestors, how much we may earn in a year.

As an egalitarian and firm anti-nationalist, he does not explain why redistribution should stop at national borders. But try telling the average Frenchman that from now on he must forgo half his wealth in order to raise up Somalia or South Sudan! The book sometimes reads as if it were written by an electoral propagandist for Éric Zemmour, acting as an agent provocateur.

Uniformity is for him the price of unity (his countryman, Frédéric Bastiat, did not make the same mistake). He has little regard for, or even awareness of, the potential political consequences of some of his proposals. In his European Assembly, for example, which would have real power (unlike the current European Parliament), France, Spain, and Italy could and probably would outvote Germany with regard to economic policy. It does not occur to him that there could be few better ways of arousing dormant German nationalism than this. Nothing is certain, but much is possible; and while he mentions the internationalism of Jean-Luc Mélanchon, the left-wing French politician, he might also have mentioned that M. Mélenchon wrote a book about Germany and Germans that could easily have been written by a patriotic Frenchman in 1916.

Piketty is a strong believer in taxes as tools to make people more equal, and objects to the elimination of the wealth tax by the French government recently. Were he given the power, he would not only re-implement it, but vastly expand the taxes demanded of the wealthy.

[…] To all this, Professor Piketty has one sovereign remedy: tax the rich.

He thinks this is democratic because many, perhaps a majority, would vote for it. He has no problems with majoritarian democracy (provided the majority agrees with him): How can democracy be tyrannous? Thus, he sees no drawbacks in Senator Warren’s proposal to set a wealth tax and to provide — provide! — “an exit tax equal to 40% of total wealth for those who choose to leave the country and relinquish American citizenship.” Moreover, “the tax would apply to all assets, with no exemptions, with dissuasive sanctions for persons and governments who do not transmit appropriate information on assets held abroad.” Not only is this tyrannous with regard to individuals, but it is tyrannous with regard to international relations, providing a justification for American jurisdiction over the whole world. Needless to say, China, Russia, and India would never accept this, and might find allies. Conflict could become endless.

The answer to this little problem is obvious to Professor Piketty: a wealth tax worldwide, such that there would be nowhere for anyone to hide. There might be a few little teething problems with implementation — for example, who is to oversee it all — but think of the benefits: lie back and think of England! Professor Piketty has found the elixir of life, and it is taxation.

December 26, 2021

Repost – The market failure of Christmas

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

Not to encourage miserliness and general miserability at Christmastime, but here’s a realistic take on the deadweight loss of Christmas gift-giving:

Christmas gifts under the tree.
Photo by Kelvin Kay via Wikimedia Commons.

In strict economic terms, the most efficient gift is cold, hard cash, but exchanging equivalent sums of money lacks festive spirit and so people take their chance on the high street. This is where the market fails. Buyers have sub-optimal information about your wants and less incentive than you to maximise utility. They cannot always be sure that you do not already have the gift they have in mind, nor do they know if someone else is planning to give you the same thing. And since the joy is in the giving, they might be more interested in eliciting a fleeting sense of amusement when the present is opened than in providing lasting satisfaction. This is where Billy Bass comes in.

But note the reason for this inefficient spending. Resources are misallocated because one person has to decide what someone else wants without having the knowledge or incentive to spend as carefully as they would if buying for themselves. The market failure of Christmas is therefore an example of what happens when other people spend money on our behalf. The best person to buy things for you is you. Your friends and family might make a decent stab at it. Distant bureaucrats who have never met us — and who are spending other people’s money — perhaps can’t.

So when you open your presents next week and find yourself with another garish tie or an awful bottle of perfume, consider this: If your loved ones don’t know you well enough to make spending choices for you, what chance does the government have?

December 23, 2021

Repost — The lousy economics of gift-giving

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

Tim Worstall explains why gift-giving at Christmas is so economically inefficient:

Christmas gifts under the tree.
Photo by Kelvin Kay via Wikimedia Commons.

The point being made is dual, that individuals have agency and that utility is entirely personal.

To unravel that jargon.

Individuals, peeps, are able to make choices. We delight in making choices in fact, “agency” is the opposite of “anomie”, that feeling that society determines what we may or can do that so depresses the human spirits. We get to choose to get up at 6 am or 8. Have coffee or tea when we do. Go buy the latest platters from the newly popular beat combo, pay the ‘leccie bill or have the coffee out at an emporium.

Having choices, making them, makes people happier.

Secondly, utility. The result of those choices, which of them will maximise happiness, is different for each and every individual. Sure, we can aggregate some of them – food is usually pretty high up everyones’ list, that first litre of water a day tops most. But the higher up Maslow’s Pyramid we go the more tastes – and thus happiness devoured – differ.

So, we make humans happier by their having the choice to do what they want, not what others think they should want or have.

Thus, give people cash at Christmas not socks.

Balancing that is the obvious point that the care and attention with which a present is considered is part of that consumption of happiness. The boyfriend who actually listens to the type of clothing desired and goes gets it provides that joy that a bloke has, for once, been listening. Or the book that would never have been individually considered but was chosen because it might – and does.

Sure.

But the point isn’t about Christmas at all. That’s a way of wrapping the point so it can be left underneath the tree of knowledge.

December 18, 2021

King James and the search for ready cash

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

In the latest Age of Invention newsletter, Anton Howes outlines how and why England’s new Stuart king found himself in desperate financial straits very early in his reign:

King James I (of England) and VI (of Scotland)
Portrait by Daniel Myrtens, 1621 from the National Portrait Gallery via Wikimedia Commons.

… after a generous honeymoon period of about a year, he and his government soon discovered that they were leaking cash. Despite eliminating the costly wars in Spain and in Ireland, James still had to pay off the debts that his predecessor Elizabeth I had incurred in fighting them. And he had a more extensive, and expensive, royal family to support. He traded the one-off expenses of war for the ongoing expenses of a profligate court.

This may sound like a good deal. James effectively stopped the English Crown splashing out money on really big but infrequent expenses, while increasing its ongoing expenditure — like refraining from buying a new car every few years, while spending a lot more each month eating out at restaurants.

But the Crown’s sources of revenue were ill-suited to this change. The funding for wars had been voted to Elizabeth by Parliament, usually as and when the need arose. Such expenditures were matters of national interest, and she otherwise just relied on other sources of income — ongoing taxes like customs duties, or simply the rent from her lands. When the one-off “subsidies” granted to her by Parliament had not quite been sufficient to cover the costs of the wars, Elizabeth had made up the difference by keeping her own ongoing expenses as low as possible, and took out loans to fill any gaps. It also helped that in the years before crises, Elizabeth had tried to run a surplus, building up a war-chest of cash to dip into.

So switching to the new pattern of expenditure was not straightforward. To increase the Crown’s ongoing expenses, it would have to find more sources of ongoing income, especially as it was already in deficit and had loans to pay off. It was politically impossible for James to ask Parliament for extra one-off subsidies to help him bridge the gap, as some of Elizabeth’s subsidies from 1601 had yet to even be collected. He did actually test the waters about what would happen if he did ask, just in case, but when the matter was raised by some would-be sycophants, it was met with outrage. As one member of Parliament angrily put it, “we have no sheep that yields two fleeces in the year.”

The country was already feeling over-taxed, there were no looming crises to justify such extra taxation, and even if there were, such one-off measures would be unsustainable. James needed to find revenue streams to match his spending leak — and ideally, to even exceed it. His ministers fretted about getting the Crown back into surplus again, to build up another war-chest. Who knew when the next war or rebellion might arise.

So when James called his first Parliament in 1604, it was not really to ask for one-off subsidies as Elizabeth had so often done. Instead, he and his ministers focused on outlining a series of financial deals.

December 12, 2021

“Say what you will about Rand, nobody ever described her as a light read”

Filed under: Books, Economics, Liberty — Tags: , , , , — Nicholas @ 03:00

In Quillette, David Cohen notes that we’re coming up on the 40th anniversary of Ayn Rand’s death, which will almost certainly help expose her work to a renewed audience of disaffected teens and freshman university students:

More than a half-century ago the great — and, alas, irreplaceable — American scholar Allan Bloom became aware of the spell she could cast. He first started noticing it around the time he became aware of a decline in serious reading among his students. As the University of Chicago professor later recounted in The Closing of the American Mind, it became particularly evident whenever he asked his large introductory classes which authors and books really mattered to them. Most of the undergrads fell silent, he wrote, or else were puzzled by the question. There was generally no text to which they looked “for counsel, inspiration or joy,” he remarked. But one exception kept popping up.

There always seemed to be, he marvelled, a student who mentioned Atlas Shrugged, a work “although hardly literature, which, with its sub-Nietzschean assertiveness, excites somewhat eccentric youngsters to a new way of life.” And rather more of them than did Allan Bloom or, indeed, pretty much anyone else in the United States who has ever tried to hawk philosophy to the masses. Rand’s book sales overall stand at around 30 million, with hundreds of thousands more each year, and probably rather more this coming year.

Not only is she sought-after for her two best-known novels — the other being The Fountainhead — but also for her nonfiction. Her slim volumes of collected essays and old newspaper columns and other outtakes comprise an apparently fathomless vault from which the Ayn Rand Institute routinely cobbles together regular offerings for the lucky kids. One survey by the Library of Congress listed Atlas Shrugged as second only to the Bible in terms of campus popularity; an incredible accomplishment. All the more so in an era of Twitter, Facebook, and all the other intimations of the shortened attention-span. Say what you will about Rand, nobody ever described her as a light read.

A random internet search throws up an impressive litany of fans from the entertainment world, including Oliver Stone, Rob Lowe, Jim Carrey, and Sandra Bullock. Even the late professional wrestler James Hellwig, better known as The Ultimate Warrior, bellowed her praises, which might add some context to those rollickingly individualistic pre-fight interviews he used to do back in the WWE glory days. Oh, and let’s not forget Brad Pitt and Vince Vaughn. Which is particularly interesting, I think, since Jennifer Aniston (also a Rand fan) replaced the first with the second after Pitt ran off with Angelina Jolie, who’s also on record enthusing about Rand’s “very interesting” take on the good life.

In politics and economics, Rand had her youthful followers, too, and here again one sees the youth-appeal angle. Probably her best-known disciple is the former Federal Reserve chairman Alan Greenspan, who is rather ancient now. But back when dinosaurs still roamed the Earth, Greenspan declared that the high empress of the libertarian Right “taught me that capitalism is not only practical and efficient but also moral.” Like the young and philosophically restless undergrads in Allan Bloom’s classes, the British health secretary Sajid Javid also discovered her early on, and apparently still reads the courtroom scene in The Fountainhead every year. Or rather, as the cool libertarian kids in the black jeans might prefer to put it, it still reads him.

December 10, 2021

Shovel-ready infrastructure we’re already busy working on … the superhighway to serfdom

Jacob T. Levy considers the warning about authoritarian solutions to societal problems given by Friedrich A. Hayek in The Road to Serfdom and shows just how little we heeded his concerns:

It is well-known that the classical liberal economist F.A. Hayek dedicated The Road to Serfdom to “socialists of all parties”, and wrote the book “as a warning to the socialist intelligentsia of England.” I suspect we now understate the importance of these facts. After decades of the Cold War and self-conscious conservative-libertarian “fusionism” in both the U.S. and Britain, what sticks in our memory of The Road to Serfdom is its defense of liberal open markets against economic planning and regulation of the sort advocated on the left. That is of course how it was wielded in the post-2008 surge in interest in it, in the wake of the financial crisis and the subsequent bailouts and stimulus packages: as a weapon of the right.

But if Hayek’s argument characterized socialist planning and regulation as a slippery slope, the slope did not only slope down toward the left. Fascist Italy and Germany figure even more prominently than the USSR in the book’s image of the despotism being risked:

    It is necessary now to state the unpalatable truth that it is Germany whose fate we are now in some danger of repeating … students of the current of ideas can hardly fail to see that there is more than a superficial similarity between the trend of thought in Germany during and after [World War I] and the present current of ideas in the democracies … And at least nine out of every ten of the lessons which our most vociferous reformers are so anxious we should learn from this war are precisely lessons which the Germans did learn from the last war and which have done so much to produce the Nazi system … [A]t an interval of fifteen to twenty-five years we seem to follow the example of Germany.

In the face of resurgent right-wing populist and nationalist authoritarianism in the world, it is worth reconsidering the legacy of The Road to Serfdom and of Hayek’s work to bolster liberalism.

Hayek warned of centralizing and authoritarian urges of both the left and the right, but it’s in the “permanent” government — the civil servants who remain in office regardless of electoral outcomes — that much of the danger to individual liberty lies:

Throughout Hayek is concerned for constitutional parliamentary government and the rule of law, and their protection against arbitrary government. The idea that freedom requires clear and general rules of conduct anonymously applicable to all — that government run by ad hoc edict is oppressive — was to be the major theme of his subsequent works in political theory, The Constitution of Liberty and Law, Legislation, and Liberty; but it is central to the argument of Road to Serfdom as well.

In the preface to the 1956 edition, Hayek described the postwar Labour government as having created a bureaucratic “despotism exercised by a thoroughly conscientious and honest bureaucracy for what they sincerely believe is the good of the country. But it is nevertheless an arbitrary government, in practice free from parliamentary control; and its machinery would be as effective for any other than the beneficent purposes for which it is now used.”

Here one hears a predecessor of the widespread classical liberal “we told you so” after the election, blaming the Obama administration for increasing the presidential power that the Trump administration would now inherit. But it is worth emphasizing that Hayek still called the purposes pursued by the left-wing bureaucratic state “beneficent”.

The tone Hayek adopts here is not the schadenfreude of contemporary whataboutism. Now that “hot socialism is probably a thing of the past” (hardly what one would expect Hayek to say were he the determinist caricature sometimes embraced by fans as well as critics), the welfare state calls for “careful sorting out” in the pursuit of its “practical and laudable” aims. He calls for the welfare state and social insurance to be implemented through general rules and fiscal policy rather than administrative coercion, nationalization, and direct economic planning, because the latter instruments “are not compatible with the preservation of a free society.”

H/T to Tamara Keel for the link.

How WW2 Created a Welfare State – WW2 – On the Homefront 013

Filed under: Britain, Economics, Government, History, WW2 — Tags: , , , — Nicholas @ 04:00

World War Two
Published 9 Dec 2021

In predicament due to the extreme situation of war, people are in dire need for a working system of social security. Therefore, Beveridge is instructed by the British government to draw up a report on the state of the country´s insurance schemes. But in his opinion, a war is no time for patching up a collapsing system – and he is ready to make some waves.
(more…)

December 7, 2021

How are things going in Honduras?

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

For those not following the Honduran experiment with ZEDEs (las Zonas de Empleo y Desarrollo Económico — Zones for Employment and Economic Development) also known as “charter cities” or “model cities”, Scott Alexander provides a handy summary of the situation in the wake of the recent Honduran elections:

Honduras, Guatemala and El Salvador
Image via Google Maps.

The socialist opposition has won Honduras’ election and pledges to fight against charter cities there. “Immediately upon assuming the presidency, we are going to send the National Congress an initiative for the repeal of the ZEDE law,” incoming president Xiomara Castro said.

This was what everyone was afraid of. But the last party tried pretty hard to protect ZEDEs from trigger-happy successors, and the constitution currently says that the only way to get rid of them is to win two consecutive 2/3 votes to do so, then give the existing projects ten years to wind down.

Can the socialists get a 2/3 majority? Wikipedia predicts the incoming Honduran Congress will look like this:

Liberty and Refoundation (the socialists) will probably enter into a coalition with the Savior Party and have 65/128 seats for a bare majority. They need 86 votes for a 2/3 majority, which in theory they can get if the Liberal Party agrees. The Liberal Party seems centrist and hard to pin down, but this article includes the following great quote:

    “The Liberal Party opposes the ZEDEs because, above all, they undercut our national sovereignty, and because we don’t want them to become hideouts for extraditable criminals,” said [Liberal Party leader Yani] Rosenthal, who served a three-year prison sentence in the United States for money laundering and participating in a criminal scheme with the Los Cachiros cartel.

Rosenthal kind of goes back and forth elsewhere, but in the end I think he’ll vote with the socialists on this. Still, there’s some speculation that his party might not vote as a bloc, and even a few defectors would be enough to prevent a supermajority.

In theory, even if the socialists win two consecutive votes, they have to give the projects ten years to wind down. Ten years is forever in politics, and probably before then the capitalists will get back into power and say never mind, everyone can keep doing what they’re doing. The socialists are aware of this and say that their supplementary strategy is to have everything about the ZEDE law declared unconstitutional.

This should be a hard sell, because ZEDEs are a constitutional amendment, plus the current Supreme Court explicitly ruled a few years ago that they were constitutional. But apparently the Honduran Supreme Court can declare constitutional amendments unconstitutional if it really wants. And the new government will get to appoint a new Supreme Court in two years, and although the exact process is complicated, they may be able to get people who agree with them on this.

Also, incoming president Castro is married to Manuel Zelaya, a former president who tried to pull an Andrew Jackson after the Supreme Court ordered him to stop holding an illegal referendum to change term limits in his favor. He ordered the military to hold the referendum anyway, and was only ousted after the military couped him instead. So this is not exactly a family known for their deep respect for the exact wordings of laws or court rulings (not that anyone in Honduras has really excelled on that front). See further speculation eg here and here. And here’s Mark Lutter from Charter Cities Institute on the elections and the future.

QotD: The decline of class distinctions in Britain

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

After 1918 there began to appear something that had never existed in England before: people of indeterminate social class. In 1910 every human being in these islands could be “placed” in an instant by his clothes, manners and accent. That is no longer the case. Above all, it is not the case in the new townships that have developed as a result of cheap motor cars and the southward shift of industry. The place to look for the germs of the future England is in the light-industry areas and along the arterial roads. In Slough, Dagenham, Barnet, Letchworth, Hayes – everywhere, indeed, on the outskirts of great towns – the old pattern is gradually changing into something new. In those vast new wildernesses of glass and brick the sharp distinctions of the older kind of town, with its slums and mansions, or of the country, with its manor-houses and squalid cottages, no longer exist. There are wide gradations of income, but it is the same kind of life that is being lived at different levels, in labour-saving flats or council houses, along the concrete roads and in the naked democracy of the swimming-pools. It is a rather restless, cultureless life, centring round tinned food, Picture Post, the radio and the internal combustion engine. It is a civilization in which children grow up with an intimate knowledge of magnetoes and in complete ignorance of the Bible. To that civilization belong the people who are most at home in and most definitely of the modern world, the technicians and the higher-paid skilled workers, the airmen and their mechanics, the radio experts, film producers, popular journalists and industrial chemists. They are the indeterminate stratum at which the older class distinctions are beginning to break down.

This war, unless we are defeated, will wipe out most of the existing class privileges. There are every day fewer people who wish them to continue. Nor need we fear that as the pattern changes life in England will lose its peculiar flavour. The new red cities of Greater London are crude enough, but these things are only the rash that accompanies a change. In whatever shape England emerges from the war it will be deeply tinged with the characteristics that I have spoken of earlier. The intellectuals who hope to see it Russianized or Germanized will be disappointed. The gentleness, the hypocrisy, the thoughtlessness, the reverence for law and the hatred of uniforms will remain, along with the suet puddings and the misty skies. It needs some very great disaster, such as prolonged subjugation by a foreign enemy, to destroy a national culture. The Stock Exchange will be pulled down, the horse plough will give way to the tractor, the country houses will be turned into children’s holiday camps, the Eton and Harrow match will be forgotten, but England will still be England, an everlasting animal stretching into the future and the past, and, like all living things, having the power to change out of recognition and yet remain the same.

George Orwell, “The Lion And The Unicorn: Socialism and the English Genius”, 1941-02-19.

December 5, 2021

Will publishers move back to actually printing their own books?

Filed under: Books, Business, Economics — Tags: , , — Nicholas @ 03:00

In the latest SHuSH newsletter, Kenneth Whyte explains some of the issues publishers face in getting their books printed, as most publishers outsourced the actual physical work of printing and binding many years back:

Offset printing.
Image from Wikimedia Commons.

I had a serious conversation with another publisher this week about the need for publishers to start printing their own books.

Those familiar with publishing history will know that from the fifteenth to the nineteenth century, most publishers printed their own books. Ownership of a press, as much as anything, was what made a publisher a publisher. In the course of the twentieth century, it was decided that publishing books and printing books were different businesses. Virtually all publishers outsourced their printing to high-volume printing specialists who were constantly upgrading their equipment, and who, theoretically, at least, were better, faster, and cheaper than in-house printing operations.

[…]

Apart from that handful of artisans, today’s book publisher can no more operate a printing press than a backhoe. He or she outsources printing to specialists on a project-by-project basis.

The options for large-scale quality printing are increasingly scarce, thanks to a lot of consolidation in the printing business. Smaller shops (like the artisans) only do paperbacks; hardcovers require a lot of expensive binding equipment. If a publisher wants a big run of a hardcover title, the most likely printers are the industry giants: R.R. Donnelley (above) or CJK Group in the US; Friesens and Marquis in Canada. These companies all use huge offset web presses that are big as gymnasiums and only economically efficient at higher quantities (i.e., in the thousands). The technology involves metal plates and rubber mats and massive rolls of paper (if you’re interested, read more here) and the quality is first rate.

I should have said that the only options for a big run of hardcovers in Canada are Friesens in Altona, Manitoba and Marquis in Montmagny, Quebec. There are no hardcover printing options in Ontario, where so many publishers are concentrated (although Marquis does have a plant in Toronto).

[…]

The reason publishers are now talking about doing their own printing is that it is increasingly difficult to get time on any kind of press. Friesens, when Sutherland House started a few years ago, could usually do a job for us in eight weeks. There were seasons — the dead of winter, the height of summer — when they could deliver even faster and we’d get a discount because their presses weren’t especially busy. COVID-19 changed all that.

People have been buying more books during the pandemic, and publishers have been printing more. Friesens is now fully booked six to eight months out; its fall 2022 schedule is already crowded. The US printers we use as alternatives to Friesens are similarly backed up.

It’s making the decision to print in hardcover hazardous. It used to be that if you printed a few thousand copies of a new book in hardcover and it was in danger of selling out, you could get back on press in six to eight weeks, maybe less, and continue to fill orders. Now, if that original press run is selling fast, you might have to wait six to eight months to print a second edition. You’ll be out-of-print for most of that time, and all momentum will be lost. Some publishers are thus moving immediately to digital paperback formats (none of the digital printers have hardcover binderies) for their second editions, even if it’s only weeks into a book’s life. There is more availability at digital printers, so resorting to the digital paperback format allows you to keep your momentum.

November 25, 2021

History of Venice: Rise to Glory

Epic History TV
Published 14 Dec 2018

Listen to or download the music HERE: smarturl.it/epichistoryvenice
Music by https://www.musicdesigngroup.com

Thanks to Elias Tsiantas for the 3D Venetian galley footage
Thanks to Miłek Jakubiec for the Battle of Marignano image

Support the channel & get exclusive previews at Patreon:
https://www.patreon.com/epichistorytv

Want to learn more? We recommend A History of Venice by the late John Julius Norwich, a great popular historian on all things Mediterranean (as an Amazon Associate I earn from qualifying purchases): http://geni.us/7q71zx

#EpicHistoryTV #HistoryofVenice

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