One of David Ricardo’s foundational assertions was the law of one price. That tradeable goods will cost the same, when their transport costs are included, in different places. The insight being that if they weren’t then people would buy in one, sell in the other, thereby equalising prices. A reasonable corollary to this idea is that exchange rates should move based upon purchasing parity or interest rate parity. The second is because people can move their money, just like anything else, to arbitrage between prices – here, the interest rate. The other because, well, that’s what arbitrage will do, equalise those PPP exchange rates. Not wholly, not perfectly, but roughly enough.
Tim Worstall, “Ricardo Still Right 201 Years Later”, Continental Telegraph, 2018-11-01.
April 18, 2021
QotD: Two centuries on, Ricardo still right
April 17, 2021
Considering the costs and benefits of extreme specialization
In the latest post on Matt Gurney’s Code 47 Substack blog, he considers the trade-off between population density and the range of specialization that can be supported at various densities:
“Model A Ford in front of Gilmore’s historic Shell gas station” by Corvair Owner is licensed under CC BY-SA 2.0
I wish I remembered where I read this. It was a book I was blowing through for a university paper; only one chapter was really of interest to me when I was trawling for footnotes but I stumbled upon an interesting section that talked about services and specialization in a modern economy. The author offered a simple explanation of service specialization that I’ve never forgotten. Imagine a village with 100 people, the author said. Now imagine what services are available there. There’s probably a gas station, and maybe you can get a few services done to your car there, too. Basic repairs. Tire rotations. Oil changes. Things like that. There’s probably also a convenience store, and the store might also have a place to send or receive mail, or maybe even to rent a movie. (Back when that was a thing we did.) You might have a coffee shop of some kind, maybe a diner. But that’s marginal. You almost certainly don’t have a school, full post office, bank branch or medical centre of any kind. Not in a village of 100 people.
When you itemize out all the services you can get, it’s probably about five or maybe 10 — gas pumped, tires changed, oil changed, basic engine repairs, store clerk, movie rental, mail sent and received. Maybe someone to pour you a cup of coffee and get you a sandwich — but only maybe. The point isn’t to be precise in our list or count, but just to contemplate the relationship between the population and the number and type of available services.
Now scale that village up 10 fold, the author said. Now it’s a town of 1,000. The number of services explodes. You still have everything you did before. But now you’ve also got specialized shops, restaurants, a bank or two (and all the services they provide), probably a house of worship, medical services of various kinds (including eye care, dentistry, etc), personal-care services, better access to home and lawn care, various repair and maintenance service, technical services, a post office … the list goes on. You also start to see competition and the efficiency that brings — our village of 100 would have a gas station and a convenience store (quite possibly at the same location!). But our town of 1,000 would have a few of each. You’d get more services, and start to see prices dropping for the commonly available offerings.
You get the idea — the more you scale up a population, the more specialized services that are available and the more accessible they become. And this includes not just categories of service, but also increasing degrees of specialization. Our village of 100 probably has no full-time doctor. Our town of 1,000 probably has a family physician. But after we bump things up to 10,000, 100,000 and then a million people, we’re getting not just doctors, but highly trained, specialized physicians, surgeons and diagnosticians. Our town of 1,000 has a dentist, but our city of a million has dental surgeons who’ve specialized in repairing specific kinds of trauma and injury.
Anyway. I don’t remember what book this was from. But I do remember this short section. I think about it a lot. We Canadians of 2021 are, for the most part, hyper-specialized. I’ve written columns about this before, including this one from 2019, which I’m going to quote liberally below:
Human history is, in one simplified viewing, the story of specialization. As our technology advanced, a smaller and smaller share of the labour pool was required just to keep everyone alive. Perhaps the easiest way to summarize this is to note that 150 years ago, even in the most advanced industrial countries, something close to 50 per cent of the population was directly engaged in agriculture — half the people tilled fields so the other half could eat. Today, in both Canada and the United States, it’s closer to two per cent — one person’s efforts feed 49 others. Those 49 can pursue any of the thousands of specialized jobs that allow our technological civilization to exist. … Those 49 people are our artists and doctors and scientists and teachers. Human advancement depends on this — a civilization that’s scrambling to feed itself doesn’t build particle colliders or invent new neonatal surgeries and cancer-stopping wonderdrugs.
I stand by those remarks. But I’ve been pondering them of late with a different perspective. I’ve spent much of this week talking with doctors and medical experts in Ontario, where the third wave of COVID-19 is threatening to overwhelm the health-care system, with tragic results. And one recurring theme that comes up in these conversations is how this disaster is going to take place almost entirely out of public view. There won’t be any general mobilizations or widespread damage. People are going to die, behind closed doors or tent flaps, and other people will be forever scarred by their inability to save those people. But for most of us — those who aren’t sick, or highly specialized medical professionals — life is going to be something reasonably close to normal.
April 15, 2021
QotD: The “evil” of profits
Ludwig von Mises, Planned Chaos, 1947.
April 12, 2021
“War Communism” in the Soviet Union, 1917-1921
J.W. Rich outlines the economic and humanitarian disaster of Soviet “War Communism” that eventually forced Lenin to bring back some limited elements of capitalism to save the country:
In 1917, the Bolsheviks seized power in Moscow after the deposition of the democratic provisional government which had replaced the Tsar. However, the Bolsheviks’ hold on power was far from secure. There was little affection anywhere for the Tsar, but there was no agreement on what form of government should replace the monarchy. Bolshevism had been on the rise for years, but ideas of democracy and liberalism were gaining popularity as well. Shortly after the 1917 revolution, the Russian Civil War broke out between the Reds, the Bolsheviks, and the Whites, a coalition of anti-Bolsheviks that were generally democratic.
Through the course of the civil war, the Bolsheviks gained more power and control over increasingly large amounts of Russia. With this control, they began to implement their Marxist economic ideas into reality. On January 28, 1918, it was decreed that all factories should be directed by state-appointed managers. In effect, this amounted to a near-complete nationalization of industry. In one fell swoop, the vast majority of the production of Russia’s consumer goods was now under the purview and direction of the state.
On May 9, 1918, a grain monopoly was announced over grain production in the country. All grain harvested across the country was now the property of the state. This was extended even further when a general food levy was announced in January 1919. Any and all food was now the property of the state. In addition, local farm authorities were no longer allowed to set the levy based on harvest estimates. In essence, the state would take however much it wanted from the peasants without any concern if they had enough food to feed themselves and their families.
It was at this point that large-scale forced rationing was introduced. Money was made worthless overnight as ration cards were mandated to the entire population. No longer could you buy whatever you wished with the money you had. The goods allocated for you were predetermined on your ration card.
By late 1920, going into 1921, the Russian Civil War was all but over. The Whites had been soundly defeated by the Reds, giving the Bolsheviks control of nearly the entirety of the country. However, despite the victory in the Civil War, the economy at home was beginning to fall apart. Industrial production was at 20% of pre-war levels by 1920. As a result of this lagging production, there were few goods in the cities available. This resulted in a flight from the cities to the countryside. From 1918 to 1920, eight million people emigrated from the cities to the villages, where there was better hope of finding food or some goods. In Moscow and Petrograd, the population declined by 58.2%
The agricultural situation was not much better. Sheldon Richman records that from 1909-1913, gross agricultural output averaged 69 million tons. By 1921, it was just 31 million. From 1909-1913, sown area was over 224 million acres. In 1921, only 158 million acres were sown. This lack of food resulted in a mass loss of population. From 1917 to 1922, the entire population declined by 16 million, not counting immigration and deaths from the civil war.
War Communism was now fully implemented and the Marxist aspirations of Lenin and the Bolsheviks were now fulfilled. For the people that had to live under War Communism, however, the conditions had become intolerable. In February 1921, labor strikes began to emerge all over Russia. With the end of the civil war and living standards continuing to fall, resistance to the Bolsheviks began to spread throughout the country. Moscow was the first city to strike, with other large cities, such as Petrograd, following. The protestors demanded an end to War Communism and a restoration of private enterprise and civil liberties, such as the freedom of speech and assembly.
The protests escalated when the Kronstadt Naval Base mutinied against the government. Once a bastion of Bolshevik support and fervor, the sailors joined with the laborers in demanding reform and change. A force led by Trotsky was dispatched to deal with the mutiny, but Lenin knew that change was needed. The writing was on the wall for War Communism.
QotD: Four lessons on free trade
Below are the lessons, taken almost entirely verbatim from the bank’s online lesson (except where I’ve provided a bit of additional description). It’s a terrific lesson and all within a mere 1,400 words and a short video.
Lesson 1: All parties reap the rewards of free trade.
Specialization means focusing on what each country produces most efficiently and trading for the rest. And because specialization is more efficient, it creates more wealth than if each country tried to do it all on its own. International trade is no different from domestic specialization and internal trade — few of us grow our own food or do our own dry cleaning. Instead, we specialize and trade. The lesson includes a short cartoon video featuring “Mark and Lucy” — aimed at kids but worth a presidential view — that explains the concepts of comparative advantage and opportunity costs.
Lesson 2: Trade protectionism makes everyone worse off.
While freer trade — in both exports and imports — makes us better off, the opposite is also true. Barriers to free trade, such as tariffs, have a negative impact on our economic well being.
Lesson 3: The pie isn’t divided equally.
Freer trade has raised incomes across the global economy, but it has not benefited everyone. Countries engaged in free trade are better off overall, but some sectors and communities within countries have suffered. Governments have used policies such as ongoing learning and retraining programs to help affected workers adjust. This a better approach than shrinking the pie through trade protection. That would be worse for everyone.
Lesson 4: Trade deficits and surpluses are not a scorecard.
It’s important to debunk the myth that cheap imports are the cause of all the pain and that a trade deficit with another country is a bad thing. Looking at trade balances between a country and its trade partners, we should expect to see surpluses with some and deficits with others. This is specialization in action.
Terence Corcoran, “Amazing! Canada has one government department that actually comprehends free trade!”, Financial Post, 2018-10-04.
March 30, 2021
QotD: Static societies and disruptive outsiders
Stable societies with unchanged boundaries, Olson observed, “tend to accumulate more collusions and organizations for collective action over time.” Instead of accepting rules that encourage overall growth, these collusive organizations — trade groups and labor unions were paradigmatic examples — fight to keep what they have, slowing down “a society’s capacity to adopt new technologies and to reallocate resources in response to changing conditions,” thus reducing economic efficiency. Decline follows.
Olson pointed to Japanese stagnation under the Tokugawa shogunate, when, “before Admiral Perry’s gunboats appeared in 1854, the Japanese were virtually closed off from the international economy.” Ruling Japanese society, he writes, “were any number of powerful za, or guilds, and the shogunate or the daimyo often strengthened them by selling them monopoly rights.” The guilds “fixed prices, restricted production and controlled entry in essentially the same way as cartelistic organization elsewhere.”
A second example: Great Britain, “the major nation with the longest immunity from dictatorship, invasion and revolution” and, consequently, Olson explained, suffering “this century a lower rate of growth than other large, developed democracies.” In Olson’s view, the weak performance resulted from limits on change established by a “powerful network of special-interest organizations,” which included labor unions, industrial groups, and aristocratic cliques. By the 1970s, after the conservative government of Edward Heath fell in a losing battle with striking miners, many deemed Britain ungovernable. Olson contrasted the British situation with that of postwar Germany and Japan, where the chaos and destruction of wartime defeat wiped away established industrial and retail groups, leaving the field open to newcomers like Soichiro Honda or the Albrecht family (creators of international supermarket giant Aldi), who could work economic magic.
The word “ungovernable” was also used to describe New York in the 1960s and 1970s, when Mike Quill’s transit union ran roughshod over Mayor John Lindsay’s attempts to control public-sector wage growth. New York was a long-established city with lots of political collusion. The old Tammany Hall could broker deals to keep Gotham going, but Lindsay’s successor, Abe Beame, proved too weak to resist any special interest that wanted more spending or government favors. New York’s spending kept rising even as public services worsened, until bankruptcy loomed and public power wound up in the hands of the unelected Municipal Assistance Corporation. Thankfully, New York reformed itself economically, at least to some extent, under Mayors Rudolph Giuliani and Michael Bloomberg, as Britain did under Prime Minister Margaret Thatcher. Sufficiently strong leaders can buck entrenched insiders.
Edward L. Glaeser, “How to Fix American Capitalism”, City Journal, 2020-12-13.
March 22, 2021
Happy 75th anniversary to the Foundation for Economic Education
The Foundation for Economic Education was founded by Leonard E. Read in 1946:
This month marks the 75th anniversary of the Foundation for Economic Education. As I have benefitted from reading FEE’s literature for nearly two thirds of that time and contributed to it for decades, I feel that it is definitely worth celebrating.
This year is also the 50th anniversary of Then Truth Will Out, by Leonard Read, FEE’s founder, which he wrote involved “An assessment of position on the freedom road after passing the 25th milestone at FEE.”
That sort of compound anniversary — 25th, 50th and 75th rolled into one — suggests that we might profit from a look back at “the freedom road” with Then Truth Will Out.
I think it is one of Read’s best books, as attested to by the fact that four of the chapters in my Apostle of Peace, which discusses what I consider some of his best sustained arguments, derive from it. But in looking at the book now, I have been most struck by its opening chapter, “A Confession of Faith.”
- Perhaps the clearest way to identify one’s politico-economic position — at least in broad outline — is to reveal his idea of the ideal, that is, what he means by civilization or by a civilized people.
- To me, civilization can mean nothing less than a society of civilized people. So how is a civilized person to be identified?
- A civilized person, according to my ideal, must recognize that man is at once a social and an individualistic being.
- Thus, he must not only be self-responsible but, at the same time, understand that he owes to others no infringements on their rights.
- In a word, the truly civilized person is a devotee of freedom; he opposes all man-concocted restraints against the release of creative human energy.
- The civilized person realizes how incorrect it is to think of freedom as synonymous with unrestrained action.
- Freedom does not and cannot include any action, regardless of sponsorship, which lessens the freedom of a single human being. To argue contrarily is to claim that freedom can be composed of freedom negations, patently absurd.
- Unrestraint carried to the point of impairing the freedom of others is the exercise of license, not freedom. To minimize the exercise of license is to maximize the area of freedom.
- In order to achieve this ideal, it is necessary that there be an agency of society — representative of the social side of man — which codifies the thou-shalt-nots, the taboos, the destructive actions and enforces their observation.
- The fact that society’s agency — government — has a historical record of getting out of hand, of becoming destructive itself, only testifies to how far from civilized we are. It does not warrant discarding the idea of the ideal; it does not justify anarchy.
March 19, 2021
QotD: English food
Maybe the first question is how English cooking got to be so bad in the first place. A good guess is that the country’s early industrialization and urbanization was the culprit. Millions of people moved rapidly off the land and away from access to traditional ingredients. Worse, they did so at a time when the technology of urban food supply was still primitive: Victorian London already had well over a million people, but most of its food came in by horse-drawn barge. And so ordinary people, and even the middle classes, were forced into a cuisine based on canned goods (mushy peas!), preserved meats (hence those pies), and root vegetables that didn’t need refrigeration (e.g. potatoes, which explain the chips).
But why did the food stay so bad after refrigerated railroad cars and ships, frozen foods (better than canned, anyway), and eventually air-freight deliveries of fresh fish and vegetables had become available? Now we’re talking about economics — and about the limits of conventional economic theory. For the answer is surely that by the time it became possible for urban Britons to eat decently, they no longer knew the difference. The appreciation of good food is, quite literally, an acquired taste — but because your typical Englishman, circa, say, 1975, had never had a really good meal, he didn’t demand one. And because consumers didn’t demand good food, they didn’t get it. Even then there were surely some people who would have liked better, just not enough to provide a critical mass.
And then things changed. Partly this may have been the result of immigration. (Although earlier waves of immigrants simply adapted to English standards — I remember visiting one fairly expensive London Italian restaurant in 1983 that advised diners to call in advance if they wanted their pasta freshly cooked.) Growing affluence and the overseas vacations it made possible may have been more important — how can you keep them eating bangers once they’ve had foie gras? But at a certain point the process became self-reinforcing: Enough people knew what good food tasted like that stores and restaurants began providing it — and that allowed even more people to acquire civilized taste buds.
Paul Krugman, “Supply, Demand, and English Food”, https://web.mit.edu/krugman/www/mushy.html.
March 17, 2021
QotD: Technocracy’s failure mode
That engineering mindset is one of order, of processes, of structures. Free form and flowing is not generally described as desirable among engineers.
To change examples, Major Douglas came up with the idea of Social Credit. Calculate the profits in an economy and then distribute them to the people. This makes sense to an engineer. The shoot down that we never can calculate such profits in anything like real time just does not compute.
To engineers, if we’ve a process, a structure, then we can handle these things. Yet human life and society is simply too complex to be handled in such a manner. Sure, Hayek never was talking about sexual harassment but the point does still stand.
No, this is not really specifically about Google nor sexual harassment. Rather, it’s about technocracy and the undesirability of it as a ruling method. Here we’ve got just great engineers stepping off their comfort zone and into social relationships. The nerds that is, the very ones we’ve been deriding for centuries as not quite getting it about those social relationships, trying to define and encode those things we’re suspicious they don’t quite understand in the first place.
That is, rule by experts doesn’t work simply because experts always do try to step out of their areas of expertise. Where they’re just as bad and dumb as the rest of us. Possibly, even worse, given the attributes that led them to their areas of expertise in the first place.
Tim Worstall, “Google’s Sexual Harassment Policies – Why We Don’t Let The Technocrats Run The World”, Continental Telegraph, 2018-11-08.
March 16, 2021
The horrors of British & US Logistics in WW2
TIK
Published 15 Mar 2021The Allies may have had a lot of resources, manpower and industry, but that didn’t mean that their logistics weren’t inefficient or a disorganized mess. Today, we’re going to look at how the British railways were disaster during WW2, how the Americans ran out of fuel on the way to Germany, and why Montgomery called the planning for the invasion of Sicily a “dog’s breakfast”.
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The thumbnail for this video was created by Terri Young. Need graphics? Check out her website here https://www.terriyoungdesigns.co.uk/
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📚 BIBLIOGRAPHY / SOURCES 📚
Dunn, W. The Soviet Economy and the Red Army, 1930-1945. Praeger Publishers, 1995.
Garvey, J. Operation Husky: The Untold Story of the logistics of the Sicily Invasion. Farm Publications, Kindle 2019.
Hazlitt, H. Economics in One Lesson: The Shortest & Surest Way to Understand Basic Economics. Three Rivers Press, 1979.
MacDonald, J. Supplying the British Army in the Second World War. Pen & Sword Military, Kindle 2020.
Molony, C. The Mediterranean and Middle East, Volume V, The Campaign in Sicily 1943 and The Campaign in Italy 3rd September 1943 to 31st March 1944. The Naval & Military Press LTD 2004, first published in 1973.
Wolmar, C. Fire & Steam: How the Railways Transformed Britain. Atlantic Books, Kindle 2007.British Government, Railways Act 1921, https://www.legislation.gov.uk/ukpga/…
Full list of all my sources https://docs.google.com/spreadsheets/…
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ABOUT TIK 📝
History isn’t as boring as some people think, and my goal is to get people talking about it. I also want to dispel the myths and distortions that ruin our perception of the past by asking a simple question – “But is this really the case?”. I have a 2:1 Degree in History and a passion for early 20th Century conflicts (mainly WW2). I’m therefore approaching this like I would an academic essay. Lots of sources, quotes, references and so on. Only the truth will do.
This video is discussing events or concepts that are academic, educational and historical in nature. This video is for informational purposes and was created so we may better understand the past and learn from the mistakes others have made.
March 15, 2021
Target is careful to only cite economic reasons for abandoning their downtown Minneapolis headquarters
Jon Miltimore explains why the Target corporate headquarters in Minneapolis will be given up — for reasons that go beyond the claimed success of the telecommuting encouraged by the 2020 pandemic lockdowns:
A building burning in Minneapolis following the death of George Floyd.
Photo by Hungryogrephotos via Wikipedia.
Target Corporation, the eighth largest retailer in the United States, announced in an email to employees on Thursday that it will be leaving the City Center, its primary downtown Minneapolis location.
Company officials cited improved remote work opportunities and less need for space as the drivers for the decision.
“In just one year we’ve proven that we can drive incredible results, together, from our kitchens and basements and living rooms,” said Melissa Kremer, executive vice president and leader of Target’s human resources operations.
Target, the largest employer in Minneapolis with some 8,500 corporate workers, says the 3,500 employees who work at the City Center will still have a “home base,” but it will be at another Minneapolis location or in the nearby suburb of Brooklyn Park.
A Story of Capital Flight?
On one hand, there is little reason to doubt Target’s explanation for abandoning its headquarters. Many anticipated that the pandemic would lead to a normalization of remote work.
“The future of work will be distributed,” Erica Brescia, the chief operating officer of Github, told the BBC last fall. “We’re going to see a big shift from office by default to remote by default.”
Part of that shift, it’s reasonable to assume, would be corporations moving away from high-end corporate real estate. Yet it also shouldn’t be forgotten (or ignored) that Target’s decision comes less than a year after Minneapolis suffered some of the worst riots in US history, prompted by the May 25 death of George Floyd.
The riots — which broke out after a video went viral showing police pinning Floyd, a 46-year-old black man, to the ground for nearly nine minutes before he died — caused an estimated $2 billion in damage.
Though Target made no mention of the riots in its announcement, last summer I noted that an abundance of evidence suggested that the economic damage of the riots would persist long after the wreckage had cleared.
March 6, 2021
QotD: Why “the rich” benefit more from tax cuts
There is that objectionable idea that not taxing something is a giveaway. The root presumption there is that everything belongs to the State and we’re lucky it allows us to keep anything to deploy as we desire and not as those who stay awake in committee do. This is not an assumption that leads to a free country nor populace, nor a liberal society.
But it’s also to miss that logical point, that if income tax is to be reduced then it must be those currently paying income tax who benefit from not doing so in the future under the new rates. […] The low paid cough up hardly anything in income tax. Therefore the low paid gain hardly anything from income tax being reduced. This should be obvious.
Tim Worstall, “Budget Revelation – Those Who Pay Income Tax Benefit From Income Tax Cuts”, Continental Telegraph, 2018-10-30.
March 2, 2021
Warship purchasing is not for the faint-of-heart
Ted Campbell talks about the way the Royal Canadian Navy plans for warship purchases … and how the best-laid plans can be derailed by ignorant political advisors:
An artist’s rendition of BAE’s Type 26 Global Combat Ship, which was selected as the Canadian Surface Combatant design in 2019, the most recent “largest single expenditure in Canadian government history” (until the RCAF gets their replacement for the CF-18 Hornet).
(BAE Systems, via Flickr)
Once upon time,* about 25 to 30 years ago, in the mid 1990s, when I was the director of a small, very specialized team in National Defence Headquarters (NDHQ) in Ottawa, something like this happened: One of my colleague, who had a title like Director of Maritime Requirements or something similar said to one of his principle subordinates, “Look, now that the 280s (Canada had four Tribal Class destroyers with pennant numbers starting at 280, they were often just called ‘280s’) are finished their mid-life refit and now that the new frigates are entering service it is time to put a ‘placeholder’ in the DSP for their eventual replacements.” The DSP was (still is?) the Defence Services Programme, it is the internal document which sets out the long range spending plans (maybe hopes is a better word) for the Canadian Armed Forces.
Anyway, the Navy commander (the officer assigned to write the document, not the Commander of the Royal Canadian Navy who is nicknamed the Kraken (CRCN)) sat at his desk and consulted the most recently approved planning document which, as far as I can remember, called for a surface fleet of 25 combat vessels and four large support ships plus numerous minor war vessels (like minesweepers) and training vessels. The officer then prepared a memorandum for the joint planning staff which said that the Navy would need 25 new combat ships, to be procured between about 2015 and 2035, in five “batches” of five ships each** at a total cost of about $100 Billion, in 2025 dollars. He didn’t say much beyond that, actually, he was just intending to “reserve” some money a generation or so in the future. His memorandum sailed, smoothly, past his boss and the commodore but questions came from a very senior Air Force general: Where he asked, did the $100 Billion come from? That was an outrageous number, he said.
A meeting ensure where the Navy engineering people came and said, “$100 Billion is a very reasonable guesstimate. Our brand new frigate are costing $1 Billion each when they come down the slipway. They will each have cost the taxpayers two to three times that by the time we send them to be broken up thirty or forty years from now. Adding in the inevitable costs of new technology and inflation, which we know is higher for things like military ships and aircraft than it is for consumer goods, then a life-cycle cost of $4 Billion for each ship is very conservative. The admirals and generals huffed and puffed but they didn’t argue ~ they knew that the engineering branch insisted on using life cycle costing, even though no-one but them understood it, and they also knew that arguing with engineers is like mud-wrestling with pigs: everyone gets dirty but the pigs love it.
A decade later, when a new government was planning the National Shipbuilding Procurement Strategy, which was all about making the Canadian shipbuilding industry competitive and had very little to do with ships ~ except they would be the “product” for which the Government of Canada would pay top-dollar, the Navy was told it could have fewer ships, in two classes, and someone ~ NOT the military’s engineering branch ~ assigned a cost figure to the project which was, to be charitable, pulled out of some political/public relations staffer’s arse.
[…]
* The story is true, in general, but I was not directly involved in any of it. I learned about what happened from three main sources: 1. routine briefings that my bosses (directors-general and branch chiefs) gave, regularly, to we directors, dealing with what was going on in the HQ and in the big wide world; 2. periodic chats with my colleagues, after work on Friday afternoons, in the bar of the Officers’ Mess ~ many of us regarded 2. as a more reliable source of information than 1.; and 3. in the case of the story about the Navy engineers and the Air Force general, by a friend and colleague who was in the room.
** The idea, long before the National Shipbuilding Strategy, was to keep shipyards moderately busy on a continuous basis. The 25 ships would all be similar: the first “batch” of five would be identical, one to the other; the second “batch” would be very similar but with some improvements; the five ships of batch 3 would be similar to the ships from the second batch and those from batch 4 would be rather like their batch 3 sisters. Finally, the batch 5 ships would be product improved versions of batch 4 ~ they would still be “sisters” of the batch 1 ships, but not, in any way, twins. The idea was that about the time that the batch 5 ships were being delivered the first of the batch 1 ships would be getting ready for a mid-life refit (after 15 to 20 years of service) which would result in it being much more like the batch 5 ships … and so on.
February 25, 2021
Malthusian cheerleaders
Barry Brownstein looks at some of the claims from Malthus onward about the imminent demise of humanity due to overpopulation and how that same concern keeps popping up again and again:
Thomas Malthus.
Portrait by John Linnell, 1834, via Wikimedia Commons
… James Lovelock advanced the Gaia hypothesis that Earth is one “self-regulating organism.” Lovelock forecasts the population of the Earth will fall to one billion from its current total of over seven billion people. Given Lovelock’s cheerfulness about such carnage, it is easy to see why Alan Hall, a senior analyst at The Socionomist, wonders whether “today’s drives to limit consumption and population” are ideologically related to the eugenics movement from the past century. In his essay “A Socionomic Study of Eugenics,” Hall writes in The Socionomist:
Circa 1900, influential intellectuals in Europe and the U.S. voiced concerns about uncontrolled procreation causing a supposed decline in the quality of human beings. Today, similar groups voice concerns about uncontrolled population growth and resource consumption causing a decline in the quality of the environment … Today’s green advocates brandish images of an overrun, dying planet.
Today, the Bill and Melinda Gates Foundation is working to aid the lives of children living “in extreme poverty.” In his book, Factfulness, the late professor of international health Hans Rosling, reports on critics of the Gates Foundation who reject such efforts. “The argument goes like this,” Rosling writes. “If you keep saving poor children, you’ll kill the planet by causing overpopulation.”
In the face of advocates for such beliefs, no wonder Hall asks us to reflect on whether we “will make the cut” if those seeking to cull humanity are successful.
Malthusian Doom
We’ve all heard the SparkNotes version of Malthusian predictions of doom caused by overpopulation. Malthus thought food production could not keep pace with population growth. In his 1798 “Essay on the Principle of Population,” Malthus anticipated the suffering that awaited humanity.
The power of population is so superior to the power in the earth to produce subsistence for man, that premature death must in some shape or other visit the human race. The vices of mankind are active and able ministers of depopulation. They are the precursors in the great army of destruction; and often finish the dreadful work themselves. But should they fail in this war of extermination, sickly seasons, epidemics, pestilence, and plague, advance in terrific array, and sweep off their thousands and ten thousands. Should success be still incomplete, gigantic inevitable famine stalks in the rear, and with one mighty blow levels the population with the food of the world.
Unlike Ehrlich and others, Malthus had reason to be a pessimist in his lifetime. If Malthus had been writing history or predicting the near future, he would not have been far from the mark.
Many of the predictions of overpopulation were based on estimates of population growth (especially in sub-Saharan Africa) which were far from accurate, and in every case we know of, increased economic well-being directly impacts population growth so as a country begins to get richer its population growth begins to slow down significantly (most first-world nations are already at or below population-replacement birthrates).
In their book, Empty Planet: The Shock of Global Population Decline, Darrell Bricker and John Ibbitson have startling facts for those who believe the population will continue to explode.
No, we are not going to keep adding bodies until the world is groaning at the weight of eleven billion of us and more; nine billion is probably closer to the truth, before the population starts to decline. No, fertility rates are not astronomically high in developing countries; many of them are at or below replacement rate. No, Africa is not a chronically impoverished continent doomed to forever grow its population while lacking the resources to sustain it; the continent is dynamic, its economies are in flux, and birth rates are falling rapidly. No, African Americans and Latino Americans are not overwhelming white America with their higher fertility rates. The fertility rates of all three groups have essentially converged.
Looking at current trends and expecting them to continue is what Hans Rosling calls “the straight line instinct.” That instinct often leads to false conclusions.
February 17, 2021
QotD: Protectionists, left and right
“Progressives” who embrace protectionism share conservatives’ low opinion of their country’s businesses, entrepreneurs, and workers, but also mistakenly believe that protectionism “sticks it to” corporate oligarchs when, in fact, it creates corporate oligarchs.
Don Boudreaux, “Quotation of the Day…”, Café Hayek, 2018-09-10.
