Quotulatiousness

July 7, 2018

The bad economics of rooftop solar installations

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

Norman Rogers points out where the numbers don’t add up for many jurisdictions’ domestic solar power schemes:

Photovoltaic panels on a roof, 28 April, 2015.
Photo by Antonio Chaves, via Wikimedia Commons.

A modest proposal:

We’ve all heard about “shop local” and “get your food from local farmers, not distant corporate farms.” Lots of people have apple trees in their backyards. Often they can’t begin to eat or give away all the apples. In the meantime, big supermarkets sell corporate apples for one dollar a pound and up. I propose that people with backyard apples be able to take them to the supermarket and sell them to the supermarket for the same price at which the supermarket is selling apples. Furthermore, they should be able to take them at any time and receive payment. If the store gets too many local apples, it can reduce its purchase of corporate apples.

My apple proposal may seem ill advised, but that is exactly how rooftop solar power works. The homeowner gets to displace power from the power company, and if the homeowner has more power than he needs, the power company is obligated to purchase it, often for the same retail price at which it sells electricity. That policy is called net metering. In order to accommodate the homeowner’s electric power, the utility has to throttle down some other power plant that produces power at a lower wholesale price.

The exact arrangements for accepting rooftop solar vary by jurisdiction. In some places, net metering is restricted in one way or another.

A large-scale natural gas-generating plant can supply electricity for around 6 cents per kilowatt-hour. Rooftop solar electricity costs, without subsidies, around 30 cents per kilowatt-hour, or five times as much. Average retail rates for electricity in most places are between 8 cents and 16 cents per kilowatt-hour. Yet, paradoxically, the homeowner can often reduce this electric bill by installing rooftop solar.

It is actually worse than forcing the power company to take 30-cent electricity that it could get from a natural gas plant for 6 cents. When the company throttles down a natural gas plant to make room for rooftop electricity, it is not saving six cents, because it already has paid for the gas plant. All it saves is the marginal fuel that is saved when the plant is throttled down to make room for the rooftop electricity. The saving in fuel is about 2 cents per kilowatt-hour. So 30-cent electricity displaces grid electricity and saves two cents.

Zimbabwe and Hyperinflation: Who Wants to Be a Trillionaire?

Filed under: Africa, Economics, Government, History — Tags: , , , — Nicholas @ 02:00

Marginal Revolution University
Published on 3 Jan 2017

How would you like to pay $417.00 per sheet of toilet paper?

Sound crazy? It’s not as crazy as you may think. Here’s a story of how this happened in Zimbabwe.

Around 2000, Robert Mugabe, the President of Zimbabwe, was in need of cash to bribe his enemies and reward his allies. He had to be clever in his approach, given that Zimbabwe’s economy was doing lousy and his people were starving. Sow what did he do? He tapped the country’s printing presses and printed more money.

Clever, right?

Not so fast. The increase in money supply didn’t equate to an increase in productivity in the Zimbabwean economy, and there was little new investment to create new goods. So, in effect, you had more money chasing the same goods. In other words, you needed more dollars to buy the same stuff as before. Prices began to rise — drastically.

As prices rose, the government printed more money to buy the same goods as before. And the cycle continued. In fact, it got so out of hand that by 2006, prices were rising by over 1,000% per year!

Zimbabweans became millionaires, but a million dollars may have only been enough to buy you one chicken during the hyperinflation crisis.

It all came crashing down in 2008 when — given that the Zimbabwean dollar basically ceased to exist — Mugabe was forced to legalize transactions in foreign currencies.

Hyperinflation isn’t unique to Zimbabwe. It has occurred in other countries such as Yugoslavia, China, and Germany throughout history. In future videos, we’ll take a closer look at inflation and what causes it.

July 6, 2018

“That’s what governments are for — get in a man’s way”

Filed under: Bureaucracy, Business, Government, USA — Tags: , , , , , — Nicholas @ 03:00

Veronique de Rugy says that the 4th of July is a good time to reflect on the American Founding Fathers fighting to gain independence from a distant tyrannical government … and the rest of the year is devoted to coping with a less-distant but no-less tyrannical government in Washington:

Consider the oil and gas industry. Over the years, the federal government has adopted many regulations meant to hinder the industry. As Nick Loris, an energy policy analyst at the Heritage Foundation, reminds me, one such regulation is the Merchant Marine Act, also known as the Jones Act, which makes it more expensive to ship oil and natural gas from coast to coast. Then there are the past administrations’ outright moratoriums on drilling in certain areas of America’s coasts, which massively increases the cost of doing business. As Loris notes, there are many costly bureaucratic delays in issuing leases and processing applications for permits to drill (APDs), which stalls production on federal lands. On average, the federal processing of APDs in the last year of the Obama administration was 257 days, while state processing is typically 30 days or less.

Since Uncle Sam has a lot of regulations in place to make the operations of domestic oil and gas companies more costly, why is the biggest beneficiary of loans from the federal government export credit agency (the U.S. Export-Import Bank) the gigantic Mexico state-owned oil and gas company Pemex? Between 2007 and 2013 (the most complete data set we have), Pemex received over $7 billion in loans backed by American taxpayers to buy U.S. goods. Thanks to Uncle Sam, this discounted borrowing power gives Pemex a leg up on its competition with domestic oil and gas companies.

Then there’s the Trump administration tariffs. These import taxes on foreign goods coming from Europe, China, and other countries have not only raised the cost of doing business but also triggered retaliatory measures from foreign governments. For instance, the farm industry is paying a steep price from the tariffs on steel because they increase the cost of farm machinery, lowering profit margins. Farmers are also hurt by the European, Mexican, Canadian, and Chinese governments that have imposed retaliatory export restrictions on U.S. farm products. Many small farms are calling for help to survive. It’s so bad that the entire Iowa congressional delegation sent a letter to President Trump on June 25 in which it called the tariffs “catastrophic for Iowa’s economy.”

Quote in the headline from Firefly episode “Serenity, Part 1”.

July 4, 2018

It’s never a good idea to expand the power of the state

Filed under: Government, Liberty, Politics, USA — Tags: , , , , , , — Nicholas @ 05:00

Francis Porretto on the problem of giving the state yet another tool for its already overflowing toolbox:

    The party in power is smug and arrogant. The party out of power is insane.” – Megan McArdle, a.k.a. “Jane Galt”

Among the older maxims of politics is to beware handing the State a new power without first reflecting on how your opponents could use it against you. For as sure as the Sun rises in the East, your opponents will return to dominance someday, and whatever powers you awarded the State will be in their hands.

Just now, the focus is on President Trump’s choice of a replacement for retiring Supreme Court Associate Justice Anthony Kennedy. The Democrats are tearing their collective hair out over this, as now that the filibuster is a dead letter for judicial appointees, their minority status in the Senate leaves them no way to block his selection. Yet it was Senate Democrats during the Obama Administration who first attacked the filibuster – when they were in the majority and sought to confirm Obama appointees. Coulda told ‘em then, but they weren’t in a mood to listen.

Today’s critical battles are over freedom of expression and “deplatforming.”

Some folks of sound mind and generally good will are exercised about how Silicon Valley giants such as Facebook and Twitter regulate their immensely popular social-media platforms to disfavor conservatives. The complaints have been many, and a great many of them are both accurate (i.e., the things complained about really happened) and valid (i.e., only persons of conservative or libertarian bent were silenced). However, they come up against a barrier that’s proved impassable to date: the right of private property.

So a lot of those folks have embraced the notion that those platforms could be regulated by the federal government as public accommodations. That’s the conception under which the Civil Rights Acts were deemed to hold legitimate authority over restaurants, hotels, movie theaters, and other nominally private properties. If you present your facility as “open to the public,” the logic runs, then you can be forbidden to discriminate – i.e., to provide your services to some members of the “public” but not others.

(For those who remember the “nationwide Bell System,” the phrase common carrier might rise to mind. The concept is essentially the same, as was the federal government’s assertion of authority over it. However, in that particular case, the rationale was that the Bell System was a monopoly, protected by that same federal government. Telecom deregulation and the breakup of the Bell System put paid to that scheme, thank God.)

Those in the Right who favor this notion are asking for trouble. Someday the balance of power will shift leftward once again. What would the Democrats – an increasingly totalitarian bunch who’ve never seen a law, a regulation, or a tax it didn’t love – do with the precedent that an Internet platform can be regulated as a public accommodation, despite being private property?

H/T to Bill St. Clair for the link.

July 3, 2018

Andrés Manuel López Obrador wins Mexican presidential election

Filed under: Americas, Government, Politics — Tags: , — Nicholas @ 03:00

Tom Phillips and David Agren report from Mexico City for the Guardian:

A baseball-loving leftwing nationalist who has vowed to crack down on corruption, rein in Mexico’s war on drugs and rule for the poor has been elected president of Latin America’s second-largest economy.

Andrés Manuel López Obrador, President-Elect of Mexico, who will assume office on 1 December, 2018
Photo via Wikimedia Commons

Andrés Manuel López Obrador, a silver-haired 64-year-old who is best known as Amlo and counts Labour leader Jeremy Corbyn among his friends, was elected with at least 53% of the vote, according to a quick count by Mexico’s electoral commission.

López Obrador’s closest rival, Ricardo Anaya from the National Action party (PAN), received around 22% while José Antonio Meade, a career civil servant running for the Institutional Revolutionary party, or PRI, which ruled Mexico for most of last century, came in third with around 16%.

Addressing the media after those results were announced, López Obrador vowed to repay the trust put in him by millions of Mexicans. “I will govern with rectitude and justice. I will not fail you. I will not disappoint you. I won’t betray the people,” he said.

Mexico’s president-elect vowed to rule for people of all social classes, all sexual orientations and all points of view. “We will listen to everyone. We will care for everyone. We will respect everyone,” he said. “But we will give priority to the most humble and to the forgotten.”

[…]

Analysts also expect him to pursue a less aggressive and less militarised approach to Mexico’s 11-old ‘war on drugs’ which has claimed an estimated 200,000 lives and is widely viewed as a calamity. During the campaign, Amlo has argued “you cannot fight violence with more violence, you cannot fight fire with fire” and proposed an amnesty designed to help low-level outlaws turn away from a life of crime.

Eric Olson, a Mexico and Latin America specialist from Washington’s Woodrow Wilson Centre, said he saw Mexico stepping back from regional affairs under its new leader. “Amlo is not an internationalist … we can expect him to play less of an active role in the region on Venezuela, on Nicaragua and other trouble spots.”

Olson also expected tense moments with US president Donald Trump whose family separation policy Amlo recently denounced as arrogant, racist and inhuman. “But it’s impossible for the US to walk away from Mexico or for Mexico to walk away from the US. They are joined at the hip and need to work together even if their presidents don’t like each other and don’t get along.”

Carlos Bravo, a politics expert from Mexico City’s Centre for Economic Research and Teaching, predicted President Amlo would make fighting poverty a flagship policy, just as former Brazilian president Luiz Inácio Lula da Silva did after his historic 2002 election with projects such as Bolsa Família and Zero Hunger. Under Amlo he foresaw “massive investment in social policy” which Mexico’s new president could use to show he was attacking not just poverty and inequality but also the social roots of crime and violence.

However, Bravo said the “motley coalition” behind Amlo’s election triumph was so diverse – featuring former communists, ultra-conservatives and everything in-between – that trying to guess how he might rule was a fool’s errand. “Quite frankly, right now there is a lot of uncertainty regarding what the López Obrador government will do.”

QotD: The fatal conceit

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

… each of these questions, like the larger point made here, applies not only to proposals for complete, economy-wide central planning of the sort that was fashionable during the mid-20th century. These questions apply to any proposal for government direction of economic affairs, however ‘partial’ it might be (or seem to be).

We can all agree, for example, that economic equality is fine thing – but do we count only monetary income as relevant for assessing equality, or do we count monetary income plus monetary wealth? What about the value of voluntarily chosen leisure: does it count? if not, why not? if so, how is it weighed against monetary income or wealth? And even if we all agree upon just what sources of utility do and don’t count as relevant for assessing economic equality, and agree also on the weights of the various sources of utility for making this assessment, how is the goal of economic equality itself to be traded off against competing goals – such as economic growth, or environmental sustainability (however that might be defined!)?

The previous paragraph gives only one small example of a huge problem that confronts those who believe that entrusting the state with the power to engineer economic outcomes is really just a matter of science, of empirically discovering the allegedly objective costs and benefits of various economic arrangements and then choosing that particular arrangement that best satisfies society’s object preferences.

The very notion that there is an objective ‘best’ arrangement of economic affairs that can be discovered independently of actual market processes and then imposed by the state to improve everyone’s, or most everyone’s, well-being is, truly, a fatal conceit.

Don Boudreaux, “Quotation of the Day…”, Café Hayek, 2016-09-03.

July 1, 2018

Over-generous subsidies encourage fraud and waste

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

At Catallaxy Files, Rafe Champion continues discussing Matt Ridley’s book Climate Science: The Facts:

Ridley went on to criticise biodiesel programs and the promotion of diesel cars. Then he mentioned one of the most outlandish schemes – the clearing of forests on the west coast of the US to convert into wood pellets to burn in British furnaces instead of coal to generate electricity. The Daily Mail reported that this was one of the legacies of Energy Secretary Chris Huhne.

    Mr Huhne, who served in the coalition government and was later jailed for perverting the course of justice, championed the energy source in office and is now European chairmen of Zilka Biomass, a US supplier of wood pellets.

Nice work if you can get it.

And then there are the household biomass furnaces in Britain, promoted by Huhne under the Renewable Heat Incentive (RHI) scheme whereby businesses and households pay for a renewable energy boiler upfront then receive payments for up to 20 years depending on the amount of heat they produce.

    Some unscrupulous homeowners can double the amount they produce by using heat generated under the RHI to dry wood or other materials.

    This can then be fed back into the boiler to burn it and generate even more heat – and money from the public purse.

    The scheme was started in 2011 by Chris Huhne, then Liberal Democrat energy secretary, for businesses then extended to domestic customers three years later. Households and firms can apply for grants to switch from fossil fuel heating systems to renewable ones such as biomass boilers, which burn wood pellets, chips or logs.

As the scheme is open to applications until 2021, final payments to participants will run to at least 2041. By this time, the bill for taxpayers is expected to hit £23billion.

Closely related is the the Irish “Cash for Ash” scandal that paid more than the cost of the fuel. An orgy of corruption was sparked by renewables in Spain and there was the strange phenomenon of solar power generated in the dark because the Spanish subsidy was initially so generous is was worthwhile to shine diesel-powered lights on the panels overnight.

June 30, 2018

QotD: In government regulations, complexity is a subsidy to existing companies

Filed under: Bureaucracy, Business, Government — Tags: , , , , , — Nicholas @ 01:00

One of the major themes of the book I’m working on should be familiar to longtime readers of this “news”letter. It boils down to a simple insight: Complexity is a subsidy. The more complex you make the rules, the more you reward people with the cognitive, material, or social resources necessary to get around them. Big corporations tend not to object to more burdensome regulations because they can afford to comply with them. Dodd-Frank was great for the “too big to fail” crowd. But it has been murder on community banks that don’t have the resources to comply. As Lloyd Blankfein, the CEO of Goldman Sachs, put it:

    It’s very hard for outside entrants to come in and disrupt our business simply because we’re so regulated. We hear people in our industry talk about the regulation, and they talk about it with a sigh about the burdensome of regulation. But in fact in some cases the burdensome regulation acts as a bit of a moat around our business.

But you’ve been hearing this stuff from me for years. Let’s get back to the arrogance thing. It seems to me a big part of the problem with progressive elites these days is that they lack self-awareness. That elites arrange affairs for their own self-interest is an insight that was already ancient when Robert Michels penned his Iron Law of Oligarchy. But ever since the progressives concocted their theories of “disinterestedness,” they’ve convinced themselves that they are not in fact a self-serving elite. Give feudal aristocrats their due: They were a self-dealing crop of rent-seekers and exploiters, but at least they were open about the fact that they believed they had a divine right to sit atop the social pyramid. Today’s progressive aristocracy is largely blind to the fact that their cult of expertise isn’t really about expertise; it’s about organizing society in a way that reinforces their status and power.

Well, most of them are blind to it. Occasionally the mask slips. Jonathan Gruber, one of the chief architects and financial beneficiaries of the health-care “reform,” told audiences that Obamacare was designed “in a tortured way” to hide the fact that “healthy people pay in and sick people get money.” They had to do it this way to get around the inconvenient “stupidity of the American voter.” A feudal lord who talked this way about his serfs wouldn’t get any grief for it. But in America such honesty gets you rendered an un-person.

Jonah Goldberg, “The Consequences of Overpromising on Obamacare”, National Review, 2016-10-08.

June 27, 2018

Canada’s odd approach to open data

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

Michael Geist the contrast between what the Canadian government says about access to information and what they actually do:

The Liberal government has emphasized the importance of open data and open government policies for years, yet the government has at times disappointed in ways both big (Canada’s access-to-information laws are desperately in need of updating and the current bill does not come close to solving its shortcomings) and small (restrictive licensing and failure to comply with access to information disclosures).

For example, late last year, I noted that government departments had oddly adopted a closed-by-default approach to posting official photographs on Flickr. Unlike many other governments that use open licenses or a public domain approach, Canadians looking for openly licensed photographs for inclusion in learning materials, blog posts, or other content must rely on foreign governments. The restrictive licensing approach remains in place: those seeking photos on Flickr from the G7 will find Prime Minister Justin Trudeau’s are “all rights reserved” but other governments attending the summit – including the United States, United Kingdom, Norway, and South Africa – all facilitate re-use of their photos through open licensing.

A restrictive approach to disclosing information about completed access-to-information requests has also emerged in recent months. Open disclosure of the completed requests benefits both the public and the government. For the public, completed requests are there for the asking as they can be obtained on an informal basis at no cost. For the government, completed requests can sometimes provide the information requested by the public, thereby reducing costs and saving time for government officials. For many years, the government maintained a database known as CAIRS, which featured lists of completed access to information requests. After that was cancelled, the government created an open government page that includes the last two years of requests (the information is searchable or downloadable). According to the site:

    Government of Canada institutions subject to the Access to Information Act (ATIA) are required to post summaries of processed ATI requests. You can search these summaries, which are available within 30 calendar days after the end of the month. Searches can be made by keywords, topic or field of interest. If you find a summary of interest, you can also request a copy of the previously released ATIA records.

But you can’t access them until they’ve been published, and several government departments are as much as a year behind in making these records available.

June 24, 2018

Europe and the refugees

Filed under: Africa, Europe, Government, Italy, Law, Middle East, Politics — Tags: , , , , — Nicholas @ 05:00

Theodore Dalrymple on the various European governments’ attitudes and actions on the refugee problem:

Europe, despite its Union, is as divided as ever. Recently, when Italy’s new right-wing government — anxious to prove its credentials — refused to allow a boat carrying 629 African migrants to dock in Italy, Spain’s new left-wing government — equally anxious to do the same — accepted the boat. When the French president, Emmanuel Macron, criticized the Italians for their decision, the Italian government accused the French of hypocrisy, inasmuch as they had refused to take more than 9,000 migrants from Italy that they had previously agreed to accept.

This story is revealing in several aspects. The first is that, whatever attitude governments take to the migrants, no one truly believes that they are more of an asset than a liability. Madrid’s action, for example, was taken on “humanitarian” grounds, rather than because it believed that Spain would benefit from the migrants’ presence. When European leaders discuss the migrant question, it is always in terms of sharing the burden, not the assets, equitably. No one speaks of foreign investment in this way, which suggests that European politicians believe, whether rightly or wrongly, that the free movement of people and capital are different in an important way.

The leaders speak of sharing the burden, then, and are incensed when countries such as Hungary and Poland refuse point-blank to take any migrants from Africa or the Middle East. But I have never seen mentioned in this context the question of where the migrants themselves want to go. They might as well be inanimate toxic waste as far as the discussion is concerned, rather than human beings with wishes, desires, ambitions, and so forth. They are but pawns in a political game. Hungary, for example, is deemed duty-bound to take x number of migrants: no one asks whether x number of migrants can be found who want to go to Hungary. Nor is the question ever discussed in public whether Hungary, having open borders, would be held responsible for making the migrants stay there once they had arrived. Short of penning them in, how exactly would you keep them in Hungary, or in Poland?

June 23, 2018

Word of the day – Kakistocracy

Filed under: Government, Greece, USA — Tags: , — Nicholas @ 03:00

Ann Althouse does the etymological heavy lifting:

“Kakistocracy” — based on the Greek for “worst” + “rule” — means ” The government of a state by the worst citizens”(OED).

    1829 T. L. Peacock Misfortunes Elphin vi. 93 Our agrestic kakistocracy now castigates the heinous sins which were then committed with impunity [“Agrestic” = rural, rough and uncouth.]
    1876 J. R. Lowell Lett. II. vii. 179 Is ours a government of the people, by the people, for the people, or a Kakistocracy rather, for the benefit of knaves at the cost of fools?

I see that Salon got to the OED and deployed that word and those quotes before Trump was even sworn in: “Degeneration nation: “It takes a village of idiots to raise a kakistocracy like Donald Trump’s/Donald Trump’s government will be ‘for the benefit of knaves at the cost of fools’” (December 17, 2016):

    As Amro Ali explains in a piece calling for a revival of the term “kakistrocracy” [sic] “In a world where stupidity penetrates multiple levels of government, policies and personalities; it is strange that the term coined to best describe it has actually ended up in the endangered and forgotten words books.”…

    Forbes contributor Michael Lewitt reminds us that “kakistocracy” should be used to describe a state or government run by the most unscrupulous or unsuitable people: “Corrupt, dishonest and incompetent politicians, regulators and bureaucrats were put in charge by self-absorbed, selfish and ignorant citizens.” He goes on to acknowledge that we are probably not the first society to consider our leaders as part of a kakistocracy….

    The word kakistocracy comes to us from Greek. Kakistos means “worst,” which is superlative of kakos — “bad” — and if it sounds like shit, that’s because it is.

That link on “if it sounds like shit” goes to an etymology dictionary entry for “kakistocracy”:

    …. from Greek kakistos “worst,” superlative of kakos “bad” (which perhaps is related to PIE root *kakka- “to defecate”) + –cracy.

In that view, the real “shithole country.” When will the U.N. give us credit for having the most nerve and confidence to criticize those we elect and continually threaten to oust?

June 17, 2018

Conrad Black – Trump’s not bluffing

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

In the National Post (but linked from his personal website), Conrad Black warns of the danger of assuming that Trump is just blustering on his trade threats:

Justin Trudeau struck just the right Canadian note of our gentle nature but refusal “to be pushed around,” and he predictably will reap the short-term reward for standing up for the country opposite the ideal American bogeyman, the blustering billionaire president who has been a Garry Trudeau caricature of the Ugly American for 25 years. (It is a very incomplete picture, like most caricatures, but it works for Trump and he often cultivates it.) The boycotts of American goods and holidays will be a bonus to Canada economically and the anti-Trump American media will be along within two weeks to lionize doughty Canada like “Gallant little Belgium” in 1914 and “Plucky Israel” in 1947, and it will strengthen Canada’s always fragile self-regard opposite the United States.

On the other hand, Trump isn’t just a blowhard; all his career he has known how to go for the jugular and his reference to 270-per-cent Canadian tariffs on butter is a valid complaint that threatens to tear the scab off this egregious payoff to the comparatively small number of Quebec dairy farmers who mainly profit from it. The same issue was hammered hard by Martha Hall Findlay when she ran for the federal Liberal leadership in 2013 and by Maxime Bernier when he ran narrowly behind Andrew Scheer for the Conservative federal leadership last year. The issue died down after their unsuccessful campaigns, but if Donald Trump is incited to hammer that theme, he will roil the domestic Canadian political waters and English-French relations in the country generally.

Presumably our trade negotiators will not become so intoxicated by the prime minister’s peppy talk and spontaneous popular boycotts of the U.S. that they forget the correlation of forces. An aroused American administration could do serious damage to Canada’s standard of living, and it could be a tempting tactic to expedite more important negotiations with Mexico and the principal Asian and European powers. The United States is now enjoying three times as great a rate of economic growth as Canada (4.8 to 1.5 per cent), has lower tax rates, 11 times as great an economy, and more unfilled jobs than unemployed people.

Behind the peeling façades of Norman Rockwell and Walt Disney, the United States is a monster, and not always an amiable monster. If Canadians are blinded by their visceral dislike of Donald Trump, as the antithesis of Canadian criteria for likeable public figures, they will be exposed to the ruthless pursuit of the national interest that in his own career propelled him from technical insolvency to immense wealth and celebrity and then, against all odds, to control of a great political party and to the headship of the most powerful country in the world. If these talks blow up, the U.S. doesn’t have to settle for WTO rules; it can impose outright protectionist measures. Justin Trudeau has been agile, and the country has responded admirably. But Canadian policy-makers must understand that they are playing for almost mortal stakes with potentially dangerous protagonists who have no sense of fair play and no interest in what Canada thinks of them.

June 16, 2018

Who will think of the children Australian civil servants???

Filed under: Australia, Bureaucracy, Government, Humour — Tags: , , , — Nicholas @ 03:00

A tale from Catallaxy Files that’s sure to tug on your heartstrings:

In Canberra today, the Australian Greens announced a new tax fairness policy to remedy a design fault in the current system.

According to the Greens, it seems that it is only Australian public servants (local, state and Federal) who have been able to negotiate salary increases. As a consequence, because of their increased salaries, public servants are constantly pushed into higher tax brackets with the result that impost of bracket creep disproportionately falls on them.

Independent economic research has confirmed this phenomena. The Australia Institute economists have models showing that up to 80% of Commonwealth bracket creep tax receipts are paid by Australian public servants.

The Australian Greens believe that just because public servants earn more than private sector workers, they should not be required to pay more tax. Australian Greens’ Treasury spokesperson Adam Bandt said:

    Australian public servants should not be forced to carry the brunt of government spending, including spending on other public sector salaries. This is a role for the private sector. It is manifestly unfair that just because public servants have been able to extract additional salaries that they should be forced into higher tax brackets.

In response, the Australia Greens have announced the Tax Equalisation and Redistribution Designation (TERD). Under the TERD, full-time, part-time and casual public sector workers will be subject to a separate tax schedule with a flat 15% rate for income above $500,000. Public servant income below $500,000 will be tax free.

Of course, it would be even simpler for accounting purposes just to exempt the civil service from paying tax at all — we might expect that to be a Green Party policy plank in a year or two (or even our own NDP, who have a lot of support from our unionized civil service).

Reminder: Catallaxy Files is not a parody site … although this particular story is a parody. Not following Australian politics closely, I only twigged when they got to the acronym for the program…

June 15, 2018

Looking at US farm subsidy claims

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

On Twitter, Chris Auld, an economics professor at the University of Victoria explains why Canadian journalists should stop using the $22 billion figure for US farm subsidies to justify Canada’s unjustifiable supply management regime:





June 13, 2018

Imagine … a tariff-free world

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

Danny Chabino on what he calls “Trump’s G7 Surprise”:

In what I consider a brilliant move on the part of Trump and his team, instead of initially discussing what tariffs he would increase if x,y and z didn’t happen or if whichever nation wouldn’t reduce tariffs on whatever industry, he simply raised the simple question of why don’t we just not have tariffs at all? It’s brilliant in the sense that it not only shut down all the anticipated arguments, but also placed the world’s leaders in a position of having to awkwardly defend the very idea of tariffs (and subsidies), and they knew they couldn’t really do that. It highlighted the true intentions of the world’s leaders as representatives of the authoritarian nature of almost every existing government in the world today.

Now, please don’t misunderstand this article as me beaming with a Trump glow. In fact, Trump knew full well no one would take him up on such an offer. I do believe if they had he would have followed through, but his next moves will be ones that I believe are the wrong ones. He will seek to raise tariffs, which has always done more harm to the nation raising the tariffs than it has done good that nation. Trump will do just as he has threatened and hurt his own country;’s economy with new tariffs.

What I do enjoy, though, is that all of the world’s major leaders had to essentially admit that they don’t want their people and their economies to be better off. At least not on their own. They want their people and economies to be dependent upon their leadership and their governments. While everyone at the summit knew that the greatest of outcomes would be for all the world’s most powerful nations to exercise free trade, and that this would benefit the entire world in great proportions, that really wasn’t their aim. Their aim was to gain greater power. What an incredible admission!

When given a golden opportunity to end tariffs and increase freedom and prosperity for most citizens of the world, the world’s leaders instead chose to cling hard to their own designs. The world’s leaders know full well that tariffs hurt their own citizens, but they don’t care. Tariffs have never served the function of creating market efficiency, and they have never helped protect a nation’s economy. Instead, they have always been a means for governments to exercise control over huge parts of their own economies, and where there is control, there is power. Politicians and world leaders seek power. It’s like their drug of choice, and they can never get enough of it.

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