Quotulatiousness

July 12, 2023

“[E]lite colleges are machines for laundering privilege”

Scott Alexander ponders the reasons our elite universities operate as they do:

Harvard University Memorial Church.
Photo by Crimson400 via Wikimedia Commons.

We could think of “the best college” as a self-fulfilling prophecy; for whatever reason, one college has gotten a reputation as the one whose signal is most valuable. Everyone naturally tries to get in there; if they fail, they go to the college with the next-best reputation, and so on. The system is stable; the “best” college will keep its reputation (since it gets the best students) and the best students will always want to go to the best college. If, as Matt’s son suggests, all the Ivies started accepting the worst students instead, an Ivy degree would soon become a signal that you’re bad, and employers would stop respecting it.

I heard a fascinating variation of this hypothesis from Matt Christman of Chapo Trap House: elite colleges are machines for laundering privilege.

That is: Harvard accepts (let’s say) 75% smart/talented people, and 25% rich/powerful people. This is a good deal for both sides. The smart people get to network with elites, which is the first step to becoming elite themselves. And the rich people get mixed in so thoroughly with a pool of smart/talented people that everyone assumes they must be smart/talented themselves. After all, they have a degree from Harvard!

The most blatant form of this obfuscation: suppose you own a very successful family business. You can leave your son your fortune, you can leave him the business, you can leave him your mansion, but you can’t (directly) leave him an aura of having deserved all these things. What you can do is make a $10 million donation to Harvard in exchange for them accepting your son. Your son gets a Harvard degree, a universally-recognized sign of being a highly meritorious person. Then when you leave him the business, everyone will agree he deserves it. Who said anything about nepotism? Leaving a Harvard graduate in control of your business is an excellent decision!

This happens a little, but I think it mostly isn’t this obvious. More often the transactions are for abstract goods: prestige, associations, favors. The Maharaja of Whereverstan sends his daughter to Harvard so that she appears meritorious. In exchange, Harvard gets the credibility boost of being the place the Maharaja of Whereverstan sent his daughter. And Harvard’s other students get the advantage of networking with the Princess Of Whereverstan. Twenty years later, when one of them is an oil executive and Whereverstan is handing out oil contracts, she puts in a word with her old college buddy the Princess and gets the deal. It’s obvious what the oil executive has gotten out of this, but what does the Princess get? I think she gets the right to say she went to Harvard, an honor which is known to go mostly to the meritorious.

People ask why Harvard admissions can still be bribed or influenced by the rich or well-connected. This is the wrong question: the right question is why they ever give spots based on merit at all. The answer is: otherwise the scheme wouldn’t work. The point of a money-laundering operation is to take in both fairly-earned and dirty money, then mix them together so thoroughly that nobody can tell which is which. Likewise, the point of a privilege-laundering operation is to take in both fairly-earned and dirty privilege, then stamp both with a Harvard degree. “Fairly-earned privilege” means all the brilliant talented ambitious youngsters admitted on the basis of their SAT scores and grades and impressive accomplishments; “dirty privilege” means the kids of various old-money aristocrats, foreign potentates, and ordinary super-rich people. Colleges mix them together, with advantages for both groups.

Is this good or bad? It’s good insofar as it provides a justification for making some elite positions dependent on merit and accessible to anyone, but bad insofar as it helps defend and obfuscate the ones that aren’t. It’s good if you think it’s good for all the elites (meritocratic and otherwise) to know each other and be on the same page; it’s bad if you don’t want them to be (maybe because it helps them oppress people more efficiently).

I expect that without such a system the elites would do their own thing without any concession to merit whatsoever – so maybe it beats the alternative.

July 11, 2023

QotD: The Calgary Stampede

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

… there are those in Calgary who, in their most secret of hearts, would love to abolish the Stampede and wipe out its memory. The Stampede, to the Calgarian, is both curse and blessing, and when all the curses are thrown into the balance, you cannot help being impressed by their weight. For starters, the Stampede kills. And we’re not just talking about the chuckwagon races. There’s a scholarly paper from 2006 in which statisticians from Montreal and Edmonton wrote about their efforts to develop forecasting models for EMS demand in Calgary. They found the numbers don’t quite work unless the Stampede is included as a variable: ambulance and rescue services become so busy during the 10-day party that it throws all the equations off-kilter.

The Stampede itself is very solvent, earning an operating surplus of $3.1 million in 2011, but if the costs and benefits to the city were all counted up, the former would have to include the salaries of the thousands of high-paid Calgary professionals who see major parts of their calendar devoured by Stampede preparations and aftermath. It would include the tacit outright cancellation of nine-to-five work for the duration of the Stampede at key Calgary oil patch companies and law firms. And it would include the arms race of conspicuous consumption that sees expensive entertainers like Cirque du Soleil and the Tragically Hip brought into town for exclusive corporate affairs at Stampede time.

Meanwhile, the perceived importance of the Stampede has led to the entrenchment of a shadowy, at least slightly sinister relationship between the city’s government and the Stampede board. It took a long skein of bailouts, sweetheart deals and low-interest loans from Calgary’s city government to make the show what it is today. Over the decades, Calgary has repeatedly used its power to borrow cheaply to fund Stampede expansions, and even expropriated land outright in the Victoria Park neighbourhood in the late 1960s when some homeowners were reluctant to sell. Because the city technically owns the Stampede grounds, the Stampede pays no property tax on them. Conflicts of interest are rampant and ignored, except on those occasions when the Stampede tries to pull off some particularly ambitious business or real estate deal. Local media know they must tread carefully before broadcasting or printing anything even slightly negative about the various entities that sustain the city’s totemistic event.

Of course the Stampede has made the name of Calgary world-famous. Calgarians abroad are as sure to be asked about their Stampede as Edmontonians are to be asked about their big mall. But the marketing effect is double-edged. Andy Sayers, a communications specialist for a mid-sized Calgary oil-patch-service company, says he and others in his field “struggle with themselves” every year as the bacchanal he compares to “the last days of Rome” approaches. “I spend most of my time trying to inculcate the image of our firm as ultra-modern thought leaders”, he says. “Then I have to create the invitations to our Stampede event. It’s tricky to wrap yourself in the blanket of the Stampede — to offer a down-home feeling to visitors without making yourselves look small-time.”

Colby Cosh, “The Calgary Stampede at 100: It may be over-the-top and at times dangerous, but Calgary’s Wild West show is the best party in Canada”, Maclean’s, 2012-07-06.

May 1, 2023

“And I, for one, welcome our new CRTC internet overlords”

Filed under: Bureaucracy, Cancon, Government, Media — Tags: , , , , , , — Nicholas @ 06:00

In this week’s Dispatch from The Line, among other maple-flavoured items is the discussion of how the newly passed Bill C-11 will impact Canadians’ everyday online experience:

We at The Line have spent a lot more time trashing Bill C-18 than its cousin, C-11; the reason for that is fairly simple, if unflattering. Both bills are unwieldy little monsters, rife with competing agendas and we only have so much time and energy to spare. Of the two, though, C-18 affects us and our business more directly as it attempts to force Big Tech companies into secret negotiations to prop up dying legacy media outlets.

C-11, which passed this week, is the Liberals’ attempt to overhaul the Broadcasting Act to bring major streaming services like YouTube and Netflix under the heel of the CRTC. This is generally a pretty bad idea — and we’ll get into that in a second. But the passing of the first major overhaul of the act since the ’90s will, we expect, be heralded by the usual suspects of CanCon leeches who see in the legislation an opportunity to siphon evil Big Tech profit while forcing major platforms to force-feed Canadians into consuming more home-grown shite.

Anyway, part of the bill, it is hoped, will force online streamers to feature more Canadian content for Canadian users, particularly content that highlights the usual progressive checkboxes. And while this does make us roll our eyes a bit — just make good stuff and let people choose what they want for themselves! — we admit that this provision is the less objectionable aspect of C-11.

After this, matters get much more dicey. The attempts to force tech companies to pay for more CanCon will almost certainly backfire in the long run: companies like YouTube have already promised that they will comply with legislation by creating pass-through fees for their creators. In other words, if the government forces YouTube to pay a percentage of its profits into a CanCon fund, YouTube will generate that revenue the only way it can — by skimming more cash from its content creators and re-directing some to the creation of Canadian shows that are then commercialized by major broadcasting networks like Rogers. Seems fair!

Where the bill goes off the rails is over years-long battle over user-generated content protections. Upon hitting the upper chamber, the senate actually advocated for amendments that would ensure that Joe Blow YouTuber wasn’t going to fall under the auspices of CRTC regulation — changes that were rejected by the House. How the CRTC defines a content generator worthy of its regulation, or uses any of its new powers, is now up for consideration by the CRTC itself.

Obviously, we at The Line are concerned about how a regulator is going to employ poorly defined and vaguely stipulated legislative powers to control how Canadians are presented which content, and by whom. We are open to the hopeful possibility that the CRTC is so completely in over their heads that all of the concerns about the bill prove fruitless and overblown. But as a rule, we don’t like to rely on the incompetence of our betters to assure our protections and freedoms.

And that brings us to the major philosophical problems with C-11; the first is that legislation should generally not generate more confusion and uncertainty. As a rule, we think that our laws should be written in such a way that an ordinarily intelligent person with a standard education should be able to understand the laws that govern them. By this measure, the Broadcasting Act — like many others — fail a very basic test. C-11 is written so poorly that even experts seem to disagree about the scope of the bill and how our media landscape will be affected by it in the years to come.

[…]

There is, arguably, no reason for the CRTC, nor for the Broadcasting Act in its current form, to exist anymore. Digital space isn’t finite. Canadians can easily find news and entertainment that is relevant to them. We don’t need the government to ensure that Canadian content is produced and funded. Or, if some government intervention is deemed necessary, it need not amount to anything more complicated than a simple tax, with revenues diverted to one of this country’s myriad granting agencies to aid production. Instead, we have a government that seems hellbent on extending the power of a regulator at the very moment in history that this regulator is most redundant.

Given that we’re being led by an increasingly insular government that equates all criticism to disingenuous misinformation, and seems to want to stamp out the evils of wrong opinions on the Internet in the coming Online Harms bill, well, let’s just say we’re increasingly concerned and perturbed.

April 8, 2023

“The evidences of history and human nature are very clear: the Enlightenment was a tremendously bad idea”

Theophilus Chilton tries to persuade conservatives and libertarians that Classical Liberalism has failed:

The Course of Empire – Destruction by Thomas Cole, 1836.
From the New York Historical Society collection via Wikimedia Commons.

The premise for this article might seem surprising to many who are used to believing that the Fukuyaman “end of history”, with its proposed ultimate victory of liberal democracy and market capitalism, is a done deal. After all, we look around the world and see the spread of democracy (even if by military force) taking place, as well as seeing the world seemingly integrated into a global economy characterized by complete fungibility of capital, resources, and labour. Yet, while this may be the façade which we are presented, it is manifestly obvious that most of what is called “democracy” is a sham and most of what is called “capitalism” is merely a cover for cronyism at the highest levels. This is the case even in the United States. We can no longer call our system “liberal” in any sort of classical sense when you can be jailed for referring to someone with the “wrong” pronoun and where the supposedly “free” press is effectively only the propaganda arm of one political party.

All over the world, classical liberalism is being supplanted by socialism and progressivism. This is obvious. What is even more obvious is that classical liberalism has been completely unable to prevent this from occurring. While there are some places where the tide is at least being slowed, this is due to the efforts of nationalists and others calling for stronger government along reactionary and traditional lines, not by those advocating for Reaganism, Thatcherism, or other manifestations of modern classical liberalism. Indeed, the two primary expressions of modern classical liberalism – libertarianism and American-style conservatism – are basically failures in every way. Libertarianism has devolved into a clown show of competing virtue signals, while conservatism (which has yet to actually conserve anything) has fastened onto itself the straitjacket of ideological dogmatism dictated to it by neo-conservatives and K-Street lobbyists.

We should not be surprised, however, that this has been the case. Classical liberalism itself was doomed from its inception. The reason for this is that classical liberalism derived directly from the sort of shoddy and shallow philosophies that drove the so-called “Enlightenment”. The Enlightenment – which we were all told was a good thing by our publik skoolz – represented a marked departure by Western civilisation from traditional realities upon which successful Western cultures were built. In contrast to the traditional values of the West, Enlightenment values represented a very skewed, unrealistic form of wishful thinking. Once these departures began to be codified into practice at the national level, it was only a matter of time before the leftward drift affected even the most morally well-insulated nations.

Below, I would like to discuss four basic areas where classical liberalism as an Enlightenment philosophy was set up for failure from the beginning.

On a somewhat less polemic level, Andrew Potter wonders if the sense of civilizational decline and dissolution many of us are feeling is down to the lack of community:

Here are some charts that were going around the social media the other day:

Boyle — a partner at Andreessen Horowitz — paired these charts with links to a series of reports and studies connecting these declines to a clutch of modern day problems, in particular rising levels of anxiety and depression, despair, most notably amongst the young.

As the boomers used to say, you don’t need a weatherman to know which way the wind is blowing. The Western world is in a bit of a funk.

Our political systems have become impossibly polarized, our economies stagger from one crisis to the next, and the welfare state is bumping up against the limits imposed by escalating costs and diminishing state capacity. All of this comes as people are losing faith in the institutions that have served for decades as the building blocks of a cohesive society. Our reserves of social capital are depleted as numerous countries report falling levels of patriotism, religiosity, and community-mindedness. Everyone’s more or less given up on having kids, while close to a third of men aged 18-30 haven’t had sex in the past year.

These stats vary from country to country, and some places are obviously doing better than others. But the trends are grim across the board; there’s no question that, in general, people in the West are in a bad way. The debate revolves around the cause or causes of these phenomena. Is it social media? The pandemic? Housing prices, debt and precarious employment?

One possibility is that the problem lies with the modern world itself. That the basket of rights-based political individualism and consumer-driven economic capitalism might provide us with all manner of creature comforts and technological wonders, but it doesn’t give us meaning. At the dark heart of liberalism lies nihilism.

This is not a new charge, it has been around as long as there has been liberalism. Yet there’s a bit of disagreement over exactly where the problem lies. For some, from Dostoevsky to the existentialists, the worry was deeply metaphysical: that in the absence of a god, or some comparable external source of absolute morality, the only alternative is raw moral relativism.

For other critics, the complaint is more aesthetic. The consumer goods and individualistic values that liberalism promotes are seen as terribly shallow and narcissistic, with the vulgar virtues of television and cheeseburgers supplanting the higher arts of opera and the terroir.

But there’s another argument, that sort of splits the difference between the metaphysical and the aesthetic worries. This is the idea that for all its promotion of radical pluralism, liberalism is actually hostile to true difference and diversity, of the sort that permits the flourishing of distinct communities. This was the central complaint of the Canadian philosopher George Grant, whose anti-American nationalism was based not on any sense that Canada was intrinsically worthwhile, but that its more collective approach to public life would foster a communitarianism that was not possible in the United States.

February 6, 2023

Food prices going up? Destroying “excess” production? That’s Canada’s Supply Management system working at peak efficiency!

Jon Miltimore reports on recent comments about some of the weird requirements for quota-holding dairy farmers under the Canadian Supply Management system:

Canadian dairy farmer is speaking out after being forced to dump thousands of liters of milk after exceeding the government’s production quota.

In a video shared on TikTok by Travis Huigen, Ontario dairy farmer Jerry Huigen says he’s heartbroken to dump 30,000 liters of milk amid surging dairy prices.

“Right now we are over our quotum, um, it’s regulated by the government and by the DFO (Dairy Farmers of Ontario)”, says Huigen, as he stands beside a machine spewing fresh milk into a drain. “Look at this milk running away. Cause it’s the end of the month. I dump thirty thousand liters of milk, and it breaks my heart.”

Huigen says people ask him why milk prices are so high.

“This here Canadian milk is seven dollars a liter. When I go for my haircut people say, ‘Wow, seven dollars Jerry, for a little bit of milk'”, he says, as he fills a glass of the milk being dumped and drinks. “I say well, you have to go higher up. Cause we have no say anymore, as a dairy farmer on our own farm. They make us dump it.”

[…]

In the United States, the primary regulations are high-level price-fixing, bans on selling unpasteurized milk (which means farmers have to dump their product if dairy processors don’t buy it), and “price gouging” laws that prevent retailers from increasing prices when demand is low, which incentivizes hoarding.

In Canada, the regulations are even worse.

While the price-fixing scheme for milk in the US is incredibly complicated and leaves much to be desired — there’s an old industry adage that says “only five people in the world know how milk is priced in the US and four of them are dead” — in Canada the price is determined by a single bureaucracy: the Canadian Dairy Commission.

The Ottawa-based commission (technically a “Government of Canada Crown Corporation”), which oversees Canada’s entire dairy system (known as Supply Management), raised prices three times in 2022, citing “the rising cost of production”.

Food price inflation remains a serious issue in Canada, but the problem is particularly acute in regards to dairy products, which has seen their annual inflation rate triple over the past year, to almost 12 percent.

If the farmers were doing this sort of price-fixing themselves, it would be illegal. Instead, because it’s the government doing it, it’s mandatory. You aren’t allowed to produce any of the supply-managed products outside the system, and the government helpfully protects Canadians from being “victimized” by cheaper imports by high tariffs on anything competing with supply managed output.

As with any rigged market, the costs of “protecting” the market are diffused among all Canadian consumers, but the benefits are concentrated in the hands of the quota-holders (and the bureaucrats who oversee the system). My issues with the supply management system are one of the “hobby horses” I’ve ridden many times over my nearly 20 years of blogging.

January 25, 2023

QotD: “National unity” and economic commonsense

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

Protectionists … often trot out various versions of this national-unity argument. The premise is always that when the government uses trade restrictions that reduce the business, wages, and profits of many of us in order to compel the many of us to artificially to increase the business, wages, and profits of some of us, national unity is being served.

But never is a compelling explanation offered of just how the people of the nation are made more united – of just how some common national cause is being pursued – when one subset of the people convinces the government to reduce the real incomes, options, and freedom of another subset of the people.

Economically uninformed economic nationalists … focus only on the gains that protectionism brings to protected domestic producers. … being blind to the losses suffered by all fellow citizens save the relatively small handful of protected interests – or, inexplicably, discounting the reality or severity of these losses – interpret the gains enjoyed by the protected interests as evidence that protectionism is in the national interest.

It’s all (to use an old-fashioned term) poppycock.

Don Boudreaux, “Bonus Quotation of the Day…”, Café Hayek, 2019-04-01.

January 15, 2023

One last dance for Davos?

Elizabeth Nickson on the “walls closing in” but this time it isn’t “on Trump”, but it might be “on the World Economic Forum” and their enablers:

Klaus and his gang were in full egomaniacal flight last week in Davos. I wonder how secretly scared they were, swanning around in their $30,000 Loro Piana topcoats dreaming of what … a nice quiet prison? Their liability for this latest attempt to escape the whirlwind through forced pharmaceuticals and the construction of the Biomedical Security State, must be dawning on them. It was always a possibility, but they figured the populace — thanks to their equally witless behaviourists — were so dumb they’d consent to being permanently damaged and think it was the fault of the extreme right. And climate change.

[…]

In Australia, the more Covid shots you’ve had, the more Covid you get and the more you die. The unvaccinated sail by relatively unperturbed.

Did you know that Big Pharma takes between $8 to $10 Trillion out of the US economy every year? GDP is only $23 Trillion. That’s a lot of money to claw back by every injured person, every family who lost a wage earner, a mother, a treasured child. This is a profit center for the great unwashed unmatched in human history. A massive transfer of wealth from the .01% to us.

They are all liable: every executive, every celebrity, every film producer, every hospital chief, every newspaper publisher, every television station owner, every multinational media company, every medical center, every university, every employer, every politician who forced and bullied people. Their wealth is about to become ours.

May 10, 2021

They don’t make politicians like Lyndon Johnson anymore … thank goodness

Filed under: Books, History, USA — Tags: , , , , , — Nicholas @ 05:00

Another of the reader-contributed book reviews at Astral Codex Ten considers the personal history and astounding political career of LBJ, as told by biographer Robert Caro:

2: LBJ’s guide to amassing power

(i) Seduce older men

(Eww, not like that.) LBJ had a gift for becoming a “professional son” to any powerful man. At college, LBJ sat at professors’ feet and stared at them as if they were God’s gift to the educational system. LBJ constantly ran errands for the college president, Prexy Evans, and wrote glowing editorials about him.

LBJ’s fellow students were not amused. One said:

“Words won’t come to describe how Lyndon acted toward the faculty — how kowtowing he was, how suck-assing he was, how brown-nosing he was.”

But this flattery paid off. Evans put LBJ in charge of the financial aid program. Yes, really. And when other students wrote nasty comments about LBJ in the yearbook (e.g. the time he stole the Student Council elections), Evans ordered professors to cut out those pages with razors.

LBJ would repeat this flattery with President (Franklin) Roosevelt, Speaker Rayburn, and Senator Russell.

(ii) Treat your employees like dirt

LBJ wanted his staff to be absolutely loyal, so he could direct them like chess pieces. He found their weak points — their weight, their divorce — and mercilessly taunted them. I’m not going to describe the crude things he did.

Before his marriage, LBJ treated Lady Bird like an angel; once they were married, he treated her like one of his employees.

[…]

(v) Use money in new and exciting ways

LBJ funneled government contracts to Brown & Root, a construction company. In return, they gave his campaign gobs of money. During the 1948 election, two of his campaign staff ate at a cafe and then accidentally left behind a brown paper bag containing $50,000 in cash (more than $500,000 in today’s money). Luckily no one stole it.

Using all of this money, LBJ was able to make the media say whatever he wanted about his opponent, Coke Stevenson. He hired “missionaries” to hang out in bars and spread rumors about Stevenson. Thousands of federal workers also repeated LBJ’s talking points.

(vi) Cheat

But Stevenson was a storybook character, so money couldn’t defeat him. He simply told the people of Texas that he would continue to do the right thing, and they believed him. LBJ had lost the 1941 Senate election because Pappy O’Daniel had cheated better than he did. Now LBJ would cheat, and he would cheat big.

In 1940s Texas, basically every type of election fraud was real: Dead people voting, county bosses writing down whatever numbers they wanted, Mexicans being hired to cross the border and vote, etc. By buying tens of thousands of votes, LBJ was almost able to close the gap between him and Coke Stevenson. That wasn’t enough, so six days after the election, Luis Salas “found” 200 more votes for LBJ, giving him a margin of victory of 0.01%.

February 2, 2021

When the self-defined elites achieved class consciousness

At Rotten Chestnuts Severian adds to his ongoing series of posts identifying areas where Marx was right:

“Jay Gould’s Private Bowling Alley.” Financier and stock speculator Jay Gould is depicted on Wall Street, using bowling balls titled “trickery,” “false reports,” “private press” and “general unscrupulousness” to knock down bowling pins labeled as “operator,” “broker,” “banker,” “inexperienced investor,” etc. A slate shows Gould’s controlling holdings in various corporations, including Western Union, Missouri Pacific Railroad, and the Wabash Railroad.
From the cover of Puck magazine Vol. XI, No 264 via Wikimedia Commons.

… I liken Karl Marx to one of those bird-masked medieval Plague doctors — he sees the pathology clearly, indeed far faster and better than anyone else, but his proposed “cure” is far likelier to kill you than the actual disease. Worse, what makes Marx’s cure especially lethal is what ends up making his diagnosis essentially right: It’s a self-fulfilling prophecy.

The proletariat is achieving class consciousness, all right — look no further than the GameStop “short squeeze” for proof. But the only reason the proles are achieving class consciousness is because the “capitalists” forced them to, just like Marx said they would. The Elite and the Bureaucracy (usually, but not always, a distinction without a difference) finally achieved class consciousness through the combination of NAFTA and the Louvre Accords. Starting around 1990, then, the Elite self-consciously embraced their role as rootless, stateless, jet-setting parasites (with the wannabe-Elites in the Media, academia, and the bureaucracies signing up for tours of duty as fart-catchers, both to bask in reflected glory and in hopes of being promoted).
In short, our “Capitalists” — really, “financial-ists” or “spreadsheet gangsters,” since they don’t actually make anything, they just bust out existing firms via debt manipulation — behave exactly as Marx described factory owners behaving all the way back in the First Industrial Revolution.

In my naivete, I used to think Marx’s ranting was hyperbole. I cited the example of Andrew Carnegie — a real bastard in his youth, who went on to be one of the world’s great philanthropists. That’s human behavior, I said, as opposed to the bloodthirsty caricature of Marx’s fantasies … but I was wrong, comrades. Carnegie happily would’ve sold his fellow Americans down the river, just as Bezos, Gates, and the rest of the pirates-in-neckties are happily selling us down the river now. Only two things prevented it back then: one structural, one cultural.

The structural one is simply technology, and therefore uninteresting. Britain’s “free traders” — you know, the Jardine-Matheson types who started the Opium Wars for fun and profit — would’ve happily outsourced Britain’s entire industrial base to China if they hadn’t been hampered by wind speed. By the time this was technically feasible — which is about 1860, if you’re keeping score — simple inertia had taken over. They didn’t retool until they had to, at which point instant communications and modern ships … well, you know the rest. Like I said, it’s vital, but boring.

The cultural one is much more interesting. You might be tempted to say, as I did, that Jardine and Matheson were always on the lookout for #1, of course, but were sincere British patriots for all that, just as Carnegie for all his faults was an authentic American. I doubt it, comrades. I sincerely doubt it. What kept these guys in check wasn’t patriotism, or even culture. Rather, it was fear.

August 20, 2020

QotD: Manipulating minimum wage laws to harm your competitors

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

I would be very surprised if careful research of the history of this Oregon statute did not reveal a producer group — or producer groups — who benefitted materially from the minimum-wage-induced stifling of competition.

The logic of such rent-creating legislation is plain: producer group A competes for many of the same customers against producer group B. Producer group A, however, uses for its production a mix of inputs (most importantly, capital and labor) that differs from the mix used by producer group B. Also, producer group B might compete most effectively against producer group A not by producing outputs as nearly identical as possible to that of A but, instead, by producing “substitute” goods or services that sell at prices lower than those charged by producer group A.

For example, producer group A might consist of locally owned restaurants with tablecloths and serving food freshly prepared by skilled chefs, while producer group B consists of chain restaurants serving food less exquisite but priced much lower. Members of producer group A are upset that producer group B is competing successfully for some diners who would likely otherwise eat more frequently at the restaurants of producer group A. What are the members of producer group A to do?

They could accept the fact that competition is not tortious — indeed, that economic competition is healthy for the economy at large — and do nothing other than compete harder to win more consumer patronage. That’d be the honest and honorable path to take. But government is in the picture, standing ready to escort those with little interest in honesty and honor down the rent-seeking path.

So just pass legislation outlawing chain restaurants in our state,” suggests the leader of producer group A.

“Wish I could,” responds Sen. Slimey, “but that’s too blatant. Plus, it might not pass muster with the courts. But I’ve got an alternative plan that’s just as good.”

Do tell!” exclaims the leader of producer group A.

“Well, I understand,” replies Sen. Slimey, “that the restaurants run by producer group B use many more low-skilled workers in their kitchens than your restaurants use.”

That’s correct. We serve only fine food, so we hire experienced, high-skilled chefs, whose market wages are high.

“So,” observes Sen. Slimey, “let’s enact a statute that raises the minimum wage above the average wage now paid to the average worker in producer group B’s restaurants, but lower than the average wage paid to workers in your — producer group A’s — restaurants.”

Brilliant!” declares the leader of producer group A, who sees immediately that, while the minimum-wage legislation will on its face — de jure — apply to all restaurants, it will in fact have a differentially harsh effect on the restaurants in producer group B. The minimum wage will artificially raise producer group B’s costs of operation, causing them to reduce their outputs. One consequence of producer group B’s reduced outputs will be artificially increased demand for meals served at producer group A’s restaurants.

Sen. Slimey smiles, knowing that the news media, as well as most of the intellectuals in town, will applaud him for his apparent humanity and “Progressive” values. It’s a win-win for Sen. Slimey and for members of producer group A. And too few people will pay close-enough attention to the members, workers, and customers of producer group B to suspect that Sen. Slimey is anything other than a socially conscious public servant.

Don Boudreaux, “Doing Bad By Pretending to Do Good”, Café Hayek, 2018-05-13.

July 18, 2020

QotD: Peace can also be the health of the state

War, we libertarians are fond of telling each other, is the health of the state. Peruse the most recent posting here by our own WW1 historian, Patrick Crozier, to see how we often think about such things. So, what about that increasingly obtrusive and kleptocratic Brazilian state that has been putting itself about lately, stirring up misery and libertarianism? There have been no big wars to make the Brazilian state as healthy as it now is, and especially not recently. What of that?

The story Bruno Nardi told made me think of the book that explains how peace is also the health of the state, namely Mancur Olson’s public choice theory classic, The Rise and Decline of Nations. It is years since I read this, but the story that this book tells is of the slow accumulation and coagulation of politics, at the expense of mere business, as the institutions of a hitherto thriving nation gang up together to form “distributional coalitions” (that phrase I do definitely recall). The point being that if you get involved in a war, and especially if you lose a war, the way Germany and Japan lost WW2, that tends to break up such coalitions.

The last thing on the mind of a German trade unionist or businessman, in 1946, was lobbying the government for regulatory advantages or for subsidies for his particular little slice of the German economy. Such people at that time were more concerned to obtain certificates saying that they weren’t Nazis, a task made trickier by the fact that most of them were Nazis. Olson’s way of thinking makes the post-war (West) German and then Japanese economic miracles, and the relative sluggishness of the British economy at that time, a lot more understandable. Winning a war, as Olson points out, is not nearly so disruptive of those distributional coalitions, in fact it strengthens them, as Crozier’s earlier posting illustrates.

Brian Micklethwait, “The view from Brazil is that peace is also the health of the state”, Samizdata, 2018-04-13.

April 1, 2020

QotD: Government spending in theory and practice

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

Modern economics explains to governments how they and their crony capitalist mates can steal from you while pretending they are doing you good. And before we go any farther, here is something you should know before you listen to another word from anyone in government: Government spending never creates a net increase in employment. Government spending only creates jobs in one place at the expense of jobs somewhere else, and does it by giving money to the government’s best friends to run projects no firm, based on profit and loss, would ever undertake. And if the project is loss making, which government projects almost invariably are, it has taken the economy backwards — that is, people in general invariably become less well off than they otherwise would have been had these projects not gone ahead — even if those to whom the government has paid money are better off, which they almost invariably are. Government spending, unless there is a genuine and calculated return above the cost, is a ripoff, and it is you who are being ripped off. They pick your pockets and pretend they are doing you good.

Steven Kates, “Classical economic theory and the American recovery”, Catallaxy Files, 2018-01-15.

March 6, 2020

QotD: Mercantilism

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

The “mercantile system” is […] what we today commonly call “protectionism” or “economic nationalism.” By duping the general public into believing that the artificially promoted and protected profits and wages reaped by a handful of highly visible and politically powerful firms and workers are the same as — or are evidence of — a high standard of living for ordinary people nationwide, mercantilists convince members of the general public to accept government-imposed restrictions on their freedom to trade with foreigners. More succinctly, protectionists pull off the rather amazing feat of convincing ordinary people that their standard of living rises when government artificially increases the scarcity of the goods and services that they wish to consume.

Don Boudreaux, “Quotation of the Day…”, Café Hayek, 2017-12-17.

March 3, 2020

QotD: Public service and competitive private enterprise

Anyone who deals with the general UK public (coercive) sector regularly, knows it is a cesspit of laziness, incompetence, arrogance and corruption, riddled with civil servants that are neither civil nor servants.

And I’m not suggesting that the levels of corruption and incompetence are comparable to those found in third world hellholes. A local official in your county council is very unlikely to demand a bribe and then have your daughter raped by his buddies if you decline. He’s especially unlikely to get away with it, and then douse your family in petrol and burn them alive if you complain – those are the levels of corruption found elsewhere in the world, so we need to retain some perspective here.

But those countries have not benefited from a thousand years of sacrifice to earn us a culture that has learned through bitter experience how to run a country. Our civil servants should be performing at the highest standard and be the best in the world, because what they inherited was a culture that conquered that world, and brought civilisation and progress (often at great cost) to every corner of it.

That they have fallen from these heights and now occupy such low places should be a matter for great national shame. And yet they continue to lord it over those they pretend to serve – try calling your local planning department if you want instruction in how supercilious a local functionary feels able to be when speaking to those he claims to serve. If you just want them to do their job, you better be prepared to beg.

Whereas on the flip side, we might agree that the private (voluntary) sector is largely filled with honest and hardworking people and entrepreneurs, but there are crony capitalists out there too.

Your local butcher and baker (those that have survived the regulatory avalanches under which the crony capitalists have begged their pet politicians to bury them) remain staunch servants of their customers (through regard to their own interests), whereas oligoplists (supermarkets, telcos, insurance companies, banks, energy suppliers or transport companies) deliver to us just what the monopolists of government do – an icy contempt that would soon turn to withering small arms fire if the laws allowed it.

Alex Noble, “Corruption In The Coercive And Voluntary Sectors: Rotten Apples? Or The Tips of Icebergs?”, Continental Telegraph, 2019-12-02.

February 20, 2020

Why the Nazis Weren’t Socialists – ‘The Good Hitler Years’ | BETWEEN 2 WARS I 1937 Part 2 of 2

TimeGhost History
Published 19 Feb 2020

The Nazi economy appears to do well during the 1930s. But this is largely myth, as the German economy under Hitler is based on a self destructive, ideologically or selfishly fuelled irrationality driven by conquest and criminal practice.

Join us on Patreon: https://www.patreon.com/TimeGhostHistory

Hosted by: Indy Neidell
Written by: Spartacus Olsson
Directed by: Spartacus Olsson and Astrid Deinhard
Executive Producers: Bodo Rittenauer, Astrid Deinhard, Indy Neidell, Spartacus Olsson
Creative Producer: Joram Appel
Post-Production Director: Wieke Kapteijns
Research by: Spartacus Olsson
Edited by: Daniel Weiss
Sound design: Marek Kaminski

Sources:
Bundesarchiv_Bild:
192-269, 183-T0706-503, 183-S68029, 183-S68014,
183-S38324, 183-S33516, 183-S07227, 183-R98364,
183-H29131, 183-H25824, 183-H01704, 183-H13192,
183-H06734, 183-H00455, 183-C12671, 183-86686-0008,
183-2008-0826-506, 183-2008-0826-502, 183-2006-1128-504,
183-2004-0729-507, 183-1989-0630-504, 183-1988-0113-500,
146-2005-0191, 146-1990-048-29A, 146-1990-023-06A,
146-1984-040-26, 146-1981-124-32A, 146-1972-025-10,
102-13533, 102-12733, 102-11649, 102-06795, 102-04640,
145_Bild-P046280, 145_Bild-020683,

Colorizations by:
Daniel Weiss

Soundtracks from Epidemic Sound:
– “Document This 1” – Peter Sandberg
– “March Of The Brave 10” – Rannar Sillard – Test
– “Ominous” – Philip Ayers
– “The Inspector 4” – Johannes Bornlöf
– “Disciples of Sun Tzu” – Christian Andersen
– “Guilty Shadows 4” – Andreas Jamsheree
– “Last Point of Safe Return” – Fabien Tell
– “Death And Glory 1” – Johannes Bornlöf
– “Easy Target” – Rannar Sillard
– “Split Decision” – Rannar Sillard
– “First Responders” – Skrya
– “The Charleston 3” – Håkan Eriksson

A TimeGhost chronological documentary produced by OnLion Entertainment GmbH.

From the comments:

Spartacus Olsson
1 day ago
From an intellectual viewpoint, this is perhaps the most challenging episode I have written in this series. First of all it’s hard to make economic policy interesting, even when it’s about the Nazis. It tends to get, well … grey. Second of all it’s not that easy to simplify things without completely losing the essence of what was going on. Third of all, I’m fighting an uphill battle against a post truth, political talking point based on … let’s just call it less than ingenious purposes.

Obviously that’s the idea that the Nazis were Socialists. And perhaps that is not so far fetched when you think of the name of their party, the way they framed their anti-semitic rhetoric in a way that it would sound friendly to the working class, and their absolute disregard for telling the truth about anything, and everything. But although we have painstakingly showed you the facts, I am painfully aware that it won’t make a difference to stop the nonsense out there and in here — some pundits will religiously stick to their ideas, because if they don’t, they might have to face that some of the ideas they have are mutual with the people they so desperately want to distance themselves from. The same happened with the far left between the 1930s and 1970s, when they tried with cramped desperation to frame Stalinism as a right wing, Fascist movement — Red Fascism was the term — obviously as much nonsense as the alt-right idea that Naziism is Socialism.

And is it important? Well yes and no — the dumbos will probably get worn out at some point, it’s after all quite challenging to look for ways to distort the record over, and over again. I don’t really care if the extremists try to push their mutual garbage in each other’s lap — as a supporter of democracy and humanism, I have no regard for either end. I do however have an incredible amount of respect for conservatives, liberals, and progressives who are equally dedicated to democracy and human rights — and there is where it matters.

When the far left tries to frame Stalinism as right wing, and the far-right tries to frame Naziism is left-wing, they are trying to co-opt a position of less extremism. It’s an invasive attempt for Communists and (real) Socialists to just look like regular Progressives, and Fascists and Nazis to just look like regular Conservatives. And that my friends is dangerous, to all of us, regardless of our nationality, creed, political affiliation, or opinion — because it is specifically our individual rights and democracy that is at stake in this game. That’s what they want to take away, or in some places stop from developing.

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