Quotulatiousness

August 19, 2024

If you’ve never worked in the private sector, you have no idea how regulations impact businesses

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

In the National Post, J.D. Tuccille explain why Democratic candidates like Kamala Harris and Tim Walz who have spent little or no time in the non-government world have such rosy views of the benefits of government control with no concept of the costs such control imposes:

The respective public versus private sector experiences of the 2024 Presidential/Vice Presidential candidates.
New York Times

In broad terms, Democrats have faith in government while the GOP is skeptical — though a lot of Republicans are willing to suspend disbelief when their party controls the executive branch.

The contrast between the two parties can be seen in stark terms in the resumes of the two presidential and vice-presidential tickets. The New York Times made it easier to compare them earlier this month when it ran charts of the career timelines of Trump, J.D. Vance, Kamala Harris and Tim Walz. Their roles at any given age were colour-coded for college, military, private sector, public service or politics, federal government and candidate for federal office.

Peach is the colour used by the Times to indicate employment in the private sector, which produces the opportunities and wealth that are mugged away (taxation is theft by another name, after all) to fund all other sectors. It appears under the headings of “businessman” and “television personality” for Trump and as “lawyer and venture capitalist” for Vance. But private-sector peach appears nowhere in the timelines for Harris and Walz. Besides, perhaps, some odd jobs when they were young, neither of the Democrats has worked in the private sector.

Now, not all private-sector jobs are created equal. Some of the Republican presidential candidate’s ventures, like Trump University, have been highly sketchy, as are some of his practices — he’s openly boasted about donating to politicians to gain favours (though try to do business in New York without greasing palms). I’m not sure I’d want The Apprentice on my resume. But there must be some value to working on the receiving end of the various regulations and taxes government officials foist on society rather than spending one’s career brainstorming more rules without ever suffering the consequences.

In 1992, former U.S. senator and 1972 Democratic presidential candidate George McGovern penned a column for the Wall Street Journal about the challenges he encountered investing in a hotel after many years in government.

“In retrospect, I … wish that during the years I was in public office, I had had this firsthand experience about the difficulties business people face every day,” he wrote. He bemoaned “federal, state and local rules” passed with seemingly good intentions but little thought to the burdens and costs they imposed.

The lack of private sector stints in the career timelines of Harris and Walz means that, like pre-hotel McGovern, they’ve never had to worry about what it’s like to suffer the policies of a large and intrusive government.

That said, it’s possible to overstate the lessons learned by Republicans and Democrats from their different experiences. Vance, despite having worked to fund and launch businesses, has, since being elected to the U.S. Senate, advocated capturing the regulatory state and repurposing it for political uses, including punishing enemies.

Not only does power corrupt, but it does so quickly.

August 6, 2024

The CrowdStrike outage and regulatory capture

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

Peter Jacobsen discusses the July technical and financial fiasco as a faulty software patch from CrowdStrike took down huge segments of the online economy and how regulatory capture may explain why the outage was so widespread:

“CrowdStrike outage at Woolworths in Palmerston North” by Kiwi128 is marked with CC0 1.0 .

On July 19th, something peculiar struck workers and consumers around the world. A global computer outage brought many industries to a sudden halt. Employees at airports, financial institutions, and other businesses showed up to work only to find that they had no access to company systems. The fallout of the outage was huge. Experts estimate that it totaled businesses $5 billion in direct costs.

The company responsible, CrowdStrike, was also severely impacted. Shareholders lost about $25 billion in value, and some are suing the company. The outage has led to expectations of, and calls for, stricter regulations in the industry.

But how did the blunder of one company lead to such a massive outage? It turns out that the supposed solution of “regulation” may have been one of the primary culprits.

Regulatory Compliance

CrowdStrike, ironically, is a cybersecurity firm. In theory, they protect business networks and provide “cloud security” for online cloud computing systems.

Cloud security, in and of itself, is likely a service that businesses would demand on the market, but the benefit of increased security isn’t the only reason that businesses go to CrowdStrike. On their own website, the company boasts about one of its most important features: regulatory compliance.

[…]

When experts who have relationships with companies are called in to help write regulations, they may do so in a way favorable to industry insiders rather than outsiders. Thus, regulation is “captured” by the subjects of regulation.

We can’t say with certainty that this particular outage is the result of an intentional regulatory capture by CrowdStrike, but it seems clear that CrowdStrike’s dominance is, at least in part, a result of the regulatory environment, and, like most large tech companies, they’re not afraid to spend money lobbying.

In any case, without cumbersome regulations, it’s unlikely that cybersecurity would take on such a centralized form. Despite this, as is often the case, issues caused by regulation often lead to more calls for regulation. As economist Ludwig von Mises pointed out:

    Popular opinion ascribes all these evils to the capitalistic system. As a remedy for the undesirable effects of interventionism they ask for still more interventionism. They blame capitalism for the effects of the actions of governments which pursue an anti-capitalistic policy.

So despite the reflexive call for regulation that happens after any disaster, perhaps the best way to avoid problems like this would be to argue that in terms of regulation, less is more.

August 4, 2024

The rise and (rapid) fall of the Levittown model

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

Virginia Postrel linked to this interesting post at Construction Physics which traces the brief heyday of William Levitt’s “Levittown” model for mass-producing modern housing:

Prefabbed components and appliances for a Levittown home.
Image from Construction Physics.

For decades, people have tried to bring mass production methods to housing: to build houses the way we build cars. While no one has succeeded, arguably the man that came closest to becoming “the Henry Ford of homebuilding” was William Levitt, with his company Levitt and Sons. Levitt is most famous for building “Levittowns”, developments of thousands of homes built rapidly in the 1940s, ’50s, and ’60s. By optimizing the construction process with improvements like standardized products and reverse assembly line techniques, Levitt and Sons was able to complete dozens of homes a day at what it claimed was a far lower cost than its competitors. William Levitt styled his company as the General Motors of housing, and both he and it became famous. Levitt graced the cover of Time magazine in 1950, and Levittowns became a household name.

For a time, it appeared that Levitt might actually sweep away the old way of building and become the Henry Ford of housing through modern mass production techniques. Levitt boasted that he could build more cheaply than anyone else, and for decades Levitt and Sons was the largest homebuilder in the U.S., and probably the world.1 But Levitt’s success unraveled. By the late 1970s, Levitt and Sons had barely escaped bankruptcy, and it emerged as a small, conventional homebuilder, which it would remain until it went out of business for good in 2018. Levitt himself would leave Levitt and Sons in the early 1970s, lose his fortune after a series of failed development projects in the U.S. and abroad, and die penniless in 1994.

Levitt’s model of large-scale, efficient homebuilding using mass production-style methods worked for a brief window in the 1950s, but by the end of the 1960s a changing housing market and increasingly strict land use controls meant that such methods were no longer feasible. And even at its peak, Levitt likely pushed large-scale building beyond what could be justified on pure economic terms. Levittown was ultimately a response to a temporary set of housing market conditions, not the herald of a new, better way of building.

[…]

First Levitt homes at Levittown.
Image from Construction Physics.

At Levittown, the construction process was broken down into 26 separate steps, each performed by a separate crew. Crews would go to a house, perform their required task (using material that had been pre-delivered), then move on to the next house. Within the crew, work was further specialized: on the washing machine installation crew, William Levitt noted that “one man did nothing but fix bolts into the floor, another followed to attach the machine”, and so on. By breaking down the process into repetitive, well-defined steps, workers didn’t have to spend time figuring out what they should do (what Levitt described as “fumbling and figuring”).

In addition to task and product standardization, Levitt and Sons took advantage of machines and mechanization wherever possible. It had its own cement trucks, and operated its own foundation-digging machinery and cinder block-making machinery. Levitt and Sons was an early user of power tools like paint sprayers, power saws, routers, and nailers. The company also made extensive use of what at the time were relatively novel factory-produced materials, like plywood and drywall.

Like any mass production process, the ultimate enemy of building Levittown was delay: keeping construction on track meant a steady, uninterrupted stream of material that arrived at the jobsite exactly when needed. On a typical construction site, as much as half the time was wasted while workers wandered around looking for needed material. In Levitt’s operation, wasted time was close to zero. To ensure timely material deliveries (and to cut out middlemen), Levitt and Sons had its own distribution company, the North Shore Supply Company, which stretched for half a mile along a railroad stop near the jobsite. To avoid delays, North Shore Supply kept a sufficient supply of material on-hand to build 75 houses, and pre-assembled items like plumbing trees, stairs, and cabinets. North Shore was also where lumber was pre-cut to the correct size. By using standardized designs, planned work sequences, and carefully controlled precutting, Levitt and Sons was able to almost entirely eliminate rework during the construction process.

But assuring an uninterrupted flow of material required far more than just owning a distribution company. William Levitt described some of the extreme measures the company went to avoid delays or slowdowns:

    We wouldn’t let ourselves be stopped by shortages. When cement was unavailable in this country we chartered a boat and brought it in from Europe. When lumber was in short supply, we bought a forest in California and built a mill. When nails were hard to come by, we set up a factory in our backyard and made them ourselves.

At its peak Levitt and Sons was completing 36 homes in Levittown a day. And the huge backlog of demand meant that housing was sold quickly. Months before the first Levittown homes were completed, families stood in line for the opportunity to rent one (roughly the first 2,000 Levittown homes were built as rentals). On a single day in 1949, Levitt and Sons sold 1400 homes, some to families who had been waiting in line for days. At $7,990 for a 800 square foot home, Levitt boasted that he could sell his houses for $1,500 less than the competition and still make $1,000 in profit.2

[…]

William Levitt tried harder than anyone else to make housing mass producing happen, and for a brief moment it looked like he might succeed. But Levitt’s dreams were predicated on a particular set of housing market conditions — a huge backlog of demand, relatively few competitors, compliant building jurisdictions and little public opposition — that quickly dissipated. In The Merchant Builders, Ned Eichler notes that as early as the mid-1950s, the Levitt model of a single, enormous project built rapidly with mass production-style methods no longer made sense. Says Eichler, “There simply was no market in which an appropriate site could be bought cheaply enough or in which demand was great enough to sustain such a pace”. Many of Levitt’s innovations — slabs instead of basements, power tools, drywall and plywood — did not require large volume production, and were adopted by other, smaller builders (and have since become standard). The enormous increase in land use controls starting in the late 1960s only further inhibited the sort of large-scale developments that Levitt favored.

    1. Levitt and Sons was at least the largest in the U.S. in 1950, and was in 1968 when it was acquired by ITT, and probably for some years after that.

    2. The first Levittown demonstration homes were sold for $6,990.

July 25, 2024

David Friedman on the economics of trade

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

David Friedman discusses how, for example, the US and China manage their trading relationship:

“United States Balance of Trade Deficit-pie chart” by Shirishag75 is marked with CC0 1.0 .

I recently read a thread about US/China trade on a forum occupied mostly by intelligent people. As best I could tell, all participants were taking it for granted that things that make it more expensive to produce in the US, such as regulations or minimum wage laws, make the US “less competitive”, increase the trade deficit, give the Chinese an advantage. Reading Project 2025, the Heritage Foundation’s battle plan for a future conservative president, I observed the same pattern, with only one exception.

It did not seem to have occurred to any of the forum posters that US costs are in dollars, Chinese costs in Yuan, and what determines the exchange rate between them is the cost of producing things. Discussing trade policy in terms of absolute advantage, pre-Ricardian economics, isn’t quite as bad as discussing the space program on the assumption that the Earth is at the center of the universe with sun, moon and planets embedded in a set of nested crystalline spheres surrounding it — Copernicus was about three centuries earlier than Ricardo — but it is close. It is a point that I made here about a year ago, but since the question came up in my most recent post and in a thread on my favorite forum, it is probably worth making again.

The Economics of Trade

It is easiest to start with the simple case of two countries and no capital flows. The only reason Americans want to buy yuan with dollars is to buy Chinese goods, the only reason Chinese want to sell yuan for dollars is to buy American goods. If Americans try to buy more yuan than Chinese want to sell, the price of yuan in dollars goes up, if Chinese want to sell more yuan than Americans want to buy, the price goes down, just as in other markets. The price of yuan in dollars, the exchange rate, ends up at the price at which supply equals demand, which means that Americans are importing the same dollar (and yuan) value of goods that they are exporting.

Suppose the US government, inspired by the mercantilist view that countries get rich by exporting more than they import, tries to produce a “favorable” balance of trade by imposing a tariff on Chinese imports. Chinese goods are now more expensive to Americans. Since they want to buy less from China they don’t need as many yuan so the demand for yuan goes down, the price of yuan in dollars goes down, which reduces the cost of Chinese goods to Americans. Just as before, the exchange rate ends up at a level at which the dollar value of US exports equals the dollar value of US imports. Both imports and exports are now less, since trade is being taxed, but the balance of trade is exactly what it would be without the tariff.

Suppose the US becomes less good at making things due to an increase in government regulation or some other cause. Dollar prices of US goods in the US go up. That makes US goods more expensive to Chinese purchasers so they buy fewer of them, decreasing the demand for dollars on the dollar/yuan market. The exchange rate shifts — dollars are now less valuable so their price falls. Trade still balances. The US is not “less competitive”, merely poorer.

Now add in more countries. One reason Chinese want to buy dollars is to sell them to Germans who want dollars with which to buy American goods. We end up with a trade deficit with China, since some of the dollars they get for their exports are being used to import goods from Germany instead of the US, but a matching trade surplus with Germany, since they are using both the dollars they get by selling things to us and the dollars they get from China to buy goods from us. The same logic applies with more countries.

To explain how it is possible for the US to have a trade deficit we now drop the assumption of no capital movements. One reason Chinese want dollars is to buy goods and ship them to China but another is to buy assets in America — government bonds, shares of stock, real estate. Dollars bought and dollars sold are still equal but exports of goods no longer equal imports of goods. Part of what the US is “exporting”, selling to foreigners, is assets located in the US.

Suppose the US government wants to reduce the trade deficit. One way would be to reduce the budget deficit, since if the US is borrowing less it will not have to pay lenders as high an interest rate, which will make US bonds less attractive to Chinese buyers. Another way would be to block capital movements, make it illegal for foreign buyers to buy US assets. Doing that, however, means less capital investment in the US, hence higher interest rates. With fewer lenders to buy US bonds, the government will have to offer a higher interest rate to sell them.

One argument sometimes offered for restricting foreign investment is that if the Chinese own a lot of US assets that gives them power over us. The same argument was offered in the early 19th century when European investors were paying to build railroads and dig canals in the US. Daniel Webster pointed out that, if there was a conflict with European powers, their assets were sitting on our territory under our control. It wasn’t like they could repossess the Erie canal.

What about imposing a tariff in order to reduce imports? The logic of the previous argument still applies — the exchange rate will shift to make imports more attractive, exports less. Any effect on the deficit will depend on what happens to the attractiveness of US assets to Chinese investors. Figuring out the net effect is complicated, depending in part on what people expect trade policy and exchange rates to be when they collect on their capital investments.

July 2, 2024

The Chevron decision

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

On his substack, Glenn “Instapundit” Reynolds discusses the recent US Supreme Court decision on “Chevron deference” and how it is going to impact the administrative state (and their business victims) going forward:

Goodbye, Chevron deference. Larry Tribe is already mourning the Supreme Court’s overturning of NRDC v. Chevron, in the Loper Bright and Relentless cases, as a national catastrophe:

Oh, the humanity!

Well, speaking as a professor of Administrative Law, I think I’ll bear up just fine. I’ve spent the last several years telling my students that Chevron was likely to be reversed soon, and I’m capable of revising my syllabus without too much trauma. It’s on a word processor, you know. As for those academics who have built their careers around the intricacies of Chevron deference, well, now they’ll be able to write about what comes next. And if they’re not up to that task, then it was a bad idea to build a career around a single Supreme Court doctrine.

And that wasn’t the only important Supreme Court decision targeting the administrative state, a situation that has pundit Norm Ornstein, predictable voice of the ruling class’s least thoughtful and most reflexive cohort, making Larry Tribe sound calm.

Sure, Norm, whatever you say.

But how about let’s look at what the Court actually did in Chevron, and in the Loper Bright and Relentless cases that overturned it, and in SEC v Jarkesy, where the Court held that agencies can’t replace trial by jury with their own administrative procedures, and in Garland. v. Cargill, where the Court held that agencies can’t rewrite statutes via their own regulations. I don’t think you’ll find the sort of Russian style power grab that Ornstein describes, but rather a return to constitutional government of the sort that he ought to favor.

At root, Chevron v. Natural Resources Defense Council is about deference. Deference is a partial abdication of decisionmaking in favor of someone else. So, for example, when we go out to dinner, I often order what my son-in-law orders, even if something else on the menu sounds appealing. I’ve learned that somehow he always seems to pick the best thing.

Deference doesn’t mean “I’ve heard your argument and I’m persuaded by it”, (though something like that is misleadingly called “Skidmore deference”, but isn’t actually deference at all). Deference means “even if I would have decided this question differently, I’m going to go with your judgment instead”.

Under Chevron deference, when an agency interprets a statute it administers (e.g., the EPA and the Clean Air Act), a court will uphold its interpretation so long as it is (generously assessed) a reasonable one, even if it is not the interpretation the court would have come up with on its own. As you might imagine, this, at least potentially, gives agencies a lot more leeway, particularly when, as is often the case, Congress has drafted the statute ambiguously.

With Chevron overturned, courts will now apply their own judgment instead of deferring to agencies. Of course, this isn’t as big a deal as Larry and Norm seem to think, because Chevron has been dying the death of a thousand cuts for a while. Under the “major questions doctrine”, courts already decline to defer to agency interpretations where the issue has major social or economic ramifications.

June 29, 2024

Oh no! The filthy proles are getting too many calories! Let’s re-impose rationing!

Filed under: Britain, Economics, Food, Health, Media — Tags: , , , , , , , — Nicholas @ 05:00

Tim Worstall suggests that the regular “viewing with alarm” thumbsuckers about purchased meals having “too many calories” are actually an indication of a strong desire by the great and the good to stick their regulatory noses into the lives of ordinary people:

“Indian take away in Farrer Park” by Kai Hendry is licensed under CC BY 2.0 .

This headline is, of course, wrong.

    Some takeaway meals contain more calories than daily limit, UK study finds

There is no daily limit. We do not have laws stating how much food we are allowed to eat. Of course, there are those who want there to be such laws but there aren’t, as yet. What there is is a series of recommendations about the limits we should impose upon ourselves:

    Some takeaway meals contain more calories in one sitting than someone is advised to consume in an entire day, a study of British eating habits has revealed.

That’s better.

    Cafes, fast-food outlets, restaurants, bakeries, pubs and supermarkets are fuelling the UK’s obesity crisis because so many meals they sell contain dangerously large numbers of calories, it found.

That’s not better. Because a plate of food containing a lot of calories is not a danger. Eating many of them might be but that the average household can get a gutbuster for some trivial portion of household earnings is a glory of modern civilisation, the very proof we require that we’re all as rich as Croesus.

And this is actually true too. That we are gloriously rich and it’s our food supply that proves this. As Brad Delong likes to point out back 200 years (yes, about right, 1820s is as it was really changing but 300 years would be better) it took a full day’s work to be able to gain 2,000 calories a day for a day labourer. There are 800 million out there still living at that standard of living. We can buy 2,000 calories — if we go boring stodge — for 30 minutes work now.

By history and by certain geographies we are foully rich these days. Which is the complaint of the wowsers of course. They’re a revival of the puritans and their sumptuary laws. How dare it be true that people fill their bellies with food they actually like?

    Six out of 10 takeaway meals contain more than the 600-calorie maximum that the government recommends people should stick to for lunch and dinner in order to not gain weight, according to the research, which was carried out by the social innovation agency Nesta.

    One in three contain at least 1,200 calories – double the recommended limit.

And? So, folk can buy lots of food for not much money. This is the very thing that makes having a civilisation possible — cheap food. My wife and I do indeed partake of an Indian occasionally — and find the takeout portions rather large. So, we have one amount for lunch or dinner and we’ve a refrigerator in which to keep the excess for a supper or snack another day. This is not beyond the wit of man to organise.

We don’t order in food very often, but when we do we usually manage to get both dinner on the night and lunch on the morrow from a typical order. If the nosey parkers have their way, they’d limit what we were allowed to buy — for our own good, of course — so we’d almost certainly still pay the same amount for less food. Such a deal!

June 27, 2024

The Toronto Star wants Ontario to adopt Scottish booze regulation (but ignore the failure)

Filed under: Britain, Cancon, Government, Law, Liberty, Media, Politics, Wine — Tags: , , , , , — Nicholas @ 05:00

The Toronto Star always loves a good moral crusade, and if it also happens to fly in the face of whatever Premier Ford wants to do, then so much the better:

The Toronto Star is looking to Scotland to teach it how to reduce alcohol-related deaths. In an article titled “How Scotland started to kick its alcohol problem — and what Ontario could learn from it“, it pushes back on plans to liberalise Ontario’s state monopoly on alcohol retail, saying:

    Ontario officials say they are fulfilling a 2018 election promise to increase “choice and convenience for shoppers and support Ontario retailers, domestic producers and workers in the alcohol industry”.

    But Scotland has cut alcohol-related hospital admissions by 40 per cent and deaths by almost half. While in Ontario, alcohol-related admissions have risen by a third and deaths by almost half, according to the Canadian Centre on Substance Use and Addiction.

How did Scotland supposedly achieve this public health miracle?

    The key part of Scotland’s landmark policy was aimed at reducing drinking by introducing minimum unit prices to make drinking more expensive.,/p>

Ontario already has minimum pricing and Scotland doesn’t have a state alcohol monopoly, so it is not obvious what lessons Ontarians are supposed to be learning, but put that to one side for a moment and consider the main claim.

Anyone who has been following events in Scotland knows that alcohol-specific deaths have risen since minimum pricing was introduced in 2018 and have generally risen since 2012 following a significant downturn in the years prior.

It is that drop between 2006 and 2012 that the Toronto Star must be referring to when it claims that deaths fell by “almost half” (actually a third). But the Scottish government didn’t pass any anti-alcohol legislation in those six years and it certainly didn’t have minimum pricing. The newspaper mentions that the drink-drive limit was cut, but that didn’t happen until 2014 and the evidence is clear that it had no effect on road accidents.

Since the Toronto Star doesn’t mention when the decline in alcohol-specific deaths took place, it is leading its readers to believe that it coincided with the introduction of minimum pricing and the lowering of the drink-drive limit. I call that lying.

It is strangely fitting that Canadians are being lied to about the “success” of Scotland’s alcohol strategy since the Scottish public were conned into accepting minimum pricing, in part, on the basis of lies told about the “success” of minimum pricing in Canada. The neo-temperance academic Tim Stockwell, who is quoted in the Star article, published a series of studies in the 2010s making some absurd claims about minimum pricing that were parroted by campaigners in the UK.

June 23, 2024

The amazing range of things Britain’s Ofcom gets its tentacles into

Filed under: Britain, Bureaucracy, Government, Media, Politics — Tags: , , , , , , , , — Nicholas @ 03:00

Earlier this week, Mark Steyn discussed the British government’s Office of Communications (Ofcom) and the way it rigs regulates who can say what during British election campaigns:

Why do I think the UK state censor Ofcom should be put out of business? Because there are very few areas of British life that this strange, secretive body does not “regulate”. Take, for example, this current UK election campaign, which the media are keen to keep as a torpid Potemkin struggle between TweedleLeft and TweedleRight. So, on Thursday night, BBC bigshot Fiona Bruce will host a debate between the four party leaders – that’s to say, the head honchos of the Conservatives, Labour, the Liberal Democrats and the Greens.

Wait a minute: what about Nigel Farage, leader of the Reform party? Since the beginning of the year, Reform has been third-placed in the polls, ahead of the LibDems and Greens, and last week they rose to second place ahead of the unlovely Tories.

So why wouldn’t the second-place party get a spot in the leaders’ telly debate?

Ah, well, you’re looking at it all wrong, you hick. Here’s how the Beeb explain it:

    The Ofcom guidance gives “greater weight on the actual performance of a political party in elections over opinion poll data” taking into account the “greater uncertainty associated with support in opinion polls”.

The “actual performance of a political party” refers to their results in the two previous elections — 2019 and 2015 — when Reform didn’t exist. A lot of other things didn’t exist in 2015: Brexit, Covid, lockdown, the Ukraine war, legions of vaccine victims, the massed ranks of Albanian males occupying English country-house hotels …

But, per “Ofcom guidance”, Campaign 2024 has to be conducted on the basis of how things stood a decade ago.
You know who would also be ineligible to participate under Ofcom’s rules? Everyone’s favourite Lana Turner sweater-girl in Kiev, Volodymyr Zelenskyyyyy. He only formed his Servant of the People party in late 2017, so no election debates for you, sweater-girl. And don’t try blaming it on Putin, because it’s “Ofcom guidance” so we all know it’s on the up-and-up.

Because, as their barrister assured the High Court, Ofcom are “expert regulators”. Lord Grade and Dame Melanie Dawes probably did a module in regulation at Rotherham Polytechnic or whatever.

I can see why the likes of Naomi Wolf’s creepy stalker-boy Matthew Sweet like this system: it’s a club and they get to decide who’s admitted. It’s less obvious why the generality of the citizenry put up with it. At any rate, get set for another thrilling BBC election debate in which all four “opponents” agree on Covid, climate, Ukraine, the joys of mass Muslim immigration and the inviolability of the NHS … but ever more furiously denounce each other for not tossing enough money that doesn’t exist into the sinkhole.

Don’t get me wrong, I quite like that pixie Green leader who describes herself as a “pansexual vegan”, and I certainly don’t have the personal baggage with her that I have with Nige. But under what rational conception of media “regulation” does the six per cent basement-dweller get guaranteed a seat at the table but not Reform?

And you wonder why nothing changes?

June 15, 2024

W.H.O. the hell do they think they are?

Filed under: Britain, Bureaucracy, Business, Health, Politics — Tags: , , , , , — Nicholas @ 04:00

Christopher Snowden on what he calls a “new low” for the World Health Organization (WHO) in a report issued earlier this week that sounds like Karl Marx was one of the writers:

The WHO European Region published a new report today, written mostly by British ‘public health’ academics. It is quite revealing. For example …

    This requires, at a minimum, that governments recognize that the primary interest of all major corporations is profit and, hence, regardless of the product they sell, their interests do not align with either public health or the broader public interest. Any policy that could impact their sales and profits is therefore a threat, and they should play no role in the development of that policy. Similarly, governments must also recognize the now overwhelming evidence (see also chapters 4, 6 and 7) that HHIs [“health-harming industries”] engage in the same political and scientific practices as tobacco companies and that voluntary or multistakeholder partnership approaches do not work where conflicts of interest exist. Instead, they must regulate other HHIs [“health-harming industries”], their products and practices, as they do tobacco.

That’s just one paragraph, but there’s a lot it in.

Firstly, they are clearly not just opposed to “health-harming industries” but to private industry and the free market in general.

Secondly, they want to exclude all industries from the policy-making process, as already happens with the tobacco industry.

Thirdly, they want to regulate all “health-harming industries” in the same way as they regulate tobacco. These industries include alcohol, food and fossil fuels, but the report also mentions pharmaceuticals, infant formula, gambling, firearms, healthcare (!) and sugary drinks. As the quote above makes clear, they think that all private industry damages health in some way.

This is all there in black and white and there is much more of the same in the report. This is not scaremongering or the slippery slope fallacy. It is in an official WHO document.

When people show you who they are, believe them.

I have written about this for The Critic …

    If this sounds to you like Bolshie talk, you might be onto something. It is further confirmation that the modern “public health” movement is an arm of the hard left presented as an arm of medicine. It would be tempting to tell the authors to stay in their lane, but anti-capitalist nanny statism is their lane. For over a decade, such academics, mostly from Britain and Australia, have been pumping out studies about the “commercial determinants of health” and the “corporate political activity” of “unhealthy commodity industries”. The new WHO report is a sort of greatest hits collection. Last year they published a whole series of articles in the Lancet in which they claimed that there is “growing evidence that neoliberalism has been damaging to health” and called for “a normative shift away from harmful consumptogenic systems”.

    Half-baked Marxist rhetoric has been rife in the social sciences for decades, but these people have a vaguely coherent point to make and are pursuing a serious, if terrifying, agenda. Since they do not believe in human agency, they assume that people only make “unhealthy choices”, such as eating processed ham, because the system that controls them has been rigged by big corporations. They say in today’s report that “consumers do not have capacity (time or resources) to make the ‘right’ choice”. Fortunately, public health academics know what the right choice is and could impose it on a grateful population if it were not for the pesky free market. Hence their rage against capitalism, which extends to suspicion of intellectual property, international trade, share buybacks, impact assessments (because they allow businesses to engage with policy-makers) and even the EU single market.

Further to what I say in the article, I’d add that it is to the UK’s shame that so many of the authors of this report are British. They include quackademics that I have been making fun of for years, such as Anna Gilmore, Mark Petticrew and May van Schalkwyk. Between them, they constitute a small clique of talentless, fanatics and/or grifting social scientists who have constructed a world of unreality for themselves by publishing endless low quality journal articles which they and their colleagues then reference and self-reference. It is profoundly depressing that they are now dangling the corpse of the WHO — which was once a great institution — on pieces of string.

June 10, 2024

The FDA has a jaundiced view of psychotherapy involving the use of MDMA (aka “Ecstasy”)

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

Colby Cosh indulges in a minor “I told you so” after the FDA’s expert panel recommended against the agency permitting any medical use of MDMA, despite some experiments indicating it does have therapeutic value:

Ball-and-stick model of the 3,4-methylenedioxy-methamphetamine molecule, also known as MDMA, or ecstasy, a well-known psychoactive drug. Based on the crystal structure of MDMA hydrochloride, as determined by X-ray diffraction.
Color code: Carbon, C: black, Hydrogen, H: white, Oxygen, O: red, Nitrogen, N: blue.
Image by Jynto via Wikimedia Commons.

Hopes for research into therapeutic uses of psychedelic drugs received a setback last week, one that your correspondent saw tripping (geddit?) up the road in advance. An expert panel published its official advice to the United States Food and Drug Administration (FDA) on permitting medical use of MDMA, the synthetic nightclub enhancer that we’re afraid the kids probably still aren’t calling “ecstasy” or “molly”.

There is long-recognized potential for MDMA to be combined with classical psychotherapy in treating emotional disorders, notably post-traumatic stress (PTSD), and now there are some small, limited studies showing evidence of positive effects.

But the FDA’s scientists weren’t very impressed with this evidence, and they voted almost unanimously against creating a therapeutic exception to the illegality of ecstasy, which the U.S. Controlled Substances Act classifies as a “Schedule 1” drug, right next to heroin. The panel’s advice isn’t binding on the agency, which is crawling in somewhat good faith toward recognizing the understudied medical potential of psychedelics. But the vote emphasizes the inherent problems that drugs face, once they are defined in law as “recreational”, in winning over skeptical scientists.

Reason magazine’s great drug-war correspondent Jacob Sullum has a thorough discussion of the issues. The existing research, despite some impressive headline results, has garden-variety issues with dropout rates, follow-ups and occasional researcher shenanigans. But the big problem, which defies easy technical solution, is with scientific blinding of the research subjects.

Scientific trials of the modern kind are predicated upon separating illusory placebo effects from genuine treatment effects. Researchers expect that a high-quality study will have a control group that receives sham treatment or none at all, and good practice requires that experimenters and their guinea pigs are both blind to who is in what group.

News flash: most people can tell whether they’ve been really given a psychedelic drug. Indeed, most doctors can tell whether they’ve given a patient a genuine psychedelic drug, and how much of it. Many placebo-controlled trials on psychoactive drugs, perhaps most of them, thus suffer from an alleged problem of broken blinding. (Have a glance, for example, at Table 2 in this review of blinding procedures in psychedelic studies.)

June 7, 2024

Since 2015, the Trudeau Liberals have done a fantastic job of suppressing the Canadian economy

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

If Canadians elected Justin Trudeau and the Liberal Party to make major changes from what had gone on under Stephen Harper’s Conservatives, then they got their wish in so many different ways, but especially economically:

Reports of Canada’s dismal economic outcomes seem never to end. Why should they? For years Canadians have had the same federal government delivering the same deleterious economic policies and the same expansion in regulatory initiatives and spending that have invariably depressed economies and reduced standards of living whenever and wherever they are imposed. Therefore, until the federal government or its policies change, we should not expect the miserable results to materially improve.

The latest negative report is the release of Canada’s 2024-Q1 GDP numbers on Friday, which again showed sluggish growth relative to population, resulting in yet another quarterly decline in real GDP per capita. Relative to 2015-Q3, the last full quarter before the Trudeau government took office, cumulative real GDP per capita is up only about 0.7 per cent. A recent RBC Economics analysis showed from around 1991 to 2015, cumulative real GDP per capita growth in Canada approximately tracked with the U.S., but not since Justin Trudeau took office. Compared to 0.7 per cent growth in Canada from 2015-Q3 to 2024-Q1, real GDP per capita is up 15.7 per cent in the U.S. in the same time period.

Where the 0.7 per cent comes from matters, too. In real per capita terms, some components of GDP — mainly government — expanded while others contracted. Alarmingly, business investment, which drives productivity and standards of living, is down 13.9 per cent. This includes real per capita reductions of 15.2 per cent in residential structures, 18.4 per cent in machinery and equipment, and 19.3 per cent in non-residential structures, with an increase in intellectual property investment not nearly enough to offset the reductions in other categories.

To understand why business investment and economic performance in Canada are so poor under the Trudeau government, let us consider the following representative example of its economic strategy.

The government believes many families struggle with the cost of caring for young children, which is a legitimate concern. A reasonable solution, which the Harper government implemented in 2006, is to send money to families with young children and let parents buy for their children what they need. After the Liberals expanded that program, they could have left it at that, but what have they done instead? The government initiated a national takeover of child care, effectively expropriating child care entrepreneurs’ businesses by flooding their sector with public money and then controlling private companies’ revenues and operations. The result is child care entrepreneurs’ investments have been wiped out or severely reduced, control of their business operations have been wrestled away by government, and they are unable to properly serve their customers (the families), as evidenced by the drastic reduction in parental options and widespread shortages.

June 3, 2024

QotD: Economic feedback

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

Well, now I think about it, most feedback is annoying.

Economics is full of it — as are other economic systems — and humans find it so annoying they have devised various means of shutting it down, and then become puzzled and do crazy stuff when the system goes out of control.

Take price controls. They deliberately shut down feedback. The idea is “people need to eat and the essentials should be cheap”. We went tons of rounds on this in the seventies in Portugal. It was FUN — not — and responsible for empty grocery shelves and problems getting the essentials. Because when cooking oil was dirt cheap by price control, everyone who had ridden this pony before (with bread, with toilet paper, with …) would buy everything in the grocery shelves. Meanwhile, because it was impossible for merchants to make a profit on the thing, they didn’t stock it. Which was okay, because the factories that made it couldn’t afford to at that price, so they stopped. And all the way down the line.

This is because what the idiot politicians were shutting down was the feedback. Prices are many things — and sometimes annoying when you really want a good pair of noise-cancelling headphones but your bank account is crying, to use a totally random example — but MOSTLY? They’re information. They’re feedback.

Because, yes, people work for profit, and profit — things that Warren and Sanders will never get — is not dirty, it’s what people live on, when prices go up — meaning there’s more demand than supply — people go “hey, you can make a profit in this” and start making more, until the supply and demand match, and you can’t make as much money, so people wander off to do other stuff.

You shut down the signal, and things go insane. You keep it shut down long enough while handing down lists of things that the government wants you to make, and vast famines sweep the land but you have a surplus of size 35 shoes for the left foot only. Because the directive handed the factory made that the easiest thing to do.

But it is not just in economics (though eh, everything is a branch of economics, as my reading in my 30s informed me. Which means that’s probably when I started going insane) that humans love shutting down feedback.

The truth is we don’t like reality very much, and are more or less perpetually at war with it.

We have this image of how things should be, and because we imagine it so clearly we think it’s a moral imperative.

Sarah Hoyt, “Shutting Off Feedback or How We Got Into This Fine Mess”, According to Hoyt, 2019-11-04.

May 25, 2024

Justin Trudeau – “a large percentage of small businesses are actually just ways for wealthier Canadians to save on their taxes”

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

Even before he became Prime Minister, the signs were there that Justin Trudeau was instinctively anti-small-business and that this would inform his approach to taxation and regulation of the private sector:

Changes to capital gains tax in this year’s budget were aimed at the wealthy, said the Trudeau Liberals, but the move has angered small businesses owners who have been snared by the increase.

Maybe that was part of the plan, since Justin Trudeau appears to view small business owners as rich Canadians trying to dodge taxes.

In an illuminating interview with the CBC’s Peter Mansbridge in 2015, Trudeau didn’t directly answer a question about whether he would lower taxes for small businesses.

But he did say, “We have to know that a large percentage of small businesses are actually just ways for wealthier Canadians to save on their taxes and we want to reward the people that are actually creating jobs and contributing in concrete ways.”

It was a remarkable denigration of small business owners and may have passed unnoticed because Trudeau was still a month away from becoming prime minister.

For the record, businesses with fewer than 100 people employ almost 12 million private workers in this country.

And the government’s own statistics state that in the 20 years up to 2020, the number of small businesses increased every year except for three — 2013, 2016 and 2020 — so a decrease in two of the Trudeau years.

Meanwhile, Trudeau’s apparently tax-dodging wealthy small businesses seem to be having a hard time of it. Businesses that began with four or less employees were only 62 per cent likely to still be operating five years later.

Earlier this year, Reuters news agency warned that a 38 per cent spike in bankruptcies of small businesses in the first 11 months of 2023 could rise even further.

Small businesses are “an integral engine of Canada’s economy,” said the budget, but 72 per cent of the owners fear that the new changes to capital gains tax will harm the climate for investment and growth.

Interestingly, when Trudeau was asked in that 2015 interview how he planned to balance the budget by 2019, because that was what he promised, it was investment and growth that was the answer.

Then prime minister Stephen Harper had tried to cut his way out of the deficit, said Trudeau. “That doesn’t work.”

“He has been unable to create growth. He has the worst record on growth of any prime minister in 80 years.”

But as the Fraser Institute has pointed out, in the last nine years under Trudeau, Canadian living standards have declined.

May 24, 2024

Bernie Sanders finally finds a group of rich people who he thinks shouldn’t have to pay

Filed under: Business, Europe, Government, Health, Politics, USA — Tags: , , , , , , — Nicholas @ 04:00

As Tim Worstall points out, Bernie Sanders’ latest campaign is starkly at odds with his usual “make the rich pay” schtick:

“Bernie Sanders” by Gage Skidmore is licensed under CC BY-SA 2.0 .

It’s possible to think that Bernie Sanders, Senator that he is, is more than a little confused. Well, he’d not be the first elderly politician to suffer that fate. Nor the first socialist. It is necessary for me to be fair here though — one of his honeymoons he took in the Soviet Union. Which makes perfect sense to me — after all, there was bugger all else to do there other than your own wife.

However, here we’ve got him complaining about the cost of the new miracle drugs:

    Bernie Sanders has urged Denmark to rein in its most valuable company, Novo Nordisk, and force it to slash prices on popular weight loss and diabetes treatments Ozempic and Wegovy, taking his fight to lower “outrageously high” drug prices in the United States to the company’s doorstep as its profits soar amid ongoing struggles to meet booming appetite for the revolutionary drugs.

Hmm, dunno how well that’s going to work with the Danes really. Yes, to some extent they’re milder than when they tried to rape and pillage the entirety of Europe but not wholly. My brother worked out in Afghanistan (feeding the troops) and he had a Danish unit rotate through. So he tells me their senior sergeant type carried a double bladed axe on his backpack — it didn’t come back clean from every patrol either. They’re not all equality and gender rights these days, you know?

So, we can imagine a certain portion at least of the Danish population celebrating this rapine of Medicare’s pockets by the simple expedient of selling a weight loss drug that actually works — which is, when we come to think of it, something of an innovation. Fen-Fen didn’t work after all. Hey, you know, Vinland failed but we’ll get ’em this time? We’re charging high prices because we can?

A second pass at the argument would be that the drugs are in fact incredibly cheap. When it was shown that the same drug — semaglutide — works in stopping (that’s “stopping” as in ceased, stopped, dead, like Bernie’s career would if it were ever proven he had taken part in an act of voluntary capitalism) chronic kidney disease. So much so that the very day they announced the trials on the drug were being stopped a year early, so obvious was the success, the share prices of all the dialysis provision companies dropped 20 and 30%. That is, at near whatever price, this drug is a money saver. Which is, you know, good. J Foreigner turns up with this thing that saves America, Americans, lives and money and yet Bernie whines — so like a socialist, eh? Capitalism with markets makes us the humans who are living highest on the hog, ever, but they really never do stop whining about it, do they?

But Bernie’s real complaint is that Americans are paying more to burn off the cheeseburgers than everyone else has to. But from everything else Bernie says about anything at all this is at it should be — the rich should pay.

Back to our basics. The basic drug development problem is that the development of a drug is a public goods problem. It costs $2 billion to get a drug through the FDA and gain approval to actually sell it. Yes, of course we should slaughter much of the regulation that makes it cost that much (personally, against character type, I only recommend capture and humane release for the actual bureaucrats) but that’s another matter. It does. But if everyone can just copy the drug at that point then no one will spend $2 billion. So, OK, patents, so the developers have a decade (the patent is two decades, it takes a decade to gain approval) to make their $2 billion back then anyone can copy it. The price falls to manufacturing cost plus normal profit level and we’re about as good as we can get. This is not a perfect system but for mass market drugs it’s about as good as we’re going to get.

May 22, 2024

QotD: Are western democracies moving uniformly in the direction of “surface democracy”?

Filed under: Bureaucracy, Government, Politics, Quotations, USA — Tags: , , , — Nicholas @ 01:00

I joked before about refusing to tolerate speculation about the US being a surface democracy like Japan, but joking aside I think even the staunchest defender of the reality of popular rule would concede that things have moved in that direction on the margin. Compare the power of agency rulemaking, federal law enforcement, spy agencies, or ostensibly independent NGOs now to where they were even 10 years ago. It would be a stretch to say that the electorate didn’t have influence over the American state, but can they really be said to rule it? Regardless of exactly where you come down on that question, it’s probably safe to say that you’d give a different answer today than you would have twenty, fifty, or a hundred years ago. Moreover, the movement has been fairly monotonic in the direction of less direct popular control over the government. And in fact this phenomenon is not unique to the United States, but reappears in country after country.

Is there something deeper at work here? There’s a theory, popular among the sorts of people who staff the technocracy, that this is all a perfectly innocent outgrowth of modern states being more complex and demanding to run. The thinking goes that it was fine to leave the government in the hands of yeoman farmers and urban proles a century ago, when the government didn’t do very much, but today the technical details of governance are beyond any but the most specialized professionals, so we need to leave it all to them.

I think this explanation has something going for it, I admire the structure of its argument, but it also can’t be the whole story. For starters, it treats the scope and nature of the state’s responsibilities as a fixed law of nature. Another way to frame this objection is that you can easily take the story I just told and reverse the causality — the common people used to rule, and so they created a government simple enough for them to understand and command; whereas today unelected legions of technocrats rule, and so they’ve created a government that plays to their strengths. There’s no a priori reason to prefer one of these explanations over the other. There needs to be a higher principle, a superseding reason that results in selecting one compatible ruler-state dyad over another. I think there is such a principle, we just have to get darker and more cynical.

John Psmith, “REVIEW: MITI and the Japanese Miracle by Chalmers Johnson”, Mr. and Mrs. Psmith’s Bookshelf, 2023-04-03.

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