Monday, June 06, 2011

News items and comments

Here’s a letter to the New York Times:

Nicholas Kristof says that Americans who want lower taxes and less government regulation should study Pakistan, which he describes as “a low-tax laissez faire Eden” – and which also, of course, is a decrepit economy and society (“Our Fantasy Nation?” June 5). Never mind that, as University of Chicago law professor Todd Henderson notes, Pakistan ranks near the bottom of indices of economic freedom.* Forget also that Pakistan is dominated by the military and benighted by liberty-suffocating superstitions.

Straw-man games such as the one Mr. Kristof plays are too easy. Would anyone be persuaded, for example, if I wrote (paraphrasing his opening line) “With MoveOn.org progressives and many Democrats balking at reducing the role of government, let me offer them an example of a nation that lives up to their ideals” – and then presented as a shining example of a ‘progressive’ society North Korea? North Korea’s government, after all, offers cradle-to-grave economic supervision and protection of its citizens; incomes in North Korea are quite equal; and the government there actively directs the economy.

Would Mr. Kristof find the superficial similarities between some preferred policies of ‘progressives’ and the reality of North Korean society to be a serious reason to reconsider his ‘progressive’ beliefs? Of course – and rightly – not. And for the same reason no one should take seriously Mr. Kristof’s absurd equation of Pakistan with an America in which people would enjoy lower taxes and fewer government regulations.

Sincerely,
Donald J. Boudreaux

* In a private e-mail to me as well as in a letter that Todd sent to the New York Times.

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In today’s Richmond Times-Dispatch, I write – at the editors’ request – a follow-upto my Wall Street Journal essay predicting continuing decline in deaths caused by violent weather. Here’s my closing paragraph:

As the late economist Julian Simon taught when he won a similar bet with eco-doomster Paul Ehrlich in 1990, people who put their wealth where their words are deserve to be taken more seriously than people who scream free of charge that “the sky is falling!”

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In what is surely one of history’s great ironies, today is the birthday of both Adam Smith and John Maynard Keynes.

Smith launched the discipline of modern economics, freeing our thinking about economic matters largely from the misperceptions and prejudices of the ‘man in the street’ whose instincts prompt him to suppose that most economic problems are the result of too little money or too little demand – an instinct that, in Smith’s day, elevated mercantilism into the dominant mode of economic (non)thought. This ‘man in the street’ gives little, if any, thought to the enormously detailed and constantly occurring and largely unseen adjustments that property owners (including owners of only labor services) must make so that the plans and actions of producers and consumers are sufficiently well-coordinated across space and time that prosperity becomes widespread and continually growing. The ‘man in the street’ concentrates his worries on demand – e.g., Will consumers continue buying ‘enough’? Won’t labor-saving technology (including advances in international trade) cause sustained unemployment? What will be the jobs of the future if the familiar jobs of today are ‘destroyed’?

Keynes, regrettably, gave undeserved respect to these concerns of the ‘man in the street.’ The focus of Keynes and his followers was not on how the plans and actions of countless individuals can be reasonably well-enough coordinated, across space and time, so that scarce resources are ever-more-efficiently transformed into goods and services that satisfy consumers. Overlooking – as does the ‘man in the street’ – the importance of the details of this vastly complicated process of on-going coordination, Keynes and his disciples glommed on to what the ‘man in the street’ immediately thinks of as the economic question: is there enough demand to buy stuff? If yes, problem solved; if not, big problem – or, really, not so big if the state frees itself from the prejudices of those damned classical economists (such as Smith) and, adopting the idiot-savant genius of the ‘man in the street,’ augments inadequate private demand with demand that itcreates either through money creation or, usually more effectively for Keynesians, through debt-funded fiscal spending.

Smith had no such delusion that economies grow simply because people demand more stuff. The abilities and drive of butchers, brewers, bakers, and other entrepreneurs to earn ever-better livings by ever-better satisfying consumers (as opposed to by securing monopoly privileges from government) is what makes economies grow. Competitively determined prices are important in guiding suppliers to meet consumer demands (and in guiding consumers on how to get the most satisfaction possible from their expenditures). Taxes, regulations, monopoly privileges, and (yes, even for Smith) inadequately supplied amounts and qualities of public goods obstruct the ability of markets to coordinate savings, investment, production, and consumption in ways that keep economies growing. Smith – and, to this day, Smithian economists – concentrate their attention on supply. The problem isn’t to get people to want to consume more of what they want; it’s to get people to produce more of what people want to consume.

John Maynard Keynes, more than any other person, diverted economics from its task of understanding how order emerges unplanned from the self-interested and knowledge-limited choices and actions of countless individuals. Far more than Marx, the consequence of Keynes on economics has been lamentable.

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A cat-call to the rescue for Labor

Miranda Devine – Sunday, June 05, 11 (08:25 am)

PENNY Wong took umbrage at a little “miaow” from an Opposition bloke during a Senate Estimates hearing, and the fake sexism row lasted all week.

But rather than being offended, women should own their inner cat. Be proud of the feline warrior within.

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The valour of war’s wounded helps Humpty’s kids

Miranda Devine – Sunday, June 05, 11 (06:53 am)

BRETT Wood, the valiant 32-year-old commando who “captured a nation with his bravery,” was buried on Friday at St Andrew’s Cathedral.

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THAT SETTLES IT THEN

Tim Blair – Monday, June 06, 11 (06:21 am)

Corinne has spoken:

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Comedian and Melbourne rally MC Corinne Grant said a carbon tax must be introduced this year.

(Via Andrew V.)

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394 DAYS UNTIL LABOR’S ROCK COLDING TAX

Tim Blair – Monday, June 06, 11 (06:08 am)

Geothermians need a killer carbon tax if their embattled industry is to maintain a pulse:

This sector’s revival would be possible only if the Greens get their way and the proposed carbon tax is somewhere north of $40 a tonne, which is not going to happen …

Julia Gillard might as well have said “There will be no geothermal industry under the government I lead” just before the last election instead of that very vow in relation to a carbon tax. It would be funny if it wasn’t so damned tragic.

Oh, I don’t know. It’d be more tragic still if every other energy sector were damaged so that geothermal – or Flannergy– could bumble on.

And we are told authoritatively that even a $30/tonne carbon tax will not make the technology viable, which means it would be a brave investor to take a punt on the sector at this time.

Apparently so. The linked item lists these falls at various geothermal concerns:

• Petratherm down from 92c to 10.5c
• Panax Geothermal down from 21.8c to 2.1c
• Greenearth Energy down from 26.5c to 7.2c
• Hot Rock down from 18.4c to 4.3c
• Torrens Energy down from 50c to 5.5c
• And Geodynamics – the company in which Tim Flannery is a high profile shareholder – has plunged all the way from $1.85 to 19.5c. Stick with Panasonic, Professor. Wily investors look to other energy stocks:

You would have done so much better punting on dirty old coal. While many resources stocks have been sliding, Metrocoal has risen from 28c in early March to 63c on Friday. East Energy Resources was selling at under 20c in March and hit 65.5c a month later.

Must be all that “uncertainty”.

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HOT POLEY ACTION

Tim Blair – Monday, June 06, 11 (01:37 am)

This is why we needed the internet. Live, as-it-happens, uncensored coverage of a melting bear-shaped ice block. Look at those crowds!

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SAY YES - TO AN ELECTION

Tim Blair – Monday, June 06, 11 (12:17 am)

Let’s put it to a vote:

Australians are demanding Julia Gillard call a fresh election, saying she has no mandate for a carbon tax.

With less than a third of all voters now claiming to support the tax, the federal government is facing a nationwide backlash if it proceeds.

An exclusive Galaxy poll commissioned by The Daily Telegraph has revealed 73 per cent of people claim they will end up worse off under the tax. Just 7 per cent believe they could end up better off in some way …

A total of 64 per cent said they wanted a fresh election. Only 24 per cent believed the PM had a mandate.

The minority were represented yesterday in tax-pushing rallies organised by GetUp guppies:

image

The couple who want us to kick the carbon dioxide habit – you’re welcome to go first.

UPDATE:

Up to 8000 climate change supporters rallied in Sydney’s Prince Alfred Park yesterday as part of a national campaign urging the federal government to set a price on carbon …

But no one The Daily Telegraph spoke to could volunteer what a reasonable price would be for families to pay.

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Why is Gillard terrified to meet a sceptic?

Andrew Bolt – Monday, June 06, 11 (07:06 am)

Global warmists are terrified of debate. No warming activist or Labor minister has agreed to come on The Bolt Reportto discuss their claims. Almost no global warming scientists here will agree to debate sceptical ones. Global warming prophet Al Gore refuses interviews with more sceptical journalists. ABC warmists lobbied against the screening by the ABC of The Great Global Warming Swindle. And now this:

PARLIAMENTARIANS from Julia Gillard down appear ready to give the cold shoulder to Czech President Vaclav Klaus, an outspoken climate change sceptic, when he visits Australia next month.

Mr Klaus, a critic of the theory of human-caused global warming, will attend a series of seminars organised by the Institute of Public Affairs think tank.

He has said other politicians will not offer their views on climate change because “a whip of political correctness strangles their voices”.

If the truth is so clearly on the side of the warmists, why this fear of debate? Wouldn’t they welcome the chance to show up the sceptics? Humiliate then, live on television?

The warmists’ fear of debate tells you everything about the shakiness of their theories. And how unsure they are themselves of their own case.

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Enter at own risk

Andrew Bolt – Monday, June 06, 11 (06:56 am)

They’ve come unasked, passing through other countries where they’d be safe, and now win big payouts for being detained while we check if they really are what they claim:

AUSTRALIAN taxpayers are facing multi-million dollar compensation payouts to current and former asylum seekers who claim they suffered trauma and psychological damage in detention.

Legal and medical sources told The Daily Telegraph scores of detainees were preparing claims against the Australian government and detention centre operators Serco and G4S…

Among those making claims are Iranian Mehrnoosh Yousefi and her adult son, who have both been granted refugee status.

Mrs Yousefi’s husband, former Iranian oil industry engineer Parviz Yousefi, achieved notoriety when he sewed his lips together and attempted suicide several times while in detention at Woomera between 2001 and 2004.

In 2008 Mr Yousefi was reportedly awarded a record damages payout of more than $800,000 for psychological damage suffered in detention.

Whose money is that?

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But Labor dare not disown him

Andrew Bolt – Monday, June 06, 11 (06:37 am)

Should Thomson quit his seat? Can the Gillard Government afford to disown him, and risk losing office?

FEDERAL Labor MP Craig Thomson has dropped a defamation case against Fairfax over articles detailing alleged fraudulent use of his union credit card, including paying for prostitutes.

The articles alleged the credit card issued to him as national secretary of the Health Services Union was also used to pay for bills in bars and restaurants…

Mr Thomson, the member for the marginal NSW seat of Dobell, falsely denied the allegations of inappropriate spending of union funds...

Let me stress that Thomson insists he’s innocent of any wrong doing.

(No comments, to spare us the worry of legal trouble.)

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Gillard gone by December?

Andrew Bolt – Monday, June 06, 11 (06:18 am)

I’ve argued for months that Julia Gillard is finished, and only a lack of a clear alternative leader is propping her up.

Now Glenn Milne agrees, but adds that Labor backbenchers are growing so desperate that they could vote for Anyone But Julia:

IN a despairing counterpoint to the imminent first anniversary of Julia Gillard’s brutal installation into the prime ministership, Labor MPs have, for the first time, begun to put a deadline on her failing leadership. In recent internal discussions, backbenchers have set December - the traditional killing season for political leaders - as the first timeline for any move against her, with the default position being early in the New Year…

This suggests, if it does come, it will be backbench driven and therefore unpredictable and unco-ordinated.

Proof of this fact also came this week with disaffected Labor MPs throwing up a third way candidate for the leadership should Gillard prove terminal. To date all speculation has centred on Bill Shorten and Greg Combet as successors. Now some Labor MPS have raised the prospect of Defence Minister Stephen Smith as a possible contender. According to this school of thought, two factors count against Shorten (the more popular of the two) and Combet (regarded as the more competent). Both are former union leaders in a climate where, say some Labor backbenchers, the government’s ACTU-driven workplace reforms could soon begin to count against the administration in an economy running up against capacity constraints and skills shortages.

Second, goes the argument, neither Combet nor Shorten has enough parliamentary experience to qualify them for the top job. Enter, in the minds of some, Smith, as a safe pair of hands. Note that Wayne Swan figures nowhere in the leadership discussions currently being conducted behind the backs of Labor hands. Swan is now bracketed as part of the flailing Gillard experiment.

Smith is in fact not a safe pair of hands of all, to judge by his wild overreaction to Skype Affair. And what makes Gillard’s incompetence an even great tragedy for Labor is that it’s dragging down the reputation of people like Immigration Minister Chris Bowen, given a toxic portfolio that damages his own standing as a potential leader.

UPDATE

So, what’s Plan C?

As the political establishment looks towards the June 24 anniversary of Rudd’s ousting, it is worth reflecting that little has changed.

A year ago, Labor’s primary vote was 33 per cent and the Coalition’s 43 per cent. The most recent Herald/Nielsen poll taken about three weeks ago had Labor trailing the Coalition by 31 per cent to 47 per cent.
The Prime Minister’s approval and disapproval ratings are statistically identical to those of Rudd a year ago - in what was his final poll as prime minister - while Abbott has lifted in terms of both preferred prime minister and approval. ...

When Julia Gillard took the leadership, she identified three priorities: the mining tax, climate change and asylum seekers. A year later, all three remain works in progress and, to varying degrees, continue to drag down the government.

(Thanks to reader PaulC.)

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Useless, craven, desperate and deadly

Andrew Bolt – Monday, June 06, 11 (06:06 am)

Greg Sheridan says Malaysia may be having second thoughts about the wisdom of helping the Gillard Government out of it’s boat people disaster

The Gillard government’s inability to finalise the deal with Malaysia suggests it may be falling apart...

And the answer to Sheridan’s final question is yes, the Gillard Government truly is this desperate and stunningly incompetent:

Why did the government publicly announce the Malaysian solution before the details were negotiated and the framework worked out?

Surely not because it had to announce at the same time that the East Timor solution was finally dead? Surely not because there had just been a series of riots, fires and assaults in the detention centres, and it needed to look as though it was doing something? Surely after the slow-motion debacle of the East Timor solution collapse, this government could not possibly have been stupid enough to put spin, and an attempt to win one day’s good media coverage, ahead of important diplomatic matters of real substance?

And still the Government has not been properly held to account for having lured some 200 boat people to their deaths with its fake “compassion”.

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Let’s not cry racist too fast

Andrew Bolt – Monday, June 06, 11 (05:55 am)

Collingwood president Eddie McGuire is admirable for standing up to abusive fans, and his anti-racism is also to be applauded. But I think it’s a mistake - and another form of abuse - to accuse others of racism on these slight grounds:


Collingwood president, Eddie McGuire, angrily rebuked a St Kilda supporter who had allegedly made derogatory remarks about the Magpies’ Aboriginal recruit Andrew Krakouer…

Even as McGuire spoke to several media outlets about the incident, it remained unclear whether the St Kilda supporter had racially abused Krakouer. Or, alternatively, whether the cries that led to an attendant warning the man were an allusion to the troubled past of Krakouer, who was jailed for 16 months in Western Australia after being found guilty of serious assault.

‘’There was an unsavoury comment earlier on and then, later in the game, the same guy went off where he just said, ‘Kick him while he’s down,’’’ McGuire told Channel Nine. ‘’It just had a real edge to it...’’

But, as McGuire was asked many times during a confrontational interview by Fairfax Radio commentators Tim Lane and Robert Walls, was the abuse racist? Or merely the type of robust discourse that is an unfortunate byproduct of crowd behaviour?

McGuire was equivocal, saying that the fact the man’s MCC membership number was taken by security indicated he had crossed the line.

I’ve worried before about McGuire’s tendency to leap onto one stereotype to denounce stereotyping.

UPDATE

Was McGuire guilty of a little vilification of his own?

McGuire acknowledged the supporter’s targeting of the 28-year-old indigenous player was not conclusively racist but insisted it was “a very demeaning way to speak of any person, whether they’re black, white or brindle"…

McGuire was equivocal about the first comment from the supporter that raised his ire, confirming only that “there was a bit of [reference to Krakouer’s] jail history”. ”I’m not going to guess as to whether his intentions were racist or otherwise. I’m not a mind-reader,” he said.

That said, I am not sure it was McGuire himself who claimed the Krakouer abuse was racist.

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It looks more like people saying no

Andrew Bolt – Monday, June 06, 11 (12:09 am)

image

Something about yesterday’s rally tells me it was actually Canberra saying no to the carbon dioxide tax.

(Thanks to reader Daniel.)

UPDATE

Julia Gillard should listen more to the millions who stayed at home:

AUSTRALIANS are demanding Julia Gillard call a fresh election, saying she has no mandate for a carbon tax.

With less than a third of all voters now claiming to support the tax, the federal government is facing a nationwide backlash if it proceeds.

An exclusive Galaxy poll commissioned by The Daily Telegraph has revealed 73 per cent of people claim they will end up worse off under the tax… A total of 64 per cent said they wanted a fresh election. Only 24 per cent believed the PM had a mandate.

UPDATE

I’m not sure 24,000 miners will feel the same way:

THE impact of the carbon tax on the mining industry will be “trivial” - so small that for practical purposes it will be “invisible,” according to one of Australia’s leading labour market economists.

Professor Bruce Chapman is president of the Economics Society of Australia and director of policy at the Australian National University’s Crawford school of government.

In a report released this morning entitled How Many Jobs is 23,510 Really? he attempts to put into perspective a claim by the Minerals Council that a carbon trading system would cut by about 24,000 people the number who would be employed in the mining industry.

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The Bolt Report editorial - and Scott Morrison

Andrew Bolt – Sunday, June 05, 11 (04:38 pm)

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The best crowd money could rent to support bad policy .. And still they couldn't defend it
THEIR message on a carbon tax was loud and clear - but when asked how much they were willing to pay, there was only a deafening silence.
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The cost of bad policy
FAMILIES under the squeeze are going without new clothes, entertainment and small luxuries as data reveals household bills are soaring while incomes remain the same.
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The price of bad policy
THE final words have been uttered and the tributes paid, the skirl of the bagpipes has faded on the desert breeze and it is time for the long journey home.
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An election is the cost of bad policy
AUSTRALIANS are demanding Julia Gillard call a fresh election, saying she has no mandate for a carbon tax.

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This is the cost of bad policy
AUSTRALIAN taxpayers are facing multi-million dollar compensation payouts to current and former asylum seekers who claim they suffered trauma and psychological damage in detention.
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Democrats have too much money to spend on Edward's defence.
www.foxnews.com
Federal prosecutors seeking to prove that John Edwards used campaign funds to hide his pregnant mistress during his 2008 presidential run will have their work cut out for them.
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Time for the story to be told, and Rudd and the GG to be dismissed
www.couriermail.com.au
AN ALLEGED rape victim who was paid compensation but forced to keep quiet by the Bligh Government is set to spark a new federal inquiry into the state's longest-running scandal.

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