… is from the effervescent James Grant’s review, in the Wall Street Journal, of Sylvia Nasar’s new book Grand Pursuit: The Story of Economic Genius:
Economics may be an “engine of analysis,” as Alfred Marshall said, or an “apparatus of the mind,” as Keynes put it. But economists no more set the world to producing and consuming than baseball statisticians hit home runs. Then, too, you’ll never see Bill James, the dean of the baseball sabermetricians, trip up a base runner the way the government thwarts an entrepreneur. The intervention-minded economists are the ones who give the government its big ideas.
Beware especially of any economist who poses as a genius.
This short video conveys several truths enjoyably and with humor. (Warning: an F-bomb at the very end – but G-rated till then.) (HT Michael Ozias)
AEI resident scholar Andrew Biggs (formerly with the Social Security Adminstration) weighs in on the debate over whether or not Social Security is a Ponzi scheme. (His answer: basically, yes it is in some real and relevant ways.)
The Institute for Humane Studies’s LearnLiberty video project is churning out too many great, concise videos to keep up with! Here, for example, is the great Steve Davies on government debt. Here’s philosopher Aeon Skoeble on “What are Rights?“ And here’s economist Art Carden on chain stores.
Finally, here’s a story on how Pres. Obama has just renewed Uncle Sam’s commitment – if protectionism is sound economic policy – to help Cubans continue to prosper. Cubans don’t even have to pick up the tab to pay their own customs agents to search for and block wealth-destroying goods and services that might be imported from the U.S. (HT Rick Lowe)
My GMU colleague Dan Klein doesn’t like the now-familiar (at least to scholars in law-and-economics) characterization of property rights as being sticks in a bundle of rights – as in, for example, one of the “sticks” in the “bundle” of rights that I have as owner of a piece of land in Fairfax County, VA, is to grant to my neighbor an easement to cross my land; should I convey (by whatever means) such an easement to my neighbor, I’d transfer to him one of the “sticks” in my larger “bundle” of rights.
I’ve always liked the “sticks-in-a-bundle” conception. (I think that I first encountered this idea, not in the legal literature, but in something that Armen Alchian wrote.) But, as I say, Dan thinks this idea to be flawed, or at least misleading.
Some of the questions that Dan tells me he’s especially eager to have debated include:
What do you make of this issue? Do you think it is “merely” a definitional or semantic dispute of little importance?
If you do think it important, where do you stand? Is describing property as a “bundle of rights” inimical to classical liberalism, or is it, as Richard Epstein contends, a bulwark for classical liberalism?
Mr. Daniel Poneman
U.S. Department of Energy
Dear Mr. Poneman:
In today’s USA Today, you struggle gamely to prevent the bankruptcy of the heavily subsidized – and politically well-connected – solar-panel producer Solyndra from raising doubts about the alleged wisdom of government subsidies to sexy industries (“‘Perfect storm’ sank Solyndra“). Disappointingly, you play a trump card favored by crony capitalists: “competitiveness.”
After asserting that the prize for “winning” is “a vast economic and employment opportunity to be seized by companies that succeed in this sector,” you warn ominously that “Our competitors know this, and are playing to win.”
Economies grow (or stagnate) depending on how little (or how much) their governments interfere with producers’ abilities to specialize in those activities for which each has a comparative advantage. Anyone who understands the principle of comparative advantage knows that a country that “wins” an advantage in one industry necessarily “loses” an advantage in other industries. To understand comparative advantage, therefore, is to understand that economies (unlike firms in the same industry) don’t compete with one another. To understand comparative advantage is also to understand that, with free trade, a comparative disadvantage at producing, say, solar panels is in no way a disadvantage atconsuming solar panels. Quite the opposite.
Rather than excuse Solyndra’s failure as being the unlikely result of a “perfect storm” of bad luck, you should recognize that this failure is evidence of the truth ofPaul Krugman’s 1994 observation that “a government wedded to an ideology of competitiveness is as unlikely to make good economic policy as a government committed to creationism is to make good science policy.”
Donald J. Boudreaux
Professor of Economics
George Mason University
Fairfax, VA 22030
But Schumpeter thought that Keynes’ stagnationist ideology provided intellectual cover to those far more hostile to capitalism than he, and, moreover, that Keynes’ emphasis on the short run invited trouble from governments naturally inclined to profligacy and incompetence. It was naïve, Schumpeter believed, to hope that the State would do what its economic experts tell it to do.
Andrew Bolt – Thursday, September 15, 11 (02:20 pm)
You do realise that the Gillard Government may be thinking of laws to censor those of you who blog and tweet?
From the press conference yesterday of Communications Minister Stephen Conroy:
Journalist:But you’d also have to define who could be complained about and what the penalities would be once they were complained about? A tweeter, a blogger, a…
Well, as you said. Now you’re canvassing areas that I think will be richly canvassed in the inquiry, and these are the sort of… these are, the questions is… you’re asking all the legitimate questions.
Andrew Bolt – Thursday, September 15, 11 (11:39 am)
SOUTH Australian Premier Mike Rann has vowed to name and shame “kinky Catholics” in parliament.
Mr Rann made the extraordinary remarks during a private meeting yesterday at the South Australian State Administration Centre, attended by about 25 media advisers and other key staff.
(Thanks to reader Alan RM Jones.)
Andrew Bolt – Thursday, September 15, 11 (11:31 am)
Alexander Downer gives Julia Gillard some free advice, from one who’s been close to where she is now:
Sure, things can go wrong. They did for me when I was opposition leader in 1994-95. A bad joke and a couple of gaffes and down went my approval ratings. In January 1995 my approval rating in Newspoll was 24 per cent…
I had a plan, I had my convictions but I worried. At this rate my plan would turn to dust because I’d lose the upcoming general election.
For me the big question was: is there anyone else who could stick with my plan and win an election. There was. John Howard.
So I figured it was best to facilitate a leadership transfer to him and try to get a decent job for myself if we could win the election.
It was a sad time for me… But if we could win the election I’d have plenty of influence as a senior cabinet minister whereas where would I be if I led my party to another election defeat?
Which brings us to Julia Gillard. Contrary to popular belief she is a very pleasant woman… But what Julia Gillard lacks is a sense she has any idea what to do with power. OK, she has three big projects: the carbon tax, stopping the boats and the mining tax.
The problem with her agenda is she has just taken on someone else’s agenda and said she will implement it more efficiently. She hasn’t: she’s made an even worse hash of it…
So what is to be done? Since Julia Gillard likes power but has no idea what to do with it, all the signs are the punters will dismiss her and her Government. If she were replaced by a panicky Caucus then the Labor Party would have no credibility…
No, Gillard should resign on her own accord. She has no program, no plans and no authority. She just loves the trappings of power. Others can implement her agenda and even develop some other, interesting ideas.
(Thanks to reader Max.)
Andrew Bolt – Thursday, September 15, 11 (10:59 am)
I’d have answered in exactly the same way and without telling a single lie, because warmist journalists usually don’t know the gaps in their own arguments:
FRAN KELLY (ABC Radio National):
Australian newspaper columnist Niki Savva wrote recently that you were the Cabinet Minister who had confessed privately, quote, “that political life had become intolerable, the carbon tax was destroying the Government and you have grave doubts about climate change, revealing yourself as one more sceptic in the Government.” That’s a quote from Niki Savva’s column. Did you say all those things?
STEPHEN CONROY (Communications Minister):
Well it’s a little hard to comment on an unnamed source and the context of a conversation.
Did you say those things?
So, I’m not in a position to speculate about uninformed sources.
Well, can you speculate on whether you said anything like that?
I said – look, let’s be clear. I support the Government’s climate change position. The economy needs to be reformed, waiting as the Tony Abbott policy is, is not going to bring forward the reforms necessary for a cleaner economy so I absolutely support the Government’s policy.
Do you have grave doubts about climate change?
I absolutely support the Government’s policy position. There’s been plenty of debate and plenty of argument. The majority of scientists argue that it’s real, that humans are effecting this and the Government is responding and I support that.
So you don’t think climate change is not real? You don’t have great doubts about it?
I think the climate’s absolutely changing. There’s not an argument that the climate is changing.
It seems that Conroy, like several saner ministers in this Government, doubts that man is responsible for most of the warming, that the warming is necessarily bad, and that it makes economic sense for Australia to “stop” it, particularly when few other emitters are helping out.
It’s just amazing that journalists are taking so long to work this out, and to ask those sceptics about it.
Andrew Bolt – Thursday, September 15, 11 (07:17 am)
Follow this closely: The Australian is biased because Robert Manne refuses to write for it.
Similarly, The Bolt Report is biased because no Gillard Government minister has yet agreed to appear on it.
Andrew Bolt – Thursday, September 15, 11 (07:13 am)
Our competition watchdog should not be waving the NBN through when it is so clearly uncompetitive:
KEY planks of the National Broadband Network business case are anti-competitive and will send Australia backwards, one of Kevin Rudd’s “best and brightest” economic brains has warned.
In a blistering critique, economist Joshua Gans, who in 2008 was hand-picked to attend the then prime minister’s 2020 summit to discuss productivity, has criticised plans to subsidise the rural NBN rollout through the prices that urban consumers pay.
The promise to put a cross-subsidy in place so that regional areas pay the same access prices for the NBN as people in the city was a key promise to the regional independents Tony Windsor and Rob Oakeshott that helped Labor form a second-term government.
This promise of uniform national wholesale pricing for the NBN is also one of the reasons for the proposed $11 billion deal between Telstra, the NBN Co and Labor, which Professor Gans warns might suit the needs of the government and Telstra, but “will lead to significant consumer harm lasting for 20 years or more”.
“No one at the bargaining table appears to have represented consumer interests,” he says, warning of a “return to monopoly network provision in telecommunications in Australia”. Before deregulation in the 1990s, Australia had a public monopoly known as Telecom.
The comments are contained in a scathing submission that Professor Gans, a former University of Melbourne professor who is now at the University of Toronto, has co-written with US-based economist Jerry Hausman and sent to Australia’s competition watchdog this week. Professor Hausman has been a director of the Massachusetts Institute of Technology’s Telecommunications Economics Research program since 1988.
Andrew Bolt – Thursday, September 15, 11 (07:04 am)
You couldn’t really call it an interview, since 7.30’s Chris Uhlmann did not get a straight answer from the Prime Minister to a single one of these questions:
CHRIS UHLMANN: What will you do if Tony Abbott rejects your call to amend the law to allow offshore processing?
CHRIS UHLMANN: Surely, but what if he says no?
CHRIS UHLMANN: But it looks likely that he will say no and you must have a fallback position.
CHRIS UHLMANN: Do you regret dismantling the Pacific Solution?
CHRIS UHLMANN: That’s all been patch-up, because you had a solution that did stop the boats - 288 boats over five years before you came to government; after you came to government - 288 people, I should say. After you came to government, 11,600. You had a solution; you dismantled it. Surely that’s where the problem started.
CHRIS UHLMANN: So it was all push factors?
CHRIS UHLMANN: It had nothing to do with you?
CHRIS UHLMANN: But can you pretend that the changes that you made - can you pretend that the changes that you made had no effect?
CHRIS UHLMANN: At the heart of this, when people look at this externally and see a solution which was in place and they see the boats start to rise after your government coming into power and they here about East Timor and now the Malaysian solution, isn’t the question one of competence? That your government has not handled this competently?
CHRIS UHLMANN: Now on carbon tax of course you said that you are on the right side of history, but again, isn’t the problem that you’ve got there not one of whether or not you’ve got a good policy, it’s the problem that you’ve got with your own legitimacy on that question because before the last election you said there wouldn’t be a carbon tax?
CHRIS UHLMANN: During the election campaign you talked about community consensus and a citizen’s assembly, that you needed to build community consensus before you moved on.
CHRIS UHLMANN: Sure. But the questions that are being put to your are perhaps questions of competence and legitimacy that go beyond any policies that you might have. How do you overcome those sorts of problems if the questions are about you and not your policies?
CHRIS UHLMANN: But you reject any suggestion of any notion that there is a problem with your government in convincing the people of the Australian electorate that have you problems with competence and legitimacy?
CHRIS UHLMANN: Is being Prime Minister what you imagined it would be?
Astonishing, how Gillard refuses to answer. Does she really think people don’t notice and react to such obvious evasions?
Also astonishing is that she refuses to admit that changes in our boat people laws affect the decisions people make about getting on a boat to Australia or not:
CHRIS UHLMANN: But can you pretend that the changes that you made - can you pretend that the changes that you made had no effect?
JULIA GILLARD: Well, Chris, let’s be frank about this: there will always be global factors and regional factors that cause people to get on the move.
If boat people come regardless of our policies, why change those policies now?
Gillard must think voters are morons.
Andrew Bolt – Thursday, September 15, 11 (06:56 am)
A union architect doing work on a union boss’s house… What could possibly be questionable about that little arrangement?
UNION boss Michael Williamson had a large extension to his home pushed through by a former Labor mayor against the strong recommendations of council planning officers.
The approval by former Randwick council mayor Dominic Sullivan occurred when state shadow treasurer Michael Daley was deputy mayor. Mr Daley said yesterday he could not recall the application, and said he may not have supported it in council.
Council documents show council planners recommended on several occasions against the 2001 development to Mr Williamson’s Maroubra home, arguing it would set an “undesirable precedent”.
But that February, Mr Sullivan moved a special mayoral minute - an unusual move for a development application - to give the project the go-ahead.
Council documents show the Health Services Union’s architects Mah-Chut Architects Pty Ltd drew up Mr Williamson’s development application.
A police strike force is examining allegations against Mr Williamson, the HSU secretary and NSW Labor vice-president. They are also looking at allegations against federal MP Craig Thomson, former national secretary of the HSU.
Williamson denies any wrongdoing.
(Thanks to reader the Great Waisuli. No comments.)
A former Australian Workers Union state president asks Communications Minister Steve Conroy to get in touch about a good battle they fought as comrades:
I would welcome the chance to talk personally with my old friend Stephen Conroy, (now Senator Conroy) about what he knew about Mr. Bruce Wilson during the 1990s. I worked out of the same office as Stephen in 1991 / 1992. Stephen, along with others helped me in my AWU unon campaign against Mr. Bruce Wilson in the AWU elections to elect 5 AWU members to represent AWU Victorian members at the AWU national convention. Myself and the 4 other AWU members who joined my ticket won that election. My campaign was centered on me calling on AWU members to support me in my attemt to have an open and INDEPENDENT inquiry into gross missapropriation of AWU union members monies .... Stephen, along with other, now senior ALP players helped me and AWU members win that election.... , Mr Bolt, I would appreciate it if you could pass on my personal email details to Stephen if he wishes to discuss our old freindship that we formed during the 1990s. My name is Bob Kernohan
Andrew Bolt – Thursday, September 15, 11 (06:29 am)
Communications Minister Steve Conroy half-heartedly claims that he’s resisted Greens demands that his media inquiry go after the News Ltd papers and their owner:
Conroy stopped short of asking Finkelstein to examine media ownership, which was identified as a key issue by the powerful Greens party, a key partner in the government’s coalition rule.
Despite a stinging attack in which he accused “some organs” of News Limited, of “running a campaign against this government”, Conroy denied the inquiry was a “witch-hunt” against Murdoch’s firm.
“In terms of a witch-hunt to demand that we break up News Limited, the fact is we are not interested,” he said.
But Greens leader Bob Brown, whose idea this was inquiry was, says Murdoch’s ownership will indeed be investigated:
TONY JONES: It’s the second term of reference; it talks about the impact of technological change on the business model of newspapers and asks how diversity can be enhanced in this changed environment. Is that what you see as the foot in the door to examine newspaper ownership?
BOB BROWN: No, it’s not a foot in the door, Tony, it’s the door wide open. And of course, the commissioners will be able to look at the concentration of media ownership which has 70 per cent of the newspapers in the hands of one corporation, that’s the Murdoch empire here in Australia; nothing like that in the rest of the world.
Gosh, who to believe? The Government or its puppet-master?
Another choice: do we believe Conroy when he says this isn’t a witchhunt against News Ltd, or do we listen instead to Brown?:
TONY JONES: OK. News Limited CEO John Hartigan said today this inquiry started life as a witch-hunt by the Greens and it’s morphed into a fairly narrow look at a mixed bag of issues focusing on print journalism. Your response?
BOB BROWN: Well he’d know about it, wouldn’t he, because John Hartigan and the Australian newspaper are the great exponents of witch-hunts. They track down people, pulverise them unmercifully, there’s no answer back to that. I mean, as far as the Greens are concerned, his mission in his editorials in the Australian is to destroy the Greens at the ballot box.... It is the hate media and central, and, it’s lost track of what’s news and what’s views. It’s a views paper essentially. ...
TONY JONES: Why is the Australian so heavily in your sights, apart from the fact that they’ve targeted the Greens, a paper with a relatively small circulation?
BOB BROWN: Well you’d read it, I reckon, Tony; so do all the politicians. It’s very influential. And look, if you’re indicating that it’s targeted as far as I’m concerned, that doesn’t matter. We’ve got an independent media inquiry now which is popular with the Australian people, the idea of a media inquiry, that can look at a whole diversity of things… But I would be comfortable to see if for suggestions coming out of a media inquiry, for example, it lifted its standards. I think that would be a good thing for the public interest.
TONY JONES: In what area precisely?
BOB BROWN: Well, for example, in putting news on its front page instead of mixing it with - you know, its own ethics, say, it won’t mix up opinion and news, but from front page through to the opinion pages, it is a views paper.
But ask yourself: if the “views” on The Australian’s front page were the views of The Age on its own - say, on global warming - would Brown complain?
Now just a word of correction to Brown: News Ltd does not own 70 per cent of all newspapers. It owns about 32 per cent of newspaper titles here, and so popular are they that around 60 per cent of all sales are of News Ltd papers.
Another thing Brown gets wrong in his ideological frenzy at papers that don’t preach the Green gospel, as Fairfax papers do:
There’s four capital cities in Australia where there’s only one newspaper and they’re all owned by the Murdoch empire.
Clearly Brown doesn’t read the only daily newspaper in the nation’s capital, The Canberra Times, which is published by ... Fairfax.
But that’s fine by Brown. It’s the papers owned by his critics that need to be brought into line, and with the Gillard Government’s help, he now has his chance…
(Thanks to reader Gavin.)
Andrew Bolt – Thursday, September 15, 11 (05:29 am)
Communications Minister Steve Conroy wants journalists to be more scared of being punished for what they wrote:
And so he’s thinking of putting journalists under the firmer control of a supercop appointed by the Government:
A SINGLE statutory body with tougher powers to regulate the conduct of all media is a possible outcome from an independent inquiry announced by the Gillard government yesterday.
What could be wrong with that? You trust the Government and its friends to police the news to your advantage, don’t you?
I mean, they wouldn’t try to keep from you information such as, say, a statutory declaration alleging huge ripoffs by the then partner and client of the Prime Minister, using accounts unwittingly set up by her.
So what have journalists to fear from just one more agency set up to make them “quake in their boots”? Plainly, too much control is barely enough, and we something more than everything that already stops journalists from reporting freely:
- criminal laws
- laws against bugging phones
- the Equal Opportunity Commission
- “fit and proper” rules for owners of broadcasting licences
- the Press Council
- advertising boycotts
- internal codes of practice
- ”breach of confidence” laws
- stringpulling by mates of weaker media proprietors
- exposure by blogs such as this one or shows such as Media Watch.
- the contempt and loss of readers, viewers or listeners
- contempt of colleagues
- professional pride
- lost sleep from worry
- politically appointed activist judges
- attack campaigns by internet activist groups
Andrew Bolt – Thursday, September 15, 11 (12:02 am)
Australian columnist Niki Savva on Tuesday gave Opposition Leader Tony Abbott this advice:
He should shuffle out at least two shadows. One is (Cory) Bernardi, and the other is Kevin Andrews. Bernardi because he is a serial offender on Islamic issues… Despite Abbott’s denial, Bernardi did offer to help divisive Dutch politician Geert Wilders with his proposed visit to Australia. Once again Bernardi embarrassed his leader, and infuriated his colleagues, who believe his behaviour threatens votes in western Sydney. This is not limiting free speech; it’s about Bernardi not knowing or not caring that he has crossed a line.
Senator Bernardi responds:
Dear Ms Savva,
We have never met but I have generally enjoyed your take on politics in the pages of the Australian. I also note you have shared your opinion in the media on several occasions in regard to my political career.
Most recently, you called for my sacking from the frontbench (on both Insiders and in the Australian) for “serial transgressions on Islamic issues” and infuriating my colleagues by crossing some arbitrary line.
While you are entitled to your opinion, I do find your judgement on this occasion to be rather incongruous with mainstream opinion and question the consistency of the application of your standards of public accountability.
It is hardly a secret that I extended an informal invitation to visit Australia to Geert Wilders. I wrote about it months ago and the disclosure caused no reaction whatsoever. That is because such an invitation is a courtesy extended at almost every international meeting by almost every visiting politician.
You may not like Mr Wilders’ political stance but he commands a larger vote in an open and tolerant democracy than the Greens party in Australia and provides vital political support for the Dutch government. Mr Wilders’ electoral appeal is in response to a range of successive policy failures that have many in the Netherlands (and western Europe generally) concerned about the direction of their country.
I wonder if you would be calling for my sacking if I invited Ayaan Hirsi Ali – a former Dutch politician who is under constant protection because of her criticism of Islam – to Australia. On her most recent visit she was featured on the ABC, hosted at various functions and was even sponsored by a State government to attend an event.
Given the similar concerns voiced by Wilders and Hirsi Ali, I would be horrified if the difference in their treatment by politicians and sections of the media was related to gender or ethnicity.
You might also recall there was another outspoken critic of Islam who was hauled before a hate speech tribunal in Canada – Mark Steyn. Over 200 people attended a dinner with Mr Steyn in Old Parliament House when he was invited and funded by the Howard government on a visit to Australia. By your reckoning this would count as another ‘ transgression on Islamic issues’ that would apply to many of my colleagues.
But why stop there in exposing the egregious sin of meeting with opinionated people?