Archive for December, 2009

I’m not sure what today will bring, but yesterday was a mixed experience. The skiing was fairly nice, even though the morning started with the thermostat reading -8.

The trip to the slopes was the bad part. I’m driving in a convoy of cars through a small Vermont town, going as fast as the car in front of me and the car behind me. But I made a big mistake. I had out-of-state plates on my car, so the local bureaucrat with a gun pulls me over for going 38 in a 25.

And people wonder why I don’t feel warm and fuzzy about government.

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A Michael Barone column in the Washington Examiner compares the bloated payrolls and happy times for the bureaucracy with the challenging times for workers in the productive sector of the economy. The column does not mention that bureaucrats also are vastly overpaid compared to private sector workers:

It looks like a happy new year for you — if you’re a public employee. That’s the takeaway from a recent Rasmussen poll that shows that 46 percent of government employees say the economy is getting better while just 31 percent say it’s getting worse. In contrast, 32 percent of those with private-sector jobs say the economy is getting better, while 49 percent it is getting worse. Nearly half, 44 percent, of government employees rate their personal finances as good or excellent. Only 33 percent of private-sector employees do. It sounds like public- and private-sector employees are looking at different Americas. And they are. Private-sector employment peaked at 115.8 million in December 2007, when the recession officially began. It was down to 108.5 million last November. That’s a 6 percent decline. Public-sector employment peaked at 22.6 million in August 2008. It fell a bit in 2009, then has rebounded back to 22.5 million in November. That’s less than a 1 percent decline. This is not an accident; it is the result of deliberate public policy. …At some point — and this already has occurred in much of Western Europe — public sector spending tends to choke off private-sector growth. America’s current high unemployment levels have been commonplace in much of Western Europe for the last 25 years. The question now is whether they will become commonplace in the United States in the decade ahead.

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Great column by Arnold Kling and Nick Schulz on how markets really operate – and why government intervention either causes problems or prevents markets from fixing them. For those of you who care to get in the weeds, this is one of the reasons why the “Austrian School” of Hayek and Mises is better for understanding economics than the (also great) “Chicago School” of Friedman and Becker:

Two camps have fought the political and philosophical battle for influence over the economy in the United States for the past 100 years. They differ in their views over the nature of markets and government. And both are wrong. One camp makes it sound as if markets can do no wrong. …The other camp argues, “Markets fail, and that’s why we need government.” …In the wake of the financial crisis that gave way to the broader economic downturn, the advocates of government involvement in the economy are once again on the march and traditional defenders of markets are in retreat. And so we have seen government advance its role with partial ownership of many big banks, with a take-over of automotive firms, with a large “stimulus” program, with proposals for cap-and-trade for carbon emissions, and with a major initiative on healthcare. …Over the past two generations, a different view of markets and government has begun to emerge, one whose moment may have arrived. It is a view that believes both traditional camps have overlooked some important aspects of markets. …This view can be summarized as “Markets fail. That’s why we need markets.” …According to this view, entrepreneurs at work in the economy–in finance, high tech, manufacturing, services, and beyond–are constantly experimenting, creating new business models, techniques, and technologies that upend the established order of things. Some new technologies and innovations are genuine improvements and are long-lasting welfare enhancers. But others are the basketball equivalent of pump fakes–they look like the real deal and prompt market actors to leap hastily into action, only to realize later that their bets were wrong. Given this dynamic, markets are unpredictable, prone to booms and busts, characterized by bouts of exuberance that are rational or irrational only in hindsight. But markets are also the only reliable mechanism for sorting out this messy process quickly. In spite of the booms and busts, markets drive genuine long-run innovation and wealth creation. When governments attempt to impose order on this chaotic and inherently risky process, they immediately run up against two serious dangers. The first is that they strangle new innovations before they can emerge. Thus proposals for a Consumer Financial Protection Agency, a systemic risk regulator, a public health insurance plan, a green jobs policy, or any attempt at top-down planning may do more harm than good. The second danger has to do with the nature of political economy. Politics creates its own kind of innovators who can be as destabilizing to markets as market actors themselves–but in far more pernicious ways. Economists call these political entrepreneurs “rent-seekers.” Rent-seekers gain wealth, not by creating it, but by channeling it through political favors. Examples include government-sponsored monopolies, “targeted” tax breaks for special industries, and legislative loopholes inserted by lobbyists. The boom in housing and mortgage securities that ended so badly was fueled by government policies that were encouraged by rent-seekers in the real estate, home building, and mortgage finance industries.

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…at least for videos promoting the 2nd Amendment. Here’s a third video I found, this one featuring Ted Nugent:

Miserable drive to Vermont, by the way. Traffic in Maryland, New Jersey, New York and Connecticut.

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Hitting the Slopes

I’m heading to Vermont with the kids to see family and do some skiing.

That means less time for blogging. But since I only post three or four times per day, I’m not sure anyone will even notice if I post one or two times per day instead.

Here we are three years ago. With any luck, I’ll have an updated photo.

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The whole video is worth watching, but there’s a really powerful moment shortly after the five-minute mark.

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More TSA Incompetence

Isn’t this just wonderful? The feds have announced new rules, but it’s not clear what they are. According to some reports, though, passengers will not be allowed to have anything it their laps. Does this mean books? Blackberries? Are we allowed to twiddle our thumbs? Since I have speeches next month in Canada and the Cayman Islands, I look forward to seeing what petty and pointless inconveniences the bureaucrats at the Transportation Security Administration have in store for me:

The government was vague about the steps it was taking, saying that it wanted the security experience to be “unpredictable” and that passengers would not find the same measures at every airport — a prospect that may upset airlines and travelers alike. But several airlines released detailed information about the restrictions, saying that passengers on international flights coming to the United States will apparently have to remain in their seats for the last hour of a flight without any personal items on their laps. It was not clear how often the rule would affect domestic flights.

The key question, of course, is whether any of these rules make flying safer. After all, there are real nutjobs out there who want to kill Americans. But as Christopher Hitchens explains, the new rules are bureaucratic nonsense:

For some years after 9/11, passengers were forbidden to get up and use the lavatory on the Washington-New York shuttle. Zero tolerance! I suppose it must eventually have occurred to somebody that this ban would not deter a person who was willing to die, so the rule was scrapped. …But now fresh idiocies are in store. Nothing in your lap during final approach. Do you feel safer? If you were a suicide-killer, would you feel thwarted or deterred? …Why do we fail to detect or defeat the guilty, and why do we do so well at collective punishment of the innocent? The answer to the first question is: Because we can’t—or won’t. The answer to the second question is: Because we can. The fault here is not just with our endlessly incompetent security services, who give the benefit of the doubt to people who should have been arrested long ago or at least had their visas and travel rights revoked. It is also with a public opinion that sheepishly bleats to be made to “feel safe.” The demand to satisfy that sad illusion can be met with relative ease if you pay enough people to stand around and stare significantly at the citizens’ toothpaste. My impression as a frequent traveler is that intelligent Americans fail to protest at this inanity in case it is they who attract attention and end up on a no-fly list instead. Perfect. It was reported over the weekend that in the aftermath of the Detroit fiasco, no official decision was made about whether to raise the designated “threat level” from orange. Orange! Could this possibly be because it would be panicky and ridiculous to change it to red and really, really absurd to lower it to yellow? But isn’t it just as preposterous (and revealing), immediately after a known Muslim extremist has waltzed through every flimsy barrier, to leave it just where it was the day before?

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