Assorted Links (6/29/2010)

Here’s a list of articles that I have been reading lately:

Allan Meltzer: Why Obamanomics Has Failed –

“In The Wall Street Journal, Carnegie Mellon University economist Allan H. Meltzer says the Obama administration’s policies have introduced uncertainty about future taxes and regulations. This inhibits investment and job growth.”

If You Have to Be Wrong, How Can You Admit It More Easily? – Freakonomics Blog –

“Making admissions of error easier.”

Cash for Clunkers: A Retrospective

“Top-down industrial policy carried out through the sheer force of incentives is welcomed by behavioralist Washington.”

The Unemployment Insurance Crisis

“As of this summer, unemployment insurance trust funds in 30 states were insolvent.”

Fred Barnes: King of Pork—and Proud of It –

“In The Wall Street Journal, Fred Barnes writes that the late Robert Byrd made the most of his time in the Senate.”

Rupert Darwall: Britain Tries Fiscal Austerity –

“Rupert Darwall writes in The Wall Street Journal that Keynesianism goes out of fashion in London.”

Randy Barnett: The Supreme Court’s Gun Showdown –

“In The Wall Street Journal, Randy Barnett writes that thanks to five Justices, the right to keep and bear arms is now protected from state interference. And thanks to Clarence Thomas, an important clause in the Constitution has risen from the grave.”

Bill Wilson’s Gospel –

“The story of Alcoholics Anonymous teaches us about human nature and the kinds of social programs that do and don’t work.”

Congressional Budget Office – Distribution of Federal Taxes

“The federal tax system is progressive–that is, average tax rates generally rise with income. Households in the bottom fifth of the income distribution (with average income of $18,400, under a broad definition of income) paid 4.0 percent of their income in federal taxes. The middle quintile, with average income of $64,500, paid 14.3 percent of that income in taxes, and the highest quintile, with average income of $264,700, paid 25.1 percent.”

Is Academic Freedom Worth Its Price? – Project Syndicate

“In these hard economic times, when ordinary people are struggling to make ends meet, there is a nagging sense that universities are luxuries. In fact, universities may be the most consistently high-performing products of long-term capital investment.”

Review & Outlook: Kagan’s Commerce Clause –

“The Wall Street Journal says that Senators should ask Supreme Court nominee Elena Kagan if Congress can compel Americans to do anything?”

Drilling for Better Information –

“In The Wall Street Journal, Information Age columnist Gordon Crovitz says that the financial crisis and BP share a common attribute: regulatory failure.”

Fouad Ajami: Petraeus, Obama and the War in Afghanistan –

“In The Wall Street Journal, Fouad Ajami says that there is a mismatch between the general’s Afghan mission and the president’s summons to his countrymen.”

Review & Outlook: Triumph of the Regulators –

“The Wall Street Journal says that the Dodd-Frank financial reform bill doubles down on the same system that failed.”

Russ Roberts: Hayek: An Economist’s Comeback –

“In The Wall Street Journal, Russell Roberts of George Mason University comments on the revival of interest in the Nobel Prize winning economist Friedrich Hayek.”

How Christianity Created Capitalism

“It was the church more than any other agency, writes historian Randall Collins, that put in place what Weber called the preconditions of capitalism: the rule of law and a bureaucracy for resolving disputes rationally; a specialized and mobile labor force; the institutional permanence that allows for transgenerational investment and sustained intellectual and physical efforts, together with the accumulation of long-term capital; and a zest for discovery, enterprise, wealth creation, and new undertakings.”

Indiana ironing-board factory faces stiff competition from Chinese companies

This article provides an interesting case study which clearly illustrates various dysfunctional aspects of trade protectionism in the real world; in particular, how tariffs shield US companies from having to compete and innovate in terms of the goods and services that they produce and the business models that they employ.

Assorted Links (6/26/2010)

Here’s a list of articles that I have been reading lately:

Notable & Quotable –

“Verizon CEO and Business Roundtable Chairman Ivan Seidenberg on government and the economy.”

The Keynesian Dead End –

“The Wall Street Journal argues that spending our way to prosperity is going out of style.”

Weekend Interview with Jim Flaherty –

“Mary Anastasia O’Grady interview Jim Flaherty, Canada’s finance minister and writes in The Wall Street Journal that Canada will lead the charge against new bank taxes and for spending restraint at the G-20 in Toronto.”

Seth Lipsky: Conrad Black and the Criminalization of Business –

“In The Wall Street Journal, Seth Lipsky notes that according to the Supreme Court, the media mogul Conrad Black was convicted on overly vague concepts of corporate fraud concerning the honest services statute.”

A Day of Prayer for the Gulf States

“The governors of Louisiana, Texas, Alabama, and Mississippi and the lieutenant governor of Florida, have proclaimed this Sunday, June 27 as a Day of Prayer for relief from all the problems related to the oil spill, especially for the people, animal life and economies of the affected states.”

Ensuring That Our Economies Remain Terror-Proof

“The heads of terrorism insurance programs decided to establish — under the aegis of the OECD High Level Advisory Board — a permanent international platform on the financial coverage of terrorism risk.”

Peggy Noonan: McChrystal Forces Us to Focus –

“Now General David Petraeus owes us a candid assessment of the Afghan effort, writes Peggy Noonan in The Wall Street Journal.”

Mark Moyar: Petraeus’s Opportunity –

“In The Wall Street Journal, this selection reassures our Afghan allies that the U.S. will not begin substantial troop reductions until the Afghans can handle the insurgents on their own.”

Pete du Pont: Generation Gap –

“The Kerry-Lieberman energy bill would enervate America, Pete du Pont argues in The Wall Street Journal.”

Jon Shields: Manute Bol’s Radical Christianity –

“In The Wall Street Journal’s Houses of Worship column, Jon Shields notes that sportswriters love to use the word redemption to describe athletic performances, former NBA player Manute Bol, shoed the true meaning of the word, and literally died for Christianity.”

Terry Anderson: Why It’s Safer to Drill in the ‘Backyard’ –

“In The Wall Street Journal, PERC executive director Terry Anderson notes that spills on land are much less dangerous and easier to contain than underwater.”

Kim Strassel: Business’s Buyer’s Remorse –

“In The Wall Street Journal, Potomac Watch columnist Kim Strassel reports that the Business Roundtable has finally figured out that the Obama administration has been playing them for a patsy.”

General McChrystal and the Culture of Exposure –

“The firing of Gen. Stanley McChrystal shows our troubling emphasis on private over public performance in public officials.”

Marginal Revolution: Not from the Onion: EPA Classifies Milk as Oil

“New Environmental Protection Agency regulations treat spilled milk like oil, requiring farmers to build extra storage tanks and form emergency spill plans.”

Charles Krauthammer – Afghanistan: The 7/11 problem

Charles Krauthammer argues, and I agree, that “President Obama was fully justified in dismissing Gen. Stanley McChrystal. The firing offense did not rise to the level of insubordination — this was no MacArthur undermining the commander in chief’s war strategy — but it was a serious enough show of disrespect for the president and for the entire civilian leadership to justify relief from his post.”

Should We Raise Taxes on the Middle Class? We Already Are

“Taxes are already rising to record levels, with or without legislative changes.”

Assorted Links (6/24/2010)

Here’s a list of articles that I have been reading lately:

Economics for (and by) 10th Graders – Freakonomics Blog –

“An economics primer written by 10th graders.”

Bounding the Price Impact of the New Home Buyer Credit

“1.6 percent is still less than the housing price increase reported by Case-Shiller over the most recent twelve months. So, even if a 1.6 percent impact were not exaggerated, housing prices would have been stable or increasing over the past year even without the credit.”

Sculpture Made by Bees

“Dutch designer Tomáš Gabzdil Libertiny made a sculpture of Jesus that was completed by bees. He erected a sealed glass container with his mold inside. Libertiny then released 40,000 bees who worked on the honeycombed surface of the mold.”

France Loses; Warren Buffett Wins : NPR

“Berkshire Hathaway sold an insurance policy that would have paid $30 million if France won the World Cup.”

The Classroom Still Matters – Freakonomics Blog –

“Classroom instruction beats the internet in a new paper.”

Drop Argentina from the G-20

“The G-20 heads of state will gather June 26 and 27. One issue that should be on the agenda: Argentina’s unsuitability to remain a G-20 member.”

Arthur Levitt: A Missed Opportunity on Financial Reform –

“In The Wall Street Journal, former SEC chairman Arthur Levitt asks: How could Fannie Mae and Freddie Mac have escaped the Democrats’ attention?”

John Yoo: Democrats and the McChrystal Fiasco –

“In The Wall Street Journal, John Yoo says that Democrats during the Bush years egged on military resistance to Bush’s war policies, further increasing distrust between civilian and military leaders.”

Notable & Quotable –

“Max Boot writing yesterday in Commentary magazine’s Contentions blog on General Petraeus replacing General McChrystal in Afghanistan.”

American Thinker: Paul Krugman, the Self-Contradicting Economist

“An argument that questions the credibility of economists in general is that there are a number of disagreements among many economists, and not all of them can be right at the same time. In the case of Nobel Prize-winning economist Paul Krugman, these disagreements come from Krugman himself, as he holds contradictory opinions on a large number of topics.”

Nonsense 4.0 at Steven Landsburg | The Big Questions: Tackling the Problems of Philosophy with Ideas

I wholeheartedly agree with Steven Landsburg’s assessment of Anatole Koletsky’s Wall Street Journal essay (see, excerpted from his book Capitalism 4.0. A better title for Koletsky’s tome would be Nonsense 4.0!

How the Unemployed Spent Their Time in 2009 – Freakonomics Blog –

“They weren’t doing the laundry.”

Schumpeter 2.0 — The American, A Magazine of Ideas

“A great thinker’s contribution not only appears in his or her finished works and arguments, but also within the rich intuitions or core ideas that underlie the arguments.”

Unintended consequence of expanding liability…

According to, “Proposals in Congress to raise U.S. liability costs to $10 billion to drill for oil in the Gulf could leave just three companies — BP, Exxon Mobil Corp. and Royal Dutch Shell Plc — with the finances to self-insure”.  As I recall, prior to the BP Deepwater Horizon explosion and spill, liability for offshore oil drilling was capped at $75 million. Thus, an unintended consequence of expanding liability by a factor of 133 times (from $75 million to $10 billion) would be to make it virtually impossible for the insurance market to insure offshore oil drilling liability, which in turn would ensure that only the very largest companies in the world will have the financial capacity needed in order to be able to continue to pursue deep water drilling as a business activity (because companies such as BP, Exxon Mobil Corp. and Royal Dutch Shell Plc have the resources to self-insure this liability risk!). 

Lenny Bruce quote affirming free enterprise

I love this Lenny Bruce quote:

“Capitalism is the best. It’s free enterprise. Barter. Gimbels, if I get really rank with the clerk, ‘Well I don’t like this’, how I can resolve it? If it really gets ridiculous, I go, ‘Frig it, man, I walk.’ What can this guy do at Gimbels, even if he was the president of Gimbels? He can always reject me from that store, but I can always go to Macy’s. He can’t really hurt me. Communism is like one big phone company. Government control, man. And if I get too rank with that phone company, where can I go? I’ll end up like a schmuck with a dixie cup on a thread.”

Assorted Links (6/23/2010)

Here’s a list of articles that I have been reading lately:

Jenkins: Blowouts Will Not Always Be Prevented –

“In The Wall Street Journal, Business World columnist Holman Jenkins says Americans are curiously unwilling to acknowledge known risks.”

A Moratorium, Drilled –

“The Wall Street Journal writes on a federal judge’s decision to block the Obama Administration’s ban on deepwater drilling.”

Robert C. Pozen: $100,000 is Plenty for Deposit Insurance –

“In The Wall Street Journal, Robert C. Pozen writes that raising the cap will enhance the ability of weak banks to expand their deposit base and cause trouble for the FDIC.”

BP Spill May Be Less Than Doomsayers Think: Tadeusz W. Patzek – BusinessWeek

“Two months have passed since the blowout of the BP Plc exploratory Macondo well in the Gulf of Mexico. Much more is now known about a string of fateful decisions taken in the course of drilling this well.”

The Runaway General | Rolling Stone Politics

“Here’s the link to the controversial Rolling Stone article that is making lots of news today!”

Op-Ed Columnist – Faustus Makes a Deal –

“From the confluence of recent events, one might think the Democrats had made a deal with the Devil — and still managed to lose.”

Le Monde on The Brink | Monday Note

Hat tip to Tyler Cowen for the pointer to this article. Of particular interest is the following excerpt: “In France, firing a printing plant employee is hugely expensive. The gent is paid €50,000 per year, works 32 hours per week and 164 days per year. Firing him costs about €466,000 – that’s a French government estimate…”

The Gulf Spill and Compensation for Disaster Victims | Psychology Today

“When man-made or natural disasters strike, do the victims deserve compensation? Most people assume the answer is yes, but the case for compensation is not always clear.”

Faith, Doubt, and U.S. Foreign Policy — The American, A Magazine of Ideas

“To the degree that Obama believes in promoting democracy, his efforts will flounder if they continue to lack moral realism: a deep sense of religion’s corruptibility.”

Financial Reform Is Disaster For Banks, Consumers: Bove – CNBC

“New financial services regulations will be so disastrous that Congress will need to repeal them to undo the damage they will cause, banking analyst Dick Bove said Monday.”

Paul H. Rubin: A Tale of Two Disasters –

“In the Wall Street Journal, Paul Rubin writes that former President Bush was blamed for local failures after Katrina. Meanwhile, President Obama got a free ride for weeks as federal failures mounted during the Gulf spill.”

William McGurn: Obama Should Publicly Criticize Fannie Mae and Freddie Mac from the Oval Office – WS

“In The Wall Street Journal, William McGurn says the president needs to call attention to the role of Fannie and Freddie in the housing bust and the financial crisis.”

Bret Stephens: The Man Who Would Be King –

“In The Wall Street Journal, Global View columnist Bret Stephens explains what Rudyard Kipling tells us about Barack Obama.”

Oil in the Gulf, two months later – The Big Picture –

“62 days have passed since the initial explosion of BP’s Deepwater Horizon drilling rig in the Gulf of Mexico, and the crude oil and natural gas continue to gush from the seafloor.”

Op-Ed Columnist – Trim the ‘Experts,’ Trust the Locals –

“The chaotic organization of the federal oil spill cleanup effort highlights the need for increased local control.”

ObamaCare and the Independent Vote –

“In the Wall Street Journal, David Brady, Daniel Kessler and Douglas Rivers write that independents opposed to ObamaCare could swing the November election.”

Think Globally, Sue Locally –

“In the Wall Street Journal, Jonathan Drimmer writes that plaintiffs lawyers mount PR campaigns against corporations to trash their image and extort a settlement.”

Review & Outlook: The ‘Paralyzing Principle’ –

“The Wall Street Journal says in an editorial that the Gulf oil spill is reviving a discredited environmental theory known as the precautionary principle.”

Assorted Links (6/20/2010)

Here’s a list of articles that I have been reading lately:

The Benefits of the Financial Crisis –

“In an excerpt from Capitalism 4.0, Anatole Kaletsky says the financial crisis is leading to a new model of capitalism.”

The Case for Having More Kids –

“Social science says kids drain their parents’ happiness, but good parenting is less work and more fun than people think. Economist Bryan Caplan makes the case for having more children.”

CNBC’s Nesto Accuses Obama of Creating ‘His Own Sense of a Legal System’ –

“Reporter insists legal framework already in place to resolve oil spill claims, asks why White House has ‘a gun to the head’ of BP.”

Obamacare and its Impact on Doctors –

“Congress needs to start over with health-care reform and get it right.” 

Suspect Estimates of Sex Trafficking at the World Cup –

“Evidence to support an estimate suggesting that 40,000 sex workers could be trafficked into South Africa during the World Cup is scant, say researchers, and the real number is likely far smaller.”

Alan Greenspan: U.S. Debt and the Greece Analogy –

“In The Wall Street Journal, former Federal Reserve Chairman Alan Greenspan says that we shouldn’t be fooled by today’s low interest rates. The government could very quickly discover the limits of its borrowing capacity.”

Ethnic attacks in Kyrgyzstan – The Big Picture –

“Beginning one week ago, thousands of young Kyrgyz men rampaged through parts of southern Kyrgyzstan with weapons and torches, attacking ethnic Uzbek neighborhoods, burning homes and stores, and, according to reports, beating, raping and killing Uzbek residents. … ”

Op-Ed Columnist – Trim the ‘Experts,’ Trust the Locals –

“The chaotic organization of the federal oil spill cleanup effort highlights the need for increased local control.”

Charles Krauthammer – Obama and the vision thing

“Obama is world-historical, the visionary, come to make oceans recede and the planet heal.”

Battle For The House Is This Close | The New Republic  

“If we project the 1994 loss probabilities onto the 2010 distribution of Democratic seats in terms of party strength and incumbency status, we would expect Democrats to lose 42 of their current seats in November. Since Democrats are given a good chance of picking up at least three current Republican seats (one each in …Hawaii and Louisiana and the at-large seat in Delaware), we would expect a net loss of 39 House seats, leaving Republicans with the narrowest possible majority: 218 seats to 217 for the Democrats.”

Pizza, Long-Distance Calls, and the End of Free Checking – Business – The Atlantic

“As a child of the 1980s, I have never paid for a bank account…”

Spending Binge, Part Deux –

“Stephen Moore writes in The Wall Street Journal that fiscal schizophrenia reigns in the White House.”

Predicting the Financial Crisis: A Q&A With Fault Lines Author Raghuram Rajan – Freakonomics Blog -.

“Rajan on the crisis.”

Home Ownership in the U.S.: Rethinking Big Part of the American Dream –

“The American approach to home ownership and mortgages needs to be reconsidered, as the dream of owning a home turns into a nightmare of debt and foreclosure for many.”

Environmentalists as Battered Spouses — The American, A Magazine of Ideas

“Greens keep returning to their abuser after another promise to do good, but nothing in President Obama’s oil spill speech should offer them any hope that the administration is really going to change.”