Archive for August, 2011

A reason to celebrate

Dave Killion — August 19, 2011

The Libertarian Book Club blog has just passed its one year anniversary. Congratulations to my fellow contributors David, G, Jeremy M, Ben H, and Antony Zegers. We are, for the moment, the only libertarian voice on Vancouver Island, and one of the few in all of Canada. With all due humility, I believe what we are doing is important, and I look forward to doing even more, even better over the next 365 days.

As you sow

Dave Killion — August 19, 2011

 

One of the problems for promoters of so-called green initiatives is that the technology has too frequently not matured sufficiently to warrant substantial investment. Boosters elect to campaign for government subsidies which consume resources that would be better invested elsewhere. This unsustainable practice frequently has adverse environmental consequences (e.g. corn-based ethanol) which creates divisions within the movement. Over at Reason’s Hit & Run blog, Shikha Dalmia says it might get ugly

“Consider the recent massacre of six golden eagles at California’s Tehachapi Mountains wind farm. Federal authorities are investigating the incident, but some enviros are upset that not all their brethren are more outraged over the dead birds—along with the 440,000 others that are shredded annually by all the “cuisinarts of the sky” around the country.  Shawn Smallwood, an expert studying the impact of wind farms on migratory birds, for example, told Fox News that he can’t understand why it took so long for the U.S. Fish and Wildlife Services, which enforces the Endangered Species Act, to come in and investigate the situation. Likewise, Sue Hammer of Tehachapi Wildlife Rehab in Kern County, complained about the hypocrisy of the Golden State’s environmental enforcement establishment. “If I shoot an eagle, it’s a $10,000 fine and/or a vacation of one to five years in a federal pen of my choice,” she said. But wind farms don’t suffer the same consequences.”

Dollars are like seeds – they have to be planted in the right place at the right time. Letting government ‘invest’ in renewable energy is like spreading seed on rocks in the middle of winter.

Revolting

Dave Killion — August 18, 2011

You know what would make a good shield? Some pants!

I have been watching ‘Spartacus: Blood and Sand‘, and it’s very entertaining for those who, like me, enjoy sword-and-sandals dramas. Over-the-top comic-book violence, nudity (full frontal, male and female), romance, political scheming, slave revolts… what more could you ask for?

Historical accuracy, you say? Well, I have to admit, I have my concerns in that department. I imagine the care and training of a gladiator is an expensive proposition, yet every battle between them is to the death, and when they train they inflict what I think a slave owner would consider an expensive and unprofitable amount of damage on each other. On the other hand, (SPOILER ALERT) after watching a battle between two gladiators which has been put on for his coming-of-age celebration, a magistrate’s son orders the victor to dispatch the loser despite the battle having been merely a demonstration. When discussing the incident sometime later, the magistrate says,

“He calls for bloodshed without hesitation. Such boldness will one day lead him to the Senate.”

I imagine that’s as historically accurate as one could expect.

Inuit 1, Whale 0

Dave Killion — August 17, 2011

Whale! It's what's for dinner!

Last Monday, for the first time in about a hundred years, Iqualuit Inuit hunted and killed a bowhead whale

“It’s obvious, both from speaking with community members and watching footage on TV, that this historic event has brought a sense of pride and excitement to everyone who is fortunate enough to be a part of it,” (Edmonton, Nunavut MP Leona) Aglukkaq said in a Wednesday news release. “From elders to young children, this shared experience is a special memory that will be talked about for generations to come.”

Various native groups have been permitted to resume their traditional whaling for a few years now, and it appears that if it weren’t for government ineptitude, they could have  taken it up even before then –

“Until recently, DFO scientists claimed there were only several hundred bowhead whales in eastern Arctic waters, preventing their harvest in Nunavut.

But in 2007, they upped that estimate to at least 5,000 and decided that a controlled hunt will not put the species in danger.”

Well, for the whales’ sake, I hope the second estimate is closer than the first.  Personally, I am not opposed to whaling on humanitarian grounds, because as I often say, every wild animal is going to come to a bad end. But some people feel a particular kinship with these animals, and those particular folks can take some comfort knowing that the market is looking out for them –

“Although Nunavik was permitted to harvest one bowhead this year, after successful hunts in 2008 and 2009, no hunt was co-ordinated for 2011 because “the hunt can be expensive and labour intensive,” Kan said.”

So it may turn out that whaling will just prove to be too unprofitable to bother with. Unless the feds subsidize the hunt, which they might do in the name of cultural preservation or something. Then we will see whales killed in order to collect the subsidy. But as far as this hunt was concerned, there’s only one item I found disturbing –

“Journalists… were not allowed to document the hunt, one of three licences Ottawa permitted in Nunavut this year, as elders and hunters make every effort to shield themselves from criticism.”

I would be very interested to know how this nasty little bit of censorship was accomplished. If anyone knows, please help us out.

Links

Dave Killion — August 16, 2011

Seattle Black Panthers showing off their advanced communications technology

Too many good things to let just slip by:

  • “The Atlantic” has an article on the racist origins of gun control in general, and the impetus created by the Black Panthers –

“In February of 1967, Oakland police officers stopped a car carrying Newton, Seale, and several other Panthers with rifles and handguns. When one officer asked to see one of the guns, Newton refused. “I don’t have to give you anything but my identification, name, and address,” he insisted. This, too, he had learned in law school.

“Who in the hell do you think you are?” an officer responded.

“Who in the hell do you think you are?,” Newton replied indignantly. He told the officer that he and his friends had a legal right to have their firearms.

Newton got out of the car, still holding his rifle.

“What are you going to do with that gun?” asked one of the stunned policemen.

“What are you going to do with your gun?,” Newton replied.”

  • I think this is a good trade, and happily the choice is still mine to make (for the moment).
  • One more reason the government should not be involved in mass transit.
  • Please visit our new Facebook friend, Fred Hi-Yek

The Capitalist Workers’ Party (CWP) is part of the international capitalist tendency and a firm supporter of the capitalist order and way of life. Though inevitably and dialectically internationalist by the pre-conditions of our existence, we firmly suppoprt the Western Order and fear the implications of the Fall of the West and its values which are by their draw on millions of immigrants, proof of their virtue. We recognise the importance and potency of Marxism and Socialism but oppose these schools of thought, their ideologies and their political methods. Their legacy in the 20th Century supports our position.

How to be uber-happy and awesome.

Dave Killion — August 15, 2011

Reuters offers an editorial in which Vernon Smith, Bart Wilson, and Ronald Rotunda answer the question; Are capitalists happier? From the article –

The capitalists indicate greater happiness. We cannot measure this happiness the way we can quantify gains from trade, but the chat room discussions are revealing. In the “villages” (groups of players), the capitalist players engaged in small talk and banter as well as trade. A typical chat: Person 1 tells Person 7 that they can make more money if they specialize like the others, and Person 7 adds, “then trade” and “everyone is uber-happy.” Another player comments, “we are awesome”. “Yup,” says another. Another participant says, “usually there’s some idiot who just hordes his own blocks”. To which another responds, “very sad”. When Person 2 explains that stealing is not in anyone’s long term benefit, Person 6 responds, “I love you player 2”. The players who agreed to respect private property also seemed more respectful.

In the villages that did not respect private property, the chat room exchanges were very cold and impersonal. Surprisingly, at no point do these players discuss specialization. They saw that other villages were producing and consuming a lot more and were a lot wealthier, but they never asked how they might acquire such quantities. On the days of “rest”, they seldom chatted in the chat rooms.”

This is in no way a defence of our current corporatist system, in which politicians pursue their self-interest through the selection of winners and losers, while depriving us so many opportunities for the satisfaction and fulfillment that come from peaceful, voluntary interactions. But it provides a strong argument for where we should be heading.

A boost for the good guys

Dave Killion — August 13, 2011

Awful lot of turkeys in this straw poll.

The Ames Straw Poll in Iowa does not predict who the next Republican candidate for US President will be, but it is strongly indicative of who will be the important players over the coming months. Accordingly, Ron Paul supporters must be delighted with today’s results

“Bachmann took 4,823 votes, narrowly escaping a major upset at the hands of Texas Rep. Ron Paul who won 4,671 votes. Former Minnesota governor Tim Pawlenty placed third with 2,293, a showing that is likely to raise questions about his ability to continue in the contest.”

Paul’s close second will likely prove very motivating to a group that is already very enthused about their candidate, and will hopefully attract more attention to his libertarian views. Although Public Choice Theory teaches us that it matters very little who gets elected (since all politicians are subject to the same incentives), someone is going to get elected President of the USA, and of all the possibilities, I think Paul may do the least damage and perhaps even some good.

On a side note, I can’t help but notice how so much attention was paid to the race and gender of (respectively) Barack Obama and Hilary Clinton when they were campaigning, while there is little mention of these attributes in regards to Herman Cain and Michele Bachmann, but rather a focus on their merits and demerits. In my view, this is both appropriate and desirable.

The first rule of Book Club is…

Dave Killion — August 13, 2011

Be honest, now. Wouldn't YOU like to blow this car up?

From the movie “Fight Club” –

Narrator: A new car built by my company leaves somewhere traveling at 60 mph. The rear differential locks up. The car crashes and burns with everyone trapped inside. Now, should we initiate a recall? Take the number of vehicles in the field, A, multiply by the probable rate of failure, B, multiply by the average out-of-court settlement, C. A times B times C equals X. If X is less than the cost of a recall, we don’t do one.
Business woman on plane: Are there a lot of these kinds of accidents?
Narrator: You wouldn’t believe.
Business woman on plane: Which car company do you work for?
Narrator: A major one.

Sounds horrible. But let’s hear Professor Friedman on the matter –

That’s not actually Michael Moore, by the way. But here’s where I find the young man’s logic failing him –

… I don’t see Ford spending $13 less on each car at the cost of 200 lives a year as being a principled position to take…

Well, that’s because you’re not considering the total cost of saving those lives, which may amount to tens of millions. So talking about $13 per car is really misleading. In fact, I imagine there are lots of things that could be done to improve the safety of cars that cost very little per car, but I think if they were added to Fords, or Toyotas, or whatever, consumers would look to other slightly less expensive cars. Friedman is right. The balance between safety and cost is one that can and should be worked out between the consumer and the manufacturer through the market.

Freely trading in duplicity

Dave Killion — August 11, 2011

Here is a letter to the Globe and Mail

In your article “Stephen Harper defends free-trade deal with Columbia” (Aug. 10), the Prime Minister decries protectionism as a barrier to progress in both human rights and economic growth, and amen to that! Unfortunately, the PM’s defence of the free-trade deal suggests that his commitment to anti-protectionism is insincere. Free trade is, after all, the natural order of things, whereas so-called free-trade deals serve only to codify the manner in which trade will be restricted. True, Canadians cannot force the government of any other country to trade freely with us, but there is nothing other than corporate and political self-interest to prevent our elected officials from eliminating any and all trade barriers put up by OUR government. Of course the costs of doing so would be concentrated in a few businesses, while the benefits would be spread far and wide amongst consumers and the remaining businesses, so politicians will alternately free up or restrict trade as benefits their electoral interests. Let’s not be deceived by their rhetoric.

US Debt Disaster

Dave Killion — August 10, 2011

Antony Zegers (a fellow Victoria Libertarian Book Club member) emailed this contribution to me, with permission to post it. Enjoy –

“In a recent discussion with a friend about the debt ceiling debate, it was noted that the US federal debt after the Second World War was around 120% of GDP, which is significantly higher than the “official” number now.  The government at the time was not only able get the budget back in order, but this period ushered in several prosperous decades through the 50s and 60s.  So if the current debt situation is less severe, could we be poised for a similar happy resolution?

The following points may be worth considering:

1. The debt then was held mostly domestically through war bonds, so when it was paid back it remained in the US economy.  Much of the current debt is held by foreigners, especially central banks (particularly China and Japan).

2. The maturity schedule of the debt right now is very short.  Back then much of it was in 30-year bonds, so interest payments were stable and predictable.  The average maturity is around 3 years right now [1].  This means that even if they don’t go further into debt (which obviously they will) they have to roll over a large proportion of the debt each year.  This makes the debt very vulnerable to changes in interest rates.  The situation right now is analogous to a teaser rate on a mortgage, if rates go up they will have huge problems.  And rates will have to go up at some point.

3. The “official” debt does not include many of the liabilities that the government is on the hook for.  The “Unfunded Liabilities” of Social Security, Medicare, and Obamacare are huge.  This will either mean huge future expenditures (making it harder to pay down debt), or cuts to these programs.  Also, Fannie, Freddie, and the FHA are holding many trillionsof dollars in mortgage-backed securities.  Much of this stuff is probably worthless, and the government is on the hook for it.  There is also the state-level debt to consider.  Will the federal government stand by as states go bankrupt, or will it be called on to bail them out?

4. The GDP numbers are inaccurate.  Current GDP numbers are skewed by excessive borrowing and consumption spending, they do not really represent the productivity of the economy and the ability to raise revenue to pay down debt.  Inaccurate inflation numbers also artificially inflate the GDP stats.  GDP will likely stay stagnant or shrink in the coming years.

5.  After the war they were able to cut the massive unproductive war spending.  After the Second World War, the US government cut spending by about 65% from 1945 to 1948 [2]!  Imagine how uthinkable that would be nowadays.  The Keynesian-influenced economist at the time warned that with would create a huge depression, and advocated keeping the munitions industry going to avoid job losses.  Of course the opposite happened, and the resources freed by this spending cut unleashed a huge productive forces, paving the way for prosperity through the 50s and 60s, and also made it possible to pay back the war debts.

So what will happen?  Possible options are:

A. Pay the debt back honestly: This would require massive spending cuts, probably tax hikes, and putting a stop to inflation, which would mean higher interest rates and would throw the economy back into recession.

B. Default honestly.  This would annoy the foreign central banks, would cause much of Wall Street to go bankrupt, and would throw the economy into recession.  But at least with this option, you do not wipe out the private wealth of the people, and you have a clean slate to restructure the economy and regain prosperity.

C. Default dishonestly.  This will be done through inflation, basically printing money to pay the debts.  This is the most politically palatable option, because it allows governments to keep spending, delays the day reckoning into the future, and allows politicians to escape blame.  The problem is that by devaluing the money, you wipe out the wealth of the middle class, and inflict huge harm in the economy through capital consumption, and preventing the necessary restructuring. The most extreme possibility would be hyperinflation, which totally destroys the economy.

Option C is by far the most harmful option. Unfortunately, as evidenced by the recent raising of the debt ceiling, this seems to be that path we are headed down.”

References:

1. http://budget.house.gov/UploadedFiles/debtthreat27may2010.pdf

2. http://www.gpoaccess.gov/usbudget/fy09/pdf/hist.pdf