Saturday, June 20, 2009
Thursday, June 18, 2009
What would Ayn Rand do?
Several months ago, my best friend called to ask if I could bring him the Emergency Room; he’d smacked his head hard after his bike tires got caught in railroad tracks.
Though Rand never wrote about bicycles in her several thousand pages of fiction, presumably she would have left my buddy lying dazed by the tracks. Helping him, she’d say, would only prevent him from taking responsibility for his own acts, dampening his ability to learn to avoid train crossings.
Some Rand followers would object to such a cold interpretation, but refusal to help others is the essence of her Objectivism philosophy, summed up by hero John Galt in Atlas Shrugged: “Do not cry that you need us. We do not consider ‘need’ a claim.”
Many say it less bluntly as, “Help others by helping yourself,” but however you phrase it, it has an appealing core. Be selfish! When you go after what you want, that’s also best for other people. Helping others hurts them, so don’t bother; just get what’s yours.
Does that sound too extreme? Former chairman of the Federal Reserve Alan Greenspan now suggests it is, a change of heart that Objectivists label “cowardly,” and “traitorous.” After decades of following Rand (she nicknamed him “the undertaker” because of his gloomy disposition), Greenspan admitted that unregulated derivative trading hurt markets in ways he hadn’t expected:
Rep. Henry Waxman (D-CA) pressed him to clarify his words. “In other words, you found that your view of the world, your ideology, was not right, it was not working,”
“Absolutely, precisely,” Greenspan replied. “You know, that’s precisely the reason I was shocked, because I have been going for 40 years or more with very considerable evidence that it was working exceptionally well.”
It was going well until there was a crisis, as is true for many people’s lives. You may not often need medical malpractice laws, or environmental regulation, or a vibrant support system, but when you do, they prove their worth.
I don’t want a government dictating our every move. You should be free to bike where you want, for instance. But for those rare times you take a fall, it’s good to know that there’s a hand ready to help you get back on your feet.
Wednesday, May 27, 2009
'I suppose it's the same thing about so-called torture. Is it really so easy to determine that smacking someone in the face to determine where he has hidden the bomb that is about to blow up Los Angeles is prohibited in the constitution?'
Judge Sonia Sotomayor's judicial opinions are marked by diligence, depth and unflashy competence. If they are not always a pleasure to read, they are usually models of modern judicial craftsmanship, which prizes careful attention to the facts in the record and a methodical application of layers of legal principles.
'A law that requires execution when the case for aggravation has failed to convince the sentencing jury is morally absurd, and the court's holding that the Constitution tolerates this moral irrationality defies decades of precedent aimed at eliminating freakish capital sentencing in the United States.'
'While the law is free to promote all sorts of conduct in place of harmful behavior, it is not free to interfere with speech for no better reason than promoting an approved message, or discouraging a disfavored one, however enlightened either purpose may strike the government. ...'
Monday, May 25, 2009
- A carbon tax helps market forces work.
- A carbon tax means less government interference.
Monday, May 18, 2009
Monday, May 11, 2009
'We've so overused the word 'socialism' that it no longer has the bad connotation it had 20 years ago, or even 10,' says Anuzis. 'Fascism - everybody still thinks that's a bad thing.'
Monday, May 4, 2009
Tuesday, April 28, 2009
Monday, April 20, 2009
- Replacing a 10 mpg S.U.V. with a 20 mpg station wagon?
- Replacing a 20 mpg sedan with a 50 mpg hybrid?
Saturday, April 11, 2009
Walter Mossberg of the Wall Street Journal titled his preview 'Even in Test Form, Windows 7 Leaves Vista in the Dust.' He found it 'very promising' and 'a pleasure to use.' Could Microsoft have turned the corner?
Monday, April 6, 2009
Monday, March 30, 2009
Monday, March 23, 2009
This is the last post for awhile on why we need spending, so let's look at the clearest possible case: a village of three people who trade only with each other.
If some hold back on their spending, they all suffer. Why?
Suppose they each buy $5 of goods from the others, spending and earning $10. Peter bakes bread, Paul grows grapes, and Mary cooks casseroles, and everyone buys - and sells - two items each month.
This works fine until Peter begins to worry about the future and wants to save. He decides he can do without Paul's grapes for now, so he buys nothing more than the $5 casserole from Mary.
Paul now has just $5 to spend, since only Mary bought his grapes. Paul must cut back on his own spending as a result, and once he buys one loaf of bread from Peter - and nothing from Mary, since he has no more money - all trade is finished.
How much money does Peter now have to save?
Nothing. Zero. Zip. No one has more money in this situation, yet everyone has less to enjoy. How can that be?
This is what economist John Maynard Keynes called "the paradox of thrift." When people move too drastically to save, they can all end up saving less than if they were less thrifty. The problem results from a sluggish economy when everyone pulls back at once from their spending.
What can be done to get this village economy moving again?
Someone has to have confidence that things are improving, enough to promise purchases from both other merchants. Then the whole chain can begin moving again at full capacity.
Saving isn't inherently evil. But if people leap too quickly to increase their saving habits, they can end up with less on the table and in the bank.
Monday, March 16, 2009
Monday, March 9, 2009
'So what if it gets worse? Standard of living is all relative, anyway. You don’t mind not having as long as your neighbor can’t have it, either. Find other things to enjoy in life besides more stuff.'
Saturday, March 7, 2009
Tuesday, March 3, 2009
Monday, February 23, 2009
Monday, February 16, 2009
Monday, February 9, 2009
- Didn't spending get us into this mess? We need jobs, not cash!
We do need jobs, and the gift card helps us get there, during the months that job programs get underway. This week and next, there's only one thing that keeps businesses from folding, and that's consumer demand.
To help in the short-term, the Senate has proposed nothing but tax cuts, and that's disingenuous. While some other problems may be averted with appropriate breaks, like expanding exemptions from the Alternative Minimum Tax, we shouldn't confuse those with immediate stimulus.
When your house is on fire, there are things to do before choosing a new sprinkler system. The 600,000 jobs lost last month represent only one sixth of the the total losses since the start of the recession. We need relief soon, while all other plans take root.
The $2,000 gift card isn't a full solution, but it's a strong tool we can put in the hands of every American right now, this week.
- What if I just save the money?
Fine. If people save every penny of it, the program carries no cost: $2,000 goes to you, then back to the government years later. Even the interest goes to you and back. The Treasuries used to finance our debt are sold overwhelmingly to Americans. Despite the huge foreign reserves of Japan and China, we borrow mainly from ourselves.
But while rebate checks were saved at too high a rate to help boost the economy, the American Gift Card can do better, as it never sits in a bank. In our house, grapes get eaten a lot faster when they're out on a plate than when they sit in the bottom drawer of the 'fridge.
- Won't the money just go to China?
Amazing at it seems, given that half the things on my desk were made in China, well over 80% of dollars are spent on domestic goods and services. Even without restrictions on the card, it really will help Americans.
- Why not $2 million, so we're all rich?
$2000 is a good figure: $200 is too little and $20,000 is excessive. It's also the right amount to replace the $275 billion in proposed corporate and other tax cuts, some of which have merit but none of which have a stimulus effect with the promised speed.
$2000 per taxpayer provides a solid short-term stimulus while other programs begin, even though the mere issuing of a card doesn't create wealth. It is indeed money we're borrowing from ourselves, and for these next few months, that's a good thing. While there may be benefits to a higher rate of saving in America over the long term, the sudden drop in spending is causing substantial pain.
We can start cheering about reduced consumption after people stop losing their jobs.
- Can't we keep the government from telling us what to do or giving handouts?
Unlike other spending projects, the Gift Card program doesn't rely on the government to decide which business or industry should receive the money. You do.
There's no handout. Stores still have to attract your business if they want a boost in their bottom line. The difference between this an industry bailout is that you get to decide where the money goes.
And that's the smartest spending of all.
Saturday, February 7, 2009
It's a short-term boost, not a fix for all the long-term problems with the economy, nor to replace useful infrastructure spending or appropriate financial regulation.
Tax cuts can help avoid some problems, particularly if we wisely expand exemptions from the misguided Alternative Minimum Tax, but we shouldn't confuse tax breaks with immediate stimulus.
The store on the corner struggles when there is a fall in consumer demand. That's true whether taxes are high or low, whether subprime lenders are spinning their evil ways, or whether or not the financial markets need more regulation.
And so do the store employees. The 600,000 jobs lost last month are most remarkable in that they represent only one sixth of the the total losses since the start of the recession. We need relief now, while all other plans take root.
The $2,000 gift card isn't a full solution and isn't meant to be. It's a tool we can put in the hands of every American, right now, this month.
On Monday, I'll post answers to the most common questions about the idea, plus a response to some objections. Or you can read hundreds of differing opinions on the idea at several blogs including that of MadDogMedia, Reddit, Scott Loftesness, and The Washington Post comment board.
Friday, January 30, 2009
Tax Cuts 275
$500/person, plus expansion of business loss writeoffs
Aid to States 119
$87bn Medicaid, $25bn public safety, $7bn law enforcement
$41bn low-income support, $39bn secondary, $22bn college
Unemployment Aid 106
$43bn jobless benefits extension, $39bn health coverage
$30bn highways, $31bn building repair, $19bn water, $10bn transit
Energy Investments 54
$32bn grid upgrade, $22bn housing weatherizing
Investments in Science and Technology 16
$10bn research facilities, $6bn rural broadband Internet expansion
You can see more detailed figures in the actual proposal (.pdf document hosted by the Wall Street Journal).
Note how conservative this is - 'conservative' in the political sense. Tax cuts are not only the largest portion of the package, they're twice the size of the next largest item. More than twice the size.
And look at where the other big expenditures are: public safety, law enforcement, infrastructure. Even some of the liberal-sounding titles actually house conservative projects. 'Energy investments' isn't going toward solar-powered smiley buttons. It's primarily for upgrading the nation's electrical grid.
Good for President Obama for reaching across the aisle. Let's see how it works.