My colleague Pete Boettke was recently interviewed by The Daily Bell. A slice:
Closer to home, at GMU we have established a new research center that I am directing and Chris Coyne is the associate director. We have continued to grow our graduate student programs under the direction of Virgil Storr, and our journal editing – Review of Austrian Economics, The Independent Review, Public Choice, and Advances in Austrian Economics – as well as our editing of book series, including Cambridge Studies in Economics, Choice and Society, the Routledge series on Foundations of the Market Economy and the Edward Elgar series, New Thinking in Political Economy. Independent of our editing, my colleagues in our new center have been very active publishing books. Chris Coyne’s Doing Bad By Doing Good (Stanford), Peter Leeson’s Anarchy Unbound (Cambridge), Larry White’s The Clash of Economic Ideas (Cambridge), Paul Aligica’s Institutional Diversity and Political Economy (Oxford) and Virgil Storr’s The Culture of the Market (Routledge) have all been published in the last two or three years.
Another of my colleagues, Dan Klein, gave a fine talk this past November at GMU’s Center for Study of Public Choice.
Sarah Skwire ponders Anita Loos’s pondering of material girl. Max excellent!
Diana Furchtgott-Roth argues that proponents of the minimum wage would be more socially helpful if they became proponents of school choice.
Michael Barone writes sensibly about wealth and wealth accumulation. A slice:
Wealth accumulation and de-accumulation is a lifetime project. Almost all Americans age 21 to 29 have zero or negative net worth; most Americans age 55 to 64 have six- or seven-figure net worth. They spend their working lifetimes accumulating savings, building up home equity, making intelligent investments; then starting in their 60s they tend to spend some of that down.
So it’s not an indictment of a society or its economy to say that some large percentage of individuals at any given time have no wealth. The interesting questions how people at peak wealth accumulating age are doing, whether those younger are making headway in accumulating wealth and whether those older have enough wealth to spend down to meet their perceived needs. Intelligent analysis should — to use language economists might understand — disaggregate the data by age cohorts. Yet, every time the Federal Reserve releases its data on household wealth in America, we are treated to news stories about how most Americans have no wealth, even though most Americans age 55 to 64 do.
Ira Stoll offers nine takeaways from the recent blizzard bust. (HT Manny Klausner)
From the Adam Smith Institute:
We are delighted to announce the creation of the John Blundell Studentships initiative, which will offer annual grants to pro-freedom students for postgraduate study.
John was a tireless promoter of the free society and the free economy. Teachers, students, activists, professionals and politicians around the world were brought to an understanding of these ideas, and to become activists themselves, through John’s unique efforts.
Read more about this worthy effort named in honor of a truly remarkable man.
… is from page 98 of Robert Higgs’s 2004 volume, Against Leviathan (footnote excluded):
And make no mistake: the politicians know a good deal when they stumble into one. Large majorities of voters continue to support the attack on drug users and dealers, notwithstanding the soaring costs of imprisoning more and more people. Says James Alan Fox, dean of the College of Criminal Justice at Northeastern University, “For politicians, the drug debate is driven by the three R’s – retribution, revenge, retaliation – and that leads to the fourth R, reelection.” Never underestimate the capacity of the American public to cough up money for drum-beating politicians to squander in righteous and futile assaults on sin.
In an admirable comment on this post, regular Cafe patron Sam Grove (one of my favorites, I add to alert you to my partiality) writes in response to another commenter:
We [those of us of a free-market bent] do care about income inequality when it is a product of policies that inevitably favor the politically influential. Unfortunately, the poor are never among the politically influential, not even in a democracy.
I’d word matters a bit differently. Cronyism of the sort that Sam rightly and consistently decries does indeed unjustly enrich some people by making other people poorer. So such income transfers (which, as Sam suggests, government pulls off with far greater success than it has when it tries to transfer wealth from the rich to the poor) are not only rooted in force (and, hence, are presumptively unjust) but are also zero- or negative-sum ‘moves.’ In both of these ways such transfers differ from the voluntary and peaceful processes that create income and wealth differences in private markets.
But even with such rent-seeking, cronyist transfers, I’d not say that the concern is, or should be, with any resulting increase in income inequality. The concern is, or ought to be, with the unjust policies and activities that give rise to these transfers. If a millionaire embarks upon a life of successful house burglarizing, the problem with this activity isn’t that it further increases income inequality; the problem is that the activity itself is immoral and destructive. So just as we wouldn’t look with less disfavor upon a burglar whose success decreases income inequality than we look upon this hypothetical millionaire burglar whose success increases income inequality, our assessment of crony capitalism isn’t made any more harsh because it increases income inequality.
In my latest Pittsburgh Tribune-Review column I ponder some of the reasons for the concern over income differences. Here are the first few paragraphs:
I’ve never worried about income inequality. It’s not that I’ve not worried much about it; I’ve not worried about it at all.
Income inequality – like the color of my neighbor’s car or the question of the number of pigeons in Central Park – just never dawns on me as an issue worthy of a moment’s attention. More importantly, I’ve never encountered many people who worry about inequality.
Indeed, the only time I had regular, close contact with people who express anxiety about inequality was when I was in law school at the University of Virginia. And there, those who wailed most loudly about inequality were those from families that were, as we say, the “most privileged.”
To this day, when I read or hear concerns expressed over income inequality, I’m always a bit mystified. “Why,” I shrug, “is that an issue?”
I have always felt, and continue to believe, that fretting about monetary income and wealth differences in a market-oriented society is a sign of a deep misunderstanding of the way market economies work, of an inappropriate obsession with monetary (or narrowly materialist) values to the exclusion of other, competing values, or of envy regrettably unleashed and made respectable by populist politics.
… is from page 28 of my late colleague Gordon Tullock’s 1985 Quarterly Journal of Economics paper, “Adam Smith and the Prisoners’ Dilemma,” as reprinted in my colleague Dan Klein’s superb 1997 collection, Reputation: Studies in the Voluntary Solicitation of Good Conduct:
All of this, however, was known to Adam Smith and has probably been known to successful merchants from time immemorial. Where the market is broad and there are many alternatives, you had better cooperate. If you choose the noncooperative solution, you may find you have no one to noncooperate with.
Here’s a video of a superb appearance by Milton Friedman on Icelandic television in 1984.
One of the most frequently encountered arguments in support of the so-called “war on drugs” is that a society whose government doesn’t actively discourage the use of many or most intoxicating and debilitating substances will inevitably become coarse (perhaps even downright uncivilized) and filled with all manner of distasteful activities and frightening scenarios that threaten the security, property, persons, and peace of mind of citizens. Yet what can be more uncivilized, frightening, threatening, and ugly than a government addicted to intruding in this and many other noxious ways into people’s lives – all in the name of protecting people from having themselves and their neighbors get high in ways that government officials have divined are unacceptable?
Even if, contrary to fact, the government could succeed at ‘winning’ the ‘war on drugs’ – and even if you believe that government has a moral duty to protect people from themselves if doing so is worth the price by some reckoning – is the actual price paid today to fight this ‘war’ really sufficiently low to justify the alleged gains?
… is from page 171 of David Henderson’s excellent 2002 book, The Joy of Freedom:
Markets teach or encourage at least three virtues: tolerance, honesty, and compassion.
Kevin Williamson reflects on the meeting of the like-minds at Davos. (HT Lyle Albaugh) A slice:
Progressives say that they want inclusive social decision-making, but the most radically inclusive process we have for social decision-making is the thing that they generally distrust and often hate: capitalism — or, as our left-leaning friends so often put it, “unfettered” capitalism. And who should decide what sort of fetters are applied to whom? The view from Davos is, unsurprisingly: the people at Davos.
Tomorrow, the Heritage Foundation will release the 2015 edition of its Index of Economic Freedom.
My Mercatus Center colleague Veronique de Rugy, writing over at The Daily Beast, wants to make free trade sexy. A slice:
In fact, countries that receive the artificially cheap imports benefit far more than the protectionist country: recipient countries get more output for less input, and more imports for fewer exports. Let me make that clear: U.S. consumers of subsidized imports benefit by getting cheap goods at the cost of foreign taxpayers. That’s the closest thing to a “free lunch” in economics as you’ll ever find.
Mark Perry explains that competition breeds competence.
Lew Uhler and Peter Ferrara offer some germane facts about the tax burden in the U.S.
Reason’s Nick Gillespie singles out the five worst moments from last week’s State of the Union address.