It’s up!  Libertarianism.org  Check it out and learn – and be inspired.

Tim Worstall weighs in against the proposed Tobin tax on financial transactions.

John Tamny explains why we should cheer the disappearance of manufacturing jobs.

Really and truly, I would have linked to this superb essay by Sheldon Richman even had he not kindly quoted me in it.

The great George Melloan, writing in today’s Wall Street Journal, evaluates “Obama’s Perplexing Populism.

David Henderson reviews Alexander Field’s new book,  A Great Leap Forward: 1930s Depression and U.S. Economic Growth.

Alan Reynolds explores the claim that there is in America a growing “wealth gap.”

Finally, on last-night’s Stossel, I argued against money-manager Stephen Leeb’s insistence that China’s growing economy poses a grave danger to Americans.  (This post by David Henderson is relevant.)

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{ 103 comments }

Sheldon Richman November 4, 2011 at 9:33 am

And I believe him!

EG November 4, 2011 at 9:43 am

“a complex system of values and practices: justice, prosperity, responsibility, toleration, cooperation, and peace.”

In essence…everything everyone already believes and practices. Way to go CATO…a website on an ideology, that isn’t really an ideology, explained in 2 sentences which have virtually nothing to do with what the actual underpinnings of the non-ideology are.

But hey, when you’re trying to advertise to Ron Paul fans and high school kids…I guess its good enough.

Its about peace and justice and prosperity…and some other things that I’ve also heard at every single website and rally of every other ideology or non-ideology out there, since the beginning of time.

Was that website designed by CATO interns? If so, I take it all back.

Dan Phillips November 4, 2011 at 10:36 am

Really? It’s too amateurish for you? How deeply did you delve into the website? Click on the link to William Lloyd Garrison’s essay and read it. Maybe it leaves you cold, but it inspires most of us. Frankly I find it a sorely needed addition to the cause of liberty.

EG November 4, 2011 at 11:48 am

I didn’t dig deep in the website at all, of course. What I saw was some youtube videos, a “60 second intro”, and some essays from abolitionists from a century and a half ago. All tied together by some vague catchwords which don’t really define anything differentiating of “libertarianism”.

The ideas expressed there are common human values upon which all western civilization, law, governance and economics have been build on for the past 2 centuries at least, but more broadly for the past 2,000 years.

Its amateurish in its very concept: a website on an ideology. A terrible idea to begin with. “Libertarianism” isn’t an ideology. Its a term which loosely describes people of various classical liberal tradition, with the addition of plenty of other fringe concepts, or contemporary concepts. Its so broad that it necessarily encompasses everything and anything which defines western civilization.

Another score for CATO. Wonder how long before they start posting their Russia Today youtube clips on there; cause nothing represents “libertarianism” better than Putin-TV.

Jon Murphy November 4, 2011 at 12:05 pm

Dude, I’m sorry. I’ve read your post 5 times, but I have absolutely no clue what your point is or where you are going with this. Can you elaborate?

Methinks1776 November 4, 2011 at 12:35 pm

It’s written in slavic immigrant. I’ll translate: “Duuuuude! Libertarians totally suck.”

EG November 4, 2011 at 12:54 pm

Well, the website may have as much of a “point” as I do. My “point” is mostly directed at CATO, and their experimentation as of lately with….shall we say….less than conventional methods.

EG November 4, 2011 at 12:56 pm

Methinks, I don’t think “libertarians” suck. I am a “libertarian” myself. But I am one for lack of a better term.

Either way, I’m not slavic.

GAAPrulesIFRSdrools November 4, 2011 at 2:37 pm

“Either way, I’m not slavic.”

I am. It describes a group of people, not a specific ethnicity and not a language.

What you have above is a critique designed to promote defensiveness-which it did, since you all leapt into the fray to respond to issues of aesthetics and composition, which are matters of taste.

In short, you placed a sucker bet.

Methinks: you should use a term correctly before using it as invective. I’m pretty sure some of the present day Slavic (capital S) immigrants-many of whom are multiligual (its a long tradion, my grandmother is multilingual, even without so much as a secondary education), advanced mathematics and science-might find your prose wanting.

As an aside, its very arguably due to the efforts of a Slav, Jan Sobieski, in defeating the Turks in 1683 (on September 11-12, sound familiar? Its not an accident) that we get to pontificate on intellectual abstractions, rather than worrying which was Mecca is.

I’ll presume that we can dispense with snarky ethnic hostility now.

EG November 4, 2011 at 3:10 pm

GAAPrulesIFRSdrools, my critique is in no way based on aesthetics. it is entirely on…content. The content of any website dedicated to an ideology…is always wanting and amateurish, because it is an amateurish undertaking to build a website to an ideology.

PS: I know what slavic means. I don’t know why she thinks that supposed to insult me, since she’s Russian. Oh well. Me and Methinks have a history ;)

EG November 4, 2011 at 3:24 pm

“It describes a group of people, not a specific ethnicity and not a language. ”

Oh wait. You said that! Actually, slavic represents a specific ethnicity and a specific language.

Methinks1776 November 4, 2011 at 8:58 pm

GAAP,

You know I’m a slavic immigrant, right? That wasn’t meant as an insult. ‘Twas just a joke.

brotio November 5, 2011 at 12:19 am

Actually, slavic represents a specific ethnicity and a specific language.

Maybe I’m missing your point, because I know plenty of Slovenians who can’t speak Czech, or Russian, but all three are considered Slavic languages.

It’s also fun to listen the various tribes of Slavic ethnicity go at each other. It seems the only white people that Serbs hate more than Slovenians, are Wops.

EG November 5, 2011 at 9:54 pm

Brotio, its pretty simple. Slavic is an ethnic family and a language family. There’s lots of ethnic groups in Eastern Europe who are not Slavic. Thats all.

Invisible Backhand November 4, 2011 at 12:15 pm

“…libertarianism is good because it helps conservatives pass off a patently pro-business political agenda as a noble bid for human freedom. Whatever we may think of libertarianism as a set of ideas, practically speaking, it is a doctrine that owes its visibility to the obvious charms it holds for the wealthy and the powerful. The reason we have so many well-funded libertarians in America these days is not because libertarianism has acquired an enormous grassroots following, but because it appeals to those who are able to fund ideas.”

Thomas Frank, The Wrecking Crew

Dan Phillips November 4, 2011 at 1:38 pm

IB: I don’t know who Thomas Frank is – I’ve never heard of him – but he totally misses the mark. Libertarianism is no more “pro business” than it is “pro labor union.” Libertarianism is an ideology (to use EG’s term), a political philosophy which advocates individual liberty as the proper primary goal of political thought. In fact true libertarianism claims individual liberty to be the ONLY political goal.

You and Mr. Frank obviously confuse libertarians for conservatives. Nothing could be further from the truth.

Jon Murphy November 4, 2011 at 2:40 pm

Frank is a journalist for Harper Magazine

GAAPrulesIFRSdrools November 4, 2011 at 2:53 pm

Dan P:

Frank is a garden variety leftist, who writes (ok, whines) on the opinion page of the WSJ. I assume they keep him there as some sort of charitable venture or act of civic duty.

His screeds, tedious and predictable are a collection of indignant emotion-based grievances against reality, forever seeking to grasp the levers of government in an effort to erect the machinery of statism.

Quoting him as an authority is something of an unintended confession of a severe intellectual deficit.

Dan Phillips November 4, 2011 at 4:29 pm

OK, I did a quick google search on Thomas Frank and his book *The Wrecking Crew*. There was a video of him driving around Washington DC pointing out all the buildings housing lobbyists, and showing their connection to governmental power. He made an assertion that most of it was the result of conservative efforts. To be honest, I couldn’t agree with him more! Conservatives are equally at fault with liberals for the dilemma our society faces today. At least that’s how I see it from my seat in the grandstands (as A.J. Nock used to say).

He never mentioned what his solution to the dilemma of lobbyists would be. It would probably include giving the beaurecrats in government even more authority, without realizing that would only attract more lobbyists (although they would probably call themselves by a different name, like yesterday’s liberals are today’s progressives).

He reminds me of a reverse Rush Limbaugh. The thing I love about Rush is his analysis of the left is spot-on. But his solutions invariably require the use of government to quash liberals. This guy would undoubetly use government to quash conservatives. I’m a libertarian. I would abolish the government altogether!

You see, IB, libertarians are not conservatives.

Invisible Backhand November 4, 2011 at 6:54 pm

You see, IB, libertarians are not conservatives.

Would you be happier if I said libertarians are Republicans? How about libertarians Charles and David Koch, do they vote with their dollars conservative or liberal, Republican or Democrat? Is Grover “starve the beast” Norquist not a Republican? I’m not buying it.

Jon Murphy November 4, 2011 at 12:35 pm

I wonder where the idea that Libertarianism is pro-business comes from? Sure, we support a profit, but we also support a loss. I mean, if we were truly pro-business, would we not be advocating tariffs on imported goods so domestic producers could charge higher prices and/or increase their market share so they could earn more profit? Would we not support state-protected monopolies that could charge prices without having to worry about competition? Wouldn’t we advocate the bailout of failing companies so they could make massive profit without any risk?

Greg Webb November 4, 2011 at 1:30 pm

Jon, the left tries to smear libertarianism with being for “big business” and for “the rich” because they know that pro-freedom is overwhelmingly popular, while the left’s true ideology of big government is rejected. Consequently, they prey on peoples’ prejudices against others.

GAAPrulesIFRSdrools November 4, 2011 at 6:36 pm

“The thing I love about Rush is his analysis of the left is spot-on. But his solutions invariably require the use of government to quash liberals. ”

Are we listening to the same guy (12-3) daily? I’ve never heard such a thing. In the last couple of years, RINOS have been the recipient of his wrath as much as “liberals” and the “solution” is usually electing less RINOS and liberals.

vikingvista November 4, 2011 at 1:43 pm

Clearly you didn’t spend as much a 60 seconds there. Anyone who did, knows your post is embarrassingly wrong.

EG November 4, 2011 at 3:17 pm

I’m sure its a great website…if I were the kind of person who would visit a website dedicated to an ideology. Since I’m older than 13, thats probably not the sort of indoctrinating I want.

And again, I’m not criticizing “libertarianism” here. I am as much pro free markets as anyone here. Its the concept of doing such a thing that I find purely amateurish.

Its the sort of things that CATO has been doing lately, that often leave a bad taste in my mouth …ie, turning a loose term which encompasses many schools of thought, which are united by a common thread of free markets and individual freedom…into a sort of dogmatic personality-based “ideology” with catchy little 60-second tutorials, and 2 sentences of meaningless words. All the while appearing on RT not realizing that they are being used as anti-American tools by a totalitarian government-run propaganda channel.

THAT…isn’t “libertarianism”.

Jon Murphy November 4, 2011 at 3:20 pm

I’m sure you have seen the site. There are links abounds to pro- and anti-libertarian writings.

EG November 4, 2011 at 8:50 pm

Thats perfectly great. I didn’t address those points, or criticize it on them.

vikingvista November 4, 2011 at 4:09 pm

“I am as much pro free markets as anyone here.”

Definitely false.

There are criticisms to be made about Cato, but just like with Ron Paul, you manage to expend a lot of words without hitting upon any of them.

EG November 4, 2011 at 8:57 pm

Well I don’t think you can decide if I’m pro free markets or not. I do that. Or are you claiming that opposing Ron Paul, disqualifies me as being pro free markets? That would be something!! (and would prove my criticism of both Ron Poul and CATO :) )

I’ve been pretty clear what my criticism of both Ron Paul and CATO are. Whether you want to read them or not, is entirely your undertaking. I believe I outlined several criticisms I have of CATO…right above. And I have done so on several occasions when CATO pieces have been linked to here (and my criticisms are almost 100% on their foreign affairs opinions). One MAJOR criticism is their patronage on a regular bases of a totalitarian government’s propaganda TV channel. That s NOT small potatoes, especially if…CATO…is going to come out, in writing, in favor of a military aggression undertaken by said country against another.

And I’m supposed to stay quiet when an organization which claims to promote liberty, uses tactics which are ONLY suited for your run of the mill communist organization? Excuse me, but I’m not going to.

vikingvista November 4, 2011 at 10:48 pm

“Well I don’t think you can decide if I’m pro free markets or not. I do that.”

You are not as pro free markets as I am, I absolutely guarantee it. Neither, by the way, is Ron Paul.

“I’ve been pretty clear what my criticism of both Ron Paul…”

We’ve been through this ad nauseam before. We’ve established that you smear Ron Paul as a liar, when in fact if anyone is lying, it must be you, who defines “military bases” differently than does even the military. We’ve also established that even if we accept your false numbers, it detracts nothing from Paul’s argument, and is therefore irrelevant anyway.

The only thing we haven’t established, is why you have this bizarre woman-scorned type hyperbolic response against Ron Paul. It obviously has nothing to do with his positions. Did he personally smear you at some time? Did he deliver your wife’s baby, and charge too much for it? Did he reject your advances? Something personal and very weird is going on, since clearly nothing rational is.

EG November 5, 2011 at 2:59 pm

“We’ve been through this ad nauseam before. We’ve established that you smear Ron Paul as a liar, when in fact if anyone is lying, it must be you, who defines “military bases” differently than does even the military. We’ve also established that even if we accept your false numbers, it detracts nothing from Paul’s argument, and is therefore irrelevant anyway.”

There is no definition of a “military base”, since that is not a term the military would use. That is a term someone like Ron Paul would use. And he is lying. As for not “detracting anything” from Ron Paul’s argument…of course it does. He is a liar who keeps repeating a number that everyone has already told him is false.

“The only thing we haven’t established, is why you have this bizarre woman-scorned type hyperbolic response against Ron Paul. It obviously has nothing to do with his positions”

It has a lot to do with his positions. He is an ignorant old man who parrots positions which, even if they may contain half a truth or a third of a truth in them, are presented in a dogmatic ideological way which makes my stomach turn. And most of his positions, I think, are ridiculous to the extreme (his positions on the Fed, on gold, on the military etc). And he defends most of these positions with a barrage of lies and misinformation…which are disguised as being based on “economics” (apparently anything read on a Mises dot org post counts as “economics”), or as mainstream “classical liberal” ideas. (when they are pretty far from them)

There’s nothing positive I can say about an old dogmatic parroting fool followed by an army of screaming yelling children waving little Ayn Rand books. Thats a cult. Thats no different that communism

“since clearly nothing rational is.”

Is there something rational about Ron Paul? The problem with characters like Ron Paul, or Gary Johnosn…is that they suck the air out of a discussion. Whereas many classical liberal or “libertarian” ideas are mainstream amongst many Republicans…once you get dogmatic ideologues into the debate, there is no more debate. There’s no point in discussion the military, if what you have to deal with at that point is ideology.

Jon Murphy November 4, 2011 at 1:54 pm

By the way, the website gives a great listing of critiques of Libertarianism: http://www.libertarianism.org/introduction/critics-of-liberty

Chucklehead November 4, 2011 at 2:28 pm

Cato did a nice job. I do prefer the term classical liberalism or just liberalism to libertarianism. I do not wish to cede the word liberal to socialists any more than to cede the word gay to homosexuals.

EG November 4, 2011 at 3:21 pm

I prefer classical liberalism myself. But classical liberalism is not synonymous with today’s “libertarianism”. Today’s “libertarianism” gets to be defined by the people at CATO and the Ron Paul types. (and CATO still has a lot of good eggs in it, but its starting to get…weirder)

Thats…not classical liberalism. Maybe a lot of it is. But a lot of it isn’t.

Milton Friedman touched on this slightly when he was being interviewed for Uncommon Knowledge, when he is describing two traditions of “libertarianism”. So did Richard Epstein.

GAAPrulesIFRSdrools November 4, 2011 at 8:07 pm

I tend to agree with you on classical liberalism EG

I used to subscribe to Reason, until I realized there were to many simplistic prescriptions, for example drug decriminalization/legalization, and when I realized they were selling the idea as a predecided “solution” but was left with inchoate discomfort until I realized that enacting such a policy would inevitably be a trade-off, rather than a solution.

I’m not opposed to the idea of decrim/legalization, but it would be great if the die hards realized that caution isn’t a moral defect, that there’s some folks that just want some sort of evidence, a pilot or trial, whether it be one state, or one drug, say marijuana.

Then there’s the little complication I experienced last week, because my “hobby” involves participating in the operation of trains. I couldn’t help thinking how my 4th amendment rights were being violated as I peed in the bottle, not because there was probable cause, but to satisfy random test requirements enacted due to one idiot, Ricky Gates. Will we have to prove our sobriety even more if we decriminalized/legalized drugs? I don’t know, I just have questions. I just want to know we aren’t opening another Pandora’s box of unintended consequences.

Somehow Acton and Burke have deeper, broader and consistent insights than Ayn Rand, whose respect for private property ended when the owner wished to be charitable.

However, to belabor the issue up top, I think you have the ethnicity and language “Slovak” confused with the panethnic term “Slavic”

`

Chucklehead November 4, 2011 at 8:45 pm

“I should, of course, like to see society organized so that the individual would be free to carry on his “pursuit of happiness” as he sees fit and in accordance with his own capacities. That is because I assume that the individual is endowed at birth with the right to do so. I cannot deny that right to my fellow man without implying that I do not have that right for myself, and that I will not admit. I claim for myself the prerogative of getting drunk and sleeping off my condition in the gutter, provided, of course, I do not interfere with my neighbor’s right to go to the opera; that is my, and his, way of pursuing happiness. How can a third person know that getting drunk or going to the opera is not “good” for either of us? He, or society, or a majority may claim that we, my neighbor and I, have “wrong” values, and might try to tell us so, but the imposition of force to get us to change our values is unwarranted; such use of coercion stems from an assumption of omniscience, which is not a human quality. The best that society can do in the circumstances is to see that one’s way of pursuing happiness does not interfere with that of another’s — and then to leave us all alone.”

http://mises.org/daily/5027

kyle8 November 4, 2011 at 8:54 pm

Yes but Ayn Rand has her place. I am not worried about a lack of caution in ending the stupid war on drugs, because if it ever does happen it will be done with much fear and trepidation.

I am far more worried that we will continue to bash our heads against an iron wall year after year while thousands of lives are ruined and billions of dollars wasted before we try anything different.

EG November 4, 2011 at 9:11 pm

I couldn’t agree with you more GAAPrulesIFRSdrools.

Kyle…caution is always called for, as well as sources, when you’re going to throw around figures which number in the millions and billions.

PS: GAAP, I am very well aware of what slavic means. I’m from Eastern Europe. But if you’re not part of that ethnic family or language family, you simply ain’t. And I ain’t. Methinks is just trying to be cute.

Methinks1776 November 4, 2011 at 9:28 pm

EG, it was worth a stab for a joke :)

eeez too mach PC in Amereeka.

Thomas Bayes November 4, 2011 at 10:27 am

Hi Don,

On the issue of the “wealth gap” and the top 1%, can you provide some pointers or references to what sort of distribution is “normal” and to be expected? Most analyses ignore the question of what share we should expect. One side simply says it’s a problem; the other says it’s not.

Here are some questions whose answers might help me and others better understand the “wealth gap” issue:

What share of the nation’s wealth creation is provided by the top 1% of wealth creators?

What share of the talent and accomplishment exists among the top 1% of the nation’s baseball, football, or basketball players?

What share of annual book sales are made by the top 1% of the people who publish a book in a given year?

What share of income goes to the top 1% of people employed as actors?

What share of violent crimes are committed by the top 1% of the people who commit serious crimes?

What share of the scholarly contributions to, say, women’s studies are made by the top 1% of the people who understand what the field of women’s studies is?

Randy November 4, 2011 at 12:15 pm

Great question. Not a serious question, of course, but I’m thinking you already know that.

iipalindromeii November 4, 2011 at 4:20 pm

I’d love to see a comparison of these distributions. My feeling is that they’re all over the map. I know that the distribution of number of lines of code written by top producing programmers vs bottom producing programmers is much wider than the same for car sales – read that a few years ago.

Of course, I don’t know that it would bring any light to the subject – most of the talk about inequitable distribution is being used to express a feeling of disenfranchisement, not as evidence of disenfranchisement. People feel wronged, thus they look for why.

If we see 3 years of solid, cross-industry growth will this talk of 99% end?

I remember that the first “99-ers” I heard about were those who’d exhausted their unemployment payments.

Thomas Bayes November 4, 2011 at 4:54 pm

Actually, I do mean this as a serious question. I must have done a poor job of stating it.

The point isn’t to provide further evidence of disenfranchisement. The point is to reveal what could be a fundamental characteristic of systems that are based on, and reward, individual achievement.

Most people are familiar with the 80/20 rule-of-thumb. 80% of the productivity in an organization is accomplished by 20% of the people. I suspect this phenomenon might be more stunning if we examine what is accomplished by the top 1% of the organization.

Many people try to write books. Most flounder. Those top 1%, though, do very, very well. Is that a flaw in the system, or is it a characteristic of the system that provides all of us with better books to read?

kyle8 November 4, 2011 at 9:00 pm

I think you have the truth of it. A sober examination of the last hundred years is hard to stomach for those who advocate that people are all the same.

The truth is that nearly all human achievement, and especially those achievements which cause a large leap in understanding or quality of life are nearly always the product of either one single individual or very small group.

The same is true in the Arts as well as the sciences. All the rest of us by comparison are little better than mediocrities holding on to the coattails of the true innovators.

veritasrex November 4, 2011 at 10:43 am

Stephen Leeb was having seizures over China. It was very telling at the very end of the segment when Leeb admitted his true motivation where he said, “I don’t like China.” Envy like this reminds me of the OWS crowd. One side is envious of American citizens who do well for themselves and the other side is envious of foreign citizens who do well for themselves. The Left and Right are looking more and more alike these days although I’m sure it’s not a new phenomenon.

Jon Murphy November 4, 2011 at 12:09 pm

Envy is one of the 7 deadly sins.

Methinks1776 November 4, 2011 at 12:46 pm

Well, it almost killed Leeb when they taped that.

House Of Cards & Economic Freedom November 6, 2011 at 5:31 am

Just watched Stossel with Boudreaux and Leebs.

Leebs is a lunatic and a moron. He has no grasp whatsoever of basic economics.

And this guy manages other people’s money?

John Dewey November 4, 2011 at 7:59 pm

veritasrex: “the other side is envious of foreign citizens who do well for themselves”

That’s a very broad assertion. Many if not most people who align themselves with most conservative positions are not at all envious of foreign citizens who do well for themselves. Where did you get this idea? or perhaps I do not know what you mean by “the other side”. Please explain this assertion you have made.

Jim November 4, 2011 at 10:43 am

Wealth inequality. Reynolds does a nice job of responding but doesn’t overlooks the identity question. Just who are the 1%? When comparing across years, are they always the same folks?

It is the prospect of being in the 1% that motivates most of us. A strict egalitarian distribution of wealth kills off any motive to succeed. Add to that the realization, that most of us realize that the wealth distribution will not be egalitarian, it will favor a politically favored few.

indianajim November 4, 2011 at 10:48 am

Don,

Great job on Stossel! You maintained you cool, rational tenor in the face of seemingly invincible ignorance and irrationality. I hope Leeb lives up to making the bet he agreed to as a result of your challenge. Again, well done!

Methinks1776 November 4, 2011 at 11:39 am

My husband and I were holding our breaths watching the close calls. Leeb instantly worked himself into an impressive near coronary, prompting growing worry that one of his flapping paws was going to accidentally Karate chop Don, who was obviously trying to subtly duck away from the arm propeller, ready to flee just in case Leeb suddenly levitated and spun at him in a completion of his transformation to a bug-eyed Tasmanian Devil.

Are the pickings that slim or does John Stossel purposely persist in pitting Don Boudreaux against cartoon characters for his own amusement? It’s got be difficult for Don to figure out which flailing strip of the cat-o-nine tail of stupid to capture and tame in a timed TV segment.

Congratulations, Don, for not only getting a word in edgewise with that machine gun of discombobulated outrage but for also managing to get your point across and without bodily injury.. That’s skill.

Don Boudreaux November 4, 2011 at 11:43 am

Thanks! Mr. Leeb is quite genuinely in a lather – and it shows – about the risks that Chinese economic growth poses to Americans.

Darren November 4, 2011 at 12:01 pm

I can see arguments that certain policies favoring China may harm the American economy, but I have a hard time getting very worked up about it since I *don’t* see any major harm that can be accomplished except by our own stupidity and laziness.

MWG November 4, 2011 at 12:58 pm

What was ‘confusing’ about his argument was that because resources are scarce and China is growing quickly, the US should implement pro growth policies, which I assume will use up those ‘scarce’ resources even quicker. Hmmm… Interesting.

On another note, I believe we should implement a Reason styled drinking game. First on the list of trigger words: tenure.

Nikolai Luzhin, Eastern Promises November 6, 2011 at 5:35 am

Stossel, Leeb, and Boudreaux, now there is a troika

Leeb has the right question but totally misses the point. Leeb and Boudreaux —–

The right question is, How will China’s emergence as the World’s largest economy impact the United States? It will do such in at least three ways, not including how that economic power will translate into political power as China uses its purchasing power to increase political influence.

First, all finance will move to China. Finance has to be at the center or core. A young person graduating from college today hoping for a career selling bonds had better learn Chinese. IOW the theory of business of NY and London, gone.

Second, and this is not discussed by Leeb, apparently, is location theory. Location theory says that firms must generally be geographically close to customers. The larger China grows, the greater the pressure becomes on firms to move to China. It becomes a positive feed back. Now we are loosing manufacturing to China. Everything else will follow (Apple will move to China with Jobs death, once China lets Apple sell the IPad and IPhone in China. If China finds an internal source, Apple will die, for the scale and scope of China will mean that products are made for that market first).

Third, what I call the Planck problem, after Max Planck. There is no rule of economics that the says that the problem of resource scarcity will be solved by technology or product substitution. While this has happened historically, no rule predicts when or how such will happen or at what rate. Cowen argues the low hanging fruit is gone. What we do know from observation is that the changes in technology are not continuous; they are lumpy and arbitrary. Thus the changes are, as we know by observation like or similar to how some physical quantities can be changed only by discrete amounts, or quanta, as multiples of the Planck constant, rather than being capable of varying continuously or by any arbitrary amount.

This pattern of irregularity is totally disruptive of attempts by economies to come into balance. A level 360 month mortgage payment is at war with commodity prices that go up and up, and then crash, etc., if a cheaper substitute is found, in the most simple terms. This puts real pressure on central banks that are attempting to control local prices, an impossible task when prices are driven by uncontrollable external forces. Britain is now learning this lesson.

Gil November 4, 2011 at 1:17 pm

You make sounds as if Don is John’s pokemon.

Invisible Backhand November 4, 2011 at 11:05 am

EVERYONE MUST WATCH DON BOUDREAUX ON FBN RIGHT NOW!

http://www.foxbusiness.com/on-air/stossel/index.html#/v/1257599363001/should-us-cheer-or-fear-chinas-success/?playlist_id=87530

Interestingly, I was thinking “faith based economics” right when the other guy said “betting on a technology god”.

Look for the obvious edit to give Don a chance to talk

Stossel was siding with Don, had the quotes and graphics to support Don, not Stephen.

Take a drink when you hear the basket of 5 commodities golden oldie

Stephen Leeb is my new hero, but to be fair, he comes across as the wild haired raving nut, making Don look like the normal one.

veritasrex November 4, 2011 at 11:12 am

“faith-based economics” as opposed to what, centrally planned economics? Most prefer to call it a free market where individuals choose their own path instead of a government official choosing it for them.

Invisible Backhand November 4, 2011 at 12:19 pm

as opposed to what

Economics with numbers and arithmetic?

Greg Webb November 4, 2011 at 12:38 pm

Economics with numbers and arithmetic?

So, you finally realize that Keynesianism with its focus on “the animal spirits” is wrong.

Ben Hughes November 4, 2011 at 4:35 pm

*Like*

Invisible Backhand November 4, 2011 at 10:24 pm

Economics with numbers and arithmetic?

I have to admit that the central planners in the former Soviet Union made good use of their numbers and arithmetic. I believe the Soviet Union was one of the most successful, humane, egalitarian, and economically just societies in history, and that anything to the contrary you might have heard was libertarian, right-wing, propaganda manufactured by the Koch brothers.

My handlers at Anonymous and I intend to do everything possible to push the United States in a similar direction as the former Soviet Union (though we’ll avoid the words “socialism”, “communism”, and “Marxism”, and advertise our position instead as “European-style welfare statism”. I’m hoping everyone here will help us.

Greg Webb November 5, 2011 at 12:45 am

LOL! :)

Thomas Bayes November 4, 2011 at 11:19 am

“Stephen Leeb is my new hero, but to be fair, he comes across as the wild haired raving nut, making Don look like the normal one.”

I, too, think it is charming when someone brings a knife to a gunfight, but I can’t call Leeb a hero for doing so. What is it about confidence in human ingenuity that is so hard for progressives to grasp? Look around your office — the evidence is everywhere.

Jon Murphy November 4, 2011 at 12:07 pm

Leeb didn’t bring a knife to a gunfight. He came unarmed.

Invisible Backhand November 4, 2011 at 12:22 pm

What is it about confidence in human ingenuity that is so hard for progressives to grasp?

If you want to jump out of an airplane and have confidence the free market will provide you with a parachute on the way down, fine. Count me out.

Jon Murphy November 4, 2011 at 12:29 pm

If you want to jump out of an airplane and have confidence the government will provide you with a parachute on the way down, fine. Count me out.

Methinks1776 November 4, 2011 at 12:38 pm

I’m just saddened he’s cottoned onto the implication of jumping out of a plane without a parachute. That was my “plan A” for him.

Randy November 4, 2011 at 5:26 pm

Jon, Perfect response.

As for me, if I want to jump out of an airplane I have confidence that with a little research I can find a highly recommended instructor with good parachutes.

Dan H November 4, 2011 at 12:34 pm

What happens when the airplane known as government runs out of fuel?

GAAPrulesIFRSdrools November 4, 2011 at 1:08 pm

If you do jump out of a plane expecting a parachute, that’s not a “market”, since you are begging for assistance without OFFERING SOMETHING IN EXCHANGE!!!

Richard Stands November 5, 2011 at 2:16 am

Isn’t confidence in human ingenuity the very thing that allows most people to board an airplane in the first place? And didn’t ingenuity create that airplane, parachute, and the computers upon which we discuss it?

Invisible Backhand November 4, 2011 at 10:30 pm

Look around your office — the evidence is everywhere.

Sorry to disappoint, but I have no office — I’ve been unemployed for years. I originally lived off a trust fund my wealthy aunt left me; but after blowing through that, I decided that the only fair and just way to survive was to convince other people that they owed me a living.

(How am I doing?)

Chucklehead November 4, 2011 at 2:36 pm

Leed managed to compound fallacy upon fallacy. I love how people say with a straight face that we are running out of elements like copper, iron, and zinc. These are not destroyed by their use. Don destroyed his argument. If he is a money manager, god help his customers.
A more interesting segment was Ellise’s, who gave a lesson on progressive propaganda, with the “just a little bit more” and “social contract” hyperbole.

Jon Murphy November 4, 2011 at 2:37 pm

“How much should we give?” The answer is always “More! More! More!”

GAAPrulesIFRSdrools November 4, 2011 at 6:21 pm

I’d hate to point out how prevalent ocean floor nodules of some metals are-oh what the heck.

Invisible Backhand November 6, 2011 at 5:38 am

Stossel . . . had the quotes and graphics to support Don, not Stephen.

On second thought, I believe there are no quotes or graphics to support Stephen. His position can be supported only by ignorance and fear.

That’s why I, and my handlers at Anonymous and MoveOn.org support his position.

Ivan Georgiev November 4, 2011 at 11:28 am

Mr. Leeb’s argument in a nutshell: “I hate the Chinese. I love America. This means war.”

Methinks1776 November 4, 2011 at 11:51 am

Really? All I got (between the spittle) was “I hate people. I hate China because it has lots of people. We need to bomb the Chi-comms before they eat all our food and copper. I don’t believe in a technology god, I believe in a central planning god. We need to put corn and oil on the dinner table. Pac-man was my favourite video game growing up. I desperately need you to buy my guaranteed to be unreadable book. Where are my meds.”

Randy November 4, 2011 at 12:18 pm

:)

Ryan Vann November 4, 2011 at 4:03 pm

Down with the Chiners! Join the Donald Trumpwaffe.

GAAPrulesIFRSdrools November 4, 2011 at 11:40 am

(formerly Anotherphil)

If history is finally written by dispassionate examiners, and rescued from the clutches of the vast majority of the current crop of “hysterians” who have an idolatrous fascination with the acquisition and concentration of state power and an incessant worship on politicians with oratory persuasive in the cause of the expansion of the state, Obama will be rated as highly competitive among the least qualified and worst performing presidents.
Even his supposed strengths have proven to be vaporous apparitions. Obama’s “postpartisanship” is nothing but pedestrian division and his “postracial” perspective conceals a seething and incendiary anger against the very people that made his ascent possible (unlike the very flawed Steve Jobs, who didn’t spend his life romanticizing a biological father who had no role in the heavy lifting of raising a child). As for his supposed intellect, described as “incandescent” by one particularly fawning writer, we see absolutely no evidence of it, just a presumption. No grades, no record of accomplishment, no articulation of any novel thought, indeed not even any critical self-reflection exist. It is an indictment of the modern academy, and our gullibility that the law degree, a creation of the last century and a half, has been elevated to a doctorate to be conferred on people who seek only power. It seems only to impart the tools of confusion and more arrogance and intemperance in people who already possess those defects in excess.

What Obama has provided is a stunning indictment of the key weakness of modern celebrity democracy-that burning ambition and narcissism are still rocket fuel to a destination for someone who is thoroughly untested and unqualified for the office being sought.

If the press has been doing its job, it would have questioned his lack of achievement or accomplishment, instead of fawning and blushing like “tweens” at a Justin Beiber concert, his thin resume, radical ideology and associations and superficial and specious oratory (thoroughly unable to be delivered away from the teleprompter crutch) would have been presented for what they were-warnings of man thoroughly unschooled, indeed unaware of the need for discretion and restraint in the exercise of executive authority and disrespectful of the governed.
We can only hope the very measurable record of incompetence will overcome the noxious vacuity of “hope and change”.

Personally, I find it fascinating that a man with such a visceral distaste for finance would have accepted everything in his life, including his Nobel “Peace” prize when it was awarded essentially by grantors taking a short position on its issuance. Too bad there’s no hedge for such speculation.

Sam Grove November 4, 2011 at 6:48 pm

If the press has been doing its job, it would have questioned his lack of achievement or accomplishment, instead of fawning and blushing like “tweens” at a Justin Beiber concert

Nobody likes to bet against the race card.

Becky Hargrove November 4, 2011 at 11:40 am

That interview was great – LOL – it made my day. We’ll probably be hearing a lot more about technology gods. I’m new to broadband so that’s the first time I’ve seen you ‘battle it out’.

GAAPrulesIFRSdrools November 4, 2011 at 11:48 am

Need an edit button for return happy fingers!

If history is finally written by dispassionate examiners, and rescued from the clutches of the vast majority of the current crop of “hysterians” who have an idolatrous fascination with the acquisition and concentration of state power and an incessant worship on politicians with oratory persuasive in the cause of the expansion of the state, Obama will be rated as highly competitive among the least qualified and worst performing presidents.

Even his supposed strengths have proven to be vaporous apparitions. Obama’s “postpartisanship” is nothing but pedestrian division and his “postracial” perspective conceals a seething and incendiary anger against the very people that made his ascent possible. (unlike the very flawed Steve Jobs, who didn’t spend his life romanticizing a biological father who had no role in the heavy lifting of raising a child).

As for his supposed intellect, described as “incandescent” by one particularly fawning writer, we see absolutely no evidence of it, just a presumption. No grades, no record of accomplishment, no articulation of any novel thought, indeed not even any critical self-reflection exist.

It is an indictment of the modern academy, and our gullibility that the law degree, a creation of the last century and a half, has been elevated to a doctorate to be conferred on people who seek only power. It seems only to impart the tools of confusion and more arrogance and intemperance in people who already possess those defects in excess.

What Obama has provided is a stunning indictment of the key weakness of modern celebrity democracy-that burning ambition and narcissism are still rocket fuel to a destination for someone who is thoroughly untested and unqualified for the office being sought.

If the press has been doing its job, it would have questioned his lack of achievement or accomplishment, (instead of fawning and blushing like “tweens” at a Justin Beiber concert), his thin resume, radical ideology and associations and superficial and specious oratory (thoroughly unable to be delivered away from the teleprompter crutch) as what they were-warnings of man thoroughly unqualified and unaware of the need for discretion and restraint in the exercise of executive authority. There was plenty of evidence of his disdain for the governed.

We can only hope the very measurable record of incompetence will overcome the noxious vacuity of “hope and change”.

Personally, I find it fascinating that a man with such a visceral distaste for finance would have accepted everything in his life, (including his Nobel “Peace” prize) have been short positions. Too bad there is no hedge, no way to cover the short.

Chucklehead November 4, 2011 at 2:38 pm

We all need a edit button. What can we offer in free exchange to get one? Professors, what is the price of a edit button?

vikingvista November 4, 2011 at 4:15 pm

“An” edit button. :)

Chucklehead November 4, 2011 at 6:24 pm

Exactly my point!

Fred November 4, 2011 at 11:51 am

I’d like to see Boudreaux vs Buchanan.

Don Boudreaux November 4, 2011 at 11:59 am

If you mean Pat Buchanan, it’s already been done. Back in (I think) 2003, I debated him in D.C. (It wasn’t taped.) He wiped the floor with me. I am not remotely a skilled, or even passably good, face-to-face debater. I think too slowly; smile too little; and my speaking style doesn’t really working in that setting.

Fred November 4, 2011 at 12:07 pm

If it’s any consolation I come up with my best responses several hours after the debate is over.

GAAPrulesIFRSdrools November 4, 2011 at 1:12 pm

Debate is like many human endeavors, a practiced art-it is not an innate skill. To expect to be proficient without practice is a complete misapprension of the nature of the skill.

There will always be prodigies and wunderkinds, but the rest of us have to work at it.

Nikolai Luzhin, Eastern Promises November 6, 2011 at 5:04 am

the reason for face-to-face debate is that, next to cross examination, it is the most effective method of truth seeking available

cross exam works because the jury can see the witness thinking as they make up their answers, try to recall the lines they are supposed to say, instead of the truth.

Mark Lanier, a great trial lawyer, tells a wonderful story. At about 4:00 one afternoon he called the defendant’s representative as a witness. The defensive objected, “We have not prepared our witness to be able to testify.”

Lanier answered, “I didn’t know that preparation was necessary to be able to tell the truth.”

nailheadtom November 4, 2011 at 1:26 pm

Leeb and Boudreaux would make a great comedy team on the lines of Abbott & Costello, Laurel & Hardy or Timothy Leary and G. Gordon Liddy.

Greg Webb November 4, 2011 at 1:38 pm

Don, I enjoyed the debate. You made some excellent points despite Leeb trying to dominate the conversation. His unwillingness to engage in proper debate by permitting you to respond and make additional comments about the issue reveals his lack of confidence in his position. His style of debate and reliance on emotions and fear-mongering made him look stupid at best.

Chucklehead November 4, 2011 at 2:45 pm

I don’t think it sold many copies of his book, which was his purpose.
Amazon #5,813 in Books
http://www.amazon.com/Red-Alert-Prosperity-Threatens-American/dp/0446576239/ref=zg_bs_2594_18

Jon Murphy November 4, 2011 at 2:55 pm

After re-watching the debate, Leeb really comes off as a racist, doesn’t he. “I don’t like the Chinese. That’s why I say ‘war’”

vikingvista November 4, 2011 at 4:16 pm

I don’t know. I think he just doesn’t know the meaning of the word “productivity”.

Ben Hughes November 4, 2011 at 4:37 pm

The meaning of the word “productivity” is the just the tip of the iceberg of Leeb’s illiteracy with respect to economics.

Let this serve as another example of why economic understanding is so crucial for society in evaluating policy and truth.

vikingvista November 4, 2011 at 4:53 pm

Economic understanding in society? Reminds me of when I had a 100 page engineering report due in two days. No, more like having a manned Mars mission ready for launch next Thursday. The task only inspires me to do shots of Black Label.

vikingvista November 4, 2011 at 4:48 pm

Tamny is worth putting on a regular to-read list. Nice piece, as usual.

Indian weddings November 8, 2011 at 12:11 am

The system is complex.When we are survive our society then the economic condition is mostly matter for society. People are the do their job and the meaning of productivity word is the popularity of any type of job.

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