Some Covid Links

by Don Boudreaux on October 28, 2020

in Current Affairs, Risk and Safety

Jeffrey Tucker rightly bemoans the new feudalism that is among the results of the deranged overreaction to Covid-19. A slice:

The politicians and intellectuals who put this new feudalism in place tossed out all normal concerns over freedom, justice, equality, democracy, and universal dignity in favor of the creation of a strict caste system. So much for Locke, Jefferson, Acton, and Rawls. The medical technocracy cared only about conducting an unprecedented experiment in managing the social order as if it consisted entirely of lab rats.

(DBx: I say again: If humanity ever escapes the consequences of its current derangement, the hysterical overreaction to Covid-19 will come to be ranked among the gravest mistakes ever committed on a mass scale – and our species has committed many mistakes. The persecutors of Salem’s witches will, by comparison, seem reasonable.)

Alan Reynolds writes wisely about Covid realty. A slice:

When TV and newspaper reports (1) harp on recent cases without mentioning tests, and (2) describe fairly small local increases in hospitalizations as national and huge. or (3) talk only about adding-up all cumulative deaths since January rather than the reasonably low level of recent deaths, they are doing a really disgraceful job.

Sheldon Richman shares the recipe for causing public panic:

1. Disseminate worst-case scenarios, taking care to ignore the dubious assumptions that go into modeling while vilifying anyone, no matter how well-qualified, who refuses to ignore them.

2. Emphasize the (alleged) benefits of a draconian government response, taking care to ignore the costs while vilifying anyone, no matter how well-qualified, who refuses to ignore them.

3. Repeat as necessary, preferably often.

Art Carden has assembled an excellent pandemic reading list. A slice:

Roger Koppl, Expert Failure. I caught a bit of flak after coming to Rand Paul’s defense after he somewhat clumsily said, “We shouldn’t presume that a group of experts somehow knows what’s best.” More than one person pointed out that in invoking Adam Smith, F.A. Hayek, and William Easterly I was appealing to (wait for it) experts to make my case.

That misunderstands what Smith, Hayek, Easterly, Thomas Sowell, and so many others mean when they criticize overreliance on experts. That’s where Roger Koppl comes in, noting (as Smith, Hayek, Sowell, and others do) that expertise in one area doesn’t mean expertise in another–and even within people’s fields of expertise, they are human beings who respond to incentives. About an hour into AIER’s Summit with Martin Kulldorff, Jay Bhattacharya, Sunetra Gupta, and Stefan Baral that led, ultimately, to the Great Barrington Declaration, Jay Bhattacharya pointed out that science per se cannot evaluate all the relevant political and economic trade-offs and say “Do this.” The reason, I think, is fundamentally Hayekian: individuals’ “knowledge of the particular circumstances of time and place” cannot confront the expert as data.

Writing in today’s Wall Street Journal, John Berlau and Seth Carter report on how Dodd-Frank impairs the fight against Covid-19. (Remember: The persons to whom pro-lockdowners wish to give more authoritarian power are the very sort of irresponsible, ignorant, grandstanding, and myopic politicians who wrote and enacted Dodd-Frank.)

Members of the Editorial Board of Wall Street Journal continue to write sanely, sensibly, and far more informatively than most other media about Covid-19. A slice:

This is why the epidemiologists who wrote the Great Barrington Declaration, which has been signed by tens of thousands of doctors and scientists, advise a focus on protecting the elderly. They also warn that government lockdowns lead to worsening heart-disease outcomes, fewer cancer screenings and more mental illness.

Nearly a third of the so-called excess deaths in the U.S. this year have been attributed to causes other than Covid, including cardiovascular disease and uncontrolled diabetes. Covid has accounted for less than 10% of deaths among those over 65 this year, and a much smaller share among younger people.

In the comments section yesterday at Marginal Revolution David Henderson’s identity was faked. The fake “David Henderson” would never be as gracious, open-minded, and honest as is the real David Henderson.

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… is from pages 73-74 of the 2016 Third Edition of James D. Gwartney’s, Richard L. Stroup’s, Dwight R. Lee’s, Tawni H. Ferrarini’s, and Joseph P. Calhoun’s excellent Common Sense Economics:

In a world of uncertainty, mistaken investments are a necessary price that must be paid for with fruitful innovations in new technologies and products. Such counterproductive projects, however, must be recognized and brought to a halt. In a market economy, the capital market performs this function. If a firm continues to experience losses, eventually investors will terminate the project and stop wasting their money.

Given the pace of change and the diversity of entrepreneurial talent, the knowledge required for sound decision-making about the allocation of capital is far beyond the scope of any single leader, industrial planning committee, or government agency. Without a private capital market, there is no mechanism that can be counted on to consistently channel investment funds into wealth-creating projects.

DBx: Indeed so.

Today’s proponents of industrial-policy schemes will protest that they have no wish to get rid of capital markets. This protest is both true and reassuring. But these proponents do have a wish to prevent capital markets from working in those parts of the economy embraced by industrial policy. That is, proponents  of industrial policy want to get rid of capital markets in certain parts of the economy.

Decisions on how capital will be allocated in those parts of the economy embraced by industrial policy will be made, not by market forces – including capital-market forces – but, instead, by administrative fiat. And so the discovery and disciplining functions of capital markets – properly celebrated in the quotation above as being so vital to a healthy economy – are eliminated by industrial policy in whatever areas this policy is imposed. Indeed, that’s the very point of industrial policy: to substitute the fancies and knowledge of government planners for the demands of consumers and the knowledge generated by competitive markets. And the knowledge generated by competitive markets is inconceivably greater and more reliable than is the puny, microscopic, inevitably politically and ideologically distorted knowledge of government officials and the intellectuals who advise them.

This truth cannot be too often repeated: Proponents of industrial policy propose to substitute the ignorance of government officials for the intelligence of competitive markets.

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In my latest article for AIER I express genuine mystification at many people’s gullibility for the use of unprecedented government powers to combat Covid-19. A slice:

Why this faith? The proffered answer, of course, is that Covid-19 is unusually dangerous and, therefore, we have no choice but to put faith in government officials. This answer is bizarre, for it insists that we must now trust with unprecedented power people who regularly act in ways that prove them to be unworthy to hold lesser amounts of power. My head explodes….

Moving on, and without pausing to explore just what is meant here by “unusually,” let’s grant that Covid-19 is indeed unusually dangerous. But also unusually dangerous is arbitrary government power. Is it unreasonable for those of us who fear this power to require that proponents of lockdowns meet a higher standard of persuasion before we accede to the exercise of such power? Given that the initial spark for the lockdowns, at least in the United Kingdom and the United States, was Neil Ferguson’s suspect and widely criticized Imperial Model – a model, recall, offered by a man with an awful record of dramatically exaggerating the likely mortality rates of diseases – is it unreasonable to demand that much stronger evidence be offered before we turn silent as governments continue massively to interrupt normal life?

If you’re tempted to answer these questions in the affirmative, recognize that there’s at least one important difference between pathogens and power – a difference that should be, but isn’t, taken into consideration by pro-lockdowners. The difference is this: Population immunity, either through a pathogen’s natural spread or through a vaccine, will at some point significantly reduce that pathogen’s danger; in contrast, for protection against government power there is no population immunity or vaccine. When such power expands, the ratchet effect documented by Robert Higgs ensures that that power remains more elevated and widespread than before.

Unlike pathogens, government power continues to nourish itself as it grows into an ever-greater danger. Quaking at the very thought of Covid while discounting the danger that lurks in the immense expansions of government power done in the name of fighting Covid is wholly unreasonable.

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Stacey Rudin applauds the anti-lockdowners. A slice:

Proponents of the competing narrative [that is, the narrative opposing the lockdowns], on the other hand, must stand up to massive social forces simply to make their arguments, which are not radical: they support a return to classic pandemic management tools, the same ones used by Sweden and other states and countries which did not lock down for COVID19, which resulted in average mortality for 2020. They do not believe this pandemic warrants a complete overhaul of the economic, social, and educational systems. They believe that every human being should be empowered with truthful information about risk and how to best care for personal health, and to make his or her own choices.

David Henderson pushes back against Tyler Cowen’s argument that Covid-19’s heavily disproportionate negative impact on the elderly is irrelevant.

Art Carden explains why America will not be moved toward ‘greatness’ by Walmart’s commitment to “Buy American.”

Michael Dirda recently re-read Robert Penn Warren’s brilliant novel All the King’s Men – and he still (quite understandably) loves it.

James Pethokoukis speaks out against the proposal for a $15-per-hour minimum wage.

Scott Lincicome writes insightfully about the politics of protectionism.

Steve Landsburg ponders, with his usual incisiveness, the state of the union – and of western civilization. That state is now in very poor condition. A slice:

1) Liberalism — by which I mean the societal presumption that it’s okay for people to disagree about fundamental things and not have to kill each other over it — and even better that they can live in harmony and respect their differences — is only a few hundred years old. It is also, I suspect, a lot more fragile than it appears to those of us who have had the good fortune to live in a time and place where we could take it for granted.

2) Not coincidentally, prosperity — by which I mean that a great many people are not starving — is approximately the same age, and likely to be just as fragile. A few hundred years is, in historical time, the blink of an eye.

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Quotation of the Day…

by Don Boudreaux on October 27, 2020

in Complexity & Emergence, Philosophy of Freedom

… is from page 103 of the May 9th, 2020, draft of the important monograph – forthcoming this month jointly from the Adam Smith Institute and AIER – by Deirdre N. McCloskey and Alberto Mingardi, The Myth of the Entrepreneurial State:

[T]he economy is composed of people, and is not a machine. It is like the English language, not like an English steam engine. The people are motivated in varying proportions by prudence, temperance, courage, justice, faith, hope, and love, with the corresponding vices. By way of such principles of motion, they pursue their endlessly diverse projects, knitting and model railroading…. Let them do it, laissez faire. Such an arrangement takes people to be liberated and equal and increasingly competent adults, as against the stolid peasants or helpless proletarians of conservative or progressive theorizing since 1848.

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Recently I came upon – I forget where and in what context – a reference to the talking trees and flying monkeys in The Wizard of Oz. And I still quite vividly recall the terror that these movie scenes injected into me as a young child watching that film.

The world to me today – or, rather, my sense of it – is usefully explained with reference to those scary scenes. Specifically, one or the other of the following realities is true, but both cannot be so.

(1) Covid-19 truly does threaten humanity with evil of the sort that young children sense when first watching those scenes in The Wizard of Oz. I see most people – many of them very smart and rational and learned – reacting to covid as young children react to those scenes. But because these people aren’t children, we humans must now truly be confronted with a real-world terror that is the equivalent of orchards filled with sentient, hostile trees, and skies swarming with winged monkeys. Yet I and a very few friends and colleagues see in the orchard no talking trees but only a few unusual bear tracks, and see in the skies nothing but a handful more raptors and vultures. Extra care is called for, of course, but no fundamental change of plans.

I and my fellow blind or oblivious friends – I’ll not name them here out of a desire to protect their reputation – must have been slipped some powerful hallucinogen that displays to us a “reality” that is very far from the grisly truth.

OR

(2) The orchard really has in it nothing more unusual than a few out-of-the-ordinary bear tracks, and the skies truly feature only a handful more raptors and vultures. I and my friends, however, wonder, in amazement, at what must be seen – and at what is reported – by the many other people around us. These people react as if the orchard is really filled with evil, sentient trees, and as if the skies are dark with monkeys whose mighty wing strength is rivaled only by the length of these creatures’ blood-stained fangs.

The people – apparently, a majority – who see the orchard as sentient and the monkeys as flying must be the ones who have been slipped a powerful hallucinogen.

…..

The above few paragraphs capture how I now feel. I am disoriented. Perhaps I’m the one hallucinating. (How can I prove even to myself that I’m not?) Humanity’s reaction to covid – or, at the very least, humanity’s continuing reaction to covid as more information about the disease has been made available – strikes me, truly, as one of utter derangement without a shred of justification.

But I am one person, and those who see current reality more or less as I see it seem to be a tiny minority. So perhaps the deranged ones are us. Whatever the truth, some people are deranged – hopefully only temporarily. And I sincerely concede that I might be in the deranged group.

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With his great 1982 book, The State Against Blacks, my GMU Econ colleague Walter Williams was, along with Thomas Sowell, far out in front in explaining how illiberal policies hurt blacks. The obstacles and snares Walter then identified are now mostly worse: the war on drugs war on people who choose to ingest certain products continues; housing and land-use restrictions are worse than ever; the government-school system is a calamity disproportionately for blacks; and of course the minimum wage remains as a barrier to so many young black men and women wishing to enter the labor market.

Walter has been active in speaking out against the new illiberal measures flying under the banner of “anti-racism,” “inclusiveness,” and the like. Here’s one recent column on “Diversity, Equity, and Inclusion.” Walter’s column is syndicated nationally, including in the Richmond Times-Dispatch, read by state legislators in Virginia.

My colleagues in the GMU Law school released a well thought-out commitment in favor of free speech and academic freedom.

My Econ colleague Bryan Caplan has been writing insightfully on the same matters, see here, here, here, and most especially here.

Finally, my Econ colleague Dan Klein wrote a letter to Gregory Washington, the new President of GMU. The student newspaper did a story about it. And Dan did a presentation on these matters, video here and text here (SSRN). Dan’s letter is getting picked-up, for example here.

….

I am blessed – truly – to have colleagues such as these, with none longer than Walter, who I first met face-to-face in August 1985 when I joined GMU’s Econ faculty. I already admired the man, as a scholar and as a person. That admiration has only grown, and steadily so, over the course of the next 35 years. I am proud beyond words to call Walter a friend and, despite my never having been his student formally, one of my most influential teachers.

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In two short Facebook posts Sheldon Richman conveys more insight and wisdom than is today found in any randomly chosen selection of 1,000,001 op-eds, columns, editorials, blogposts, tweets, and speeches.

Here:

How interesting that the people most worried about Trump’s authoritarian personality demand draconian government responses to the pandemic.

And here:

Lockdown doesn’t cripple “the economy.” It cripples people who are trying to live.

Hear! Hear!

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George Will explains that America has already been injected with a large dose of socialism, and the dosage of this poison is increasing. A slice:

Wading waist-deep into political policies, the Fed is adopting, Eberstadt says, “the role of managing and even micromanaging the American economy through credit allocation, potentially lending vast sums not only to financial institutions but also directly to firms it judges suitable for government support. The Fed already dominates the markets for U.S. Treasury debt and mortgage debt as a result of previous, lesser crises. It is by no means inconceivable that the current crisis will propel it to a comparably dominant position in domestic commercial credit.” If socialism is government allocation of economic resources (and hence of opportunity), then . . .

John Cochrane of Stanford’s Hoover Institution, who blogs as the Grumpy Economist, notes that in the 2008 financial crisis, the Federal Reserve launched “creditor bailouts, propping up asset prices to keep investors from losing money, buying unprecedented assets.” The risk of moral hazard — incentives for reckless behavior — is obvious.

Whole Foods founder and CEO John Mackey joins forces with Loyola University economist Walter Block to correct the record about Milton Friedman and free markets – a record distorted by people who have no good grasp of either. A slice:

[Binyamin] Appelbaum wants to leave off “the public shaming of restaurants that refuse to give paid leave to sick employees” and have a law enacted compelling them to do just that. But what determines employee well-being is total wages, the monetary plus the non-monetary (health care, safety on the job, and other fringe benefits). The firm cares not one whit about the proportions; its eye is only on the cost of the total compensation package. It has every incentive to allocate remuneration in accord with worker preferences. Mr. Appelbaum does not realize that if paid family leave is given, and total compensation (based on productivity) does not change, then something else will be reduced, presumably take home pay. Most workers would rather have higher take home pay than paid family leave if this means to an agreed-upon end is implemented. This is basic economics 101, and there are few people who have contributed more to it than Milton Friedman.

GMU Econ alum Wayne Brough unveils the trustbuster’s fatal conceit. A slice:

Perhaps the most telling point in the proposed antitrust overhaul is the effort to topple the consumer welfare standard as the foundation for antitrust policy. Rather than protecting individual firms, the consumer welfare standard focuses enforcement on promoting efficient market outcomes. For consumers, this is measured by lower prices, more innovation, and more choices in the marketplace. The consumer welfare standard emerged more than 40 years ago and its emphasis on economic efficiency and competition rationalized antitrust policy. This replaced decades worth of antitrust enforcement that was often arbitrary and contradictory, generating less than optimal outcomes and prohibiting practices that were actually innovative and efficient.

Robby Soave interviews U.S. Education secretary Betsy DeVos (who, in my opinion, is one of Trump’s best cabinet appointees; anyone who is hated so fervently by teachers’ unions must be doing something right).

Michael Strain is correct: raising the minimum wage will harm many of the workers who such a ‘raise’ is advertised as helping.

I very seriously encourage this sort of civil disobedience.

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is from page 170 of Roger Koppl’s important – and (I repeat) especially relevant – 2018 book Expert Failure; (the quotations within this quotation are from Alfred Schutz) (link added; original emphasis):

Each of us has a different place in the division of labor. Therefore, each of us knows different things and has different sensibilities to events around us. We have different stereotypes and recipes to guide us in us in our daily lives. Each person’s “prevailing system of interests” determines which elements of his “stock of knowledge” are relevant to him.

DBx: Yep. This truth is another that is completely lost on proponents not only of full-on socialism, but also of industrial policy. Proponents of such schemes think, mistakenly, that reality is no more complex than is the array of details that they have in their minds.

How childish. How foolish. How arrogant.

…..

Pictured above is Alfred Schutz, whose works I was introduced to 40 years ago by my fellow NYU grad student and friend Roger Koppl.

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