Here’s the beginning of Sheldon Richman’s superb essay “Trade Is a Labor-Saving ‘Device‘”:
Democratic politics makes savvy people stupid, at least when they act politically. This has long been demonstrated, and it applies both to voters and policymakers. Several things account for it: the impotence of one vote, the consequent futility and hence wastefulness of acquiring information, the dispersal of the costs of government, and the resulting theatrical mood-setting farces called election campaigns.
Richard Epstein dissects Hillary Clinton’s tax plan – and finds it to be atrocious. (HT Steve Pejovich) A slice:
The Clinton program rests on an exaggerated sense of the good that government can do. But her plan will backfire in a number of ways. First, by raising the capital gains rate she reduces capital mobility and thus locks people into inferior investments. The higher rates will depress the collection of the capital gains tax, by encouraging people to delay unloading bad investments. Second, by imposing the higher taxation rates on the richest individuals, her program further tamps down on investments made by people whose investment and management skills can best create new jobs for ordinary people. She wrongly thinks that governments can expand opportunities, when its level of entrepreneurial expertise is negligible at best. Unfortunately, we can expect her program to fail just as other government programs have in everything from solar energy to neighborhood cooperatives.
(We often hear the term “price-gouging.” Why is “tax-gouging” not at least as prevalent – especially given that, unlike so-called “price-gouging,” all taxation involves the use of force?)
Scott Sumner isn’t impressed with Dani Rodrik’s latest blast against free trade.
William McGurn reminds us of Milton Friedman’s principled and unequivocal economic and moral defense of free trade. (gated) A slice:
For his part, Friedman would ask by what right should an American be prevented from buying a lawful good or service if he found a better price from someone overseas? Where’s the morality of keeping a worker from selling the product of his labor to someone who happens to live in another country? And the following was Friedman’s response on “Free to Choose” when a union official challenged him on his bid to eliminate all tariffs over five years:
“The social and moral issues are all on the side of free trade. And it is you, and people like you, who introduce protection who are the ones who are violating fundamental moral and social issues.
“Tell me, what trade union represents the workers who are displaced because high tariffs reduce exports from this country, because high tariffs make steel and other goods more expensive, and as a result, those industries that use steel have to charge higher prices, they have fewer employees, the export industries that would grow up to balance the imports, tell me what union represents them? What moral and ethical view do you have about their interests?”
Premium costs in the exchanges increased about 12 percent nationwide from 2015 to 2016. Current rates are being finalized, but it looks as if the increase from 2016 to 2017 will be double that. “This suggests that the system is not finding its balance or approaching stability but actually getting more unstable,” says Yuval Levin of National Affairs. “People just aren’t finding the insurance offerings in the exchanges attractive, and the law leaves insurers very few options for improving them. The insurers are increasingly fleeing — a third of counties in the U.S. will have only one option in the exchanges next year. And there isn’t much the administration can do about it.”
Inspired by this Kristen Bell skit, Tim Worstall tells us about Dame Stephanie Shirley.
