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Some Non-Covid Links

My GMU Econ colleague Larry White advises on “how to think straight about Bitcoin’s social costs and benefits.” A slice:

The fact that the Bitcoin network uses electricity does not provide the requisite evidence. Hospitals use electricity, as do school buses and airplanes. Virtually every industry uses electricity to produce its output. Bitcoin is not exceptional in that regard. It is true that, at the margin, Bitcoin’s demand for electricity contributes to total demand and thereby to determining the price of electricity. The greater is Bitcoin’s electricity use, the higher is the price of electricity. But that, too, is equally true for every other electric-power-using industry. The spillover effect of additional electricity demand on the price of electricity is, in technical economic terms, merely a pecuniary externality, not a technological externality. As such, it is not a source of inefficiency. Price changes are necessary for any market to regain efficiency in the face of supply or demand shifts. Price changes do not interfere with anyone’s use and enjoyment of his property. They are not the kind of Pareto-relevant externality we should worry about.

J.D. Tuccille applauds encryption.

Wall Street Journal columnist Mary Anastasia O’Grady writes about the Biden administration cozying up to the criminal gang that currently terrorizes the people of Venezuela. A slice:

Venezuela’s state-owned oil company, PdVSA, is an environmental wrecking ball. Satellite images of Lake Maracaibo show the complete devastation the company has caused. Similar degradation has occurred in the Amazonas and Orinoco regions, where the Maduro regime collaborates with criminal groups engaged in mining that trashes the environment.

On human rights, Caracas’s record of imprisonment, torture and extrajudicial killings is chilling. Some five million Venezuelans have fled the country. Those who remain suffer unimaginable privation, often without running water or adequate nutrition for their children

And here’s (mostly) sound advice from Wall Street Journal columnist Andy Kessler. A slice:

As Ben Franklin might tell today’s U.S. leaders, “You have the reserve currency status, if you can keep it.” What to do? The Federal Reserve should solidify the dollar by raising interest rates pronto. Treasury Secretary Janet Yellen needs to shout “a strong dollar is in our national interest” from the mountain tops. Ending fiscal deficits would also help by creating a bidding war for outstanding Treasurys. U.S. companies need to update complacent supply chains. If products like medications and iPhones come only from China, that’s a problem. Because of this, the Biden administration should quit the union-loving “Buy American” pitch we heard in his State of the Union address, which echoes Donald Trump’s “America first.” Apple can’t assemble iPhones in union-heavy Michigan. America’s strength comes from buying goods and services from our allies in lower horizontal layers like Vietnam, South Africa and countries in Eastern Europe. Don’t mess with that.

Alberto Mingardi understandably disagrees with Quinn Slobodian.

My Mercatus Center colleagues Adam Thierer and Christopher Kaiser reveal “the contradictions and confusions of getting Americans to buy electric cars.” A slice:

No state has completely deregulated car sales by allowing all manufacturers to sell all vehicles directly to customers. Faced with any move to end these anti-consumer laws and allow the market to function freely, dealerships cannot continue to plead the “mom-and-pop business” defense. “The top 10 dealership groups in America have annual revenue of around $100 billion, more than any car company,” says University of Michigan law professor Daniel Crane. Last year 75 economics and law professors signed an open letter urging states to legalize direct sales. “Not only have the original justifications for prohibiting direct distribution evaporated,” it noted, “but the advent of EV technology has created an urgent need to permit direct distribution.”

There are almost no other sectors where such naked protectionism is still tolerated. Liquor sales are one major exception, with some states still limiting home delivery.

My Mercatus Center colleague Jack Salmon explains that the Federal Reserve has failed to fulfill its inflation mandate. A slice:

A forthcoming research article from the Independent Institute finds that Federal Reserve economists are increasingly driven by political activism and affiliation; they also demonstrate a growing preoccupation with politically charged topics such as climate change, discrimination, and economic inequality. These goals add more pressure on the Fed to maintain accommodative monetary policy, even as inflation spirals out of control.

Perhaps this provides another explanation for why the federal-funds interest rate is still at zero and the Fed is still engaged in quantitative easing after eleven consecutive months of the annualized CPI running above 4 percent.