Customers paying sharply higher prices or mandatory surcharges are understandably reluctant to leave an additional tip for their server. Cornell economist Michael Lynn has found that gratuities are lower for workers in states with higher tipped wages. This seems to be what’s happening in Washington: Local news outlet DCist reports that some servers are earning less in take-home pay despite the higher base wage.
Early in his professional life, [Julian] Simon, like many people, thought that population growth was a problem. He thought we would run out of resources. But then he read a book that got him rethinking and caused him to dig more into the data. He never stopped. That book was Harold J. Barnett and Chandler Morse’s Scarcity and Growth: The Economics of Natural Resource Availability, published in 1963. Barnett and Morse showed that between 1870 and 1956, the inflation-adjusted prices of eleven out of thirteen minerals had fallen. Because prices reflect demands and supplies, and it was unlikely that demand for these resources had fallen, the lower prices must have been due to increases in supply.
How could that have happened at a time when both population and overall standards of living had increased substantially? Simon, in his book The Ultimate Resource, posited that it was precisely the growth in population that had led to the increased supply of resources. How so? Because, argued Simon, with more people, there were more minds, and with more minds, there were more minds solving problems. That’s what led to his book’s title. People, he argued, were the ultimate scarce resource.
Hyperbole being the default setting in today’s discourse, we are warned that the oral arguments the Supreme Court will hear on Wednesday concern cases that could, some progressive commentators insist, “kneecap” and “take a sledgehammer” to federal agencies. And could end the government’s “capacity to address the most pressing issues of our time.”
This capacity already seems nonexistent. And the people who say that the doctrine of “Chevron deference,” at issue Wednesday, is indispensable to today’s government are actually saying two things: That today’s government is incompatible with the Constitution. And that enabling the former is more important than respecting the latter.
Eliminating Chevron would not, as excitable progressives claim, cripple the government’s power to do progressives’ favorite thing: regulate. Congress’s regulatory power would be undiminished. Congress would, however, have to be more involved in writing, and therefore accountable for, regulations. By erasing Chevron, the court would force Congress out of its lassitude, whereby it allows agencies vast discretion to interpret vague statutes that are tissues of generalities.
Next week brings the annual World Economic Forum in Davos, Switzerland, sometimes cast as a meeting place for global capitalism. More precisely, it’s an annual opportunity for global politicians and activists to persuade American CEOs to stop being capitalists.
The ostensibly nonprofit forum’s well-paid founder, Klaus Schwab, has an enduringly successful shtick. He tells the CEOs that people have lost trust in large institutions like theirs. Then he tells them that to help rebuild such trust, they must stop focusing on the needs of shareholders and instead serve a larger universe of “stakeholders” like him who may have no stake in the businesses but do have strong opinions about climate and diversity.
Of course if shareholders, customers and voters trusted such policies there would be no need for the Schwab sales pitch. This in turn raises the question of whether Mr. Schwab and his fellow “stakeholders” in the world of tax-exempt entities are themselves contributing to a loss of trust—along with the loss of government revenue, of course.
In 1999, the “Black Book of Communism” tried to detail the number of civilian deaths caused by the world’s communist regimes—not deaths caused amid wars and civil strife, but direct massacres from the kind of policies so efficiently carried out in Cambodia. The authors came up with a figure of 100 million. These deaths don’t tell the entire story of fear, slavery, and repression. It’s simply unfathomable that any modern American could have a view of communist regimes that were any more favorable than the views most of us hold of Nazism.
Then again, ideological narratives grab hold of people in ways that are hard to understand. So many young leftists are nurtured in a university hothouse that divvies up humanity into fixed groups of “oppressor” and “oppressed.” They learned to have an endless faith in the government’s ability to reorder humanity. They probably haven’t been taught about what happens when officials are given unlimited powers to launch a “Great Leap Forward,” create “Year Zero” or design a “New Soviet Man.”
Power and Progress lauds Roosevelt for recognizing “the right of workers to collectively organize,” helped by special coercive power granted by government. And they seem surprised that Fr. Charles Coughlin, a former populist, New Dealer, and creator of the National Union for Social Justice, later became a supporter of Mussolini and Hitler.
To be clear, I don’t criticize Acemoglu and Johnson for sympathizing with workers’ voluntary associations. I do, too. But coercive bargaining power and compulsory membership are another matter. The coercive formula prevents a market test of the unions’ efficiency.
In short, it seems to me that Acemoglu and Johnson espouse a simple and angelic conception of democracy, which may be synonymous with “good” and “social.” I suggest they would greatly benefit from studying the public‐choice explanations of how collective choices are made in different forms of democracies—majoritarian versus constitutionally limited, for example.