Archive for the ‘Economics’ category


June 25, 2009

Cap and Trade

Al Gore

Al Gore

If you Google Waxman-Markey, the ‘Climate Change Bill’ coming up in Congress this week, you’ll see that opinions on it are all over the map. Waxman-Markey Will Mandate Greener Building, Drive Green Renovation, Waxman’s Economy Killer, Waxman-Markey bill to address indirect land use change, Global warming bill still contains some smoke and mirrors, – no two giving the same opinion.

It’s a difficult topic, because it touches on economics, science and yes, politics. From an economic point of view, Megan McCardle notes that the bill seems to be low-cost.

But the real question, I think, is whether the low cost is a feature or a bug. The only way a bill is going to have an impact is if it causes real financial pain to American households–enough to get them to change their behavior. Waxman-Markey obviously is not going to do that. And indeed, the projections of its effect on global warming are entirely negligible.

Why should that be? Does this economist have the science to back up that statement?  No, and she doesn’t need it.  She explains that the reason is political, not scientific.  The reason is  – China.

China is not going to let its citizens languish in subsistence farming because 30 years from now, some computer models say there will be some not-well-specified bad effects from high temperatures. Nor is India. Global warming isn’t even high on the list of environmental concerns they’ll want to attack as they get rich; local air pollution is far more pressing. Thinking that we’re somehow going to lead them by example is like thinking that poor rural teens are going to buy electric cars because Ed Begley jr. has one.

In other words, if you believe that climate change is anthropological in nature, you must believe that nothing is going to change until and unless China and India come on-board.

Well, what about the rest of the world? From RealClearPolitics, Robert Tracinski and Tom Minchin point out that it’s not happening in other countries either.

As the US Congress considers the Waxman-Markey cap-and-trade bill, the Australian Senate is on the verge of rejecting its own version of cap-and-trade. The story of this legislation’s collapse offers advance notice for what might happen to similar legislation in the US—and to the whole global warming hysteria.

So what do the scientists say? Dr. James Hansen, the director of the Goddard Institute of Space Science (GISS) said this, as he was being arrested:

I am not a politician; I am a scientist and a citizen. Politicians may have to advocate for halfway measures if they choose. But it is our responsibility to make sure our representatives feel the full force of citizens who speak for what is right, not what is politically expedient. Mountaintop removal, providing only a small fraction of our energy, should be abolished.

I don’t want to put words in his mouth, but I think he’s saying that the science doesn’t matter; it’s what people feel is right that matters. That sort of works, because the science is apparently being ignored. But contra Hansen, it’s being ignored for the politics. The scientists are playing politics.

A source inside the Environmental Protection Agency confirmed many of the claims made by analyst Alan Carlin, the economist/physicist who yesterday went public with accusations that science was being ignored in evaluating the danger of CO2.

The source, who chooses not to be identified for fear of retaliation, said that Carlin was rebuffed in his attempt to introduce scientific evidence that does not accord with the EPA’s view of global warming, which largely relies on IPCC reports.

Kevin Mooney at the Washington Examiner publishes on the story:

Scientific findings at odds with the Obama Administration’s views on carbon dioxide and climate change are being suppressed as a result of political pressure, officials at the Competitive Enterprise Institute (CEI) charge.
“This suppression of valid science for political reasons is beyond belief,” said CEI General Counsel Sam Kazman. “EPA’s conduct is even more outlandish because it flies in the face of the president’s widely-touted claim that ‘the days of science taking a back seat to ideology are over.’”

If this story was about anthrax, possible political manipulation in Congress and scientific intrigue, the story would not sell.  It is a mess, too convoluted, too unbelievable.  And there it is.  We buy it, we believe it’s plausible – why exactly?


Green Rust

June 9, 2009

Do Green and Rust Mix At All?

Slates Mickey Kaus points us to an article in the National Journal by Ron Brownstein. It asks one question about my home town (and “rust belt” cities in general), and about the hopes that these town have to rebuild and revitalize on waves of “Green Manufacturing”.   The question is: What are they smoking?

For officials at every level, the great hope is that these fading car towns can move from rust to green, from building autos to manufacturing wind turbines and solar panels or buses and subway cars. These places offer many advantages for such production: factories, supply chains, transportation links, and a skilled workforce “that knows how to do metal,” as Democratic Sen. Sherrod Brown of Ohio says.

Well, those seem like pretty good reasons. Brownstein continues:

But there are few examples of such conversions succeeding in the auto plants already closed, notes Dan Luria, research director for the Michigan Manufacturing Technology Center, a government-business partnership. And although Obama’s policies ensure that the U.S. will buy more alternative energy and transit equipment in the years ahead, Luria says, there’s no guarantee that those products will be built in America, much less in these particular communities, unless Washington encourages it through an integrated set of carrots and sticks beyond anything under discussion. Brown, likewise, is urging a national manufacturing policy.

Well, given their advantages, why wouldn’t autos be built in Detroit, and subway cars in Wayne, and wind turbines and solar panels in Buffalo? Kaus throws a clue brick.

Hmm. Why might manufacturers of “alternative energy and transit equipment” want to avoid locating their factories in the heavily-unionized rustbelt? Do you think the ongoing example of Detroit’s Big Three might have a cautionary effect on their decision-making?

The research director, Laria, quoted by Brownstein above, encourages the Obama administration to use “an integrated set of carrots and sticks” to overcome this – um… hesitation.  In English, Kaus notes that it’s also called a “national manufacturing policy”.  Yeah, that’s the ticket.  Make them stay in Detroit if they want to build “alternative energy and transit equipment”.  They use policy like that all the time.  In communist China and Cuba.

Worst School Board In The Nation

April 20, 2009

I’m Surprised It’s NOT In Wash.  D.C.

Don Surber blogs from the Daily Mail:

Most of Buffalo’s kids don’t graduate from high school, yet its school board members traveled first class on $90,000 worth of trips and dined on catered meals before each school board meeting — at a cost of $33,000.

And then the members of the worst school board in the nation don’t appreciate a typical menu of “egg rolls, shrimp lo mein, General Tso’s chicken, pepper steak, sesame chicken, cheesecake, cookies and flan, among other goodies.”

That was last week’s menu.

Sheesh.  The D.C. area schools are known for union members that stole $5 million from the teacher’s pension fund.  That was simple theft.  This, this is simple stupidity.

“It’s not a high-end buffet, and it’s not a lot of it, either. It serves like 20, 30 people maybe,” board member Ralph Hernandez told the Buffalo News. “The administrators eat there, too, the superintendent and associate superintendents. Most of us don’t even eat it. We’re sick of it, and it’s the same stuff all the time.”

Uh-huh.  The Buffalo school system spends over $16,000 per student.  I see how that’s possible.

You May Not Agree

March 20, 2009

And I’m Not Even Sure I Do

And this comic is really, really, unfair.

But he’s got a point.
And it’s really, really. good.

Warning: this comic occasionally contains strong language (which may be unsuitable for children), unusual humor (which may be unsuitable for adults), and advanced mathematics (which may be unsuitable for liberal-arts majors).

Did You Hear About The Protests?

March 14, 2009

No, huh.

We’ve come a long way from Woodstock, haven’t we, boomers?  Now you have to wonder what else aren’t they telling you?

If a revolution happens and no reporters cover it, will it make a sound? That’s a good question because an anti-tax revolution as American as they come is under way, and the country’s top newsmen could care less.

Anti-tax protests have been sprouting like spring flowers from sea to shining sea the past couple of weeks.

There have been “Tea Party” protests in Atlanta, Chicago, Dallas, Denver, Nashville, New York…

But if you only get your news from the mainstream media, you probably wouldn’t know the protests ever happened. Most major news outlets have provided zero coverage of any of the individual events or the grassroots movement as a whole. The conservative-leaning Internet startup Pajamas TV is the only outlet consistently covering the protests, which totaled nearly 30 by PJTV’s count after last weekend.

If you wonder why your local newspaper is losing revenue, you haven’t been paying attention.
Via Instapundit, here’s a report on yesterday’s protest in Rochester, NY.

“In New York state, we have the double whammy…living in a state with the highest taxes in the union…it’s squeezing us. We’re losing population and losing businesses,” said one protestor.

Passage of President Obama’s nearly $800 billion stimulus package drew similar protests in 40 major cities across the country last week.

And probably in yours, too.

Real Americans Don’t Hate The Rich

March 1, 2009

They Want To Be Rich!

And I also question the timing.

Patterico brings to the web what he found on the front pages of the LA Times.

Page One of today’s L.A. Times says:

From front to back and on nearly every page, President Obama’s new budget plan delivers a stark message: It’s time for the rich to lighten the load on the middle class.

That’s right, rich folks! You’ve been avoiding your fair share of the taxes for far too long! Stop putting so much of the load on the middle class!

And this his what he found “after the jump”.  You know – where they like to bury the information they don’t want you to see.

[S]ome economists warned that higher taxes on the affluent could reduce their entrepreneurial energy and were unfair because upper-income Americans already pay a large share of the government’s total revenue.

You don’t say.

Yeah.  I call that – what the LA Times writes – class warfare, and I don’t believe that Americans buy into it (they never have, even in the hay-day of socialist unionisation in the ’30s).  Well, some do, of course.  And we see them in the highest echelons of government, just as we see them in the editorial sections of the major newspapers (what’s left of them, anyway).   After the lessons of the ’30s, and the lessons of the ’80s, I’m beyond questioning their intelligence.  I question their motives and patriotism.

I lied before.  I don’t question their timing at all.  It’s obvious and transparent.

Just Begging For John Galt To Appear

February 28, 2009

It’s Only A Novel. It’s Only A Novel

Keep repeating that to yourself as Ayn Rand’s dystopia comes ever closer to reality.  Check out this exchange in Der Spiegel Online:

SPIEGEL: What do you mean with your battle cry, “We’re not paying for your crisis”? Don’t you want to pay taxes anymore?

Passadakis: We believe that the cost of the economic crisis should be footed by those who profited most from globalization.

SPIEGEL: As a leading exporter, Germany too has profited.

Passadakis: No, the majority of people have not earned much from the boom — instead they have had to deal with restraint in their wage agreements. The rich, on the other hand, have seen strong increases in their wealth. So it is only fair that they should pay extra duties.

SPIEGEL: You want to fleece the Aldi brothers and the Klatten and Otto families (Germany’s richest people) among others?

Passadakis: Yes, they in particular should be ordered to come to the check out. We are calling for the rich to pay out between 5 and 20 percent of their wealth.

I think if you look up the word “theft” in the dictionary, you’ll find that exchange.  What I find so sad is that this is exactly the scenario Rand put to paper in the ’40s and ’50s, which led to the withdrawal of competent people from collective society.  In her novel(s), this left those remaining – the hangers-on, the bureaucrats, politicians, and many whom are now known as “the creative class” – to wallow in a misery of their own making.  Now, Rand was a megalomaniac, a moral cretin and a flake (see also, here).  Her writing is simultaneously awful and great, and in some odd way, unforgettable.  She hit a nerve and she hit on a truth that gets harder to ignore.

Who is this Passadakis character, by the way?  Is he of consequence? Alexis Passadakis is an activist from the group Attac, which is organizing demonstrations in Berlin and Frankfort with the slogan “We’re Not Paying For Your Crisis!”  We’ll see how the Aldi brothers, the Klatten and Otto families react in Germany.  It won’t be long after that we see how the Bill Gates, the Paul Allens and Warren Buffets react in this country.  It’ll be “interesting.”