Friday, 15 November 2024

Shock & Surprise: Lawyers oppose removal of lawyers' gravy train

 

Cartoon by Nick Kim 

I'd like to say I was astonished to read that 42 KCs (so-called "King's Counsels") signed an open letter opposing David Seymour's Treaty Principles Bill.

But why should anyone be astonished that 40 folk sucking off the Treaty tit would oppose the removal of their teat.

In the film The Castle Darryl Kerrigan describes these legal vultures as "rich folks' lawyers." People who prey upon uncertainty in law, on confusion in contracts, on doubtfulness in legal decisions, turning dubiety into billing hours. Their carrion is the many, many thousands of dollars a day they charge to pore over legal documents and invoice for all that uncertainty.

For them, the Principles of the Treaty of Waitangi being undefined by parliament is not just a godsend, it's a meal ticket. A once-in-a-lifetime chance to make bank.

The very last thing they want is for those undefined Principles, placed by Geoffrey Palmer et al at the heart of so much law since the 1980s, to be defined. To be made clear. To leave no room for debate.

The very last thing they want is for that gravy train to be taken away.

To paraphrase H.L. Mencken, "Much of the vagueness and uncertainty in present law is due, in the main, to lawyers, and, in part at least, to good ones. They are responsible for the perversion in law of undefined principles that now clutter the statute-books, and for all the evils and cost that go with ongoing attempts to defined them. Every Waitangi Tribunal judge is a lawyer. So are most politicians. Every invasion of the plain rights of citizens has a lawyer behind it. If all lawyers were hanged tomorrow, and their bones sold to a mah jong factory, we’d be freer and safer, and our taxes would be reduced by almost half.”


COP 29: "The entire event was a monument to the contradictions of modern climate policy."



"Picture this: COP29, the annual climate circus where the world’s leaders gather to wag fingers and wring hands over carbon emissions, is hosted in none other than Azerbaijan—a country whose economy runs on fossil fuels like a muscle car guzzling premium gas. ...
    "[Azerbejani president Ilham] Aliyev ... point[ed] out that [Europe's] energy 'security' conveniently overrides their green ambitions ... only meeting Europe’s insatiable demand for natural gas because, you know, someone has to keep the lights on over there. The subtext? 'We’re saving you from freezing, so maybe chill with the climate scolding.'
    "Notably missing from the conference were key world leaders, a snub that suggests even they couldn’t stomach the irony. Or maybe they were too busy figuring out how to reconcile their Net Zero pledges with their growing reliance on oil-rich nations like Azerbaijan. Either way, the hypocrisy runs both ways. ... 
    "The Western delegates who flew to Baku in private jets to wag their fingers about emissions are no less hypocritical. There they sat, nodding politely as Aliyev defended fossil fuels while quietly hoping he keeps shipping that sweet, sweet natural gas their way.  ... The entire event was a monument to the contradictions of modern climate policy. ...
     "Azerbaijan hosting COP29 is the perfect encapsulation of why no one takes these climate conferences seriously anymore. They’re not about saving the planet; they’re about playing politics, appeasing donors, and virtue signaling on a global stage. Aliyev’s speech was a reminder that behind all the lofty rhetoric is a steaming pile of contradictions."

Thursday, 14 November 2024

15 YEARS AGO: Now a more bigoted state

Since this blog has been going now since 2005 (which is bloody frightening) I'll occasionally head back a few years to pull out something particularly prescient to re-post. Such as this (from almost fifteen years ago), a warning that wasn't heeded about what happens to everybody when big-government thuggery demands a "crack-down" — 'cos there's nothing big government likes more than a good crack-down, like a multi-million-plus mass deportation...

Just a bigoted state [update 4]

The only honest line British Prime-Minister-in-absentia Gordon Brown has ever been heard to utter came last week when he told aides that a women who had just confided to him the alleged evils of Eastern-European immigrants was “just a bigoted woman.”

And so she was. 

Cross the Atlantic now to Arizona, where a bigoted state now requires everyone to carry around their birth certificate, just so they aren’t mistaken for someone who’s living and working in the state without big-government’s blessing. 

If Gordon Brown’s apology for his momentary rush of honesty was the shot heard still being heard around the British electorate, then Arizona’s attack on personal liberty is the shot against individual freedom that’s being heard right around the world.  It’s a reminder that it’s not just the left side of the aisle that are big-government bullies--and a reminder too that neither side has a monopoly on taking advantage of those stateless souls who leave their homes in search of a better life.Cartoon by Henry PayneJust so we’re clear, This Is What Arizona Republicans Want America to Be Like—a place where people of a certain race can be arrested dragged off to jail at the whim of a policeman for the crime of not carrying their papers.  Only Godwin’s Law precludes me from pointing out a particular police state of which that might remind you.

The police-state crackdown is bad enough.  But what it’s demonstrated all too clearly is that for many people apparently committed to individual liberty and small government are anything but.  Scratch the surface of too many small-government conservatives, and what you find there is nothing more than stinking, ill-informed authoritarian racism.  (Just one reason I’ve taken the likes of Andrew Bolt off my blog roll).

I say ill-informed, because it’s the only possible defence people like Bolt might have for being bigoted men and women themselves.

Because the facts confound the bigots. The fact is that in a free society, more people are a boon, not a burden. 

That as author Robert Heinlein suggested, successful immigrants demonstrate just by their choice and gumption in choosing a new life that they are worthy of respect. 

And as James Kilbourne says, “God damn you if the only two words you can find to put together when talking about people who leave their homelands to seek a better life for themselves and their families are ‘illegal aliens.’”

The fact is—and let me say it again just to stress the point—that in a free society, more people are a boon, not a burden. You think that’s hyperbole?  Well, it’s not.  Look at the American experience—the country’s wealth was built upon open immigration—on the melting pot that was the result of the open immigration of the nineteenth-century. But even in more oppressive times of today, the facts are clear that that the freer the country, the more immigration is a boon for everybody—and that immigrants themselves are overwhelmingly more productive and better behaved than most of the bigots are.

Just consider the litany of facts the bigots need to contend with regarding American immigration:

  • The runaround needed to immigrate legally to the US is one prime reason so many do it illegally. 
  • 'Illegals' are not milking the government; if anything it is the other way around. The National Research Council found for example that most immigrant families "contribute an average of $80,000 more to federal coffers than they consume over their lifetimes." 
  • Immigrants generally earn more than they receive. 
  • More than 60% of illegal immigrants pay income tax, and two-thirds kick in to Social Security (and most get nothing back). 
  • Immigrants help sustain economic growth and cultural dynamism. 
  • Immigrants "are generally less involved in crime than similarly situated groups," and crime rates in border towns "are lower than those of comparable non-border cities." 
  • Crime rates in the highest-immigration states have been trending significantly downward. 
  • Even economists who favour restrictive immigration policies admit low-skilled immigrants are a net plus to the economy. 
  • Unemployment is low and crime is down everywhere, especially in places teeming with immigrants. 
  • Immigration gives you the benefits of geniuses who were born elsewhere. Google, Yahoo! and Sun Microsystems were all founded by immigrants. 
  • Immigrants are more likely than 'natives' to be self-employed. 
  • Immigrants tend to create their own work -- when they're allowed to. 
  • The power and reach of Spanish-language media in L.A. for example shows supply of productive people creating its own demand. 
  • Immigrant labour makes work easier for all of us, and brings new skills to the table. 
  • Immigrants and low-skilled American workers fill very different roles in the economy. 
  • Immigrant labour makes all businesses easier to start, thus spurring 'native' creativity. 
  • "Some argue that we should employ a more restrictive policy that allows in only immigrants with 'needed' skills. But this assumes the government can read economic tea leaves." - Tyler Cowen and Daniel M. Rothschild 
  • New arrivals, by producing more goods and services, keep prices down across the economy -- the net gain to US from immigration is about $7 billion a year. 
  • There's no reason that the North American Free Trade Agreement (or NZ's own free trade agreements) shouldn't apply equally to people as to widgets. 
  • Even in the halls of Congress, economic arguments against immigration are losing their aura of truthfulness, so pro-enforcement types are focussing on “national security.” 
  • "The only way to actually prevent terrorists from slipping in is to legalize as much 'illegal immigration' as possible. If one is looking for a needle in a haystack, as the saying goes, one has a hell of job. Finding that needle on a relatively clean floor, however, presents an achievable goal." - James Valliant
  • Immigration is good for the immigrants themselves. . . . 

Those facts were extracted from the following articles, which provide whole magazines full of ammunition against the bigoted and the ill-informed: 

And of course there are the two classic Harry Binswanger articles which are 'must-reads' for the moral and practical case behind open immigration (note, open immigrationnot open borders.): 

The fact is that there is neither fact nor right on the side of the bigots.  As George Reisman explains for America:

    “The philosophy of individual rights and capitalism implies that foreigners have a right to come and to live and work here, i.e., to immigrate into the United States. The land of the United States is owned by individuals and voluntary associations of individuals, such as private business firms. It is not owned by the United States government or by the American people acting as a collective; indeed many of the owners of land in the United States are not Americans, but foreign nationals, including foreign investors.     
“The private owners of land have the right to use or sell or rent their land for any peaceful purpose. This includes employing immigrants and selling them food and clothing and all other goods, and selling or renting housing to them. If individual private landowners are willing to accept the presence of immigrants on their property as employees, customers, or tenants, that should be all that is required for the immigrants to be present. Anyone else who attempts to determine the presence of absence of immigrants is simply an interfering busybody ready to use a gun or club to impose his will.

The fact remains that the only possibly human objection that well-informed people might have to open immigration is that immigration is a drain on the Welfare State. That they object to being forced to pay for people they’ve never met. This much is understandable. (That is the dark truth at the heart of the whole Welfare State—far from offering charity, it sets man against men.)   Again, George Reisman makes the argument: in summary, that Immigration Plus Welfare State Equal Police State.

    “Illegal immigrants are overwhelming the resources of the Welfare State: government–funded hospital emergency rooms are filled with them; public schools are filled with their children. On the basis of such complaints, many people are angry and want to close the border to new illegal immigrants and deport those who are already here.     “They want to keep new illegal immigrants out with fences along the border. It is not clear whether the fences would contain intermittent watchtowers with searchlights and machine guns. The illegal immigrants who are already here would be ferreted out by threatening anyone who employed them with severe penalties and making it a criminal offense not to report them.     
“This is a classic illustration of Mises’s principle that prior government intervention into the economic system breeds later intervention. Here the application of his principle is, start with the Welfare State, end with the Police State. A police state is what is required effectively to stop substantial illegal immigration that has become a major burden because of the Welfare State.”

And Tibor Machan makes a similar argument, that the biggest problem with the welfare state is not that it might lead to even greater control by government, but that in providing a pseudo-moral argument to treat other human beings like cattle, it habituates people to the sort of easy brutality seen now in Arizona, and in sundry other cases of inhumanity

But far from being a reason to abandon open immigration, the problems that state-enforced welfare cause for open immigration are reason instead to abandon the short-lived anti-human experiment that is the Welfare State. 

    “The philosophy of individual rights and capitalism implies that the immigrants do not have a right to be supported at public expense, which is a violation of the rights of the taxpayers. Of course, it is no less a violation of the rights of the taxpayers when native-born individuals are supported at public expense. The immigrants are singled out for criticism based on the allegation that they in particular are making the burden intolerable.
    “The implementation of the rights both of the immigrants and of the taxpayers requires the abolition of the Welfare State. Ending the Welfare State will end any problem of immigrants being a public burden.
    “Of course, ending the Welfare State is much easier said than done, and it is almost certainly not going to be eliminated even in order to avoid the environment of a police state.
     “But the burdens of the Welfare State and the consequent resentment against immigrants could at the very least be substantially reduced by means of some relatively simple, common-sense reforms in the direction of greater economic freedom. . . .”

And they could be reduced too by the simple and easily-introduced expedient of allowing existing citizens to sponsor and take financial and legal responsibility for new citizens.

But this would require a basic humanity that too many of the bigots seem to lack.

In the meantime then, you want an immediate solution to the 'problem of illegal immigration? Then here it is"

    “The problem of ‘illegal’ immigration can be solved at the stroke of a pen: legalize immigration. Screen all you want (though I want damn little), but remove the quotas. Phase them out over a 5- or 10-year period. Grant immediate, unconditional amnesty to all ‘illegal’ immigrants.”

There endeth the problem.

UPDATE 1:  More good anti-bigoted commentary here [hat tip Thrutch]:

  • THE NEW CLARION: The Rights of Man, the Privileges of Citizen
    This is the end-of-road for conservative anti-immigrationists:  the selective  degradation of the liberty to live in a particular place from a right to a “privilege”.  As a hostile commenter put it sarcastically… 

        “Nothing says freedom from government interference like ‘show me your papers.’ Of course, limited government only applies to people who are real Americans, not to Mexicans.”

    Let us examine the conservatives’ trip down the anti-immigration road, and see how it ended there — and what it means for conservatism’s purported fealty to Americanism….
    Read on to see many more anti-immigration shibboleths summarily dispatched. 

  •  PAJAMAS MEDIA: Treat the Cause, Not the Symptom: Welfare State Is Draw for Illegals
    While I commiserate with Arizona voters [says Gus Van Horn] public services are the problem, not ‘illegals.’
        …SB 1070 is wrong for Arizona for reasons far beyond civil rights issues.
        SB 1070 deserves only one fundamental criticism: It would fail to protect the individual rights of American citizens — even if it hermetically sealed our borders and the police never touched a single American hair in the process of enforcing it. This is because the biggest headaches attributed to illegal immigration are not caused by it at all…

UPDATE 2: I’m starting a list.  And in ‘tribute’ to Gordon, I’m calling it “Just Some Bigoted Arseholes.”

First on the list is Blair, for this . . . 

To which you can add Silent Running, run by a New Zealand blogger advertising “strong right-wing views” on his banner, who thinks “Mexico is polluting us”; Cactus Kate, who has “sanctimonious” on her banner (and bigotry in her waters); and Crusader Rabbit, who has “liberty” on his banner, and black thoughts about Mexican crowds being “a target-rich environment” in his heart …

UPDATE 3:  Says an editorial in the Arizona Republic

    “We need leaders.
    “The federal government is abdicating its duty on the border.
    “Arizona politicians are pandering to public fear.
    “The result is a state law that intimidates Latinos while doing nothing to curb illegal immigration.
This represents years of failure. Years of politicians taking the easy way and allowing the debate to descend into chaos…
    “Comprehensive [immigration] reform will make the border safer. When migrant labor is channeled through the legal ports of entry, the Border Patrol can focus on catching drug smugglers and other criminals instead of chasing busboys across the desert.
    “Real leaders will have the courage to say that.”

UPDATE 4Reason magazine, whose superb 2006 issue on immigration was the source of many of those linked articles above, has four online articles on the current melee that deserve the attention of everyone not already blinded by bigotry: 

  • Immigration Isn't the ProblemDavid Harsanyi, May 3, 2010 
      “For the most part, the controversy we face isn't about immigration at all. It's about the systematic failure of federal government to enforce the law or offer rational policy. There's a difference…
      “The uplifting tale of the hard-boiled immigrant, dipping his or her sweaty hands into the well of the American dream, is one thing. Today we find ourselves in an unsustainable and rapidly growing welfare state. Can we afford to allow millions more to partake?
      “When Nobel Prize-winning libertarian economist Milton Friedman was asked about unlimited immigration in 1999, he stated that ‘it is one thing to have free immigration to jobs. It is another thing to have free immigration to welfare. And you cannot have both.’” 
  • Mysteries of an Immigration LawSteve Chapman, April 29, 2010 
      “The worst-case scenario is that Hispanics will face possible police harassment anytime they venture out of the house. Not to worry, says Kris Kobach, a law professor at the University of Missouri-Kansas City who helped draft the text.
      “He told The Washington Examiner that cops can ask for immigration information only when they have ‘lawful contact’ with someone—when ‘the officer is already engaged in some detention of an individual because he's violated some other law.’
      “In fact, the law doesn't define the crucial term. One of the dictionary definitions of ‘contact’ is ‘immediate proximity,’ which suggests that anytime a possible illegal immigrant comes in sight of a cop, the cop has a legal duty to check her papers.” 
  • How Immigration Crackdowns BackfireSteve Chapman, April 22, 2010 
      “It's no surprise that Arizonans resent the recent influx of unauthorized foreigners, some of them criminals. But there is less here than meets the eye.
      “The state has an estimated 460,000 illegal immigrants. But contrary to myth, they have not brought an epidemic of murder and mayhem with them. Surprise of surprises, the state has gotten safer.
      “Over the last decade, the violent crime rate has dropped by 19 percent, while property crime is down by 20 percent. Crime has also declined in the rest of the country, but not as fast as in Arizona…” 
  • Don't Let Obama Touch Immigration ReformShikha Dalmia, April 13, 2010
    ”America's immigration system is badly broken and in desperate need of fixing. And that is precisely why President Barack Obama should not be allowed to touch it.”
  • Immigration & Crime, Steve Chapman, February 22, 2010
      “From listening to the more vigorous critics of illegal immigration, our porous borders are a grave threat to safety. Not only can foreign terrorists sneak in to target us, but the most vicious criminals are free to walk in and inflict their worst on innocent Americans.
      “In xenophobic circles, this prospect induces stark terror. Fox News' Glenn Beck has decried an ‘illegal immigrant crime wave.’ A contributor to Patrick Buchanan's website asserts, ‘Every day, in the United States, thousands of illegal aliens unleash a reign of terror on Americans.’
      “Sure they do. And I'm Penelope Cruz…
      “A 2007 report by the Immigration Policy Center noted that "for every ethnic group, without exception, incarceration rates among young men are lowest for immigrants, even those who are the least educated. This holds true especially for the Mexicans, Salvadorans and Guatemalans who make up the bulk of the undocumented population…
      “[Ron] Unz points out that in the five most heavily Hispanic cities in the country, violent crime is "10 percent below the national urban average and the homicide rate 40 percent lower." In Los Angeles, which is half Hispanic and easily accessible to those sneaking over the southern border, the murder rate has plummeted to levels unseen since the tranquil years of the early 1960s.
       “This is not really hard to understand. Today, as ever, most foreigners who make the sacrifice of leaving home and starting over in a strange land do so not to mug grandmothers or molest children, but to find work that will give them a better life. Coming here illegally does not alter that basic motivation.
      “In other words, they want to become full-fledged Americans, and they're succeeding. Is there something scary about that?”

Well, is there?

Wednesday, 13 November 2024

"I can’t predict what a Trump administration will do. Neither can Donald Trump."


"Unfortunately, my prediction of a Trump victory was correct.
    "I can’t predict what a Trump administration will do. Neither can Donald Trump.
    "But I can say there will be a price to pay. The form it will take is not predictable. Maybe, as in the first years of his first administration, the economy will improve. But the long-term consequences of an anti-conceptual, xenophobic, conspiracy-spinning president will overwhelm any short-term material gains."
~ Harry Binswanger from his post 'Some Positives'

'The Ungrateful Pedestrian' or 'When Do Politicians Deserve Our Praise?'




“The idea that government deserves credit for all of the benefits produced by freedom," says Don Boudreaux in this guest post, "is a special case of the pernicious deification of government. Such claims are preposterous. They are on a moral and intellectual par with my claim that I deserve credit for not killing pedestrians with my car.”

The Ungrateful Pedestrian, or When Do Politicians Deserve Our Praise?

by Donald J. Boudreaux

Yesterday evening I drove to a nearby restaurant. On my way I passed several strolling pedestrians. I did not kill a single one!

Please note that I possessed near absolute ability to do so. A quick and easy flick of my wrist on the steering wheel at almost any time on my drive would have meant certain death for numerous pedestrians. But I refrained from running them over.

The above account is all true.

Suppose now that you were one of these pedestrians and I solicit from you expressions of gratitude for my not running you over. How would you react? Not only would you be indignant at my solicitation, you’d think me to be demented. And properly so. I would be insanely brazen to seek your gratitude for my not bulldozing you with my car.

And yet politicians routinely seek—and receive—praise for actions that differ in no fundamental way from the actions of drivers who avoid running down innocent pedestrians.

We are assailed with monotonous regularity with news reports and campaign ads boasting of how this minister or that politician “created” so-many-thousand new jobs, or is responsible for whatever amount of economic growth has occurred during his or her term of office. Such claims are preposterous. They are on a moral and intellectual par with my claim that I deserve credit for not killing pedestrians with my car.

No politician creates jobs or prosperity. Jobs and prosperity are created by entrepreneurs and business firms whenever the economy is sufficiently free of government meddling. For government to avoid meddling—that is, for government to keep taxes low and to steer clear of regulating voluntary exchange—is indeed desirable. But to avoid interfering with voluntary exchange is not at all actually to create whatever jobs and prosperity emerge from voluntary exchange. To insist otherwise would be no different from my insisting that I, as a driver who did not run over Ms. Jones as she walked back from the supermarket, am responsible for the tasty dinner she cooked that evening for her family.

If a car is careening out of control onto a pedestrian walkway, anyone who leaps into the car to stop it is a genuine hero. This person does deserve applause and gratitude (while, incidentally, the persons who either intentionally or carelessly caused the car to be out of control deserve condemnation and, perhaps, jail time). But even this hero does not take credit for all that is created and produced by those who would have otherwise been killed.

Whenever that rarest of creatures—an honourable elected official—actually manages to loosen some part of government’s grip on us, that person does merit bona fide acclaim. Even he, however, doesn’t deserve credit for whatever economic growth and cultural flourishing follow. Such credit properly belongs to the countless people who create, innovate, take risks, save, and work hard to produce what consumers want.

The idea that government deserves credit for all of the benefits produced by freedom is a special case of the pernicious deification of government. When deified, government is mistakenly seen as responsible for all that happens in society.

A distressingly large number of writers contend that what looks like government’s refusal to intervene is really just a different form of government intervention. I offer here only two examples. One is left-wing economist Warren Samuels who, in a 1995 issue of Critical Review, wrote that deregulation is simply government regulation carried out by enforcing private property rights rather than by enforcing bureaucratic edicts. When the economy is deregulated, what Samuels sees is that “[o]ne system or structure of (nominally private) coercive power is substituted for another by the very institution, government, which helped establish and/or reinforce the first one.” According to Samuels, only the unsophisticated believe that when government deregulates it thereby reduces its sway over the economy.

This view isn’t confined to left-wingers. Louis Hacker, in an otherwise fine essay appearing in F. A. Hayek’s edited volume Capitalism and the Historians, insists that “the idea of laissez faire is a fiction. For the state, by negative action—that is, by refusing to adopt certain policies—can affect economic events just as significantly as when intervention occurs.” Well, yes–in the same way that I, by not running my car over pedestrians, can affect events just as significantly as if I do kill pedestrians.

Only in the most base materialist sense are Samuels and Hacker correct: insofar as government possesses power to restrict commerce and suffocate industry with its regulations, any self-restraint by government in its zeal to regulate can be said to “affect economic events.” But such sophistry sneakily erects as the benchmark for evaluating government activity the maximum possible destruction that government could possibly inflict. If the actual amount of destruction caused by government falls short of what government could have caused, then government is credited with producing all that it refrained from destroying. Using such a benchmark is lunacy.

The Soviet military could have annihilated the United States population with an atomic attack at almost any time during the cold war. Should we then credit the Soviet military for our current prosperity and our very lives? Does it really make sense to speak of the Soviet military as having “affected economic events” by not launching a nuclear strike against America? If so, then why not also credit the decision by the British military not to launch a nuclear attack against us as a cause of our prosperity?

Refraining from interfering in other people’s affairs is simply the right thing for everyone, including government, to do. 

Until someone convinces me that I deserve a ticker-tape parade every time that I don’t run down a pedestrian with my car, I will find intolerable the misbegotten gratitude and applause that politicians receive for not destroying even more of our liberties and wealth than they currently ravage.

* * * * 

Donald J. Boudreaux is a senior fellow with the F.A. Hayek Program for Advanced Study in Philosophy, Politics, and Economics at the Mercatus Center at George Mason University, a Mercatus Center Board Member, and a professor of economics and former economics-department chair at George Mason University.
This article first appeared at the Foundation for Economic Education.

Tuesday, 12 November 2024

Limited resources ...


“The direct use of physical force is so poor a solution to the problem of limited resources that it is commonly employed only by small children and great nations.”
~ David Friedman from his book The Machinery of Freedom

 

Monday, 11 November 2024

"But no, he doesn't want to be a dictator."


"And there it is," says Mark Coppock. "I knew it was coming, but even I didn't expect Trump to literally order it by fiat -- he will sign an executive order to override the 14th Amendment. But no, he doesn't want to be a dictator."


But no, he's pro-freedom, pro-capitalism, pro-America. He's going to end the administrative state ...
 

But no, they should just come in "legally" ...


But me no buts: When someone tells you who they are, believe them.

Javier Milei: "How Import Tariffs Weaken the Economy and Your Wallet"

 



Friday, 8 November 2024

More on trade



Oops. 

"Here's the thing about Trump's tariff plans," explains David Henig, focussing just on the economic vandalism in the States. It will undoubtedly mean it will almost certainly be cheaper to simply manufacture everything outside the US and just import the final product.

He explains that a flat tariff, whether 20% as suggested for most non-US products—or up to 60%, as the moron is proposing for Chinese goods—would be levied in a "non discriminatory [fashion] between intermediate and finished goods. Trump may only be thinking of final consumer goods," if 'thinking'is really even the correct word to use in a context such as this, "but they [finished goods] may only account for 5% of imports." So ...
What does it mean for Trump's tariff plans that nearly all US goods inputs are intermediate goods? Essentially, that if all goods attract a 20% tariff, then it will almost certainly be cheaper to simply manufacture everything outside the US and just import the final product.
What does that mean in plain English?? 

"Intermediate goods" is what economists call stuff that businesses buy to make other stuff. So in that graph above, it means all those capital goods, industrial supplies, and car parts and engines are all intermediate goods. But so too are any consumer products that businesses buy intending to make subsequent salesthey are all, of them, inputs into the "final production" of American goods.
Thus [as Don Boudreaux explains], nearly all imports that are not raw materials are appropriately classified as intermediate components.

And so: 

the percentage of American imports that together comprise the category “intermediate components or raw materials” is far larger than 53%. Indeed, it’s likely well over 95%.
So what does that mean in simple economics? 

In economics so simple that even a moron (or a US president) could understand? 

It means that if tariffs are imposed as the moron intended then "it will almost certainly be cheaper to simply manufacture everything outside the US and just import the final product."

Oops.

Thursday, 7 November 2024

It's mourning in America again


 Thoughts on US politics from Johan Norberg, in Sweden ...

So, it’s mourning in America again. Some thoughts: 
The real loser is Joe Biden and his advisors. Had he stepped down in time, he would have given Democrats time for a competitive primary to select someone who did not have such a dismal campaign record. History will not be kind. No American I’ve met outside of an organised event was excited by Kamala Harris. And in times of trouble, voters prefer “strength” to “likeability.” 
My hunch that she would nonetheless take this was wrong. I remind myself of a taxi driver in Pennsylvania who told me he had thought a lot about Trump’s comment that Harris did not use to be black and now wanted to be black. “He has a way of saying things that just sticks in your mind.” That is disturbing, but should also worry Republicans. They won’t find another bully with that kind of crazed, hypnotic charisma again. When J D Vance or Tucker Carlson say similar things, they just seem weird. 
After 2028 Republicans are probably in opposition again. They should prepare by limiting executive powers and strengthening checks and balances. I fear they’ll do the opposite, to unleash the Trump. 
And since inflation and high prices decided this election (3/4 of voters said it caused them hardship), perhaps not increase prices even more with tariffs and deportation of a large share of the workforce? 
US public debt is 100% of GDP and the government now spends more on interest rates than the military. Trump has promised to make this much worse. In 2050, debt will be 160%. This is an existential risk for the US and the issue’s total absence during the campaign make me think that nothing will happen until there is a catastrophic bond-market event. 
As for the Democrats, many claim that voters rejected Harris because of racism and misogyny. Stop it. Exit polls suggest that Harris got fewer female voters than Biden did, and Americans knew that Obama was black before they voted for him twice. Of course, there is a disturbing bias, but this is mostly a way of clinging on to a sense of superiority when you lose, and will only stop you from adapting your agenda to win the next time. 
It’s high time to abandon a woke, anti-business progressivism that has been rejected again and again by voters (and fix your cities). I fear that four years under a rude far-right Trump will have the opposite effect on Democrats. 
Europe can no longer take America for granted, and has to rebuild its military to provide for its own defense and to support threatened democracies like Ukraine. The right time to start is some 30 years ago. 
Trump’s tariffs will primarily hurt Americans. Europe should not respond by hurting Europeans with retaliatory tariffs, but by offering alternative deals that might tempt Trump, and deepen free trade with a global coalition of the willing. 
Finally, the silver lining is that Americans suddenly trust their electoral system again, and Trump supporters will not storm the Capitol. At least, that’s something. 
Update 1: (Oh, and one more thing: Voters really loathe chaos at the border. For those of us who think our societies thrive on openness, a more orderly, lawful immigration system is absolutely essential.)

Update 2: Foreign policy? Yes, it's scary for sure. The only thing I'd add is that his unpredictability will come into play ... He might hate seeming weak on Ukraine more than he loves Putin. We'll see.

 

"Democracy is the theory that the common people know what they want, and deserve to get it good and hard."


"Democracy is the theory that the common people know what they want, and deserve to get it good and hard." 
~ H. L. Mencken, from his 1916 Little Book in C Major


Wednesday, 6 November 2024

Reagan: "Warmly ruthless"

 

While we await the worst election result, about the worst US candidates in living memory, you might like to cast your mind back to Ronald Reagan. A Republican president when that meant something different. Martin Anderson worked as senior policy advisor to Reagan and helped shape the platforms of each of his campaigns. He remembers him this way:

"I once described him as warmly ruthless. He had this appearance of being friendly and jovial and nice, never argued with anyone, never complained. But if you shook your head and thought about it a little bit, he always did it his way. It was like there was a steel bar right down the middle of him and everything you touched was soft and fuzzy except the steel bar in the middle. He always did it his way. No matter how many people talked to him, no matter what happened, he always did it his way. If you were in the way, you were gone, you were fired. He never took any pleasure out of it, just gone. ...
    "He was incredibly smart. I know this doesn’t sound reasonable, but he was incredibly smart. I’ve dealt with professors at Columbia and professors at Stanford, but he could look at something and understand it and grasp it and turn it around and work with it and play with it. He was incredibly quick. I’d say he had a brain that was comparable to—and I’d talk to Milton Friedman or Ed Teller and Arthur [Burns], all those guys, he could stay with them.
    "Now, he hid that. He just backed off. He never argued with staff. You could have ten different people tell him the same thing and he’d just listen. He never said to them, Look, you dumb bunny, ten years ago I wrote an article on this, a long article. He’d just say, That’s an interesting idea. So many of the policy issues that were proposed to Reagan over time, by different people, he listened, That’s very interesting. Then when he did it, even though it was something he’d decided many, many years previously he would do, all these people were delighted. He was doing what they had told him. He was happy with that, he didn’t care.
    "He used to say privately, There’s no limit to what a person can get done if you don’t care who gets the credit. And he was just very smart. 
    "The second thing is, there was this feeling that he was lazy, that he took naps. Well, I travelled with him for almost four years. He never took a nap. It was total nonsense. In fact, he worked all the time. We have uncovered evidence with this book in terms of the handwritten documents and so on, he was writing all the time. He was studying, he was writing, he was working all the time, in private. As soon as he came out in public, put on the public persona, he was friendly and jovial and talking. ... 
"So I think people made the mistake of saying, Gee, this guy is an easy-going—obviously, we never see him working, so therefore the staff must be telling him what to say. Not true. And when they ran up against him, they assumed he could be persuaded and pushed around. Big mistake. And the woods are full of people that tried to do that ...
    "I remember one little thing in the campaign where ... one of the staff was answering some questions from reporters about naming a Vice President. The staff guy got up there and said, 'What he’s saying is totally wrong politically. He’s got it all wrong, he shouldn’t be saying this, he shouldn’t be saying that, telling me to straighten it up.' So I said, 'Hey, you tell him.' So he sits down with Reagan, explains to Reagan why what he is doing is wrong. Reagan looks at him and nods and says, 'Thanks,' real pleasant, 'Thank you very much.' Next day there’s a press conference and the second or third question is dealing directly with this. And I’m standing there and I’m looking. So Reagan looks around the room, and he looks around and he finds this guy that gave him the lecture and he looks directly at him and gives the 'wrong' answer. He did this all the time, nobody noticed. To this day they don’t notice, but that’s all right, he didn’t care."

[Hat tip David R.Henderson


Monday, 4 November 2024

What would Sumner say about Trump and Vance’s pro-tariff rhetoric?


Trump isn't just for tariffs. He's enthusiastically for tariffs. He wants to build a tariff wall — and this time everyone — from producers to consumers — from American to Chinese — who will pay.
[T]he scale of what Mr. Trump is proposing is larger than any tariff increases that have been seen in nearly a century. He has floated a “universal tariff” of 10 to 20 percent on most foreign products and tariffs of 60 percent or more on China. To ban Chinese cars from coming into the United States via Mexico, he has said he would impose “whatever tariffs are required—100 percent, 200 percent, 1,000 percent.”

By the way, "in nearly a century” means “since Smoot-Hawley,” the notorious 1930 tariff act that helped precipitate the Great Depression and encourage a second Great War.

Remember that?

Yet the arguments Trump and Vance are making for tariffs were already addressed by free-trade proponents over a century ago. But, as Kody Jensen points out in this guest post, ignoramuses like Trump and Vance keep making them. So he goes back to what one of those anti-tariff agitators were saying, a pro-trade fellow called William Graham Sumner ...


What would Sumner say about Trump and Vance’s pro-tariff rhetoric?


Sadly, all US presidents in recent times have leaned towards opposing free trade, but some have been worse than others. One has been much worse. In recent times Donald Trump has built his political reputation on being its wholehearted adversary. William Graham Sumner (1840–1910) was a wholehearted supporter of free trade. Professor, sociologist, clergyman, and advocate of laissez faire, the gold standard, and free trade — I went back to Sumner to find out how
he would respond to claims made by Trump and his running mate JD Vance about free trade in the recent debates? 

Let’s go to his writings to find a potential answer.

The Great Free Trade Debate

DT: “First of all, I have no sales tax," responds Trump to Harris characterising his tariff plan as a sales tax.. That’s an incorrect statement. We’re doing tariffs on other countries. Other countries are going to finally, after 75 years, pay us back for all that we’ve done for the world. I took in billions and billions of dollars from China.”

Sumner observes that protectionists have always shied away from referring to tariffs as taxes. Consider these comments from his 1888 book Protectionism: the -ism which teaches that waste makes wealth:
There are some who say that “a tariff is not a tax,” or as one of them said before a Congressional Committee: “We do not like to call it so!” That certainly is the most humorous of all the funny things in the tariff controversy. If a tariff is not a tax, what is it? In what category does it belong? No protectionist has ever yet told. They seem to think of it as a thing by itself, a Power, a Force, a sort of Mumbo Jumbo whose special function it is to produce national prosperity. They do not appear to have analyzed it, or given themselves an account of it, sufficiently to know what kind of a thing it is or how it acts. Any one who says that it is not a tax must suppose that it costs nothing, that it produces an effect without an expenditure of energy. They do seem to think that if Congress will say: “Let a tax of —— per cent be laid on article A,” and if none is imported, and therefore no tax is paid at the custom house, national industry will be benefited and wealth secured, and that there will be no cost or outgo. If that is so, then the tariff is magic. We have found the philosopher’s stone.
Furthermore:
A protective tax is one which is laid to act as a bar to importation, in order to keep a foreign commodity out. It does not act protectively unless it does act as a bar, and is not a tax on imports but an obstruction to imports. Hence a protective duty is a wall to inclose the domestic producer and consumer, and to prevent the latter from having access to any other source of supply for his needs, in exchange for his products, than that one which the domestic producer controls. The purpose and plan of the device is to enable the domestic producer to levy on the domestic consumer the taxes which the government has set up as a barrier, but has not collected at the port of entry. Under this device the government says: “I do not want the revenue, but I will lay the tax so that you, the selected and favoured producer, may collect it.” “I do not need to tax the consumer for myself, but I will hold him for you while you tax him.”
DT: “They aren’t gonna have higher prices," claims Trump, when asked if consumers can afford higher prices caused by tariffs. "What’s gonna have and who’s gonna have higher prices is China and all of the countries that have been ripping us off for years”

WGS: “To this it is obvious to reply: what good can they then do toward the end proposed?”

If the tariffs do not raise prices, then how do they encourage the protected industries? No doubt it would be a neat trick if the President could force foreigners to pay more for US products while not raising prices for US consumers. However, I cannot comprehend how taxes on US imports will achieve this. And nor can you.

Vance: “Think about this. If you’re trying to employ slave labourers in China at $3 a day, you’re going to do that and undercut the wages of American workers unless our country stands up for itself and says you’re not accessing our markets unless you’re paying middle-class Americans a fair wage.”

WGS:
The protectionist says that he does not want the American labourer to compete with the foreign “pauper labourer.” He assumes, that if the foreign labourer is a woolen operative, the only American who may have to compete with him is a woolen operative here. His device for saving our operatives from the assumed competition is to tax the American cotton or wheat grower on the cloth he wears, to make up and offset to the woolen operative the disadvantage under which he labors. If then, the case were true as the protectionist states it, and if his remedy were correct, he would, when he had finished his operation, simply have allowed the American woolen operative to escape, by transferring to the American cotton or wheat grower the evil results of competition with “foreign pauper labour.”
Can a tariff raise the general wage level? Sumner says no:
Wages are capital. If I promise to pay wages I must find capital somewhere with which to fulfill my contract. If the tariff makes me pay more than I otherwise would, where does the surplus come from? Disregarding money as only an intermediate term, a man’s wages are his means of subsistence—food, clothing, house rent, fuel, lights, furniture, etc. If the tariff system makes him get more of these for ten hours’ work in a shop than he would get without tariff, where does the “more” come from? Nothing but labour and capital can produce food, clothing, etc. Either the tax must make these out of nothing, or it can only get them by taking them from those who have made them, that is by subtracting them from the wages of somebody else. Taking all the wages class into account, then the tax cannot possibly increase, but is sure by waste and loss to decrease wages.
One point both Trump and Vance raised was that apparently even Joe Biden agreed with protectionist ideas, as he did not remove most of the tariffs imposed by the previous administration. I do not know what answer Sumner could give to this ubiquity of bad economics, other than to glumly shake his head.

And to point out perhaps that it is not economics that preaches tariffs to make Americans rich again—despite all the evidence against it: It's politics.

Saturday, 2 November 2024

"The paradox of 'Trump Derangement Syndrome' is that the phrase is used only by the very people who are suffering from it."



"[W]hen you make an argument like this, a certain type of person will immediately dismiss you with the term 'Trump Derangement Syndrome,' or TDS. ... This is obviously a lazy attempt at deflection—a phrase invoked to avoid having to think about evidence of Trump’s unfitness for office. ... You hear it from die-hard supporters and random people on the internet. But I think it is already distorting some of the press coverage of this election.
   "Here is the problem. What Trump is saying and doing is so unhinged—for example, repeating wild stories that Haitian immigrants are eating dogs and cats—that if all you do is simply describe it, you are the one who sounds crazy.
    "Trump says, for example, that he will use the military to jail his critics. ... * Or maybe Trump says he thinks we should suspend the Constitution ... ** Then your listener says, 'Oh, come on, you’re totally exaggerating. You’re suffering from Trump Derangement Syndrome.' But in dismissing you, your listener is moving himself farther away from an accurate grasp of reality. He is the one becoming—dare I say it?—deranged. ...
    "Donald Trump has intuitively mastered the techniques of propaganda, which include the Big Lie ... and also the Incredible Truth: a fact so outrageous that people refuse to accept its reality. If ... t if you go way beyond that to do or say something completely insane, no one will believe you’re doing it—even as you do it right out in the open.

“Trump Derangement Syndrome” has its origins in 'Bush Derangement Syndrome,' which was used to describe the truly hyperbolic reaction on the far left to George W. Bush ... But what Trump realised is: What happens if you yourself embrace the hyperbole and go out and embody it? All the rules intended to keep political discussion productive by protecting against hyperbole then work to protect you—and to protect you precisely because you embraced the worst possible views.
    "This is the fate that has been suffered by Godwin’s Law. ... you can talk about immigrants 'poisoning the blood' of the country and foreigners bringing in 'bad genes.' Have two of your chief supporters host and recommend an interview with an open Nazi apologist. Go onto a livestream with a guy who regularly hosts neo-Nazis. Talk about how you wish you had the kind of generals Hitler had. Refer to Nazis as very fine people. And then scream about how unfair it is when anyone points this out. ...
    "The paradox of 'Trump Derangement Syndrome' is that the phrase is used only by the very people who are suffering from it."

~ Robert Tracinski from his post 'The Anatomy of “Trump Derangement Syndrome”'
* Trump: "I think the bigger problem are the people from within. We have some very bad people. We have some sick people, radical left lunatics. And I think they're the—and it should be very easily handled by, if necessary, by National Guard, or if really necessary, by the military…. The worst people are the enemies from within, the sleaze bags, the guy that you’re going to elect to the Senate, shifty Adam Schiff."

** Trump: “A massive fraud of this type and magnitude [i.e., the election he actually lost] allows for the termination of all rules, regulations, and articles, even those found in the Constitution.”