Tuesday 25 December 2012

Frank Lloyd Wright: “Man the Enlightened Being"


Architect Frank Lloyd Wright liked to send out his poetic Christmas message every year extolling “man the enlightened being” . So do I.

“The herd disappears and reappears," says Wright's message, "but the sovereignty of the individual persists." What better time of year to reflect on that. [Note that by the word ‘Democracy’ Wrighsimply means Freedom.]

_Quote Literature tells about man. Architecture presents him. The Architecture that our man of Democracy needs and prophesies is bound to be different from that of the common or conditioned man of any other socialized system of belief. As never before, this new Free-Man’s Architecture will present him by being true to his own nature in all such expressions. . .

With renewed vision, the modern man will use the new tools Science lavishes upon him (even before he is ready for them) to enlarge his field of action by reducing his fetters to exterior controls, especially those of organized Authority, publicity, or political expediency. He will use his new tools to develop his own Art and Religion as the means to keep him free, as himself. Therefore this democratic man’s environment, like his mind, will never be style-ized. When and wherever he builds he will not consent to be boxed. He will himself have his style.

The Democratic man demands conscientious liberty for himself no more nor less than he demands liberty for his neighbor. . .

Whenever organic justice is denied him he will not believe he can get it by murder but must obtain it by continuing fair dealing and enlightenment at whatever cost. He will never force upon others his own beliefs nor his own ways. He will display his social methods to others as best advantage as critic or missionary only when sought by them.

His neighbor will be to him (as he is to himself) free to choose his own way according to his own light, their common cause being the vision of the uncommon-man wherein every man is free to grow to the stature his freedom in America under the Constitution of these United States grants him.

Exterior compulsion absent in him, no man need be inimical to him. Conscience, thus indispensable to his own freedom, becomes normal to every man. . .

Remember the men who gave us our [American] Nation. We have ‘the Declaration’ and our Constitution because they were individualist. Great Art is still living for us only because of Individualists like Beethoven. We have creative men on earth today only as they are free to continually arise as individuals from obscurity to demonstrate their dignity and worth above the confusion raised by the herding of the common-man by aid of the scribes and Pharisees of his time—quantity ignoring or overwhelming quality. The herd disappears and reappears but the sovereignty of the individual persists. . .

Read on here for the full message: “Man, the Enlightened Being” by Frank Lloyd Wright, and remember to have a great individualistic holiday season.

And remember this useful advice about responsible holiday drinking: Don’t underestimate when you’re at the bottle store. It would be irresponsible to run out.

Saturday 22 December 2012

It must be holiday time

I always like piling up my my holiday reading ready to pack.

Isn't it fortunate I can get most of it now on Kindle. But not all...

 

Wednesday 19 December 2012

Oh look , it’s a pay rise…

Here’s what else John Key and Bill English* just dropped into your Christmas stocking this week: a pay rise for every MP. Every single one of them.

While many people struggle financially at Christmas, politicians will be enjoying early holiday cheer with a pay rise.
   
The independent Remuneration Authority has again made an end of year recommendation for a pay increase for the MPs.
   
Prime Minister John Key said said today he was comfortable with politicians getting more in their pay packets this year.

Arsehole.

While you and I get a tax rise from this creep—in a week in which they hope you won’t notice and won’t remember by next year—the overpaid Beehive bludgers give themselves a pay rise.  Perhaps as a reward for all their excellent work this year?  [Insert

What a fucking disgrace.

Oh yes, and their pay rise will be backdated, “giving politicians a Christmas lump sum.”

Words fail me.

* * * * *

* Don’t give me that bullshit about how the “Remuneration Authority” is “independent”—they’re about as independent as the Treasury, whose fictional projections of rapidly-falling unemployment and balanced budgets by 2014/15 would be laughable if not so obviously shilling for the government.  If Bill and John wanted the pay rise annulled, they could stop it by the flick of a pen. Instead, Key has “written back [to the Authority] saying in principle we're comfortable” with the recommended pay rise.

Is he really that desperate for MPs’ votes?

Carols by Flash Mob

Tuesday 18 December 2012

Oh look, it’s a new tax

Here’s what John Key and Bill English just dropped in your Christmas stocking: a new tax.

3 cents a litre on your petrol every year for the next three years to pay for the govt’s asphalt machine—that’s 9c a litre in total by 2015 on top of the petrol taxes they already fleece you for every time you go to the pump.* Plus increased road user charges for the next three years.**

Arseholes.

It’s been obvious to everyone with a calculator that unless it stops spending so goddamned much its pledge to be in surplus by 2014/15 is as likely as those “ongoing” and “substantial” tax cuts they bogusly promised to get elected in 2008.

This is really nothing more than a new tax to stop them driving over their own fiscal cliff. Which, unless they stop spending  so goddamned much,*** they will.

* * * * *

* Real price of petrol last time I checked was round $1.20 plus taxes, around one dollar being the cost of crude oil and 20c what the oil companies take to import, refine and distribute. All the rest already goes to the grey ones.
** And, since you’ve never seen a new tax yet that a govt hasn’t wanted to stick around and keep paying for its largesse, you just know these new taxes will be permanent.
*** Which is as near to a certainty as you ever get in politics.

The 12 beers of Christmas

2102 was the year of craft beer—the year when craft beer was everywhere. Even in Lion Breweries’s portfolio.

So what was my own personal 12 beers of 2012—beers I noticed1—beers with a summery tinge2—beers above and beyond my usual favourites3—beers I’ll be making a special point to track down and consumer over the summer?

  1. Harrington’s ‘Rogue Hop’
    'An organic pilsener, this surprisingly hoppy pilsener is perfect for summer. Seen about in a few shops now in surprisingly affordable slabs. And if you’re visiting Christchurch, visit the brewery and load up some riggers to take home in your spare suitcase. I know I have.
  2. Garage Project’s ‘Day of the Dead’
    Why would you add chilli to a porter? You’d only ask that question before you’ve had one of these. The one exception to the rule that beer only has four ingredients.
  3. Yeastie Boys’sRex Attitude’
    A beer that truly grows on you, in every sense.  In 2012 it finally made itself indispensable.
  4. Little Creatures Pale Ale
    While bumptious NZ beers tried the extremes, Little Creatures kept making damn fine well-crafted pale ale. And in 2012, with Lion acquiring the company, you can suddenly find it in every good bottle store in the country. And even some of the bad ones.
  5. Epic ‘Message in a Bottle’
    If this is truly a recipe from days gone by, as the advertising argues, then it’s easy to see the days went by very well indeed. Hard to get, but worth the effort.
  6. Epic ‘Zythos’
    Another bumptious beer by the Hop Hooligan. I recently made the mistake of drinking an Epic Pale Ale straight after one of these. There are few other beers that can make an Epic Pale Ale taste ordinary. This is one.
  7. Emerson’s ‘Bookbinder’
    I discovered the perfectly-crafted session beer, and it is called Bookbinder. Well-tested now over several sessions (hic) I have hopes that with Emerson going mainstream you might soon find this everywhere. (One can hope.)
  8. Hallertau ‘Statesman’
    This is an old favourite I’m gratefully discovering on tap around the traps—most notably at Ponsonby’s Golden Dawn. So good it makes you want to suffer Ponsonby to enjoy it—or better yet, to drive to Riverhead to drink it straight from the brewery’s mouth.
  9. Mountain Goat India Pale Ale
    One I enjoyed in Melbourne this year.
  10. Feral Brewery’s ‘Hop Hog’
    Another Australian, the name says it all.
  11. 8 Wired ‘Fresh Hop Wired’
    Wow. The original hard-to-find-but-worth-the-effort.
  12. Leigh Sawmill ‘The Doctor’
    A flavourful fellow, I predict generous helpings fresh from the brewery door will adorn our Christmas table this year. And moisten much of the after-match. We will, after all, be just down the road…

Cheers, and what are your 12 beers of Christmas, 2o12?

1. Some for the first time, some I just noticed properly this time.
2. By which I means beers with a summery tinge that taste like beer. Which excludes your DB Summer Ale.
3. Take a bow Epic Pale Ale, Galbraith’s Resurrection, anything else by Renaissance or Three Boys…

Jingle Bells

The only time you’ll ever hear it on this blog—and possibly the fastest you’ll ever see it performed…

Monday 17 December 2012

Quote of the day: On the reaction to a shooting

“’Tough cases make bad law,’ it is often said. I suggest
a corollary: extreme events make bad legislation.”

- Gene Callahan, “A*** L****, the Perfect Cypher upon Whom We Can Project Our Agendas

Will the catalyst be Japan?

Which country has the biggest government debt-t0-GDP ratio in the world?

Which country went into recession two decades ago, and has never really emerged?

Which country’s leader has signalled he intends to print money, QE to infinity, to monetise that debt?

The answer to all of these questions is not Greece, Spain or Italy. Nor is it the U.S.

It’s Japan.

With interest rates at zero and government debt more than double its GDP—and rising—and an aging population who have virtually denuded their savings in patriotically buying govt bonds, it has little hope of ever reducing that debt honestly, and no hope at all if interest rates ever rise.

Japan is the world champions at kicking the can down the road—zero interest rates and piling up govt debt for two decades in a desperate but vain attempt to create the “stimulus” theorists say should have resulted in prosperity—consuming capital and chewing up the pool of real savings like a shark at a city beach—producing only more debt, more “deflation,” falling wages, falling production, falling demand,  and two decades of stagnation.

And over the weekend, the Japanese election gave victory to the opposition Liberal Democratic Party, whose leader Shinzo Abe has for months been saying he will engage in quantitative easing beyond even the dreams of Bernard Hickey, printing paper money to monetise the debt and beyond—enough to turn “deflation” into raging inflation, and Japanese paper and government bonds into toilet paper.

‘He’s also on record as saying:

“he went into politics to help Japan ‘escape the postwar regime" and throw off the shackles of wartime guilt. In its place he has talked of creating a "beautiful Japan" defended by a strong military and guided by a new sense of national pride.

He also intends

to change the constitution to allow Japan to "have a proper military and defend its own territory, including every inch of Japan's sacred land and sea - including the disputed Senkaku or Diaoyu Islands”… Mr Abe belongs to that part of Japanese society that does not really believe Japan's wartime aggression against China and South East Asia was a crime.

The world is carefully poised for catastrophe. Something profoundly bad is going to happen somewhere to set it off.

Will the catalyst be Japan?

Quoting on Auckland…

Phil McDermott on “A Flawed Case? Auckland’s City Rail Link Project

“One of the reasons as I understood it for creating a single Auckland Council was to reduce wasting money on uneconomic and unwarranted projects. Well, this obsession with the CRL simply demonstrates how a bigger council can make even bigger mistakes…”

I have still yet to hear a cogent reason for creating a super-sized bureaucracy in Auckland.

I don’t think one ever existed.

Why? And how? [update 3

WHY?

THAT’S THE FIRST question everyone asked after another idiot committed suicide by massacre, shooting twenty-six adults and youngsters in cold blood in a school in Connecticut before—well, who the hell cares what happened to him after that. Twenty-six human beings died, and something non-human.

Why did he do it? Why do any of these random shooters do it? An email doing the rounds attributed* to Morgan Freeman (the modern American “voice of God”) has one answer:

This may sound cynical, but here's why.
    It's because of the way the media reports it. Flip on the news and watch how we treat the Batman theater shooter and the Oregon mall shooter like celebrities. [The Columbine murderers] are household names, but do you know the name of a single victim of Columbine? Disturbed people who would otherwise just off themselves in their basements see the news and want to top it by doing something worse, and going out in a memorable way. Why a grade school? Why children? Because he'll be remembered as a horrible monster, instead of a sad nobody.
    CNN's article says that if the body count "holds up", this will rank as the second deadliest shooting behind Virginia Tech, as if statistics somehow make one shooting worse than another. Then they post a video interview of third-graders for all the details of what they saw and heard while the shootings were happening. Fox News has plastered the killer's face on all their reports for hours. Any articles or news stories yet that focus on the victims and ignore the killer's identity? None that I've seen yet. Because they don't sell. So congratulations, sensationalist media, you've just lit the fire for someone to top this and knock off a day-care center or a maternity ward next.
    You can help by forgetting you ever read this man's name, and remembering the name of at least one victim. You can help by donating to mental health research instead of pointing to gun control as the problem. You can help by turning off the news.

Sound comments. As a news consumer myself, I’ve never found it hard to turn of the news at times like this.

And at this blog, I’ve always followed the policy of never naming murderers. Why give them the oxygen of publicity.

THE NEXT QUESTION EVERYONE was asking was How?

How can this be stopped from happening again? Answers were rolling in even before the mourning started, and well before facts started to come in. President Obama said “meaningful reform” must be enacted so it won’t happen again. Rep. Dianne Feinstein has a bill all ready to put to Congress in the first week of the next session, banning … something. And talking heads and talkback callers everywhere are calling for guns to be made harder to obtain, semi-automatic weapons to be banned,  gun licensing to be made harder the “gun culture” and gun ownership to be throttled by lawmakers bringing a clipboard to a gunfight.

Throttling gun cultures with more laws. Prohibition. This surely ignores that only the law-abiding listen to such laws. 

Newtown officials: Principal shot lunging at Adam LanzaAnd what have all the laws against guns in schools done but disarm everyone there—leaving defenceless the people who run them and all the youngsters they should be protecting, and telling murderers they get at least thirty minutes of safe shooting before any threat to their life is likely to arrive.

It is said that as the armed idiot roamed the corridors bravely killing unarmed six- and seven-year-olds, a very brave school principal Dawn Lafferty Hochsprung (right) charged him in a desperate attempt to stop him. She died in the attempt.

Imagine yourself in that position, desperate to save the children in your care and utterly powerless to do anything about it.

I wonder what you would have wanted in your hand when you confronted the gunman: a small handgun? or a clipboard?

* * *

*Probably incorrectly. But since Morgan Freeman is the name most Americans would come up with if asked to name the man to play the voice of God, he’s the obvious choice for the actual author(s) to pick.

UPDATE 1: Lenore Skenazy from Free Range Kids comments:

It’s impossible not to feel afraid, sad, sickened and deeply pessimistic when something like this occurs. However, “something like this” — well, there aren’t a lot of somethings like this, and that’s a truth I am desperately trying to remind my heavy soul. It may feel like “school shootings happen all the time,” but they don’t. They are rarer than rare. They are as unpredictable as anything can be. And if today we find ourselves making a mental list, “Columbine, Virginia Tech, Sandy Hook,” that’s because they are few enough, in a country of 300 million, that we know their names.
    This does not mitigate our sorrow, but it can — with some effort — mitigate our fear. It is not to dismiss the parents’ pain that I encourage you to turn off the TV. It is to keep some perspective…

And she points out the deadliest school massacre in US history was in 1927—and why its aftermath matters now .

UPDATE 2: Foregoing the knee-jerk, Australian Tim Blair takes the wide perspective, observing there are both more guns in the US, and fewer deaths

There is always a bigger picture. In the case of the latest horrific US mass shooting, the bigger picture is this:
    There are around 310 million non-military firearms in the US, basically enough to equip every man, woman and child with a deadly weapon. Close to 5.5 million new firearms are produced within the US every single year – two million more than the entire amount of firearms owned by Australians. Another three million firearms are imported to the US annually. Nearly 50 per cent of Americans have at least one firearm in their house. The market for firearms has increased constantly since the election of Barack Obama in 2008, with Smith & Wesson expecting almost $400 million in gun sales during 2012.
    And the rate of firearm-related murders keeps falling.
    You read that correctly. As the number of guns in the US increases, the deaths keep going the other way. “The rate of gun-related murder and manslaughter fell 11 per cent from 2008 to 2010, the most recent year for which comparable statistics are available,” Businessweek reported in October. Moreover, “the gun-killing rate has fallen a total of
51.5 per cent since 1993.”

UPDATE 3: Fred Rogers talks about discussing tragic events in the news with kids, which at the moment encompasses everything from Newtown Connecticut to Apia, Samoa. It includes this piece of advice for all of us:

[Hat tip Noodle Food]

Friday 14 December 2012

FRIDAY MORNING RAMBLE: The ‘can’t the David Bain trial be made to go away’ edition

It should have been over years ago, and if police hadn’t buggered it up so badly it’s impossible to know whodunnit, it could have been.
It should have been over this year and, but for Judith Collins’s decision to promote competing reports, it would have been.
Welcome to another year of discussing a case that started in 1994.

You want the idiot’s summary of the idiotic extra-judicial stoush about the Bain reports? Here it is.
Fisher Binnie Idiot’s Summary (I am the idiot) – DIM POST

Collins’s real problem with the Binnie report? Here’s a clue: “anger and simple upset over the conduct of the police force. [Jurors] had always considered the police above reproach. They found they were wrong.
David Fisher: Bain report shines spotlight on police mistakes – NZ HERALD

Word of the Year? Word of the Decade?
Public Address Word of the Year and Word of the Decade - the Vote! – HARD NEWS

“If the two parties fail to come to a deal by Jan. 1, taxes on the average middle-income family would rise about $2,000 over the next year. That would follow a 12-year period in which median inflation-adjusted income dropped 8.9 percent, from $54,932 in 1999 to $50,054 in 2011.”
And that’s if you don’t believe official inflation figures understate how much value dollars lost over those 12 years.
U.S. politics in two sentences – MARGINAL REVOLUTION

Fresh from his eponymous inquiry, Lord Leveson visits Australia to talk about cracking down on blogs and tweets. “Lawlessness in one area may infect other areas,” says Leveson.  “The bottom line is this: Leveson is an enemy of free speech as these clips makes clear” …
Leveson is in Australia – Sinclair Davidson, CATALAXY FILES

Seems the loony Lord just copies and pastes from Wikipedia.
Lord Leveson copies out Wikipedia – LISTENER

The global warming game has changed, admits the UN’s IPCC in their next alarmist report on global warming—leaked this week one year ahead of its scheduled release. Leaked, because it admits that the sun’s activity in recent decades has had more effect on warming that previously allowed, or understood—and the leaker thought you should know taht. “The admission of strong evidence for enhanced solar forcing changes everything [says the leaker]. The climate alarmists can’t continue to claim that warming was almost entirely due to human activity over a period when solar warming effects, now acknowledged to be important, were at a maximum. The final draft of AR5 WG1 is not scheduled to be released for another year but the public needs to know now how the main premises and conclusions of the IPCC story line have been undercut by the IPCC itself.”
IPCC AR5 draft leaked, contains game-changing admission of enhanced solar forcing – WATTS UP WITH THAT

The big profits of Australian banks is not all good. “Australia has an oversized banking sector for its economy and the banks remain over-leveraged and heavily invested in residential and commercial real estate.”
The Australian Banking Behemoth – Dan Denning, DAILY RECKONING

“Politics has become a big game for the amusement of those involved, which considering the scale of the challenges facing this country it really shouldn’t be.” All too true.
Unwittingly, Maria Miller's Spad has done her country a favour – Iain Martin, TELEGRAPH

More evidence "Don't be evil" means "Be capitalist": Google chairman says "We are proudly capitalistic. I'm not confused about this."
Google's tax avoidance is called capitalism, says chairman Eric Schmidt – TELEGRAPH

How anti-vaxxers see the world:

“We now have the announcement that Ben Bernanke’s US Federal Reserve will buy $45 billion a month in treasuries, QE4, until unemployment reaches 6.5% or his version of inflation exceeds 2.5%… The next announcement may well remove the $45 billion monthly limit. Then he will be able to finance the government with as much fairy dust money as he likes.”
There He Goes Again – Hunter Lewis, CIRCLE BASTIAT

“Counterfeiting is a crime. There is an act of Congress that allows the Fed to get away with it. Still, a banker from an earlier era would have only done it in the dark of night. In the time of Edward II, a banker who clipped his coins would have his balls cut off…
    “The gist of the Fed's new plan is to print up US$85bn per month and use it to buy mortgage-backed securities and US government debt. This is supposed to increase 'demand', and thereby get the economy moving faster. The important thing is that the Fed has no money with which to buy these things. It has to create it out of thin air. A lot of it.
    “At that rate, the Fed will be adding to the nation's monetary base - the Fed's assets - three times faster than the US economy creates new goods and services…”
The Outrageous Behaviour of the US Fed – Bill Bonner, DAILY RECKONING

This throws the US dollar over the currency cliff, says Peter Schiff:

“So between this and QE 3 which was announced just two and a half months ago, the Fed will be printing $85 billion per month,” just as Treasuries look like they’re starting to crumble. “If Treasuries begin to collapse at a time when the Fed is buying up over 70% of debt issuance, then the Great Treasury Bubble is finally about to burst… Take out Fed support … and interest rates will be soaring.”  And no government anywhere can afford that, not to mention every over-extended borrower. “We’ll have to wait to see how this plays out, but we’re getting dangerously close to a US debt crisis that will make 2008 look small in comparison.”
And That's Checkmate Bernanke – Graham Summers, ZERO HEDGE

The reaction of Treasury bond buyers “demonstrates that although the Fed may be capable of managing inflation expectations, its ability do so is no longer to be reckoned in months or weeks, but in minutes.”
Fed Losing Its Grip on Our Expectations – Rick Ackerman, ZERO HEDGE

Even central bankers were concerned, Reserve Bank of Australia head Glenn Stevens describing quantitative easing as potentially harmful and Bernanke’s approach as "ultimately inimical to financial stability and hence macroeconomic stability."
The Central Bank Backlash: First Hong Kong, Now Australia Gets Ugly Case Of Truthiness – Tyler Durden, ZERO HEDGE

Meanwhile, back in Japan…
Japan in recession – MACROBUSINESS.COM.AU

Fortunately, making money from central-bank money printing has become increasingly difficult. “The fact is the world has been turned on its head for the past four years. People and investors have forgotten the real driver of prosperity and wealth. It’s not central bankers or governments that create wealth, it’s entrepreneurs, business people, and individuals…each acting in their own selfish interest.” Which is why each round of money printing has received an increasingly cold shoulder.
Central Bank Prints More Money — No One Cares – Kris Sayce, MONEY MORNING AUSTRALIA

"The Fed is now forthright that it is targeting the unemployment
rate. The problem is that it doesn't control the unemployment rate."

- Gerard O’Driscoll

So, what’s the difference between altruism and benevolence?

Attractive little nooks for reading and sleeping. (Because ‘“reading" often means falling asleep, and drooling heavily, after the first five pages. A bright shade of paint can keep you awake for at least the first chapter.’)
Create Lovely Little Nooks for Reading & Sleeping – APARTMENT THERAPY

Ravi Shankar, who died this week, called hippy fans of his sitar playing at Woodstock and elsewhere “strange young weirdos… shrieking, shouting, smoking, masturbating and copulating – all in a drug-crazed state…” He was right, you know.  Interesting that he and Ayn Rand would agree on that.
In truth, Ravi Shankar couldn’t stand the hippies – TELEGRAPH
ARC’s Yaron Brook revisits “Apollo and Dionysus” – ARC

Help is at hand for Apple Users who want to know where the f**k they are.
Google Maps Returns To iOS, Now With Voice Guided Turn-by-Turn Navigation – FORBES

Alleged architect Frank Gehry can’t handle a real artist.
What Happened with Frank Gehry on the Eisenhower Memorial – SABIN HOWARD SCULPTURE

I’m pretty sure this news of “an Objectivist XXX Porn Parody” is satire, but you never can tell. After all, Alan Greenspan might well have said, “This is the first porn parody that celebrates Rand’s ideals of objectivism and rational egoism.”
Aynal Architecture: “This Ain’t The Fountainhead” – GRAM PONANTE [Very NSFW]

Joe Maurone is right. Dedicate 2013 to the best within you:

Here’s Charles Mingus…

…and Mario Lanza …

…and Freddy Kempf, who I’ll wager you foolishly missed at the Town Hall last week:

[Hat tips Pharyngula, Marginal Revolution, Whale Oil, Daniel Wahl, TakingHayekSeriously, Eric Crampton]

Have a great weekend!
PC

PS: Make mine an Epic Message in a Bottle please:

“Who Plans?”

This letter to the Washington Post by inveterate letter-writer Don Boudreaux, which he titles “Who Plans?” perfectly complements yesterday’s brilliant post by Bernard Darnton:

Carter Eskew finds inspiration for our troubled times in Franklin Roosevelt’s 1932 call for “bold, persistent experimentation” (“A country where millions feel stuck, or worse,” Dec. 13).  Mr. Eskew falls for rousing words used to peddle regrettable policies.
    Amity Shlaes argues persuasively in her 2007 book, The Forgotten Man, that “Roosevelt’s commitment to experimentation itself created fear”* – fear that, as economic historian Robert Higgs documents, greatly prolonged the depression.**
    A chief reason for this sad result is that experimentation in the style of the New Deal actually chokes off the real deal.  Substituting serially a handful of grandiose, one-size-fits-all schemes dreamed up by politicians – where no such scheme competes simultaneously with any other – forcibly eradicates hundreds, even thousands, of individual private experiments undertaken simultaneously, each launched and guided by someone with his or her own money at stake and prohibited from forcing unwilling others to play along with any particular experiment.  Experimentation, therefore, of the sort that Franklin Roosevelt championed was really neither so “bold” (as it was done with other people’s money and lives) nor “persistent” (as, at any time, it displaced countless individual and simultaneous experiments with one gargantuan ‘experiment.’)
    New Deal centralization put “Great” in the Great Depression.  The last thing we need today is a repeat of that failed experiment.

Sincerely,
Donald J. Boudreaux
Professor of Economics
and
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA  22030

* Amity Shlaes, The Forgotten Man (New York: Harper, 2007), p. 9.

** Robert Higgs, “Regime Uncertainty: Why the Great Depression Lasted So Long and Why Prosperity Resumed after the War,” The Independent Review, Spring 1997, vol. 1, pp. 561-590.

Thursday 13 December 2012

NOT PJ: One Chance

This week, Bernard Darnton is taking his chances. But not on shopping for handbags.

image“We’ve got one chance to get this right,” is the catch-cry of the Christchurch rebuild. Based on this one sentence it’s easy to conclude: we’re fucked.

If we’ve only got one chance to get it right, the plan needs to be perfect. No person, mayor, or czar, no committee, council, or cabinet can possibly know enough to synthesize the needs and hopes of hundred of thousands of citizens into the perfect city plan. Therefore, the plan won’t be perfect. Therefore, we’re fucked.

A city isn’t a set of drawing, or a spreadsheet. It is an organism. It can’t be planned from the top down; it has to be built from the bottom up, evolving as the result of a million experiments. Much like the robust and varied natural world, a city is the result of generations of trial and error, of failure and improvement. One problem with grand plans is that planners double down on bad bets whereas evolution clears them away and tries something else.

The idea that we’ve only got one chance to get this right is a self-fulfilling prophecy. CERA, the City Council, the Central City Development Unit, don’t have the ability to get it right in one go—no one does. But the plan must be conformed to and if we can’t get it right then, damn it, we’ll just have to get it wrong.

To get an idea of how wrong, you just have to listen to the cheerleaders. Apparently the key to Christchurch’s future economic success is “high-end retail”. Someone has gone round the great cities of the world and decided that what they all have in common are traffic problems and fancy handbag shops, perhaps failing to notice that these are symptoms of economic success, not causes. So Christchurch is going to get narrow, 30 km/h streets and shops selling shiny, brand-named tat.

The plan is to grass over half the city and build small amounts of expensive office space on the rest. The theory is that Christchurch was failing economically before the earthquakes and so if we triple the cost of office space, that will attract “high end tenants.”

For the record, “high end tenants” means outfits like Inland Revenue, which gives you a good idea of where the planners think that money comes from. Never mind, also, that Inland Revenue has signed a nine-year lease on an office out near the airport.

The ground floors of these expensive office buildings will be filled with “high end retail.” Louis Vuitton has been name-dropped. I have no idea if Louis Vuitton has been informed of their critical role in the rebuild. So the fool-proof “one chance” plan for Christchurch’s economic success revolves around Inland Revenue call centre staff spending their lunchtimes buying Louis Vuitton handbags.


Artist’s impression of central Christchurch. (Inland Revenue employees on their lunch hour not shown.)

The citizens of Christchurch would like to thank, in advance, New Zealand’s taxpayers for their unstinting support.

A rare insight into the planner’s mind came to me at a recent party. I suggested that Christchurch’s rebuilding would be clipping along much better if people were allowed to build whatever they liked on their own land. This was unacceptable said the planner because so much time has been put into the planning. If people just did what they wanted to, they might not conform to the plan (!) and then all that effort would be wasted!!

Even armies, who can shoot people who get in the way, understand that no plan survives contact with the enemy.

When I suggested that maybe they could save all that effort by not doing the unwanted planning in the first place, all I got was sputtering. Many good arguments evoke sputtering. “B … B … But … but … then everyone would die of typhoid!!!”

I bowed to my audience and took the win. To be fair, that response probably owed more to excessive alcohol consumption that to departmental policy, but it provides insight. It’s not that far from in vino veritas to in vino dumb-ass.

The planners know that planning is valuable. What they don’t understand is that the plans themselves are useless. The value comes from thinking about the possibilities, not from the mindless execution of the plans (and those who get in the way).

If Christchurch is only given one chance to get to get it right, the city will die.

If the plan is to build a “high-end” cargo cult and hope that wealth appears magically over the horizon, we will be miserably disappointed.

Christchurch doesn’t need one chance, it needs a thousand chances. It needs CERA and the CCDU, who have suffocated the city for two years, to make way for the thousands of individuals who will experiment, and iterate, and evolve the city into something marvellous._BernardDarnton

* * * * *

Bernard Darnton is Not PJ O’Rourke, but you can’t blame him for that.
Read his other posts here.

Wednesday 12 December 2012

Progressive energy vs “sustainable” energy

Ladies'  I Love Fossil Fuels T-ShirtWe hear a lot from the likes of Gareth Hughes—the energy spokesman opposed to energy—about so called “sustainable energy.” As if one particular form of energy could be used and generated perpetually, like the ancients’ dream of a perpetual motion machine.

This is about as sensible as a belief in alchemy, but is one of two primary reasons the likes of young Gareth is so violently opposed to oil. Alex Epstein from the Center for Industrial Progress points out the very concept of “sustainability”

is a relic of centuries when human beings repeated the same lifestyle over and over–instead of finding better and better ways to do things.

Epstein argues the non-concept should be replaced by the concept of progressive energy:

Progressive energy: The ideal source of energy is not some “sustainable”–i.e., endlessly repeatable–form, but the best, cheapest, ever-improving form human ingenuity can devise. As long as human beings are free, they will continue to develop new resources from previously useless raw materials (such as shale oil). An oil industry is ideal in the same way the iPhone is an ideal for so many. It may not be the best forever, but it is the best for now and we should be grateful to have it.

Can I get an amen?

Scandalous Regulators

Guest post by Mark Thornton

Business scandals often lead to calls for greater regulation. Yet, as economist Mark Thornton discusses, and as we’ve discovered ourselves in so many recent scandals—Enron, BP oil spill, Bernie Madoff—leaky homes, Pike River, CTV Building, Ross Asset Management—regulators have been among the chief culprits in providing for everyone an organised way of going wrong with confidence.

Photo of Mark    ThorntonScandalous Regulators
by Mark Thornton on December 11, 2012

The Democratic Party had its message on the economy well-prepared for the recent U.S. elections. From President Obama to his campaign directors to campaign advisor-hacks, all the way down to the local party patsies, the message was uniform and well rehearsed. “We do not want to return to the failed economic policies of four years ago. Those policies caused the economic crisis that almost put the country back in a great depression. We cannot return to the naïve policy that deregulation is good for the economy.” [We heard this same mantra in every year of Helen Clark’s government, didn’t we, and now every week from Russel Norman. ]

The Romney campaign essentially left this crucial talking point unchallenged. When confronted with this charge from the Obama campaign, Romney’s response was to concede that capitalism requires regulation to work, but to insist that the regulation cannot be excessive and burdensome, or ultimately the consumer will be hurt.

This is an entirely unsatisfactory response. The problem is that Romney and his campaign do not really know how capitalism works. They do have some idea of how the actual interventionist economy works. That is the economy where Romney made all his money. However, it is not a platform from which you can see how an economy works without interventions, regulations, and “favorable” injections from the Federal Reserve. Romney made his money during a time of “easy money” under Alan Greenspan.

What the Democratic spin boils down to is that a lack of regulation allows greed and irrational behavior to destroy the economy and hurt consumers.

This simply is not true. When you look at the cases where this was supposed to exist, you find the Democratic party spin is wrong. Regulations do not make markets safer, more efficient, or work better for consumers in anything but a superficial sense. Regulation only provides “confidence” and assurance that only leads to crisis. Regulation does not produce harmonization of markets or insurance for consumers.

Regulation simply does not work. It is designed with hopes of success, but with no mechanism to achieve this success. We hope for efficiency, but what we get is bureaucracy. We hope for effectiveness, but what we get is rules and red tape that serves neither producer nor consumer. We hope for safety, but what we eventually get is chaos. Let us take a look at the prominent cases where regulation was supposedly lacking and examine the real cause of chaos.

The Bernie Madoff scandal involved Madoff’s tightly controlled firm taking client money and supposedly generating spectacular and consistent investment returns. However, Madoff was not really a great investor; he was running a Ponzi scheme where he used investors’ money to pay for redemptions by his clients. Most of the money apparently went into his own pockets.

First, how did he get away with this scheme for so long? It was not because he was unregulated. He was officially under the scrutiny of the Securities and Exchange Commission (SEC), the Financial Industry Regulatory Authority, and probably other government regulatory agencies. Despite ever-increasing budgets and staff, and even warnings from outsiders, the SEC failed to act.

Second, how did he finally get caught? He was only caught after the stock market crashed and investors sought to redeem large amounts of their funds. He confessed to his sons that he was operating a Ponzi scheme and his sons turned him into authorities.

imageIf the stock market had not crashed, Madoff might still be celebrated as a genius investor. Many said that Madoff’s investment returns were too good to be true. Experts agreed that they could not be true, and still the SEC failed to act. The fact that he was licensed and regulated by the government gave investors in his firm “confidence” that Madoff’s investment strategy was truly the work of a genius.

The housing bubble and the financial crisis that followed are considered a classic case of a lack of sufficient regulation, which in turn permitted unmitigated greed and irrational behavior to cause a massive amount of manic speculation.

The idea that banking and finance are unregulated is just plain laughable. There are various regulatory agencies at the state, federal, and international level. Thomas Woods reports that there are over 12,000 bureaucrats devoted to financial regulation in Washington DC alone and that inflation-adjusted spending on it has tripled since “deregulation” began in 1980. There are at least 115 agencies that regulate the financial industry at the state and federal levels alone.[1]

Three regulatory factors that contributed importantly to the crisis and its magnitude were as follows:

  1. Regulation of credit rating agencies resulted in toxic assets being labeled AAA trustworthy.
  2. The regulations and requirements imposed on banks forced them to make bad loans under the Community Reinvestment Act.
  3. The squabble between competing federal regulatory agencies prevented credit default swaps (CDS) from operating in a transparent and liquid market place.

The housing bubble is a classic case of how regulation cannot prevent such problems, but can only help increase their magnitude. The biggest regulator of money, banking, and housing is the Federal Reserve. It are the dominant umbrella regulator, and it caused the housing bubble with its long policy of easy credit from 2001 to 2006. Chairman Alan Greenspan denied a bubble could exist and about the same time, his Vice Chairman Ben Bernanke even provided words of encouragement for an audience of independent community bankers:

Our examiners tell us that lending standards are generally sound and are not comparable to the standards that contributed to broad problems in the banking industry two decades ago. In particular, real estate appraisal practices have improved.

Other officials at the Federal Reserve would continue to laud Federal Reserve policies and the new financial innovations such as mortgage back securities and credit default swaps well into 2007. They were the cheerleaders for the housing bubble, providing confidence for both leaders and speculators.

Another example: the BP Gulf oil spill was certainly a tragedy, especially for the company. Being so far off shore and drilling for oil in such deep waters made it seem that there was absolutely no government regulation. The government had no assets to stop the oil spill or to prevent it from spreading. We all had to just sit, watch, and wait for the company itself to fix the problem.

The irony is that the reason that BP was drilling in such an inhospitable environment was precisely because of government intervention. The Federal government prohibits drilling in the relatively safe and shallow eastern Gulf of Mexico and permits it in the deeper; more storm prone western Gulf of Mexico. Federal regulators also administer a tax and fee structure that encourages oil companies to drill primarily in the deepest, riskiest regions of the Gulf.

Federal regulation of oil drilling rigs is conducted by the Mineral Management Service (MMS). They are supposed to conduct monthly inspections of these massive rigs, publish reports and issue safety citations when necessary, and put rigs on a regulatory “watch list” for any rig with repeated safety violations.

Well that simply did not happen. The inspections were not held on a monthly basis. Inspectors spent little time on the rigs during inspections; they often relied on the company itself for safety information, and issued very few safety citations. Sadly, regulators actually designated the Deepwater Horizon rig's safety record as exemplary and based on that track record the agency named the rig a model for industry safety in the year prior to the disaster.

In fact, the MMS never required compliance with regulations related to inspecting the blowout preventer devise, which ultimately caused the spill to spiral out of control. The reason MMS was lax in its duties and even allowed company officials to write up its reports[2] is probably because MMS employees were accepting all sorts of kickbacks, bribes, and other benefits. Officials in charge have expressed regret, and promised it won’t happen again: at least for the next couple of years, for sure.

As these examples illustrate, when examining this type of scandal, you do not find unregulated firms fleecing their customers. What you do find are highly regulated firms that are being pushed and pulled by regulations into unstable and unethical activities. Enron is another good example. It was probably regulated by more agencies than any company in existence and yet it created a gigantic mess that was never noticed by regulators, but had to be uncovered by a single independent financial analyst.

imageThe regulator is portrayed as a public-spirited specialist. They know the public good. They know the results that are expected. They know how to bring about those results. It is as simple for them to regulate their corner of the economy as it is for Emeril Lagasse to make crab cakes or for Martha Stewart to make a simple doily. [But as we’ve discovered with seismic standards here in NZ, knowing what regulations or standards to impose, and what the result of following them will be, cannot be known in advance.]

The public is told that regulators do not cause problems; they prevent them. They police the economy. They are the watchmen that have been endowed with the wisdom, ability, and selfless devotion to the public good.

There are indeed many people who work as government regulators that are very smart and well-trained that have public spirit and the public good in their hearts. There are also plenty of cads and knuckleheads that work as regulators.

The problem with government regulation is that you cannot fine-tune the regulations: nor can you perfect the regulatory work force in such a way to make regulation work in anything but a superficial way. The truth is that regulation instills confidence in the public so that they let down their guard and makes them less cautious while at the same time distorting the competitive nature of firms in the marketplace.

After every economic crisis there are calls for new regulations, more funding, and more controls. Economic wisdom dictates that we be ready to contest those calls when the next crisis of the interventionist state occurs.

* * * * *

Mark Thornton is a senior resident fellow at the Ludwig von Mises Institute in Auburn, Alabama, and is the book review editor for the Quarterly Journal of Austrian Economics. He is the author of The Economics of Prohibition and the editor of The Quotable Mises, The Bastiat Collection, and An Essay on Economic Theory.

Notes
[1] Thomas E. Woods, Jr., Rollback: Repealing Big Government Before the Coming Fiscal Collapse, Regnery Publishing Inc., p. 60
[2] According to my sources, it is common for company officials in many industries to actually fill out forms that are supposed to be fill out by regulators.

Judith Collins is talking bullshit

It’s reported that former local tax lawyer Judith Collins reckons the internationally-respected former Canadian Supreme Court judge’s report on compensation for David Bain is wrong on law, contains assumptions based on incorrect facts, and "lacked a robustness of reasoning used to justify its conclusions.”

I say that’s bullshit.

I say the reason she won’t make Justice Binnie’s report public is because it will be patently obvious everything she says about it is bullshit.

I say the reason she’s not taken the report's recommendation to grant compensation—the only reason—is nothing to do with Justice Binney’s alleged errors in law, and everything to do with the public’s overwhelmingly negative reaction to David Bain getting compensation.

She’s a politician. She couldn’t care less about the law. But she does care about the public.

But the public should get over themselves. The public, who overwhelmingly mistrust David Bain, should realise nonetheless that a jury in our highest court of law found him not guilty after thirteen years in prison for a(nother) case the police bungled, and he’s entitled to compensation for wrongful imprisonment.

And she should say that.

And she should stop impugning someone who I have no doubt knows the law vastly better than she does.

Tuesday 11 December 2012

Meanwhile, in Doha, nothing happened

cartoon-400.png

The Doha Round of climate chinwags ended with Christopher Monckton expelled for telling the truth, the gravy train riders telling themselves they’d live to trough another day, and green activists “close to despair” over the non-results of the non-agreements of yet another non-event. Benny Peiser rounds up some of the coverage:

    A couple of weeks ago the great global warming bandwagon coughed and spluttered to a halt in Doha, the latest stop on its never-ending world tour. The annual UN climate conference COP18 is no small affair. This is a bandwagon whose riders number in the thousands: motorcades of politicians, buses full of technocrats and policy wonks and jumbo-jets full of hippies travelling half way round the world, (ostensibly) to save the planet from the (allegedly) pressing problem of climate change 
    — Andrew Montford, The Spectator 9 December 2012

    At the end of another lavishly-funded U.N. conference that yielded no progress on curbing greenhouse emissions, many of those most concerned about climate change are close to despair.
    –Barbara Lewis and Alister Doyle, Reuters, 9 December 2012

    The United Nations climate talks in Doha went a full extra 24 hours and ended without increased cuts in fossil fuel emissions and without financial commitments between 2013 and 2015. However, this is a “historic” agreement, insisted Qatar’s Abdullah bin Hamad Al-Attiyah, the COP18 president.
    Inter Press Service, 10 December 2012

    The conference held in Qatar agreed to extend the emissions-limiting Kyoto Protocol, which would have run out within weeks. But Canada, Russia and Japan – where the protocol was signed 15 years ago – all abandoned the agreement. The United States never ratified it in the first place, and it excludes developing countries where emissions are growing most quickly. Delegates flew home from Doha without securing a single new pledge to cut pollution from a major emitter.
    –Barbara Lewis and Alister Doyle, Reuters, 9 December 2012

    Climate negotiators at the most recent conference on global warming were unable to reduce expectations fast enough to match the collapse of their agenda. The only real winners here were the bureaucrats in the diplomacy industry for whom endless rounds of carbon spewing conferences with no agreement year after year mean jobs, jobs, jobs. The inexorable decline of the climate movement from its Pickett’s Charge at the Copenhagen summit continues. 
    –Walter Russell Mead, The American Interest, 9 December 2012

    The UN climate conferences have descended into ritual farce, as naked money-grabbing on behalf of poor countries contrasts with finagling impossible solutions to what is likely a much-exaggerated problem. One leading question is how dubious science, shoddy economics and tried-and-failed socialist policies have come to dominate the democratic process in so many countries for so long. The answer appears to be the skill with which a radical minority — centred in and promoted by the UN, and funded by national governments and, even more bizarrely, corporations — has skilfully manipulated the political process at every level.
    –Peter Foster, Financial Post, 7 December 2012

    It’s green, it’s cheap and it’s plentiful! So why are opponents of shale gas making such a fuss? If it were not so serious there would be something ludicrous about the reaction of the green lobby to the discovery of big shale gas reserves in [Britain]. Here we are in the fifth year of a downturn. We have pensioners battling fuel poverty. We have energy firms jacking up their prices. We have real worries about security of energy supply … In their mad denunciations of fracking, the Greens and the eco-warriors betray the mindset of people who cannot bear a piece of unadulterated good news.
    –Boris Johnson, The Daily Telegraph, 10 December 2012

    [Hat tip Watts Up With That]

Men are born free but are everywhere in zones. Nearly everywhere.

Most of the English-speaking world’s planners have embraced the strangulation of cities by planning—and virtually all the English-speaking world’s politicians have let them.

Men are born free but are everywhere in zones—zones drawn up by planners to fit us into their dreams. Everywhere, that is, but Houston.

The good citizens of Houston have resisted zoning, voting it down every time it has been offered to them.  Consequently, while housing in much of the western world has become seriously unaffordable, the city of Houston remains unzoned, and its housing among the most affordable anywhere.

How affordable? Simon White has done a wee comparison for you, comparing houses in middle-level Houston with houses in the more affordable parts of Auckland and Christchurch. As he says, this was “a very sobering exercise - particularly in Auckland where there are very few new standalone 3 bedroom/2 bath rm houses available for less than $500,000”:

Comparison: New Zealand to Houston new house prices

Houston has a population of more than 6million, and was the fastest growing large city in the USA in the last decade.
Its ‘supply responsive’ land use and infrastructure policies have ensured that housing remains affordable (around half the cost of Christchurch and Auckland relative to income).  Because of this, Houston households have a much lower total cost of living than other cities, and household debt levels are significantly lower (less than half that of NZ, relative to income). All as a result of lower house prices.
Want some examples? Here goes:

A new family home in Cave Creek Drive, Humble, Houston: US$182,950. That’s just $223,000 in New Zealand dollars.
It is 30km from centre of Houston; 3bedroom; 208m2 floor area ; 511m2 section. Home with 2 car attached garage, 3 bedrooms, 2 baths, dining room, family room. Upgrades include: porch elevation, stone accent exterior, 42'' maple kitchen and bath cabinets, 3/4'' granite kitchen countertops, 8'' stainless steel undermount sink, tile backsplash on diagonal, double vanity in master bath, alarm trim with strobe light. Tile flooring at: entry, master bath, kitchen, breakfast. Wall tile at all baths.
The NZ dollar price of this house in Houston is $223,000 – similar houses in the Christchurch area cost $420,000 or more. In Auckland these houses are generally in excess of $500,000.

Comparison: 3 bed room, 2 bathroom houses that at 20 to 30km from city centre (in NZ dollars, taken from realty.co.nz):

 

Houston

( Typical example)

Christchurch

Templeton

Christchurch

Rangiora

Christchurch

Lincoln

Christchurch

Rolleston

Auckland

Takanini

(terraced home)

Auckland

Weymouth

South Auck.

Auckland

Massey

West Auck.

Price (NZD)

$223,000

$419,000

$489,000

$495,000

$469,000

$412,000

$429,000

$479,000

Construction year

new

1998

new

new

new

new

new

new

Section size (m2)

511

 

656

520

750

185

716

529

House size (m2)

208(Note 1)

180

200

175

185

156

180

166

Distance from city centre (km) approx

30km

<30km

30km

25km

30km

30km

30km

20km

Total price(NZD) per m2 of floor area (note1)

$1072

$2,328

$2,445

$2,829

$2,535

$2,641

$2,383

$2,886

Notes:
1. The Houston price per m2 is overstated and house size understated relative to NZ examples - because in the USA the garage is excluded from the floor measurement. Add around 40 square metres to the Houston houses to match them up.
2. There is very little available new housing (standalone 3 bedroom/2 bath room) for less than $500,000 within 40km of Auckland city centre.

Here are some other examples of newly constructed homes recently listed on the Houston market :

clip_image004

A new two story family home in Skyview point Houston:
$129,995 (NZ$158,000)
15km from centre of Houston
3bedroom; 2 bathroom; 189m2 floor area

clip_image006

A New basic single family home in Peyton Stone Houston:
$115,960 (NZ$141,400)
20km from centre of Houston
3bedroom; 2 bathroom; 139m2 floor area and 470m2 section
Specs: floors of lino and carpet, and laminate bench.

clip_image008

A new Condo in a seaside village - Houston:
$154,900 (NZ$189,000)
30km from centre of Houston
3bedroom; 2 bathroom; 145m2 floor area

clip_image009

A quality new family home – Ponte Serra Drive, near the seaside, Houston:
$209,000 (NZD $255,000)
35km from centre of Houston; 3bedroom; 191m2 floor area ; 607m2 section.
Home with 2 car attached garage, 3 bedrooms, 2 baths, granite kitchen countertops.
Tile, wood and carpet flooring .

Houston, we have a problem.