Coyote Blog

John Tamny in TCS Daily:

In a recent Los Angeles Times op-ed, "Overselling Capitalism,"
University of Maryland Professor Benjamin Barber wrote of the "crisis"
in the capitalist mindset, where the "'Protestant ethos' of hard work
and deferred gratification has been replaced by an infantilist ethos of
easy credit and impulsive consumption that puts democracy and the
market system at risk."

Wow, I must not have gotten the memo.  Here I have been plugging negative numbers into my 1040 for three or four years in an attempt to build a business and some future wealth, and it turns out that deferred gratification is out of style.   (TJIC also did not get the memo)

Here is a big reality check for professor Barber:  The fact that a few mortgage companies got overly generous in extending mortgage credit does not mean that the work ethic and entrepreneurship is dead.  In fact, they are virtually unrelated topics.  If the price of something is reduced, more is going to be consumed.  Suppliers of credit reduced the price of credit, too far as it turned out to make a profit, and more was consumed.  This does not represent so tragic change in the human makeup, it is just supply and demand at work, like normal, and some bad business judgement. 

In fact, I can't get over the class-based condescension that seems to fill every nook and cranny of the commentary on the mortgage bubble bursting.  When in the late 1990's, rich VC's provided too much money too cheaply to yuppies running Internet companies, I don't remember anyone lamenting a shift in human motivation or a failure of capitalism.  But when banks provided too much capital too cheaply to lower income people for home mortgages, suddenly all those lower-income people are representative of the failure of capitalism and the work ethic.

One of the reasons I blog is that the act of writing helps me clarify my thinking on certain issues.  I have written a number of times about my concerns over the "war powers" this administration is taking upon itself.  Arnold Kling's article in TCS Daily helped me clarify a better framework for thinking about my issues.  I can now put my concerns in two categories:

• The administration is going too far in using the war as an excuse to circumvent a number of Constitutional protections, from habeas corpus to search and seizure.  This does not mean that I am necessarily against all new activities, but they need to be initiated within our Constitutional framework.  Take surveillance activities.  Its not unreasonable to think that terrorism demands new surveillance tools.  But the principle we have always followed for surveillance is that Congress authorizes the power and the judiciary gets some type of review of the targets and methods.  Bush seems to have become impatient with separation of powers to the point that he does not even try to engage the other arms of the government, instead using the war to claim a fiat power.  (It should be noted that even when the separation of powers is respected, as with the Patriot Act, mistakes are made and we can go too far.  However, at least we can debate it and there are Congressmen we can hold accountable).
• The second category of problem I have is with the open-ended nature of the war.  Calling this the "War on Terror" is only marginally more precise and limiting than saying we are fighting the "War against Bad Stuff."  If one asks, "Who are we fighting", the administration answers "Whoever the President says we are fighting against".  If one asks "When is it over" the administration either answers "Whenever the President says it is" or else, probably more honestly, they say "not for a long, long time."

In terms of civil liberties, the second point may be the most problematic.  Most citizens will grant the President some special war powers (as in fact the Constitution does), though we can argue whether the current administration has gone too far in defining these powers for themselves.   But if you combine this with letting the administration define exactly who the enemy is and how long the war lasts, it makes for a combination deadly to civil liberties.

Take the example of detention of enemy combatants.  Administration supporters argue that we have always been authorized to hold enemy combatants until the end of the war, as we did in WWII.  And so we did.  We were at war with Germany, so we detained German soldiers we captured until the end of the war.  Note that these are definitions that everyone at the time could agree on -- ie everyone knew what a German soldier was and everyone knew that "end of the war" meant when we marched into Berlin.  Few German detainees were held for much more than a year.  By the way, it is interesting to note that even in WWII, we abused this notion.  The administration defined "enemy combatant" as "anyone in the US of Japanese descent", so that we ended up interning innocent American citizens for years, much to our shame today.

However, in the current "war", an enemy combatant is anyone the administration says is an enemy combatant (at least in their theory) and "for the duration" means as long as the administration cares to hold them, up to and including "forever." 

Conservatives wish to argue that the "War on Terror" is a new kind of war and demands new tools to fight it, which they use to justify all kinds of secret searches and detainments.  Fine, but then it also needs new types of civil liberties checks.  Coming back to our detention example, in WWII it was not really necessary to have some kind of judicial review on the question of whether a captured German soldier was an enemy combatant;  the uniform was a pretty good giveaway.  However, such a review is necessary today, since the enemy combatants languishing at Gitmo (many of who I am willing to believe are bad guys) don't have any identifying uniforms or paperwork.

If I read him right, Kling is saying something similar:  Some security activities that were traditionally not allowed may be necessary, but for every civil liberties give-back there needs to be a countervailing new control or check on government activity:

On the whole, Posner makes a persuasive case for tilting the judicial
balance in favor of reasonable efforts to promote security rather than
strict-constructionist civil libertarianism. However, I believe that
what we need to do is re-build our civil libertarian fortresses, not
simply retreat from them. That is why I favor much stronger accountability for agencies engaged in surveillance. It is why I am proposing here a formal process for naming our enemies.

Michael strong has a great article in TCS Daily about Chinese citizens pulling themselves out of poverty:

Between 1990 and 2002 more than 174 million people escaped poverty in China,
about 1.2 million per month.

In part he credits America's newest great Satan, Wal-mart:

With an estimated $23 billion in Chinese exports in 2005 (out of a total of $713
billion in manufacturing exports),[2] Wal-Mart might well be single-handedly responsible for
bringing about 38,000 people out of poverty in China each month, about 460,000
per year.

There are estimates that 70 percent of Wal-Mart's products are made in
China.[3] One writer vividly
suggests that "One way to think of Wal-Mart is as a vast pipeline that gives
non-U.S. companies direct access to the American market." [4] Even without considering the $263 billion in
consumer savings that Wal-Mart provides for low-income Americans, or the
millions lifted out of poverty by Wal-Mart in other developing nations, it is
unlikely that there is any single organization on the planet that alleviates
poverty so effectively for so many people.[5] Moreover, insofar as China's rapid manufacturing growth
has been associated with a decline in its status as a global arms dealer,
Wal-Mart has also done more than its share in contributing to global peace.[6]

It is almost certain that abusive practices exist in some of Wal-mart's Chinese suppliers -- in particular, slavery and compelled work must end and be opposed by all of us.  But wages that are "too low" is not one of these abuses.  In fact, wages at these suppliers, that comfortable middle class Americans decry as too low from the safety of their Pottery Barn couch, are actually a victory for Chinese workers.  Strong provides the context that is always missing from attacks on Chinese wages:

If we care about alleviating global poverty we need to take this fact
seriously. Without Wal-Mart, about half a million of these people each year
would be stuck in rural poverty that is, for most of them, far worse than
sweatshop labor.

And he provides some context as well for the futility of charitable aid:

Other than economic growth, there is no way to double the salaries of a 100
million people (and growing). After the 2004 Asian Tsunami, more than one-third
of Americans gave more than $400 million in charitable aid, an extraordinary
outburst of giving by any standard. And yet there are more than 630 million
rural Chinese remaining, many of whom are living on less than a dollar per day.
While each would welcome a charitable dollar if we could get it to them, that
charitable dollar, representing one good day's worth of income, would not do
them nearly as much good as would a job in the city paying twice as much day in,
day out. Charity cannot take place on an adequate scale to solve global
poverty.

I made similar points in my post several years ago on why progressives hate capitalism:

Progressives do not like American factories appearing in third world
countries, paying locals wages progressives feel are too low, and
disrupting agrarian economies with which progressives were more
comfortable.  But these changes are all the sum of actions by
individuals, so it is illustrative to think about what is going on in
these countries at the individual level. 

One morning, a rice farmer in southeast Asia might faces a choice.
He can continue a life of brutal, back-breaking labor from dawn to dusk
for what is essentially subsistence earnings.  He can continue to see a
large number of his children die young from malnutrition and disease.
He can continue a lifestyle so static, so devoid of opportunity for
advancement, that it is nearly identical to the life led by his
ancestors in the same spot a thousand years ago.

Or, he can go to the local Nike factory, work long hours (but
certainly no longer than he worked in the field) for low pay (but
certainly more than he was making subsistence farming) and take a shot
at changing his life.  And you know what, many men (and women) in his
position choose the Nike factory.  And progressives hate this.  They
distrust this choice.  They distrust the change.  And, at its heart,
that is what the opposition to globalization is all about - a deep seated conservatism
that distrusts the decision-making of individuals and fears change,
change that ironically might finally pull people out of untold
generations of utter poverty.

When I get an odd or inappropriate Christmas gift, I usually get a good chuckle with the family and then try to figure out who to recycle it to next year (though the Chia Shrek may be a keeper).

When economists get a bad gift, they try to quantify deadweight loss to the economy.  And, according to Marginal Revolution, the number is substantial.

Update:  more here at TCS

I worry that global warming advocacy has crossed the line from science to religion, such that data counter to the basic mantra is considered heresy rather than scientific discourse. 

In my review of Michael Crichton's new book, I said I was sympathetic to his global warming skepticism but that I thought his characters and plot were over the top and he was too heavy handed with the polemic, which hurts any action novel.  Maybe I was wrong:

We have to offer up scary scenarios, make simplified, dramatic statements, and make little mention of any doubts we have. Each of us has to decide what the right balance is between being effective and being honest.

- National Center for Atmospheric Research (NOAA) researcher and global warming action promoter, Steven Schneider

More here from Arizona Watch.  I do disagree a bit with using the Nature Conservancy as a proxy for all environmental groups.  Though they advocate things I don't agree with, the vast majority of their funds go to actual preservation rather than political advocacy (unlike Sierra Club or others).  They are actually one of the better examples of trying to use private voluntary action rather than the government to reach some environmental goals.

I have written more on Kyoto here.  A good recent article in TCS by George Taylor talking about the panic around arctic temperatures is here.

Kyoto and similar protocols are dying, and for entirely predictable reasons.  Story in TCS from Buenos Aires.

The conventional wisdom that it's the United States against the rest of the world in climate change diplomacy has been turned on its head. Instead it turns out that it is the Europeans who are isolated. China, India, and most of the rest of the developing countries have joined forces with the United States to completely reject the idea of future binding GHG emission limits. At the conference here in Buenos Aires, Italy shocked its fellow European Union members when it called for an end to the Kyoto Protocol in 2012. These countries recognize that stringent emission limits would be huge barriers to their economic growth and future development.

None too soon for me.