Solution? Economic Growth

Tamny always cuts through the crud:

What used to end careers in basketball no longer necessarily does.

Notable about this is that all manner of maladies not related to sports used to amount to death sentences. As this column routinely makes plain, pneumonia used to be “Captain of Man’s Death” per the late surgeon and author, Lawrence D. Dorr. Tuberculosis was a quick life ender too. So was yellow fever. Cancer was a certain killer, but then most didn’t live long enough for some form of cancer to get them. See what used to bring on mortality first.

So what happened? Economic growth did.

Tamny Strikes Again

The incomparable Tamny! He thinks in such unfamiliar ways it is like a workout to read his stuff - but because the light of clarity is so satisfying, it is always worth the effort.

To which some will say “yes, but,” only to mention all manner of ridiculous (in retrospect, of course) internet companies that went public over twenty years ago. There’s your “bubble,” right? Wrong. Lest readers forget, Amazon’s share price fell into the single digits in 2001 after all too many ridiculed its formerly triple digit valuation. Amazon was once “Amazon.org AMZN -0.9%,” and it was for a time one of the more public faces of an “internet bubble” having “burst.” “.org” for Amazon was a joke about its “non-profit” status. What’s perhaps “obvious” now about good and bad internet companies wasn’t obvious at the time. What’s transformative yet again is a magnet for all sorts of investment that often only becomes understandable well after the fact.
“Yes, but” what about the housing “bubble” in the 2000s? Glad you asked.

https://www.forbes.com/sites/johntamny/2021/02/07/a-modest-proposal-to-voluntarily-abolish-the-word-bubble/?sh=378fd9e2710b

Why The Rich Pay For Everything

I'm always glad to see Tamny's stuff and this one is more readable than most, and just as helpful to be clear about the significance of human freedom to human well being.

I hope the good doctor found as much satisfaction as it seems like he should have ... some of the successful do not. 

 https://www.realclearmarkets.com/articles/2020/12/29/remembering_the_great_lawrence_d_dorr_md_654733.html

As good to re-read as it was to read the first time ...

Two hundred years ago the American people were quite a bit more equal in terms of wealth, and life was marked by unrelenting drudgery. Those relatively brutal living conditions weren’t an effect of socialism, even though socialism would have eventuated the same outcome.

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Cooperative exchange is the highest form of human interaction.

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The shame of socialism is that the wildly talented are restrained from profitably improving the lives of the people around them, and perhaps continents away. Thinking about life two hundred years ago, distance was a severely limiting factor for the talented when it came to making things better for everyone. No doubt there were people with skills similar to those of the richest Americans today, and some became very well-to-do by early 19th century standards. But they didn’t become staggeringly rich simply because a lack of technology limited the ability of the ‘1 percenters’ of the early 19th to touch the U.S. (and the world) with their genius. Limited technology has socialistic qualities in the outcome sense for it restraining the brilliant from improving the lives of others while getting rich for doing just that.

 https://www.forbes.com/sites/johntamny/2018/11/11/surging-wealth-inequality-is-a-happy-sign-that-life-is-becoming-much-more-convenient/?fbclid=IwAR3BbDsvASk_GAtBhFiiO3KtAxq5wHf8sSXies80B4IBUvXsc-McUme928I&sh=2657557064ca

The scarcity mentality leads folks to believe that if one person is rich, the wealth must come at the expense of another person. What the wealthy do in a capitalist economy is create more wealth - more stored human time and energy - through cooperative exchange.

Free Your Mind and Your ....

Football exploits?

 https://www.realclearmarkets.com/articles/2020/09/25/ignore_the_emotional_college_football_players_are_not_exploited_578191.html

"But think of child labor laws ..."e

This is one of my favorite insights about such things as child labor laws - they take effect at the point that they are almost not needed. 

"Actually, it wasn’t child labor laws that let them escape from child labor: it was economic growth. As people grew wealthier, parents no longer needed their children to be productive. Instead, they could support the family without their children’s income and so instead could send their kids to school. And incidentally, as E.G. West showed in Education and the State, the state in Britain was not a major funder of education and yet schooling was widespread.

"It is true that child labor laws reduced child labor around the edges. But they’re an instance of what is almost a general law in economic policy. I’m using “general law” in the sense of regularity. The laws that pick up enough support are usually ones that require people to do what the majority are doing already. I believe for example, although I can’t find the source immediately, that the legislated 40-hour work week came about only after it had become standard practice."

https://www.econlib.org/orourke-on-the-millennials-and-socialism/

Putting Money in the Pockets of the Citizenry

Amy Johnson, a nurse practitioner, spoke at the South lawn event about how deregulation and modernization of the federal healthcare bureaucracy had aided healthcare providers in rural areas who are now able to use telehealth to dramatically expand the range of services available to patients.

Similarly, Arizona rancher Jim Chilton spoke of a much-needed reprieve from the Obama-Biden administration’s notorious Waters of the United States rule, which allowed federal bureaucrats to regulate private land with almost no restrictions. In Chilton’s case, the government decreed that the “dry washes” on his property constituted “waters of the United States” because, despite having no water, they have at least 12 inches of sand at the bottom.

During his first year in office, the president delivered on his campaign pledge to reduce the tax burden on ordinary Americans, signing into law historic tax cuts. But, because tax cuts get all the fanfare, not everyone is aware that deregulation is actually just as — if not more — significant.

For example, the Competitive Enterprise Institute, a libertarian think tank, estimates that government regulation is a “$1.9 trillion ‘hidden tax’” which “is greater than the corporate and personal income taxes combined.”

https://www.foxnews.com/opinion/trumps-deregulatory-agenda-andy-puzder

On the Basics of Capitalism aka Cooperative Exchange

A reminder of the basic ideas of corporations and risk.

https://www.nydailynews.com/opinion/ny-oped-the-wrong-coronavirus-stimulus-20200323-h6erlkfgvjg5vlmrizphmgpdb4-story.html

It is not Tamny's easiest writing to understand but I wish I could master his ability to cut through all of the incorrect thoughts we all share about what government is and is not, and how little people understand what they are talking about when they talk about the actions of governments against the people that fund them.

To which one assumes conservatives will reply per the editorial that this is a “liquidity panic," and since it is, the federal government must step in. Except that tight liquidity is a market signal like any other; in this case one logically signaling horror on the part of investors that politicians on all levels are in the process of forcing a centrally planned economic reversal on the most dynamic economy in the world. Conservatives claim to revere market signals, market signals are presently telling politicians to stop the economic asphyxiation they’re forcing on the economy, but conservatives want taxpayers to blunt the signal?
https://www.realclearmarkets.com/articles/2020/03/18/dear_conservatives_if_you_bail_out_everyone_you_bail_out_no_one_486845.html?mc_cid=cdc4762403&mc_eid=7eb43cc72c

Tamny Wins

https://www.realclearmarkets.com/articles/2019/08/15/dear_catherine_rampell_the_former_soviet_union_had_many_experts_too_103850.html

A frequent theme in this column is one about the fallability of the brilliant. Jeff Bezos regularly acknowledges how often his experiments prove much less than great, the best venture capitalists admit that more than nine out of ten capital commitments result in bankruptcy, and then the world's best traders note that they're wrong almost as often as they're right. It's incredibly difficult to predict the future, and that's an understatement.

Love Workers?

Businesses don’t exist to create jobs. If readers doubt this they need only try to raise start-up funds with “creating jobs” listed at the top of their business plan. Lots of luck finding investors when your goal is costs, as opposed to returns.

Crucial here is that the desire for returns among investors is what indirectly leads to copious hiring. Workers enable the returns that entice those with means to delay consumption in favor of the investment without which there are no companies, jobs, and progress.

Still, it’s the investment returns that matter simply because they beget more investment. If you love the worker, you must love much more the investors who make work opportunity possible in the first place.

https://www.realclearmarkets.com/articles/2019/01/03/if_you_love_workers_you_must_love_investors_even_more_103560.html

Flippy is the man

"But to show readers just how similar and tribal left and right in the U.S. have become, consider the rollout of Flippy.  Flippy is a robot “employee” of the Caliburger chain, and he is apparently able to cook as many as 2,000 hamburgers per day.  Interesting about all this is that while Reagan’s backers once defended him against the assertion that his policies were only creating fast food jobs, modern members of the right are now criticizing lefty policies that are allegedly – drumroll please – destroying those same jobs.  It would be funny if it weren’t so sad."
https://www.realclearmarkets.com/articles/2018/03/13/flippy_the_burger_flipping_robot_is_not_a_creation_of_naive_wage_floors.html

Economics Is Anything But Dismal

Well written econ is a delight.  Tariffs are still dumber than a post.
https://fee.org/articles/economics-was-invented-to-refute-trumps-tariff-arguments/

Precision in Language

Everyone knows that correlation doesn’t equal causation, but somehow people seem to forget. Endogeneity is a word that can help you remember. Something is endogenous when you don’t know whether it’s a cause or an effect (or both). For example, lots of people note that people who go to college tend to make more money. But how much of this is because college boosts earning power, and how much is because smarter, harder-working, better-connected people tend to go to college in the first place? It’s endogenous. The media is full of stories about how which kind of people stay married, or what diet is associated with better health. Whenever you see these stories, you should ask “What about endogeneity?”
https://www.bloomberg.com/view/articles/2017-01-05/5-economics-terms-we-all-should-use

If things are getting hotter and carbon levels in the atmosphere are rising, does that mean carbon is causing the temperature changes?  Or are warmer oceans off gassing more carbon dioxide?  Hmmm....

Grow or Die

With 4% growth, most of the federal government's shortages - the ones we fight over - would go away. I don't know if an economy as large as ours can grow at that rate, especially when the rest of the world is stuck in the economic muck of authoritarianism. Growth rate increase should be the priority, it nudges every other lever for humans to thrive.
http://www.wsj.com/articles/the-entrepreneurial-way-to-4-growth-1479254382

They Are Plenty Smart at Being Politicians

Brilliant.

The whole article.

"Facing additional headwinds were the long-planned D.C. stores, and not just due to the regulatory hurdles and lobbying fees the company endured before being permitted to enter the market. Since then, a ballot measure seeks to boost the local minimum wage to $15 from $11.50, and the city has proposed legislation to mandate minimum hours for part-time workers and impose new family- and medical-leave requirements.

So Wal-Mart told city officials that the stores couldn’t be profitable and it was nixing them. 

To the politicians who serve as gatekeepers to opportunity, which first requires erecting obstacles to opportunity, the company has become unfit for citizenship in their republic of rent-seeking. “I’m blood mad,” Mayor Muriel E. Bowser told a news conference. “This is devastating and disrespectful to the residents of the East End of the District of Columbia,” former Mayor Vincent Gray told the Washington Post.

The proverbial Martian would wonder why politicians are surprised by a shortage of jobs for their constituents, when they continually promote policies that drive jobs away."

http://www.wsj.com/articles/bad-days-for-wal-mart-americans-1453247631

Goldilocks and Oil

Informative about the interaction between pricing and oil production, as well as showing how little the oil companies control production/price.
http://resourceinsights.blogspot.com/2015/10/goldilocks-and-three-prices-of-oil.html

"The Press", A Joke

And yet, so far no reporter has raised the possibility that Yee supported tighter restrictions on guns in order to keep gun prices high and his own services in demand. Economist Bruce Yandle popularized the idea of the “Bootleggers and Baptists” coalition. The apocryphal Baptists want to ban alcohol. Bootleggers don’t make much money when liquor can be bought legally at a grocery store or bar. So the bootleggers bankroll the Baptists’ effort to ban booze.

Now I sincerely doubt that Yee was that clever. The more likely explanation is that he believes in gun control and he’s a greedy hypocrite (and maybe not too bright either). The fact that gun-control policies are to his advantage is just a happy coincidence.

What’s interesting — and vexing — to me is that this sort of analysis is all the rage when it comes to conservatives and Republicans, and utterly incomprehensible to most journalists when it comes to liberals and Democrats.

Read more: http://www.realclearpolitics.com/articles/2014/03/31/leland_yee_the_kochs_and_the_press_122114.html#ixzz2xXWX76ME 
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"I'm a Believer"

All the evidence, then, points to substantial positive short-run effects from the Obama stimulus. And there were surely long-term benefits, too: big investments in everything from green energy to electronic medical records.

So why does everyone — or, to be more accurate, everyone except those who have seriously studied the issue — believe that the stimulus was a failure? Because the U.S. economy continued to perform poorly — not disastrously, but poorly — after the stimulus went into effect.

http://www.nytimes.com/2014/02/21/opinion/krugman-the-stimulus-tragedy.html?partner=rssnyt&emc=rss&_r=0

Interesting expression of faith.  By what means could we "know" what would have happened without the stimulus?  Dr. K moves with ease from the role of economist to true believer.

"Big Investments"?  Where the money bro?

The Mobility Muddle | RealClearPolitics

By the conventional wisdom, American society is becoming more rigid. People's place on the economic ladder ("relative mobility") is increasingly fixed.

Untrue, concludes the NBER study. (The study is NBER Working Paper 19844.)

"We find that children entering the labor market today have the same chances of moving up in the income distribution (relative to their parents) as children born in the 1970s," write the economists. Comparing their results with earlier studies covering 1950 to 1970, they also find little difference. Social mobility "remained remarkably stable over the second half of the 20th century in the United States," the study says.

Moreover, there's significant shifting among classes. About a third of the children born into the wealthiest fifth of Americans stay in the richest fifth as adults -- but two-thirds move down. Among children born to parents in the middle 20 percent by income, about a fifth end up in the richest fifth, as do about 9 percent of children born to the poorest fifth of Americans.

Read more: http://www.realclearpolitics.com/articles/2014/01/25/the_mobility_muddle_121352.html#ixzz2sHFQiRpP
Follow us: @RCP_Articles on Twitter