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Garthnak
User: [info]garthnak
Name: Garthnak
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"Nobody can be so amusingly arrogant as a young man who has just discovered an old idea and thinks it is his own."
–-Sydney J. Harris
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One thing that I find particularly compelling is analyzing economic behavior through the actions of kids or children's stories.  They're simple and expressive - anyone can understand them.  I bring this up because of a couple articles I read recently, and because of one I read a while ago (though I'm sure they're not the only examples of this phenomenon):
If anyone knows of other examples in this vein, I'd be interested to see them.

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On a semi-related note, I encourage you all to read Russell Roberts's new article up on Econlib which I think does an excellent idea of explaining the economic way of thinking in mostly lay terms.  The task of economics is not to study money or prices or even businesses - it is to study "emergent phenomena", situations in human life that are a result of human action but not of human design.  For those of you wondering why gas prices are in a flux the way they are, and why most economists believe that political "solutions" like gas ceilings would not lead to desirable outcomes, I think you would derive benefit from reading it.

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(props to the Angry Economist)

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As B. K. Marcus points out, one of the most basic (and frustrating) arguments in political economy is the minimum wage.  It is frustrating because the misunderstanding about it is the cornerstone of a common misunderstanding of economics - the belief that economic problems can be legislated away.

Economics Ranting - PLEASE read )

If you remember nothing else about economics, at least remember this principle, as it was simply stated by Robert Heinlein:

There Ain't No Such Thing
As A Free Lunch.

(TANSTAAFL)

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Current Mood: frustrated
Current Music: Rush - Bastille Day

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This is too funny.  Thanks to Cafe Hayek.

Can you imagine?  This student is providing a valuable service to dorm residents, and the college newspaper is encouraging them not to take advantage of it because it might make other students cry. WAAAAAAAAH!  Boo-fucking-hoo.  How insecure are Harvard students that they would resent others for choosing to hire a cleaning service?  I don't think I want "unity" with a bunch of envious cry-babies, whether I could afford to hire Dormaid or not.  But this is just typical Leftist/Socialist "feel bad about your success" tripe, which of course we've all come to expect from mainstream academia.  Still, they must know by now...why do they keep supplying us with more ammunition?

And have we learned nothing from the Incredibles?

<comment-whore>Agree or disagree, tell me what you think.</comment-whore>

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Current Mood: amused

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Merry Christmas to all!  Yes, even if you don't celebrate it, you can still have one.

This time of year, it seems like libertarians like to weigh in on the Ebenezer Scrooge question, on both sides.  Here is a sampling from this year and years past:
What I Like About Scrooge - Steven E. Landsburg
Who's the Scrooge? - Roderick T. Long
In Defense of Scrooge - Michael Levin
A TCS Christmas Carol - Douglas Kern
I Am Ebenezer - Brad Edmonds
And other Christmas-related articles from economists:
The 12 Days of Christmas Index - PNC Bank
The Economics of Santa's Workshop - Michael Levin
Is Christmas Inefficient? - Jeffrey Tucker
A Capitalist Christmas - Dale Steinreich
Bethlehem's Economic Lessons - Lew Rockwell
Have a great day.  Oh, and if I notice anyone refer to Christmas as "X-mas", then so help me I will string you up with tinsel.

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Current Mood: cheerful
Current Music: "Weird Al" Yankovic - The Night Santa Went Crazy

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Via Econlog, a couple of articles comparing government to food selection, both very good.  First, Chris Dillow from Stumbling and Mumbling:
I’ve got an idea that would revolutionize the way we do our weekly shopping.

Every few years, we all vote for our favourite supermarket company. The one that gets more votes across the country than any other then gets to deliver our shopping every week to all of us, regardless of whom we voted for. It delivers goods of its own choosing, at prices that it sets. It will make us buy Pedigree Chum even if we don’t have a dog. If we refuse to pay, the supermarket can throw us into prison. And if we try to buy food from other shops, we will still have to pay the winning supermarket.

After a few years, at a time of the supermarket’s choosing, we get to hold another vote. This is the only say we get about the prices we’re charged or the food we get.

Now, this is probably the stupidest idea you’ve ever heard. But it’s exactly how we buy our political services.
A related story from Reason by Wil Wilkinson:
Imagine you live in a town where you are required to pay several thousand dollars of taxes each year into a public fund that is used to buy food for the entire community. There is a publicly elected “Menu Board” that determines each year’s offerings. You wanted rye this year? Sorry! The Board voted for Wonder Bread. Again! You could, in principle, opt out of the public food system and buy rye, pumpernickel, or seven grain oat-nut crunch at a fancy private store. But you’ve already paid thousands in taxes, and can’t afford to pay twice for everything you eat. The Menu Board picks it. You eat it.

Imagine the controversy. Vegetarians (“You’ll get lentil loaf and like it!”) will lock horns with the Atkins lobby (“You can have my bacon when you pry it from my dead cold fingers!”) to wrest control of the Menu Board. The kosher set will fight against shrimp-lovers; Mormons will rail against the Starbucks crowd; Hindus will agitate against the forces of barbeque.

Public school boards and curriculum committees are like menu boards for our children’s minds. Isn’t what we teach our children more important than what we feed them? Bitter and divisive conflict over curriculum is inevitable. Miller and Levine’s Biology is to creationists what pork is to Muslims. Getting a Cobb County sticker with your biology book is like getting a little note with your pork chop: “Warning: Not Halal.”
And, via a commenter on the Dillow article above, "What If Supermarkets were Run like Schools?" by Mark Harrison.

I am becoming increasingly of the opinion that our children are in dire straits if something is not done quickly (ie, within the next 10 years) about the public school situation.  Public schools are not cutting it, and throwing more money at the problem* is not helping.  Why do we have so much choice for supermarkets to provide food, which is vital - but so very little choice for schools, which are just as vital?  Why is this inefficient bureaucratized monopoly allowed to persist in spite of all of its shortcomings?  Have people really been so fully indoctrinated that they can not possibly imagine a world without public schools, that they believe something so necessary would be allowed to die if it were not provided by the State?  I just don't buy it.

School vouchers are probably our best bet right now - anything to put the fire to the feet of the people who are currently failing our children and demanding more money at the same time.  While I realise some people (*cough*public school teachers*cough*) find the idea just horrible, it seems to me the reasons are generally more of ignorance or stubbornness than of legitimate and fair consideration.  Talk about "reactionary" thinking - if you mention the word "voucher" around some teachers, they seem ready to bite your head off.  Who knew teachers were so..."conservative"?

* Updated: Since apparently the UC Hastings proposition search link was just for my session, it timed out. I have added below a table of education ballot propositions that have passed over the last 20 years.

Click here and search for "education and bond" and check "Passed". Over the last 20 years, I find no fewer than 14 spending propositions:
YearProp #NameBond issueEstimated Cost w/Interest
198426State School Building Lease-Purchase Bond Law of 1984$450,000,000$922,000,000
198653Green-Hughes Shool Builging Lease-Purchase Bond Law Of 1986$800,000,000$1,200,000,000
198656Higher Education Facilities Bond Act Of 1986$400,000,000$700,000,000
198875School Facilities Bond Act Of 1988$800,000,000$1,430,000,000
198878Higher Education Facilities Bond Act Of 1988$600,000,000$1,000,000,000
1988791988 School Facilities Bond Act$800,000,000$1,430,000,000
1990121Higher Education Facilities Bond Act Of June 1990$450,000,000$905,000,000
19901231990 School Facilities Bond Act$800,000,000$1,430,000,000
1990146School Facilities Bond Act Of 1990$800,000,000$1,430,000,000
1992152School Facilities Bond Act of 1992$1,900,000,000$3,300,000,000
1992153Higher Education Facilities Bond Act of June 1992$900,000,000$1,560,000,000
19921551992 School Facilities Bond Act$900,000,000$1,560,000,000
1996203Public Education Facilities Bond Act of 1996$3,000,000,000$5,210,000,000
19981AClass Size Reduction Kindergarten-University Public Education Facilities Bond Act of 1998$9,200,000,000$15,200,000,000
Total:$21,800,000,000$37,277,000,000

You may notice that some of these appear to be identical, except for a slightly different name and a different number - but they are in the same year. This is not a duplication - the voters passed two bond measures in both elections of the same year, at least thrice. In addition to this, note that in California public education facilities are allocated fully 40% of the annual state General Fund budget.

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Current Mood: contemplative

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Now this (from Marginal Revolution) is the way to do it.  Kids at an elementary school near Detroit are getting money for grades.  And look!  They'll even be getting a lesson in government oppression:
After the Christmas break, Knoper said the paycheck curriculum will be ramped up a notch when the kids start paying taxes on the hallways (a form of road tax) and playgrounds.
Maybe next they could start redistributing grades to some of the underperforming students.  "Sorry, Jimmy, you're not getting an A - Clarence has an F, so he's obviously more needy than you - we're giving you both C's instead.  Why are you crying?  Aren't you compassionate for Clarence?  Don't you want him to succeed too?  What a greedy little capitalist - you obviously don't understand that your grades are entirely due to society, and thus society has a right to take and redistribute them.  Go take a time out and read chapters 19 through 22 of Das Kapital."

Some of the students have even learned about tyranny of the majority and lobbying for special favors:
At one point, Knoper's students were selling items to each other, sending a mini-black market into full swing. Then the third-graders started to see the downside of the black market and voted to outlaw it, Knoper said. They've also learned -- like many adults -- that sharing money and loaning money among friends are bad ideas.
How nice of some third graders to vote to outlaw a practice that did not affect them unless they participated voluntarily in it.  They're learning splendidly from their parents - that if someone competes with you, all you have to do is lobby the authorities to take them out for you.

Of course, there are even predictable economic problems.  First, there is no wage competition - the students have a monopolist employer, and have no recourse to seek different wage-for-schoolwork opportunities.  Thus rewards are set arbitrarily.  Secondly, I'm going to assume that the supply of "Beverly Bucks" is not fixed, but is in fact printed by the very people paying the children.  Then again, this could give the children (and the teachers!) a necessary lesson in inflation and the problems with government debt-financing.  If the teachers are actually smart about economics, they may be able to correct it by altering wages or prices over time based on the current money supply - but somehow, I'm doubting they'll pay that close attention.  I'm getting pictures in my head of a Beverly Depression with 8-year-old hoboes doing homework for other children for a wheelbarrow of Beverly Bucks.

Notice there is even a problem of scarcity:
Across the hall, one student was almost in tears. The radio pens sold out before he could get one. Even at $100, the pens were extremely desirable items and teacher Kim O'Rourke promised to look for more of them.
And the scarcity is made worse by what probably amounts to price controls (or at least price inflexibility - the administration of the school store by bureaucrats rather than businessmen whose income is tied to the store's earnings).  The pens that students purchase for $100 sold like hotcakes, apparently - if the price had been adjusted higher due to demand, perhaps the student would not be weeping and would have one instead.  Ah, the valuable lesson that price gouging is good.

But, despite the niggling economic issues, I still think that on the whole this is a valuable teaching method.  It gives students a concrete positive incentive, rather than merely fear of retribution when their parents receive a report card.  I'm sure detractors will complain that it is conditioning children to become little consumers - but then, I don't really have a problem with rational consumerism, and it is better to teach the children about it earlier rather than later if they are to make wise purchasing decisions in the future.

I actually experienced something similar to this when I was in first grade, and I lovedit.  Mrs. Gallo, our teacher, would hold class-wide oral quizzes and we would receive play-money in exchange for correct answers.  The play-money could be spent after the quiz at Mrs. Gallo's "shop", which she would set up on a blanket in the middle of the classroom - it would have erasers, pencil sharpeners, and other little school-related supplies, all marked with certain prices in play-dollars.  I remember happily purchasing a multi-colored eraser one time, and looked forward to these quizzes with great enthusiasm.  Purchasing power, when there are things you wish to buy, is a powerful motivator for success.  I wish Beverly Elementary all the best.

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Just because I know someone would hate it if I cluttered up her journal with ramblings about politics and economics, I'm going to post my own analysis to a particular article right here.

With regards to Arnold's "economic girlie-men" comment, I thought it was just meant as a joke.  What he's referring to is that the economy's getting better, and while I actually do share many of Bill Mann's concerns as well, I don't think that's necessarily a reason to be "pessimistic" - though we certainly should be cautious.

Frankly, Arnold and the president differ quite a bit ideologically about the economy, and I heard rumblings among Republicans on the John Ziegler show last night about how they felt Arnold's speech wasn't enough of an endorsement of Bush. I think that's because Arnold is two things - he is economically more conservative than Bush and socially MUCH more liberal than Bush. The fact that he grew up in (and left) a socialist country, and many years ago showed up at a Reason Foundation banquet leads me to believe he has some fairly libertarian leanings. I'm sure he has no illusions about the economy being perfect, or about America being perfect.  What I do think is that he was under a lot of pressure from the Republicans to come out and endorse Bush (who he's been fairly luke-warm on since he was elected).

Arnold's statement about the economy being better is reflective of a larger problem - not just Democrats, but most people seem to still believe that the economy is stagnating and not improving. There was an article in The Economist a couple months ago on this subject.  Contrary to popular perception, inflation has remained relatively low and stable this year and job creation has been skyrocketing compared to what it was over the last two or three years.  None of that really has anything to do with Bush, of course - though his piddling tax cuts may have helped, they weren't the reason.  What is happening is that we are recovering from the recession. Yes, job creation is slower than it was before - but that's because we're recovering from a recession.

Now, I've still got reservations about the economy, though I still wouldn't call myself pessimistic. Some of the things I've been reading lately leads me to believe that the fed hasn't been doing so hot a job lately, that they authorized too much monetary inflation which could catch up with us over the next few years. That's impossible to predict, however. For the time being, I remain - if not optimistic, then at least realistic. The economy will work itself out. What I do know is that I do not trust either Bush or Kerry to handle it when it does (for good or ill), though.

Makes me almost want to waste my vote.

In other other news, I'm single again.

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