Red Sox Recap

Sunday was an amazing day as the Boston Red Sox won the World Series on our birthday.  It was a double celebration.  We have four comments.

First, the Sox were dominant.  They were dominant in the regular season by winning 108 games.  They were dominant in the postseason going eleven and three.  Two of the teams they beat in the playoffs had won 100 games.  It was one of the great seasons in MLB history.

Second, young New England fans are spoiled. We went oh for 90 last century with the Sox and Pats.  This century the have combined for nine championships.

Third, as we discussed a few days ago David Price could improve his Hall of Fame chances with a good start.  He did even better with two wins based on excellent starts. If he finishes up his four year contract with the Sox he should be in great shape.

Fourth, talk of dynasty is premature because the Sox are going to have budget problems.  Currently, the Sox have the highest payroll in MLB at $234 million but their best player, Mookie Betts, only gets $10.5 million and they have several other young players that will get big increases soon.  Those salaries will go up by a large amount soon.  What will happen to critical players like Steve Pearce and Nathan Eovaldi?  It is going to be an offseason of tough decisions for the Sox.  We hope they show great wisdom but baseball futures are hard to predict.

We will enjoy this glorious year.  We will try to keep future expectations at a reasonable level.  The former will be easy but the latter will not.

The Growth Fairy Visits

Economic growth created our current state of economic grace.  Deirdre McCloskey calls it The Great Enrichment.  Jonah Goldberg calls it The Miracle.   Both of them would agree, we think, that it wasn’t planned.  After thousands of years of human life being short and brutish, in the past few centuries there has been a dramatic change in the quality of human life.  The [economic] growth fairy visited, because of the miracle of compound interest (separate from Jonah’s Miracle), and left us with riches and resources that the richest folks from a century (and especially two) could not imagine.

As an example, Jules Verne published Around the World in 80 Days in 1873 (set the year before).  The hero takes over, Wikipedia helpfully converts it into 2017 pound sterling, two billion pounds or about three billion dollars to make the trip.  We will take the Lady de-Gloves to Changsha, China in a little over a day for about a thousand dollars (and another thousand for the round trip) in a few weeks.  It is a nice comparison of how life has change in a century and-a-half.  Ordinary people now can do far more than the rich could do ten or 15 decades ago.

Economic growth is crucial to our future well being.  If the economy grows at one percent the compound growth over your child or grandchild’s 80 year life span is about 120% but at three percent it is about 960%.  It is a big difference.  It is important because the growth fairy has revisited the US economy after being away for a few years.  The WSJ tells us:

The Commerce Department reported that the economy grew at a robust 3.5% in the third quarter, a mild slowdown from 4.2% in the second. Consumer spending led the way with a 4% increase rooted in a tight job market and wage gains that have bolstered economic confidence. The economy has now grown by 3% over the last 12 months.  The U.S. economy hasn’t grown at 3% in a calendar year since 2005…

We, along with the WSJ, John Taylor:

When policy moves closer to those three attributes, as in the 1980s and 1990s for the advanced countries and more recently for emerging market countries, the economy does well, growing in a stable manner. When policy deviates from those three, as U.S. monetary policy did going into the tragic global financial crisis, the economy does poorly.

and many others believe in the growth fairy.  We do not believe that we can eliminate economic cycles.  Rather, we believe that good policy leads to, on average, better results and bad policy leads to bad results.  There are numerous examples of bad policy with Venezuela being close to the worst possible policies.  We think the WSJ is pretty close on its summary of good and bad policy in the US:

Can economic growth from tax reform and deregulation stand up to the headwinds from higher interest rates, tariffs and perhaps a Democratic Congress?

The WSJ position on interest rates isn’t clear.  It seems like they are saying increasing interest rates are a problem but are they suggesting action to reduce them?  We are with John on a rules based monetary policy rather than worrying about and trying to manipulate interest rates.  So do you believe in fairies?  This is one you really don’t want to die.

 

Tony Evers And The Minimum Wage

In Wisconsin we have, for some reason, a tightly contested race for governor between Republican incumbent Scott Walker and Democrat Tony Evers.  It seems, based on the news, like it should be a cakewalk for Scott.  For example, the front page of the local paper reports record low unemployment. A regional employer is offering free rides to their place of business to try and attract employees.  Economic growth continues to hum along.  It is hard to see why there is a contest.

Sidebar One: Try Googling Economic Growth In The Third Quarter.  Several of the articles emphasize that growth slowed from 4.2% to 3.5%.  Of the last 16 quarters only the 4.2% is higher.  End Sidebar One.

It appears from the advertising that fills the airwaves some folks are upset that Scott ran for president two years ago.

One silly part of Tony’s platform is his support for a $15 (yup, that is fifteen dollars an hour) minimum wage.  According to the Wisconsin State Journal as reported in the local newspaper:

Sidebar Two: Close to always we go and find Internet sites for this stuff but this seems well established.  End Sidebar Two.

[Tony], who has touted his support for a $15 [fifteen dollars!] minimum wage in Wisconsin, also said he is open to exceptions to the $15 minimum wage in rural areas and for teenagers.

When we see proponents for raising the minimum wage we always wonder if they are knaves or fools.  Tony has created a third category.  The fools think it is a good idea.  They don’t understand that, amongst other things, workers need to accumulate personal capital to be more valuable to employers.  One crucial way to accumulate such capital is working.

The knaves think that raising the minimum wage will benefit some group they favor.  It might create more government dependency and benefit government workers.  Some union contracts have clauses about the minimum wage and an increase in it might help some union workers.  And there are numerous other possibilities.

Tony, the third possibility, appears to see the minimum wage as a purely political play. He seems to recognize that it is a bad idea and that we can’t punish everyone and so we need exceptions but he continues to tout the idea as part of his platform.  We find that his position is more disappointing that either the knaves or fools.

David Price And The Hall Of Fame

We are just back from a family vacation, waterslides and MagiQuest with the grand-de-Gloves, so we need to catch up with old business.  One of those is David Price’s impressive outing beating Justin Verlander to win the ALCS.  It was nice to see him do well and great to see him handle it well.  David had an abysmal record as a starter in the postseason.  We will cheat slightly by only looking at his ALDS record.  His ALCS record has already been updated for his recent stellar outing and he was a reliever in his only World Series appearance until tonight.  His ALDS record is 1 and 8 with a 5.63 ERA.  The record for postseason losses is 16 by Tom Glavine but Tom won 14 and had a 3.30 ERA so we are not sure if David was the worst postseason pitcher of all time but he is in the running.

His strong performance in clinching the pennant for the Red Sox will get him lots of attention.  Our question is about the Baseball Hall of Fame (BBHOF).  As we see it for pitchers, the BBHOF is all about wins and awards.  Currently David has a regular season record of 143 and 75.  He won the AL Cy Young Award and is a five-time all-star at age 32.  In 2018 he was 16 and 7.  He is way behind Clayton Kershaw who is 30 and has been a seven-time all-star, three Cy Young Awards, four other top fives, and an MVP Award.  Despite Clayton’s inconsistent postseason form he looks to be a first ballot BBHOF guy.  Perhaps even if he doesn’t pitch again.

David is unlikely to be a first ballot guy but if he can continue near his recent form, let’s say 15 and 10 for six more years, would make him 233 and 135.  Currently, the top three active pitchers by wins are Bartolo Colon, age 45, (247-188), CC Sabathia, age 37, (246-153), and Justin Verlander, age 35 who David bested (204-123).  Justin is close to a sure thing as a seven-time all-star with a Cy Young and MVP.  CC is likely while Bartolo is unlikely.  David has a long way to go but he has a chance at the BBHOF.  A few more good outings in the postseason might get a few more votes.  We hope that a great one comes tonight.  Time to turn on the tape.

Stress Test

Yesterday’s Patriot and Red Sox games were a real stress test.  We think we are still alive so we passed.  In one evening the Pats gave up 31 second half points and they able to win with a field goal on the last play of the game.  The Red Sox, in a close to must win game, gave up a run in the ninth and the last out was caught on the warning track.  Phew!  It was almost too much for one night.

For most of our lives the Red Sox and Patriots rarely played meaningful games and on those rare occasions usually managed to lose them, often in memorable ways.  For awhile the Pats had the worst loss in the AFL Championship and the Super Bowl.  Nope, we are not going to link to Bill Buckner.  It is better to have stress on a regular basis if you have championships in the bank.

Politics Of Minimum Wage

The Editorial Board at the WSJ has a real man bites dog story that led us to recognize another side to the minimum wage dispute.  In Revolt Of The Tipped Masses the editors describe the conflict between the Washington DC City Council and the workers they are allegedly trying to help.  Here is the part that turned on the light for us:

Before the measure passed in June, many restaurant workers wore buttons asking patrons to “save our tips” and “vote no on 77.” When Washingtonians passed the measure anyway, the workers pushed for repeal. Though restaurants pay a $3.89 hourly wage to tipped workers, “we choose these jobs because we make far more than the standard minimum wage” from tips, bartender Valerie Graham told the City Council.

As Valarie says, especially in an elite establishment in a big city like DC folks can be making a tidy sum on tips.  A high minimum wage effectively eliminates tips.

Sidebar One: Many of them are not declaring the full amount of tips to the IRS.  It is not relevant to us here but it does increase the incentive to fight City Council.  Partially taxed higher amount is way better than fully taxed lower amount.  End Sidebar One.

Sidebar Two: We are heading for China later this year.  One thing every person emphasizes is that there is no tipping in China.  End Sidebar Two.

What we recognized is that there are two groups of workers adversely affected by minimum wage legislation.  We always emphasize the folks who will lose their jobs and it is a bigger deal to lose your job than to take a pay cut.  The pay cut is a pretty big deal too.  Remember what Valarie said: “We chose these jobs…”  She is a person worth listening to.

Free Trade Agreements

We are for unilateral free trade.  We favor eliminating all US tariffs.  We are OK with helping other countries by reducing their taxes including tariffs but it isn’t really important to us.  Thus any free trade deal is a second best solution for us.

Iain Murray at NRO brings us an interesting issue of all the additional agreements that have cluttered up trade agreements.  Do read the whole thing for a good discussion of the trade-offs.  He says:

Trade deals are better than no trade deals, generally speaking. But bad trade deals can set dangerous precedents. That was why in the 1990s, the staunch free trader Fred Smith, founder of the Competitive Enterprise Institute (where this author works), opposed the North American Free Trade Agreement’s (NAFTA) inclusion of side agreements that had nothing to do with trade. He worried that those provisions, mainly concerning labor and environmental standards, would set a precedent to elevate those goals above tariff reduction—the supposed point of trade deals.

Was he right? The conclusion of NAFTA’s renegotiation, the U.S.-Mexico-Canada Agreement (USMCA), suggests he was.

USMCA has 34 provisions, 13 annexes, and 13 side letters.  Iain is right that the expansion of such agreements is a problem.  Some times the problem is a bit of neocolonialism and other times it is the reverse.  We are against both but especially the latter because we live here.  It could be solved most easily with our suggestion of eliminating all US tariffs because.  The problem is that free trade is only high political priority for a few of us.  Many people oppose free trade.  Some folks support neocolonialism and others the reverse.

Free trade is a high priority for us just like Fred but we tend to support such agreements.  It is clear to us that we are not going to take our preferred step of eliminating all tariffs.  It is equally clear that agreements will need to be complex to garner sufficient support to be agreed to by the administration and supported by the Senate.  Rejecting such agreements because they are not ideal is eliminating the possibility of any agreement.  It is a binary choice to approve or reject USMCA.  We vote to support approval of USMCA despite its flaws.

A Tale Of Four Countries

To adapt Dickens to our current situation: It is the best of times, it is the worst of times.  That is what Liam Halligan is telling us at UnHerd in [Theresa] Should Set Her Sights On Crony Capitalists.  Liam says the Brexit is not the most important topic for the Tories. It is rebooting capitalism and part of that is fighting crony capitalism.  We tend to agree.

We are only mildly supportive because we don’t like the term crony capitalism (CC) and Liam is really vague about how to fight it.  CC is when the government alters the market to favor certain parties.  A classic example is taxis.  We see the cronyism but not the capitalism.  The best way to fight CC is by reducing regulation.  Liam is vague about what he wants yo do to fight CC and his only real suggestion seems to be more regulation for big entities:

Big companies across the Western world have become far too powerful. Our political, business and media elites are much too intertwined. Such cosy relationships have resulted in an enfeebled competition policy, which is further increasing the might of a small number of corporations, to the detriment of consumers, smaller firms and broader society. [Emphasis added]

We are not sure where Liam is going but if he really wants to fight the cronyism in CC then we are with him.  On the other hand, more regulation will make these entities even more intertwined.

It is the best of times.  Liam reminds us that capitalism has enriched everyone everywhere it has been applied:

Or that, since the late-80s fall of the Berlin Wall, the spread of capitalism has enriched billions – with the share of the global population in extreme poverty plunging from two-fifths in 1990 to under one tenth today.

It is the worst of times as socialism has been tried repeatedly and devastated wide areas of the globe:

No matter that the Soviet Union collapsed under the weight of its economic contradictions. [here is remembering the start of the terror]

Of course, Venezuela is a current example that socialism always fails.  The talented and beautifully named Mary Anastasia O’Grady tells us a story of Why Central America Stays Poor in the WSJ.  We are unsure if we disagree with Liam because he is so often vague about evidence and recommendations.  We disagree in part with Mary but we are sure about it because she writes so clearly:

Nature can be cruel in underdeveloped countries. Yet it wasn’t fire, flood, mudslide or volcano that served this economic gut punch. This is a man-made travesty, courtesy of Guatemala’s Constitutional Court. It is a saga worth recounting because it goes to the heart of the country’s intransigent poverty.

Mary lays the problem at the feet of Guatemala’s Constitutional Court for their interpretation of a treaty:

[T]he United Nations International Labor Organization’s Convention No. 169 states that indigenous peoples living in the area of development projects need to be consulted. Guatemala is a signatory to the convention.

We think some of the blame should go to Guatemala for approving the treaty.  Conservatives recognize the folly of vague treaties, laws, and regulations that sound good because they can come back to bite you just like they did for Guatemala.  Even Progressives can become textualists when it benefits them.

To get back to Dickens is the worst of times because of public and media attitudes.  Liam reports that:

A recent YouGov poll suggested around 60% of voters think the railways and Royal Mail should be renationalised. Over half want the water and energy companies back in public sector ownership. A ComRes survey earlier this year showed that young British adults now think capitalism is more dangerous than communism.

Liam seems to think we should accept such foolishness rather that try to educate folks.  It is true that socialism doesn’t work but folks need reminding.  The attitude towards communism is astounding and another reason for education.

It doesn’t help that the Labor party is headed by Jeremy Corbin.  Liam describes Jeremy’s proposals:

And that’s [what we would call bad reporting] allowing [Jeremy] to present, with some success, his programme of aggressive renationalisation, sweeping trade union powers and highly punitive taxation as “the new common sense of our time”.

The next part of Dickens applies even more: It is an age of wisdom, it is an age of foolishness.  The USSR, Venezuela, and Guatemala offer lessons for the UK.  The first two remind us that socialism, government control of the economy, doesn’t work.  Liam reminds us we need reminders.  Guatemala reminds that treaties, laws, and regulations are written and need interpretation and application.  Much of CC lies in the interpretation and application of such documents.  Some is in the creation of such documents.  If we mean to fight CC we should be at least judicious in the creation of such documents and recognized the need to revise them as necessary.

We’d like to say that it would be a far, far better thing than they had ever done before if the Tories really fought CC but the Tories saved Western Civilization from fascism under Churchill and saved the UK from another form of socialism under Thatcher.  But it is still a really good idea and fighting CC will be a worthy challenge.

That Strange Tribe

Mark Sherman of the Associated Press was on the front page of the local paper with an unmarked opinion piece on the outcome of Brett on the Supreme Court.  As we and many others have noticed progressives like Mark approach conservatives like they have never met one.  Whatever the reason, Mark’s discussion seems very odd to a conservative because it is not how we think.

Sidebar: Deciding who is a “true” conservative is a difficult task.  Yes, we are aware of the no true Scotsman problem and that conservative are a small part of the big Republican tent.  We think the critical demarcation for conservatives is process.  To oversimplify, conservatives think about process while progressives think about outcomes.  End Sidebar.

We know it is a long quote but here are Mark’s first three paragraphs:

The moment conservatives have dreamed about for decades has arrived with Brett Kavanaugh joining the Supreme Court. But with it comes the shadow of a bitter confirmation fight that is likely to hang over the court as it takes on divisive issues, especially those dealing with politics and women’s rights.

With Kavanaugh taking the place of the more moderate Anthony Kennedy, conservatives should have a working majority of five justices to restrict abortion rights, limit the use of race in college admissions and rein in federal regulators.

The newly constituted court also might broaden gun rights, further relax campaign finance laws and halt the expansion of the rights of LGBT people, who three years ago won the right to marry nationwide with Kennedy in the majority.

Mark has a whole list of outcomes that he is concerned about.  For most of the rest of the article he tries to convince the majority that to use the majority would erode the court’s legitimacy.  We read that part so you don’t need to.

Conservatives are happy because there appears to be an originalist Supreme Court majority.  That majority may lead to some outcomes that conservatives prefer as well as some they don’t.  It will be interesting to see if the progressives continue to vote as a block or will  try to influences outcomes by being part of the majority.  Legal scholarship is not our area but we expect less predictable patterns from the new court.  Perhaps when we have an unhappy outcome we can commiserate with a progressive like Mark.

Brett And Sue

We reading Sue Grafton’s V Is For Vengeance as the Brett nomination follies were going on.  Reading was much better than watching the follies.

Sidebar: Sue wrote 25 alphabet mysteries with her plucky but foolish PI Kinsey Millhone.  We are reading them in order.  V was written in 2011 but it was set in 1988.  One of the joys of the series is Sue is loves to find the right word and the obscure fact.  If you are going to read them you need to read them all because it is like a TV series with the same characters showing up here and there.  End Sidebar.

The confirmation is good for our Republic, excellent for the Republicans, and great for The Donald.  It is good for the country because the Democrat behavior has failed.  It is excellent for the GOP because if they lost this confrontation with the left there would be no reason for the GOP to continue to exist.  It is great for The Donald because those folks (not us) who worship him and his winning will be even more enthralled.

The commonality that got our attention is Sue’s attitude towards the right is a carbon copy of the one we see often and most recently in the Brett follies.  The left continues to control the media and loves to tell stories about folks on the right.  The problem is that they are not aware of what goes on with the right.  Sue wanders away from her attention to detail to do the same.  We will give you three examples and remind you that V is set in 1988.

The first is on page 240: “The club was largely given over to couples in their seventies and eighties, whose homes had appreciated in value while their retirement income had dwindled, subject to the whims of the economy.”  Well, real economic growth for 1983-88 was: 7.9%, 5.6%, 4.2%, 2.9%, 4.5%, 3.8%.  Comparable data for our 44th president was: 1.6%, 1.5%. 2.6%, 2.7%, 2.0%, 1.9%.  Yes, his best year in the last six was not as good as Reagan’s worst year in the last six.  Yes, we know that the president has a limited ability to influence the economy so we are mostly talking about memory.  How about the stock market that might determine retirement income?  The Dow Jones bottomed out below 2100 in June 1982 and was around 4400 when the story began in May 1988.  Yup, it had more than doubled in seven years although it was down from its 1987 high but these couples should be long term investors.  In short, times should be good for investing as well as home ownership.

The second is on the same page 240: “All four [two couples] were ardent Republicans, which meant any talk of politics was quickly addressed as they were all in agreement.”  Ardent Republicans that agree on everything.  It wasn’t true then and it isn’t true now.  The GOP primary in 1988 was a contested one, albeit, not exceptionally contentious. During that era there were many disputes on the right.  One of the most notable was the Panama Canal treaty.

The third is on page 296 when Dante, the hero loanshark says: “The cost of living is up.  The market is down.”  Perhaps we just take this as a convenient lie to cover Dante’s evil nature.  In any case it is untrue.  The market was up as already noted.  We take the cost of living as meaning inflation.  There was some inflation in 1988 but it was way down.  During 1979-81 inflation was in double digits.  It was down to 4% in 1988.  It is a pretty weak case to say that inflation is way down but it is a big problem because it is still more than zero.

Sue is like most of the writers and editors.  The good news is she is writing fiction and might be just adopting a left wing attitude.  What it means is that bad stuff about right wingers and Republicans is too obvious to need research.  Good things about leftist have the same tendency.  Mid-terms can’t come too soon.