Another Williamson Lament

When you belong to the smallest of fringe groups, capitalistic orphans, it would seem unwise to split the group but we are going to do it today.  Fellow orphan Kevin D. Williamson has an article at NRO, Trump isn’t A Nazi.  He’s A Failure.  Kevin says:

Which is to say, on the core issues of economic growth, trade, and immigration, President Trump is a failure by his own criteria. [Emphasis added.]

We wish that capitalistic orphans were a bigger group and that economic growth was a core political issue.  Economic growth is obviously not a core issue for Democrats.  All the major Democrat candidates for president in 2020 want to ban it or restrict it.  Most of those favoring restriction want substantial restriction on fracking.  Foolish is a really kind word to describe such policies.

Why does Kevin think The Donald is a failure?  He says:

In 2016, Trump promised Americans sustained 3-percent economic growth, but the economy has not met that standard. He promised a shrinking trade deficit, but the trade deficit has grown. He promised to build a wall along the southern border and to make Mexico pay for it, which he has not done.

Fair enough, 2.86 is not three.  Of course, us capitalistic orphans don’t care about the trade deficit but The Donald campaigned on it.  We agree with Kevin that

A more intelligent approach for Democrats (and for us lonely few anti-Trump conservatives) would be to concede that the president’s positions on issues such as illegal immigration and trade speak to concerns that are genuine and legitimate while pointing out that his actions have been in the main ineffective or genuinely destructive.   [Emphasis added]

Kevin agrees with us that hoping for a more intelligent approach from the Democrats is futile at this time.  Republican alternatives are equally bad.  Where we part company is on the bold item, in the main,  that we are willing to support The Donald because he has done things to support economic growth (and some foolish things like trade wars) and restricting illegal immigration.  As Kevin well knows, changing the course of the federal government is incredibly difficult.  The Donald is far from perfect but he is currently the best on offer.  We think he is worth supporting in 2020.

Professorial Meth: As Bad As It Seemed

We have been meaning to get around to this.  One of our common themes is that the university is its own worst enemy. We had seen various headlines about professors in Arkansas arrested on meth charges.  We had hoped that it might have been some grad students or a part-timer. Check out this report from last month:

A director and an associate professor in Henderson State University’s chemistry department were arrested Friday on charges of manufacturing methamphetamine, according to a media release.

Obviously, anybody making meth at the university would be bad news for the university but if full-time faculty were doing it then it would be a disaster for us.   The cited article appears to make it clear that this is the disastrous case:

The news release did not say whether investigators believe the two associate professors manufactured methamphetamine on campus, but it said Arkadelphia police, a narcotics task force and Henderson State University contributed to the investigation. HSU is a public university in Arkadelphia.

The university’s website listed Bateman as an associate professor and as the director of undergraduate research in the chemistry department. An online profile under Bateman’s name said he has been working at Henderson State University since 2009. [Emphasis added]

There are differences among schools but being classified as an associate professor means that you are a full-time tenure track faculty member.  It typically means that you have earned tenure.  As Bateman had been at HSU since 2009, he is almost surely tenured as tenure does not take ten years like you might think.  It is not that professors are making meth all over.  It is bad enough that two of them are.

 

Finding Friends at the Orphanage

We have been feeling left out.  As Josh Hawley and Marco Rubio have been making headlines about creating a more intrusive and authoritarian right in order to match up with the left, us market oriented folks that feel a kinship with the growth fairy have felt left out.  Matthew’s and David’s critiques of Marco are reasonable but neither made us felt like we had much overlap in our Venn diagrams.

Kevin D. Williamson (all of these are at NRO) has helped us feel like less of an orphan with Marco Rubio’s Half-Baked Political Philosophy.  You should read all the links to see what is going on but do make sure to read Kevin.  Here is a  great paragraph that explains why Marco is on the wrong path:

Men such as Senator Rubio desire for themselves the power to overrule markets — to limit trade and property rights, enterprise and exchange — in the service of what Senator Rubio describes as the “common good.” The problems with that are several. For one thing, Senator Rubio does not know what the common good is and has no way of knowing. For another thing, we know quite well, from long experience, how such vague and plastic notions of the “common good” interact with the discrete good. [Emphasis added]

We agree with Kevin why it is a problem.  As Kevin kindly puts it, there are at least several reasons why any modifier to capitalism really become crony as in crony capitalism.  We also agree on the solution:

Capitalism is what happens when government respects property rights, which include the rights to trade and to work. What we need from men in government is not the quasi-metaphysical project of reinventing capitalism in the name of the “common good.” What we need from government is — government.

It is nice to be in the orphanage with Kevin.  We could be a category like Capitalistic Orphans.  We wonder if Dave Barry would like that as a band name?  The problem is that voters (or at the very least political advisors) seem to like quasi-metaphysical projects for the economy and society, e.g., MAGA.  Thus, for Capitalistic Orphans is option is not finding a majority but finding enough support to become a faction on the right.  We hope you will join us.

How Matters

Jon Pavolvitz is getting likes on Facebook for his post I’m Not On The Radical Left, I’m In The Humane Middle.  It has a picture of a winsome lass sitting on the double yellow line of a highway.  Jon says he supports the Declaration of Independence and The Golden Rule so he doesn’t understand why folks call him part of the radical left.  He then goes on to list his beliefs which we reproduce below in bold with our comments.  Other than the first one they are pretty inexplicit.  How you would accomplish these goals matter and determine where you stand.












We suspect that Jon, like many people, doesn’t think much about the other side.  Perhaps he thinks of The Donald as right wing.  We don’t.  There are some nasty folks on both sides of the political divide but, by and large, most of them are trying to solve problems.  Largely, the disputes are about priorities and methods.  For example, it is generally true that people on the left want to raise the minimum wage and people on the right don’t.  There are people on the left that want to raise the minimum wage for nefarious reasons but most of them really think it will help poor people.  Most of the people on the right think it will harm the poor.  Such a difference of opinion doesn’t make either side evil.  We think that folks have often failed in their responsibility to investigate alternative thinking.

 

In Defense Of Saab

We took great umbrage at the beginning of Kevin D. Williamson’s new NRODT article, Elizabeth Warren Is Wrong About Pay Day Lenders, (we are bit sure about the paywall) that comes out early on NRO.  Of course, any article that starts with “Elizabeth Warren Is Wrong” is likely to be good and the article is terrific and you should read it all.  You should subscribe if you haven’t.  The problem is the beginning.  Kevin says:

Do you know who the car-finance guys really miss? “Saab,” he said. “The Saab customer was the best.” The people who bought Saabs turned out to be as sensible and practical as the people who designed them — good credit, appropriate incomes, sensible down payments. “It wasn’t like Porsche or Land Rover,” he said. “Nobody bought a Saab because it fulfilled some fantasy.”

We loved our Saab.  Now our love might have been augmented by the fact that it replaced the Toyota with over 400,000 miles that would only start if you put a coat hanger in the carburetor just before you cranked the key and then removed immediately after the vehicle started.

Sidebar: Here is a cite for those of you that don’t know what a carburetor is.  We are pretty sure that the Saab was our first fuel injected vehicle.  End Sidebar

It was fortunate that the Toyota hood (like the Saab) was hinged at the front so starting it only required a mild bit of contortion.  The Saab not only started all by itself but it was responsive, was a joy to drive, and had a heated seat, another thing that has become standard but wasn’t several decades ago.  It also had its practical side with front wheel drive (another innovation) and big tires that took the worry out of Wisconsin winters.

Why is Kevin’s article great?  First he makes this point:

Being poor sucks, and no regulation is going to change that.

Later he expands on exactly why:

Of course, there are a lot of broke-ass suburbanites driving around in Land Rovers they cannot really afford. It is not only the poor who make bad financial decisions. (I could produce a conspectus [your word of the day] of my own.) But the poor always have less room for error, and for their errors, as for most things, they pay a proportionally higher price.  [Emphasis added]

The play Fences has some great examples of the poor making good and bad decisions.  The dad, Troy, discusses with one of his sons if they should fix the roof or get a TV.  Troy isn’t as poor as some but he he trying to show his son exactly the problem Kevin describes.  They can only do one or the other.  Troy is working poor but his good financial sense allows him to help out others at the cost of some advice.

Kevin would like the Fences model but recognizes, unlike Elizabeth, that pay day lenders might be the best option for many folks.  Too bad he never yearned to have a Saab of his very own.

Good Ideas, Bad Ideas, And Bad Claims

The left cannot claim to have all the bad economic ideas.  They have the worst as we see in Venezuela but they do not have exclusive rights to such ideas.  There are lots of ideas out there and some of them are good but to get them noticed folks often make extreme claims.  Thus, good ideas get dismissed because they are not quite as good as the claims suggest.

Our example of a bad idea comes from Cesar Conda at NRO.  He says:

President Trump should propose exactly what President Barack Obama did in 2011: a temporary reduction in the Social Security portion of the payroll tax from 6.2 percent to 4.2 percent.

Cesar Conda is:

a former Bush-Cheney White House domestic-policy adviser and senior aide to three Republican U.S. senators, is founding principal of Navigators Global.

He is writing at NRO.  It is not unreasonable to take him seriously.  We shouldn’t.  Part of his argument is economic growth and we are fans of the growth fairy.  Economic growth is critically important and we believe that governments can influence the growth fairy.  But the way to get the growth fairy on your side is through long-term policies.  Countries with policies that support economic freedom like enforcing the rule of law, having low corruption, low regulation, low taxes, and free trade are highly likely to be visited by the growth fairy.  Going in the opposite direction then the more likely the growth fairy won’t visit.

The best you can hope for with Cesar’s idea is to move growth around.  It was one of many bad ideas from the 44th president.  It is worse now given the deficit and the near insolvency of Social Security.

Sean Maskai Flynn at Market Watch has two really good ideas for improving health care and reducing or limiting the costs.  They are good ideas because they are long-term and make healthcare more of a marketplace than it currently is.  First, we need transparent health care prices:

The first policy—price tags—is a necessary prerequisite for competition and efficiency. Under our current system, it’s nearly impossible for people with health insurance to find out in advance what anything covered by their insurance will end up costing. Patients have no way to comparison shop for procedures covered by insurance, and providers are under little pressure to lower costs.

Absolutely.  And second we need health savings accounts (HSA) that revert to the owner or can be extended into future years.  We don’t agree with Sean that the employer needs to “gift” them and he is surely wrong that it is a gift.   Any such payment is surely part of compensation rather than a gift.  We are not sure of how such a payment would be treated by the IRS.  The tax treatment of HSA need to be part of the solution.  We think the important points are high HSA limits and the opportunity to move amounts among years.

The second policy—deductible security—pairs an insurance policy that has an annual deductible with a health savings account (HSA) that the policy’s sponsor funds each year with an amount equal to the annual deductible.

The details are important but the problem is that the headline says these two changes would reduce health care costs by 75 percent.  Nope.  The text says they will provide $2.4 trillion [yup, trillion] per year in savings.  Since health care spending in 2017 was $3.5 trillion this gets another Nope.  Still, transparent prices and HSA with high limits and methods to move amount into other years or revert to the owners are great ideas.  Temporary tax changes are not.  Realistic claims are another good idea.

 

Expected Good News

One of the many great things about markets is that they encourage learning.  Isaac Orr at The Center of the American Experiment has an excellent article with a great title:

Capitalism is Saving the Planet Part Six: Minnesota Forests Are Flourishing

It is expected good news because capitalism and markets learns what generates profits and what the consumer wants.  You should, of course, read it all to get the details.  And you can savor the title again.  We will give you Isaac’s conclusion:

Using these technologies [see here] is not only good for the timber industry’s bottom line, they are good for the forests themselves. Rather than being an opponent of healthy forests, the capitalist timber industry is more invested in forest health than any other stakeholder, and therefore they have the most incentive to ensure Minnesota forests are healthy and vibrant.

Although Isaac uses environment as a category he doesn’t remind us that trees are natural carbon eaters.  The link tells us:

As a tree matures, it can consume 48 pounds of carbon dioxide per year (among other greenhouse gases like ozone), and releases enough oxygen for you to breathe for two years!

So the one billion additional trees in Minnesota will be eating 48 billion pounds of CO2 per year.  According to Wikipedia, Minnesota produces just under 90 million metric tons of CO2.  A metric ton is 2205 pounds so this is a big deal in term of arresting CO2 growth even if we are not entirely convinced of all the numbers.  We are working to find Isaac’s other five parts.