A Case for Perpetual Copyrights and Patents

Is there such a thing as intellectual property, which the state should protect by issuing or recognizing copyrights and patents? (The other principle type of intellectual property is the trademark, which is less contentious and not of interest here.)

I am aware of three plausible arguments against copyright and patent laws:

Copyrights and patents are legal contrivances that enable their owners to extract artificially high returns (rent, in the jargon of economics) by slowing the proliferation of marketable ideas.
It is impossible to “steal” an idea from someone. The person who first has the idea still has it even if someone else learns of and uses it.
It follows that when A earns money by using his own idea (e.g., producing a song of his own composition, building a better mousetrap of his own design), B cannot rightly taken any of A’s earnings; that would be theft. But if B earns money by using A’s idea, the earnings are B’s, not A’s, because B’s earnings are due to his own efforts.

The first argument stands alone, as a proposition that might be tested empirically. The second and third arguments are moral and linked. The following discussion is organized accordingly.

THE ECONOMICS OF COPYRIGHTS AND PATENTS

Stephan Kinsella relies on the first point in “Ideas Are Free: The Case Against Intellectual Property“:

Material progress is made over time in human society because information is not scarce. It can be infinitely multiplied, learned, taught, and built on. The more patterns, recipes, causal laws that are known add to the stock of knowledge available to all actors and act as a greater and greater wealth multiplier by allowing actors to engage in ever-more efficient and productive actions. It is a good thing that ideas are infinitely reproducible, not a bad thing. There is no need to impose artificial scarcity on these things to make them more like scarce resources, which, unfortunately, are scarce.

I refer to Kinsella because his is a prominent “libertarian” voice against intellectual property. But his argument — if one can call it that — is, at best, incomplete. It treats ideas as if they were free goods, simply floating in the air to be plucked. But good ideas — alternating current, the light bulb, the telephone, the graphical user interface, and on and on — are the products of hard work that is financially risky.

What is needed, on the first point, is not a Kinsella-like assertion but empirical evidence. This is on offer in Michele Boldrin and David Levine’s Against Intellectual Monopoly (.pdf version here). The following, with my comments in bold type and enclosed in brackets, is from Chapter I, “Introduction”:

The U.S. Constitution allows Congress “To promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries.”… From a social point of view, and in the view of the founding fathers, the purpose of patents and copyrights is not to enrich the few at the expense of the many…. [C]ommon sense and the U.S. Constitution say that these rights must be justified by bringing benefits to all of us. [Utilitarian obiter dicta; assumes away property rights of creators.]

The U.S. Constitution is explicit that what is to be given to authors and inventors is an exclusive right – a monopoly. Implicit is the idea that giving this monopoly serves to promote the progress of science and useful arts. The U.S. Constitution was written in 1787. At that time, the idea of copyright and patent was relatively new, the products to which they applied few, and their terms short. In light of the experience of the subsequent 219 years we might ask: is it true that legal grants of monopoly serve to promote the progress of science and the useful arts?

Certainly common sense suggests that it should…. Would not the world without patent and copyright be a sad cold world, empty of new music and of marvelous new inventions?

So the first question we will pose is what the world might be like without intellectual monopoly. Patents and copyrights have not secured monopolies on all ideas at all times. It is natural then to examine times and industries in which legal protection for ideas have not been available to see whether innovation and creativity were thriving or were stifled. It is the case, for example, that neither the internet nor the jet engine were invented in hopes of securing exclusive rights. In fact, we ordinarily think of “innovative monopoly” as an oxymoron. We shall see that when monopoly over ideas is absent, competition is fierce – and that as a result innovation and creativity thrive. Whatever a world without patents and copyrights would be like, it would not be a world devoid of great new music and beneficial new drugs. [To be proved, or not.]

You will gather by now that we are skeptical of monopoly– as are economists in general. Our second topic will be an examination of the many social costs created by copyrights and patents. Adam Smith – a friend and teacher of James Watt – was one of the first economists to explain how monopolies make less available at a higher price. In some cases, such as the production of music, this may not be a great social evil; in other cases such as the availability of AIDS drugs, it may be a very great evil indeed. [But without the promise of monopoly would there have been AIDS drugs?] However, as we shall see, low availability and high price is only one of the many costs of monopoly…. [Generalize the preceding comment.] We shall also see that because there are no countervailing market forces, government-enforced monopolies such as intellectual monopoly are particularly problematic. [There are always countervailing market forces; even “monopolists” do not have monopolies on everything that consumers might want. Substitution is a powerful but under-appreciated force.]

While monopoly may be evil [Whoa, there! Evil is Stalin, Hitler, and al Qaida, not a bunch of aspiring plutocrats.], and while innovation may thrive in the absence of traditional legal protections such as patents and copyrights, it may be that patents and copyrights serve to increase innovation….

In the final analysis, the only justification for intellectual property is that it increases – de facto and substantially – innovation and creation. [Not the only justification. There is the property right to be reckoned with.] … Is it a fact that intellectual monopoly leads to more creativity and innovation? Our examination of the data shows no evidence that it does. [We shall see.] Nor are we the first economists to reach this conclusion. After reviewing an earlier set of facts in 1958, the distinguished economist Fritz Machlup wrote

it would be irresponsible, on the basis of our present knowledge of its economic consequences, to recommend instituting [a patent system].

Since there is no evidence that intellectual monopoly achieves the desired purpose of increasing innovation and creation, it has no benefits. So there is no need for society to balance the benefits against the costs. This leads us to our final conclusion: intellectual property is an unnecessary evil. [To repeat, this ignores the property right.]

I will not suggest that the various expansions and extensions of copyright and patent protection over the past decades have been necessary or desirable. But there is the reasonable question whether some degree of copyright and patent protection is economically beneficial. What do Boldrin and Levine have to offer on that score?

They offer page after page of theorizing and many special cases. The most interesting cases, for my purposes, are those that cover broad swaths of time, and thus are less likely to have been influenced by transient events. One such case involves the effects of the expansion of copyright protection on the output of literary works:

[B]eginning in 1919, the length of copyright has been continually extended. At the turn of the century it was 28 years and could be extended for another 14. Prior to the Copyright Term Extension Act (CTEA, or Sonny Bono Act in the popular press) of 1998 it was 75 years for works for hire, and the life of the author plus 50 years otherwise, its last major extension having been approved in 1976. Thus, the length of copyright term roughly doubled during the course of the century. If this approximate doubling of the length of copyright encouraged the production of additional literary works, we would expect that the per capita number of literary works registered would have gone up. Below is a graph of the number of literary copyrights per capita registered in the United States in the last century. Apparently economic theory works whereas the theory according to which extending copyright term boosts creativity in the long run, does not. The various copyright extensions have not led to an increase in the output of literary work. (pp. 111-2 of the .pdf version)

The graph, which I am unable to reproduce here, yields no discernible trend. This counts in favor of Boldrin and Levine, who (it is evident) are much opposed to copyright and patent protection. There is much in the tone of their writing to suggest that their opposition preceded their analysis, rather than being a result of it.

Later, one finds the following “evidence” about the general effects of copyright laws on the output of musical compositions:

[Professor Frederic Scherer] … compared the average number of composers born per million population per decade in various European countries. Turning first to England, he considers the precopyright period 1700-1752, and the post copyright period 1767-1849. As controls he looks also at what happened in Germany, Austria and Italy[,] in which here was no change in copyright during this period [1700-1849, presumably]….

We see that the number of composers per million declined everywhere, but it declined considerably faster in the UK after the introduction of copyright than in Germany or Austria, and at about the same rate as Italy. So there is no evidence here that copyright increased musical output. (pp. 212-3 of the .pdf version)

Nor is there evidence that the introduction of copyright led to a reduction in the ranks of composers. Continuing:

However, the evidence is mixed, because the same experiment in France is more favorable to copyright. In France the precopyright period is 1700-1768, and the post copyright period is 1783-1849….

Here we find that, in France, when copyright is introduced the number of composers per million increased substantially more than in other countries. This should be noted, as it is pretty much the only piece of evidence supporting the idea that copyright increased classical music production we have been capable of finding. (p. 213 of the .pdf version)

But the case of France should be accorded a lot of weight because of the time period it covers.

Despite Boldrin and Levine’s obvious biases (especially against “big corporations”), I am satisfied that the economic case for any level of copyright and patent protection is mixed, at best. The case for such protection, if any, must stand on moral grounds.

ECONOMIC EFFICIENCY DOES NOT EXCUSE THEFT

This brings me to the second argument against copyrights and patents, namely, that an idea cannot be stolen. This, if true, supports the third argument, namely, that a person who “copies” someone else’s “idea” and sells the copies he makes is not stealing from the originator of the idea.

Boldrin and Levine do not resist the idea that ideas can be property:

We do not know of any legitimate argument that producers of ideas should not be able to profit from their creations. (p. 9 of .pdf version)

But…

Why … should creators have the right to control how purchasers make use of an idea or creation? (ibid.)

Timothy Sandefur puts it this way:

There are two elements of property that are usually merged, but which in the context of intellectual property are not necessarily connected: (1) the moral right of a person to the use and enjoyment of the property in question, and (2) the moral right of the owner to forbid another person from using or enjoying the property in question.

In the case of tangible property, real or personal, the second flows naturally from the first, because the property is naturally exclusive, meaning that if I have it, you simply cannot; if I take it, you no longer have it—you have been “disseised.” Intellectual property, however, is not like this. I can “take” it from you, and yet you still have it. If, for example, you are the greatest musician in the history of rock and roll (that is, John Fogerty) and you have written the greatest song ever (that is, “Born on The Bayou,” from the glorious 1968 album Bayou Country), then I can sing “Born on The Bayou” in my shower, and you can still, at the same time, use and enjoy your “property” as you wish: you can perform it, sell it, or leave it alone. Elements (1) and (2) are separated—your moral right (assuming it exists) to use and enjoy your song does not necessarily entitle you to forbid me from simultaneously using and enjoying your song.

The business about singing a song in the shower is a diversion from the real issue, which is making a copy of an original work (of art, music, literature, mechanical design, etc.). The making of a copy encompasses not only the physical reproduction of an original work in a medium (including electronic media) but also the performance of a song, staging of a play, reading of a book, and the like, especially for an audience (whether paying or not). The making of a copy, thus properly defined, has the potential of depriving the work’s creator of “a penny” or more, by fraud or theft, and is therefore tantamount to the initiation of force against the work’s creator.

Sandefur, it seems, would disagree with that. He says, in another post, that there is a

difference between one’s right to his earnings, and one’s right not to have his earnings taken from him. With regard to tangible property, these two things fit together perfectly, like the convexity and concavity of the same curved line. But with regard to intellectual property, which is non-exclusive, these two things are pried apart. A man who invents a new mousetrap certainly deserves what he can earn for producing that mousetrap. (And nobody may take either his earnings or his particular mousetrap from him.) But he does not necessarily have the right to stop others from “taking” his mousetrap idea from him, because even when a person does so, he still retains that idea. It is nonexclusive.

Is the idea (the design of a mousetrap) really separable from the product (the mousetrap that is manufactured according to the design)? Or, to put it in terms of Sandefur’s musical example, is the idea (the song “Born on the Bayou”) really separable from the product (performances and recordings of the song)?

Consider the following hypothetical “facts” and situations relating to “Born on the Bayou.” The “facts” are predicated on the reasonable assumption that the use of copyright notices by creators of original works is merely a substitute for the kind of contract that those creators (or most of them) would insist upon before performing, recording, or displaying their works. The expectation of a contract (of the kind outlined below) is the proper starting point for an analysis of the legitimacy of copying.

Hypothetical “facts”: John Fogerty writes “Born on the Bayou,” performs it in a recording studio (and only there), and offers copies of the recorded performance for sale. Each copy authorized for sale by Mr. Fogerty displays (in lieu of a copyright notice) the following statement:

TERMS AND CONDITIONS OF USE: This product consists of these terms and conditions and the enclosed CD, which contains the song, “Born on the Bayou.” The song and the musical performance of it that is recorded on the enclosed CD are the property of John Fogerty. Mr. Fogerty grants the purchaser of this product a limited license to play the CD for private, non-commercial use. The purchaser may make one copy of the CD, but only as a backup in case the purchased copy is damaged. The purchaser may not otherwise make a copy or copies of the CD for distribution to others (with or without remuneration). The performance of “Born on the Bayou” by any other person before an audience (with or without remuneration) requires the express, written consent of Mr. Fogerty and the payment of a royalty to Mr. Fogerty, according to a schedule that is available at <bornonthebayou.com>. Broadcasting companies may play this CD (or portions) thereof) on radio, television, the internet, or via other telecommunications media when they adhere to the notification requirements and royalty schedule that is available at <bornonthebayou.com>. These terms and conditions are an integral part of this product, and may not be detached from it. The initial purchaser of this product, as a condition of the purchase of this product, accepts these terms and conditions and agrees to convey them to a subsequent purchaser or grantee of this product. These terms and conditions thereby become binding on each and every party to whom this product is conveyed by sale or grant.

In the absence of copyright laws, this kind of statement would document the contract between an artist (or his assignee) who creates, performs, or exhibits an original work (of any kind) and persons who are allowed to see or hear the work and/or own authorized copies or recordings of it. (Similar statements accompany software and tickets for sporting events, musical performances, and theatrical productions.) In other words, the removal of copyright protection need not result in a an “open season” on original works of artistic creation.

The following hypothetical situations, which rely on the above “facts,” are therefore reasonable tests of Sandefur’s distinction between an idea and the products derived from it.

Hypothetical situation #1: Joe Smith buys a “Born on the Bayou” CD, makes copies of it, and sells the copies for far less than the price of copies authorized by John Fogerty. Smith may even choose to give away the copies. In either event, Fogerty’s “right not to have his earnings taken from him” is violated because the availability of cheap or free copies of Fogerty’s performance reduces (in some amount) the number of authorized copies that Fogerty is able to sell.

Hypothetical situation #2: Jack Brown buys a copy of the CD, teaches himself to perform “Born on the Bayou” in the style of John Fogerty, records a performance of the song, and sells copies of the recording. Brown would not know of “Born on the Bayou,” or how to perform it, were it not for the CD that he had purchased, with its accompanying agreement. Brown’s action may not deprive Fogerty of his ability to perform “Born on the Bayou,” but it could deprive Fogerty of sales of his creation. And, artistic self-actualization aside, it was the prospect of selling copies of the song that led Fogerty to write and record it in the first place. Brown, like Smith, has violated Fogerty’s “right not to have his earnings taken from him.”

These hypotheticals suggest that Sandefur’s distinction between “one’s right to his earnings, and one’s right not to have his earnings taken from him” is a false one in the case of an unauthorized copying of an original work. In such a case, the two things cannot be “pried apart.” Even though Smith and Brown would not have stolen any of Fogerty’s earnings from his sales of CDs or his performances of “Born on the Bayou,” their actions would have had the same effect. That is, they would have reduced Fogerty’s earnings by depriving him of customers for his CDs and performances. Sandefur’s distinction applies if, and only if, a Smith or a Brown competes with Fogerty by composing and recording an original work.

A logician might accuse Sandefur of sophistry. The sophistry — unintended, I’m sure — arises from the use of “idea” to describe a creative work. As Sandefur puts it (in the second of the posts quoted above), the inventor of a mousetrap

not necessarily have the right to stop others from “taking” his mousetrap idea from him, because even when a person does so, he [the inventor] still retains that idea.

An “idea” (a design, a song, etc.) that exists in a person’s mind becomes more than an “idea” when that person has documented it in some form (a drawing, a set of specifications, a musical score, a recording, etc.). Another person — unless he is a mind-reader — cannot steal an “idea,” but he can steal the external manifestation of the idea. It is the external manifestation — not the “idea” — that is stolen by copying (in one way or another). And it is the external manifestation that the creator may rightly seek to protect from being copied, by attaching to it a contract like the “Terms and Conditions of Use” sketched above.

By what “right” does the creator of a work “dictate” the terms and conditions of its use? By his ownership of the property (the external manifestation of his “idea”), to which he attaches the terms and conditions. Prospective buyers are free to accept the terms and conditions (by buying the property) or to reject them (by declining to buy the property). As long as the terms and conditions are stated openly, there is no question of fraud or coercion. The choice — to buy or not to buy, given the terms and conditions — is entirely in the hands of a prospective buyer. (I have no idea how my position squares with statutory and common law, but I can see no moral objection to it.*)

CONCLUSION

Boldrin and Levine make an economic case against perpetual copyrights and patents, but it is a narrow one that does not really address the broadly disincentivizing effects of the complete loss of copyright and patent protection across all fields of endeavor. (This is not to say that Boldrin and Levine ignore the contractual alternative that I discuss here. See, for example, page 9 of the .pdf version of their book.)

On the other hand, there is a strong moral case for copyrights and patents — even perpetual ones. When faced with a choice between economic efficiency and morality, I choose morality.
__________
* The terms and conditions attached to a creative work, as I have sketched them, are like restrictive covenants in a residential subdivision, which

may govern what color a home’s exterior is painted, what and how many exterior decorations are allowed, where cars are allowed to be parked, or even who lives in the house (outside of the owner’s nuclear family).

Such covenants apply not just to the original owner of a house, but also subsequent owners. They restrict what may be done to a property, but not to whom a property may be conveyed. The latter kind of restriction long ago ran afoul of the U.S. Supreme Court, in Shelley v. Kraemer (1948). Here is the key language of the Court’s opinion (references to other cases and footnotes omitted):

We hold that, in granting judicial enforcement of the restrictive agreements in these cases, the States have denied petitioners the equal protection of the laws, and that, therefore, the action of the state courts cannot stand. We have noted that freedom from discrimination by the States in the enjoyment of property rights was among the basic objectives sought to be effectuated by the framers of the Fourteenth Amendment. That such discrimination has occurred in these cases is clear. Because of the race or color of these petitioners, they have been denied rights of ownership or occupancy enjoyed as a matter of course by other citizens of different race or color. The Fourteenth Amendment declares “that all persons, whether colored or white, shall stand equal before the laws of the States, and, in regard to the colored race, for whose protection the amendment was primarily designed, that no discrimination shall be made against them by law because of their color.”

Only recently, this Court had occasion to declare that a state law which denied equal enjoyment of property rights to a designated class of citizens of specified race and ancestry was not a legitimate exercise of the state’s police power, but violated the guaranty of the equal protection of the laws. Nor may the discriminations imposed by the state courts in these cases be justified as proper exertions of state police power.

Respondents urge, however, that, since the state courts stand ready to enforce restrictive covenants excluding white persons from the ownership or occupancy of property covered by such agreements, enforcement of covenants excluding colored persons may not be deemed a denial of equal protection of the laws to the colored persons who are thereby affected. This contention does not bear scrutiny. The parties have directed our attention to no case in which a court, state or federal, has been called upon to enforce a covenant excluding members of the white majority from ownership or occupancy of real property on grounds of race or color. But there are more fundamental considerations. The rights created by the first section of the Fourteenth Amendment are, by its terms, guaranteed to the individual. The rights established are personal rights. It is, therefore, no answer to these petitioners to say that the courts may also be induced to deny white persons rights of ownership and occupancy on grounds of race or color. Equal protection of the laws is not achieved through indiscriminate imposition of inequalities.

Nor do we find merit in the suggestion that property owners who are parties to these agreements are denied equal protection of the laws if denied access to the courts to enforce the terms of restrictive covenants and to assert property rights which the state courts have held to be created by such agreements. The Constitution confers upon no individual the right to demand action by the State which results in the denial of equal protection of the laws to other individuals. And it would appear beyond question that the power of the State to create and enforce property interests must be exercised within the boundaries defined by the Fourteenth Amendment.

The problem of defining the scope of the restrictions which the Federal Constitution imposes upon exertions of power by the States has given rise to many of the most persistent and fundamental issues which this Court has been called upon to consider. That problem was foremost in the minds of the framers of the Constitution, and, since that early day, has arisen in a multitude of forms. The task of determining whether the action of a State offends constitutional provisions is one which may not be undertaken lightly. Where, however, it is clear that the action of the State violates the terms of the fundamental charter, it is the obligation of this Court so to declare.

The historical context in which the Fourteenth Amendment became a part of the Constitution should not be forgotten. Whatever else the framers sought to achieve, it is clear that the matter of primary concern was the establishment of equality in the enjoyment of basic civil and political rights and the preservation of those rights from discriminatory action on the part of the States based on considerations of race or color. Seventy-five years ago, this Court announced that the provisions of the Amendment are to be construed with this fundamental purpose in mind. Upon full consideration, we have concluded that, in these cases, the States have acted to deny petitioners the equal protection of the laws guaranteed by the Fourteenth Amendment. Having so decided, we find it unnecessary to consider whether petitioners have also been deprived of property without due process of law or denied privileges and immunities of citizens of the United States.

Whether the Court’s legal reasoning is also morally sound I leave as an exercise for the reader.

Hank Williams Jr. and Hitler

Better late than never. This is the about equating Obama with Hitler, as Hank Williams Jr. did earlier this month.

Aaron Goldstein of The American Spectator doesn’t like Hitler analogies:

[C]omparing anyone to Hitler who hasn’t committed genocide (or aspires to do so) only serves to trivialize the evil committed in his name and ideology.

I must disagree with Mr. Goldstein. Specifically, Hitler was not only a genocidal maniac but also a despot who commandeered Germany’s economy and society and molded them to suit his ends.

My money says that Obama — like FDR, his presidential role model — is greatly inclined in the same direction. Consider, for example, the evident willingness of a senior administration official to curb speech critical of Islam as a form of racial discrimination, the administration’s overt attack on freedom of religion, and Obama’s attack on bullying as another way of curbing speech. Obama’s attempt to seize the health-care industry — along with the auto and financial industries — may generate more headlines, but his insidious efforts to stifle Americans’ basic freedoms says volumes about his fascistic mindset.

Externalities and Statism

In “Regulation as Wishful Thinking,” I say negative things about the main excuse for regulation, which is the existence of so-called negative externalities. This post focuses on the concept of externality and the absurdities to which it leads.

An externality — in case the term is new to you —

is a cost or benefit … incurred by a party who did not agree to the action causing the cost or benefit. A benefit in this case is called a positive externality or external benefit, while a cost is called a negative externality or external cost.

Economists seem to believe that externalities are “bad,” even positive ones. Why? According to the Wikipedia article quoted above, ”

[w]elfare economics has shown that the existence of externalities results in outcomes that are not socially optimal. Those who suffer from external costs do so involuntarily, while those who enjoy external benefits do so at no cost.

The absurdity of this economistic view of the world is demonstrated easily:

1. If an attractive woman catches my eye, should I compensate her for the enjoyment that I derive from looking at her? If not, why not? Her attractiveness undoubtedly generates a lot of positive externalities.

2. If the same physically attractive woman catches the eye of a crude man, he will leer, wink, and perhaps make suggestive motions or remarks. His actions, which are a reaction to a positive externality (the effect of the woman’s attractiveness) have the effect of offending the woman and causing her psychological discomfort. His actions, in other words, cause a negative externality that can be traced to the same source as the positive externality in 1.

In short, life is full of externalities — positive and negative. They often emanate from the same event, and cannot be separated. State action that attempts to undo negative externalities usually results in the negation or curtailment of positive ones. In terms of the preceding example, state action often is aimed at forcing the attractive woman to be less attractive, thus depriving quietly appreciative men of a positive externality, rather than penalizing the crude man if his actions cross the line from mere rudeness to assault.

The main argument against externalities is that they somehow result in something other than a “social optimum.” This argument is pure, economistic hokum. It rests on the unsupportable belief in a social-welfare function, which requires the balancing (by an omniscient being, I suppose) of the happiness and unhappiness that results from every action that affects another person, either directly or indirectly. To return to the example, forcing the woman to be less attractive may make the woman more or less happy (depending on how she weighs her allure against the unwelcome attention that it draws), but it definitely makes me less happy. And even if the woman is happier, her gain in happiness does not cancel my decrease in happiness.

A believer in externalities might respond by saying that they are of “economic” importance only as they are imposed on bystanders as a spillover from economic transactions, as in the case of emissions from a power plant that can cause lung damage in susceptible persons. Such a reply is of a kind that only an omniscient being could make with impunity. What privileges an economistic thinker to say that the line of demarcation between relevant and irrelevant acts should be drawn in a certain place? The authors of campus speech codes evidently prefer to draw the line in such a way as to penalize the behavior of the crude man in the above example. Who is the economistic thinker to say that the authors of campus speech codes have it wrong? And who is the legalistic thinker to say that speech should be regulated by deferring to the “feelings” that it arouses in persons who may hear or read it?

Despite the intricacies that I have sketched, negative externalities are singled out for attention and rectification, to the detriment of social and economic intercourse. Remove the negative externalities of electric-power generation and you make more costly (and even inaccessible) a (perhaps the) key factor in America’s economic growth in the past century. Try to limit the supposed negative externality of human activity known as “greenhouse gases” and you limit the ability of humans to cope with that externality (if it exists) through invention, innovation, and entrepreneurship. Limit the supposed negative externality of “offensive” speech and you quickly limit the range of ideas that may be expressed in political discourse. Limit the supposed externalities of suburban sprawl and you, in effect, sentence people to suffer the crime, filth, crowding, contentiousness, heat-island effects, and other externalities of urban living.

The real problem is not externalities but economistic and legalistic reactions to them. These reactions are manifestations of rationalism. As Michael Oakeshott explains, a rationalist

never doubts the power of his ‘reason … to determine the worth of a thing, the truth of an opinion or the propriety of an action. Moreover, he is fortified by a belief in a ‘reason’ common to all mankind, a common power of rational consideration….

… And having cut himself off from the traditional knowledge of his society, and denied the value of any education more extensive than a training in a technique of analysis, he is apt to attribute to mankind a necessary inexperience in all the critical moments of life, and if he were more self-critical he might begin to wonder how the race had ever succeeded in surviving. (“Rationalism in Politics,” pp. 5-7, as republished in Rationalism in Politics and Other Essays)

The main result of rationalistic thinking — because it yields vote-worthy slogans and empty promises to fix this and that “problem” — is the aggrandizement of the state, to the detriment of civil society.

The fundamental error of rationalists is to believe that “problems” call for collective action, and to identify collective action with state action. They lack the insight and imagination to understand that the social beings whose voluntary, cooperative efforts are responsible for mankind’s vast material progress are perfectly capable of adapting to and solving “problems,” and that the intrusions of the state simply complicate matters, when not making them worse. True collective action is found in voluntary social and economic intercourse, the complex, information-rich content of which rationalists cannot fathom. They are as useless as a blind man who is shouting directions to an Indy 500 driver.

Here is a good example of that kind of backseat driving:

For the left, political objectives relate to policy ends. We want to expand access to quality health care. We want to lower carbon emissions to combat global warming. We want to reform the lending process for student loans so more young people can afford to go to college. We want to make public investments to create jobs. (Steve Benen, “They’re not parallel ideologies,” Washington Monthly, October 18, 2011)

The list could go on and on, almost without end, of course. Because there is no end of “problems” that cry out for political “solutions.” Political, in this case, refers not to the voluntary processes and organizations of civil society — which are truly political — but to state action on behalf of this and that group and “cause.” It reminds me of the management style of a former boss, whose every whim became a top priority.

In the end, if anyone is better off it is politicians and bureaucrats who rake in above-market wages and outrageously cushy pensions. It is certainly not the members of competing interest groups, each of which vies to make its “cause” the number-one priority, and all of which end up paying for every other group’s favorite “cause.”

Then, too, there is the law of unintended consequences, which ensures that every state-imposed “solution” creates a new problem (a real one) that — you guessed it — cries out for state action. For example:

Night operation of the windmills in the North Allegheny Windpower Project has been halted following discovery of a dead Indiana bat under one of the turbines, an official with the U.S. Fish and Wildlife Service said Monday.

A more serious example:

On the Republican campaign trail, the health care debate has focused on the mandatory coverage that Mitt Romney signed into law as governor in 2006. But back in Massachusetts the conversation has moved on, and lawmakers are now confronting the problem that Mr. Romney left unaddressed: the state’s spiraling health care costs.

After three years of study, the state’s legislative leaders appear close to producing bills that would make Massachusetts the first state — again — to radically revamp the way doctors, hospitals and other health providers are paid.

Although important details remain to be negotiated, the legislative leaders and Gov. Deval Patrick, all Democrats, are working toward a plan that would encourage flat “global payments” to networks of providers for keeping patients well, replacing the fee-for-service system that creates incentives for excessive care by paying for each visit and procedure….

And when that brainstorm fails to solve the very real problems created by Romneycare, the ~~idiots~~ politicians and do-gooders who dictate to the people of the Commonwealth of Massachusetts will try to conscript doctors, hospitals, and other providers of medical care into an overtly socialized system, which will come to be known (appropriately) as Commie-care. Then, predictably, the Commonwealth will try to remedy the flight of providers by some cockamamie scheme or other, which will accomplish the two-fold feat of making Massachusetts a medical wasteland while drying up the funding for Commie-care by driving out wealth-creators.

The fundamental problem with rationalistic “solutions” to “problems” — other than the fact that they do not work — is that they have externalities that make pollution and other undesirable by-products of economic activity seem almost benign. (For an estimate of the magnitude of the externalities of statism, see this post.) It is just that statist politicians are skilled at disguising the destructiveness of statist “solutions” and turning every real problem caused by state action into an excuse for more state action. They are abetted, of course, by the economic illiterates whose votes make democracy an enemy of liberty.

Civil society, left unfettered by statist decrees but protected by a minimal state, would cope very well with negative externalities, were it allowed to function. I have made that case in “Regulation and Wishful Thinking,” and will not repeat it here. (See especially the section of the post that is headed “The Alternatives to Regulation: Markets and Common Law.”) The general point is made by Oakeshott:

To some people, ‘government’ appears as a vast reservoir of power which inspires them to dream of what use might be made of it. They have favourite projects, of various dimensions, which they sincerely believe are for the benefit of mankind, and to capture this source of power, if necessary to increase it, and to use it for imposing their favourite projects upon their fellows is what they understand as the adventure of governing men. They are, thus, disposed to recognize government as an instrument of passion; the art of politics is to inflame and direct desire. In short, governing is understood to be just like any other activity — making and selling a brand of soap, exploiting the resources of a locality, or developing a housing estate — only the power here is (for the most part) already mobilized, and the enterprise is remarkable only because it aims at monopoly and because of its promise of success once the source of power has been captured….

Political conservatism is … not at all unintelligible in a people disposed to be adventurous and enterprising, a people in love with change and apt to rationalise their affections in terms of ‘progress’. And one does not need to think that the belief in ‘progress’ is the most cruel and unprofitable of all beliefs, arousing cupidity without satisfying it, in order to think it inappropriate for a government to be conspicuously ‘progressive’. Indeed, a disposition to be conservative in respect of government would seem to be pre-eminently appropriate to men who have something to do and something to think about on their own account, who have a skill to practise or an intellectual fortune to make, to people whose passions do not need to be inflamed, whose desires do not need to be provoked and whose dreams of a better world need no prompting. Such people know the value of a rule which imposes orderliness without irecting enterprise, a rule which concentrates duty so that room is left for delight…. (“On Being Conservative,” pp. 431-5, Rationalism in Politics and Other Essays)

Another Reason to Fear the Fed

A rah-rah story about inflation leads with this:

WASHINGTON (Reuters) – Consumer prices outside food and energy rose at their slowest pace in six months in September as the cost of apparel and used vehicles fell, suggesting inflation pressures remained contained.

The fact of the matter is that inflation, as measured by the Bureau of Labor Statistics, is on the rise:

Methinks I see the effects of quantitative easing: More money is pushing against a stubborn “refusal” by businesses to invest and expand, given the present anti-business, anti-wealth, pro-entitlement regime in Washington.

The Myth That Same-Sex “Marriage” Causes No Harm

Stephen J. Heaney writes at Public Discourse, in “Abortion, Divorce and “Same-Sex Marriage”: No Blood, No Foul?“:

Human beings are both rational and social creatures. We live not in herds but in ordered societies. We do this because it is good for us: the order of society that is necessary for us to live well is preserved by government and laws. If our government and laws do not help us to flourish (or if they actually assault our well-being), it is impossible to justify living under that government or those laws.

If government exists to support us in our flourishing, then it is obligated, in the deepest sense, to function in accordance with the truth of what is fitting for us. It is obligated to try to protect us from harm, and to support us in what is good for us….

The cause du jour, the primary contest over human flourishing, is the debate over the meaning of marriage.

The truth of marriage is that it can only exist between one man and one woman, for the sake of the children who may come as a result of their sexual union. Thus government is obligated to recognize the truth of marriage; to protect and support that project of bringing children into the world and caring for them; to recognize all and only actual marriages; and to discourage sexual acts in other contexts.

Proponents of same-sex marriage might well note here that my argument about the harm I undergo makes sense only if one agrees with my understanding of sex and marriage. This is, of course, true. With a different understanding of marriage, one might argue that same-sex couples are harmed by the lack of marital status because they believe it is owed to them.

The simple fact that no one in the entire history of humanity has ever thought it even possible for two people of the same sex to marry should give us pause. If it does not, then arguments about the nature of marriage should. I have argued previously in Public Discourse that marriage exists only as the union of one man and one woman, declared before the community, because the community has a stake in the outcome of their sexual union, i.e., children. If it were not the case that sex leads naturally (though not in every case) to children, the community would have no interest in the relationship, any more than in any other relationship of friendship or amusement. Indeed, it is impossible to imagine how anyone would have thought up the idea in the first place.

On the other hand, those who support same-sex “marriage” do so with an argument that looks something like this: “Nobody talks that way anymore. Nobody acts that way anymore. Therefore marriage has changed.” They look around at a society that, at least in practice, behaves as if sex and marriage mean nothing more than whatever the people who enter into a relationship want it to mean.

We may note that the conclusion of the above argument does not follow from the premises. The fact that many people think and act differently these days about marriage does not change the nature of marriage, any more than the nature of a cat would change if we decided to treat it like a rosebush.

If marriage is what they say it is, however, then marriage is nothing more than a contract. And if it is merely a contract, then the proper response of government and law is not to legalize same-sex marriage; it is to get out of the marriage business entirely. Law’s function, then, would be merely to help settle disputes between people who claim contracts have been violated. Any harm involved would be entirely a function of the terms of the contract, not the nature or circumstances of the people involved.

If, however, the nature of marriage is what I have argued for here, then two people who are literally incapable of marrying one another are not suffering a harm, or even a loss, when the society refuses to call their relationships a marriage. There is a difference between suffering a loss and simply not getting what one wants.

My wife, my children, and I are harmed when the government turns its back on the truth of marriage, and thus turns its back on its citizens’ flourishing. The government may force me to send my children to schools that mandate the celebration of same-sex relationships, thus violating my rights as a parent. It may prosecute me for hate crimes for the very expression of my views, thus violating my freedom of conscience and speech. I hope not. These harms are not a logically necessary outcome of the recognition of same-sex marriage, so perhaps that threat will dissipate. But the other harms that I have spelled out above are indeed necessary and harmful consequences of the adoption of same-sex marriage. The proper response of society to the widespread abuse of sex and marriage is not to multiply the harm by abandoning the truth. Rather, it is to get back on the right track.

My own view of same-sex “marriage” is remarkably similar to Heaney’s, even though my view has a different provenance than Heaney’s religious-philosophical one; for example:

The recognition of homosexual “marriage” by the state — though innocuous to many, and an article of faith among most libertarians and liberals — is another step down the slippery slope of societal disintegration. The disintegration began in earnest in the 1930s, when Americans began to place their trust in chimerical, one-size-fits-all “solutions” offered by power-hungry, economically illiterate politicians and their “intellectual” enablers and apologists. In this instance, the state will recognize homosexual “marriage,” then bestow equal benefits on homosexual “partners,” and then require private entities (businesses, churches, etc.) to grant equal benefits to homosexual “partnerships.” Individuals and businesses who demur will be brought to heel through the use of affirmative action and hate-crime legislation to penalize those who dare to speak against homosexual “marriage,” the privileges that flow from it, and the economic damage wrought by those privileges.

It should be evident to anyone who has watched American politics that even-handedness is not a matter of observing constitutional limits on government’s reach, regardless of who asks for an exception; it is, rather, a matter of expanding the privileges bestowed by government so that no one is excluded. It follows that the recognition and punitive enforcement of same-sex “marriage” would be followed by the recognition and bestowal of benefits on other arrangements, including transient “partnerships” of convenience. And that surely will weaken heterosexual marriage, which is the axis around which the family revolves. The state will be saying, in effect, “Anything goes. Do your thing. The courts, the welfare system, and the taxpayer — above all — will pick up the pieces.” And so it will go….

Given the signals being sent by the state, the rate of formation of traditional, heterosexual marriages will continue to decline. (According to the Census Bureau, the percentage of adult males who are married dropped steadily from 71.1 percent in the 1960 census to 58.6 percent in the 2000 census; for females, the percentage dropped from 67.4 to 54.6. (The latest available figures, for 2009, show no significant change since 2000.) About half of each drop is explained by a rise in the percentage of adults who never marry, the other half by a rise in the percentage of divorced adults. Those statistics are what one should expect when the state signals — as it began to do increasingly after 1960 — that traditional marriage is no special thing by making it easier for couples to divorce, by subsidizing single mothers, and by encouraging women to work outside the home.

The well-known effects of such policies include higher rates of crime and lower levels of educational and economic achievement. (See this and this, for example.) Same-sex marriage would multiply these effects for the sake of mollifying a small minority of the populace.

There is plenty of harm to be done by the state’s recognition of same-sex “marriage.” Heaney is right to warn against that harm. (See also: Michael Cook, “The ‘No Difference’ Theory Is Dead,” Mercatornet, February 9, 2015. The article summarizes a study which finds that opposite-sex parents are better than same-sex parents.)

For a deeper examination of the effects of state action on morality, see Francis J. Beckwith’s “Government Forms (or Deforms) Souls.”

Regulation as Wishful Thinking

Paul Krugman is arguably a better advocate of regulation than a philosopher (unless the philosopher also has a Ph.D. in economics). But Krugman has met his match in Steven Landsburg, who slices and dices Krugman’s latest justification of the nanny state. Landsburg’s effort might render this post superfluous, but I began to write it before learning of the latest Krugman-Landsburg confrontation (the dénouement of an earlier one is here). There is more to be said and, unlike Landsburg, I am not a sucker for the concept that underpins regulation: the social welfare function (about which, see below).

IMPETUS

This post is inspired by Jason Brennan’s offering at the Bleeding Heart Libertarians blog, “A Simple Libertarian Argument for Environmental Regulation.” Brennan writes:

Libertarians are often very hostile to environmental regulation. Why? Reflecting on the argument below should help us understand their grounds and whether the grounds are any good.

1. Pollution and other kinds of environmental externalities impose costs upon others. A polluter forces others to bear the costs of his activities. Pollution tends to violate people’s property rights, as well as certain rights they have over themselves (such as the rights against having their health compromised against their will).

2. Government regulation of environmental issues is USUALLY/OFTEN/SOMETIMES effective, and is USUALLY/OFTEN/SOMETIMES more effective than using courts to defend the rights mentioned in premise 1. Courts are SOMETIMES/OFTEN/USUALLY ineffective in protecting these rights.

3. Therefore, government should have the right to issue environmental regulations in order to protect property rights, rights to life, and rights to health.

I don’t see how a libertarian could deny premise 1. So premise 2 does all the work. Premise 2 is an empirical premise. We can debate which word (“usually”, “often”, or “sometimes”) belongs in each sentence to make premise 2 true. However, unless the libertarian believes we should instead have “never” in the first sentence of premise 2, then it seems the libertarian has a strong case for favoring some government regulation of environmental issues….

Brennan is wrong to say that “premise 2 does all the work.” Premise 1 does just as much “work,” in a negative way, because it ignores positive externalities. Further, Brennan’s premise 2 omits to mention that regulation — however effectively it may address particular problems — is, on the whole, counterproductive. Brennan’s conclusion (#3) would be flawed, even if premises 1 and 2 were complete and correct, because it rests on the utilitarian presumption of a social welfare function.

In a follow-up post, “Objections to the Simple Libertarian Argument for Environmental Regulation,” Brennan writes:

[H]ere are some objections [to the earlier argument]:

A. The Mission Creep/Abuse Objection: Though 3 is true, if we give government the power to enforce the rights mentioned in 2 through environmental regulation, government will abuse and misuse this power. It will misuse/abuse it so much that it won’t be worth it. It’s better just to leave things to courts, and if that doesn’t work, just let people pollute.

B. The Cost-Benefit Objection: While government is sometimes effective at enforcing rights, cost-benefit analysis shows that the EPA and other such agencies, even when acting without abuse and in good faith, spend/cost far too much for every year of life saved. Against, it’s better just to leave things to courts or even just let people pollute.

C. Other Unintended Consequences Objection: Allowing government to try to solve the problem causes various other negative consequences, and isn’t worth the cost.

D. The Market Can Fix It Objection: There are some market-based (e.g., Coasean) means to solve these problems.

Having been thoroughly schooled in public choice and all the usual stuff, I see the point behind A-D. There’s significant truth behind each of these objections. However, if you’re one of those libertarians who believes the government should issue no environmental regulations (and many libertarians do believe this), you seem to me to be far too pessimistic about A-C and/or optimistic about D. Do the facts really turn out to imply that the optimal amount of government environmental regulation is none?

In the following sections, I expand on my statements about the premises (#1, #2) and conclusion (#3) of Brennan’s original post. Along the way, I address points A, B, C, and D of Brennan’s second post. I also address Brennan’s implicit assumption that regulators can arrive at an “optimal amount” of regulation. This is simply nonsense on stilts because, among other things, it contravenes “public choice,” in which Brennan claims to have been “thoroughly schooled.”

NOT ALL EXTERNALITIES ARE NEGATIVE

A polluter may be producing something that is of value not only to the purchasers of that product but also to others who derive benefits from the purchasers’ use of the product, benefits for which those others do not pay. In other words, negative externalities may be accompanied by positive externalities.

Consider electricity, which in the United States is generated mostly by fossil-fuel and nuclear-power plants. Coal-fired plants still generate about half of America’s electric power; nuclear plants account for another 20 percent. Both types of plants are perennial targets of environmental activists, who cavil at the emissions of coal-burning, the possibility of nuclear accidents, and the problem of containing or disposing of coal ash and radioactive waste. The stance of environmentalists — which is essentially the stance of the Environmental Protection Agency — is to reduce pollution and eliminate risk without regard for the positive externalities of power generation.

And those positive externalities are vast. The availability of electricity has made possible countless inventions and innovations, to the benefit of producers and consumers who did not pay a penny more to power companies for the benefits thus derived. Those inventions and innovations would not have been possible — and will not be possible — if not for the availability of electricity. To the extent that coal generation makes electricity cheaper and more widely available, it encourages beneficial inventions and innovations. One can say that a positive externality of coal-generated electricity has been a higher rate of economic growth — more jobs and greater prosperity — than would otherwise have been possible.

I have made a rough estimate of the value of the positive externalities of electrical power, as follows:

1. The tables for value added by industry at the Bureau of Economic Analysis (BEA) website do not subdivide the utilities industry into categories (electric power, water, etc.). I therefore used the values given for the entire utilities industry as an upper bound of the value added by private electric-power companies. That value was 1.8 percent of GDP in 2008. Many governments (including the federal government) are in the power-generation business, but the value-added by government power utilities is not available, so I took as an upper bound the value added by government enterprises (federal, State, and local), which was 1.1 percent of GDP in 2008. Power-generating entities in the United States therefore add — at the very most — about 3 percent to the nation’s total economic output.

2. But the value added by power generation — something less than 3 percent of GDP, according to the BEA — fails to account for the fundamental importance of electric-power generation to America’s economy. It would not be a great exaggeration to say that the overnight loss of power-generating capacity would set the economy back to its status circa 1900. That was after factories had begun to use electricity but before it came into wide use in large cities. Real GDP per capita in 1900 was about 1/8 of the value it reached in 2008.

3. Try to think of an economic activity that does not depend on electricity. Given the pervasive dependence of all parts of the American economy on electricity, it would be difficult to deny that the power industry’s positive externality (its social return, if you will) is upwards of 7/8 of GDP, whereas the nominal value-added of electric power is less than 3 percent of GDP. That, my friends, is a positive externality to end all positive externalities.

REGULATION IS COUNTERPRODUCTIVE

Regulation is counterproductive for several reasons. First, it curtails positive externalities. Nothing more need be said on that score. The other reasons, on which I expand below, are that regulation cannot be contained to “good causes,” nor can it be tailored to do good without doing harm. These objections might be dismissed as trivial if regulatory overkill were rare and relatively costless, but it is pervasive, extremely costly its own right, and a major contributor to the economic devastation that has been wrought by the regulatory-welfare state.

Who Regulates the Regulators?

Regulators do not stop regulating when they (might) have done some good. Regulatory overreach is endemic to regulatory activity and cannot be separated from it. A lot of bad inevitably accompanies a bit of good. This happens because the regulatory agenda is driven by a combination of

“activists” whose specific (and mostly aesthetic) objectives (kill the pipeline, don’t drill in ANWR, save the spotted owl, etc.) are intended to to limit economic activity and consumer choice;

scientists who are eager to join the consensus about the latest environmental craze, just to be part of the action and also to grab their share of government-funded research — which, not coincidentally, tends to lend credence to the scare-of-the-month that justifies regulation;

regulatory “capture,” through which incumbent firms “help” regulators in ways that favor incumbent firms and limit competition; and

politicians and bureaucrats who play to “activists,” incumbent firms with deep pockets, and the general public (by claiming to be pro-environment), while extending their reach and power — because that is what politicians and bureaucrats like to do.

Regulation as a Blunt Instrument

Regulation substitutes one-size-fits all “solutions” for the tailored outcomes of free markets (including Coesean bargaining) and civil litigation. The result is a consistent pattern of government failure, which is amply documented. (See, for example, the 144 issues of Regulation that have been published to date.) Regulation might be defensible (though not by me) if it were a matter of occasional failure, but it is not. Resorting to regulation to “solve a problem” is like playing Russian roulette with five bullets in a six-shooter.

At its best, regulation mimics the results that would have obtained anyway, as seems to have been the case with automobile safety regulations. These did no more than allow the continuation of a long-running trend toward safer autos and highways, but at the cost of making autos less affordable for low-income persons.

At its worst, regulation prevents consumers from obtaining life-saving products. This can happen indirectly, through the generally stultifying effect of regulation on economic activity (estimated below). And it can happen directly, as with the Food and Drug Administration’s notorious record of delaying the availability of health- and life-saving medicines. (For more on the high cost of regulation, see W. Kip Viscusi and Ted Gayer’s “Safety at Any Price?” in Regulation, Fall 2002. For a good example of government imposing a dangerous one-size-fits-all burden on the populace, see Kenneth Anderson’s post, “The Science Is Settled: You’re Just Too Stupid to Live,” at The Volokh Conspiracy.)

A pervasive form of regulation, which usually is not labelled as such, is the Fed’s manipulation of interest rates and the supply of money. How has that worked out? Business cycles have become more volatile since the creation of the Fed in 1913. The worst downturn in American history — the Great Depression — can be chalked up, in large part, to the Fed’s loosening of credit in the late 1920s, followed by its contraction of the money supply in the early 1930s. We owe the Great Recession, which lingers, to the “perfect storm” of low interest rates (thanks to the Fed) and the regulation of housing markets (to encourage home-ownership by low-income persons) via Fannie Mae and Freddie Mac.

Environmental regulation is no different than any other kind, resting as it does on aesthetic preferences, half-baked “scientific” theories (AGW being the latest and perhaps the most egregious of the lot), and the unholy alliance of “bootleggers and Baptists.” The “bootleggers” are incumbent firms; producers of “green” products and such-like; and politicians and bureaucrats, who stand to gain power and prestige from their “unselfish” efforts. The “Baptists” are smug do-gooders who just will not leave the rest of us alone to figure things out for ourselves.

The Interest-Group Paradox

Environmental regulation and regulation in general are integral to the vast and vastly destructive regulatory-welfare state that has rise up in America since the early 1900s. That growth is the result of a phenomenon which I call the interest-group paradox.

Pork-barrel legislation exemplifies the interest-group paradox in action, though the paradox involves more than pork-barrel legislation. There are myriad government programs that — like pork-barrel projects — are intended to favor particular classes of individuals. In the case of environmental regulation, the favored classes are “activists,” bureaucrats, incumbent firms, “green” enterprises, and the politicians who benefit from their symbiotic relationships with the aforementioned. The support for each program is “bought” at the expense of supporting other programs. Because there are thousands of government programs (federal, State, and local) — each intended to help a particular class of citizens (at the expense of others) — the net result is that almost no one in this fair land enjoys a “free lunch,” despite almost everyone’s efforts to do just that. This is the interest-group paradox.

The interest-group paradox is like the paradox of thrift, in that large numbers of individuals are trying to do something that makes certain classes of persons better off, but which in the final analysis makes those classes of persons worse off. It is also like the paradox of panic, in that there is a crowd of interest groups rushing toward a goal — a “pot of gold” — and (figuratively) crushing each other in the attempt to snatch the pot of gold before another group is able to grasp it. The gold that any group happens to snatch is a kind of fool’s gold: It passes from one fool to another in a game of beggar-thy-neighbor.

If you want regulation, you must pay the political price by backing other programs, for which you will seek payment in the form of additional regulation, and so on, ad perpetuum.

The Final Tally

The direct cost of regulation is about 10 percent of GDP: $1.5 trillion in today’s dollars. The indirect cost of regulation cannot be separated from the cumulative burden of the regulatory-welfare state. But that burden would not be as large as it is were it not for the integral role of environmental regulation in the working of the interest-group paradox. I have estimated that the establishment and expansion of the regulatory-welfare state over the past century has reduced real GDP by about 70 percent from the level it would have attained if the state had not been expanded beyond a “night watchman” role.

The price tag is so large that everyone (“activists,” regulators, etc.) pays in one way or another, through fewer choices, fewer jobs, and lower real incomes. And it cannot be otherwise because, as noted above, the bad inevitably comes with the good. To believe or claim otherwise is to indulge in the Nirvana fallacy and wishful thinking.

FUNDAMENTAL FLAW: THE MYTH OF THE SOCIAL-WELFARE FUNCTION

Costs aside, regulation is based on an epistemological error. The urge to regulate presumes a social welfare function that can be maximized — or improved, at least — by limiting the negative externalities that flow from certain economic activities.

For example, an environmental regulation might cause the owner of a polluting factory to buy and operate some kind of equipment that reduces the factory’s emissions. When the owner complies, those who live near the factory are presumed to be better off. And perhaps the benefits extend farther afield. But, in any case, the factory owner’s higher costs are likely to have untoward effects, for example, fewer jobs for factory workers and higher prices for the purchasers of the factory’s products.

When a proponent of regulation is confronted with this reality, he is likely to shrug and say that the costs (fewer jobs, higher prices) are worth the benefits (less pollution). Whence the moral authority to make that kind of judgment? It implies the existence of a social-welfare function, to which the proponent of regulation is privy.

This is nothing less than utilitarianism in the modern garb of cost-benefit analysis. The theory of cost-benefit analysis is simple: If the expected benefits from a government project or regulation are greater than its expected costs, the project or regulation is economically justified.

But cost-benefit analysis has a fundamental flaw, which it shares with utilitarianism: One person’s benefit cannot be compared with another person’s cost. (This objection vanishes when parties are free to engage in Coasean bargaining, but regulation preempts that option.) Suppose, for example, that the City of Los Angeles were to conduct a cost-benefit analysis which “proved” that the cost of constructing yet another freeway through the city would be more than offset (i.e., would yield a “net benefit”) because it would reduce the imputed cost of time spent in traffic by workers who drive into the city from the suburbs.

Yes, that is how cost-benefit analysis works. It assumes that the costs borne by one set of persons (taxpayers, consumers, unemployed factory workers, etc.) can be offset by the benefits that accrue to other persons (commuters, persons who live near factories, environmental “activists,”, etc.). It is the creed of “the greatest amount of happiness altogether.”

A moment’s reflection will tell you that there is no such thing as “the greatest amount of happiness altogether.” If A steals from B, A is happier for having obtained money with little effort, while B is less happy because he has less money. Does A’s gain in happiness cancel B’s loss of happiness. If you say “yes,” welcome to the world of psychopathy.

And you do say “yes,” implicitly, if you believe in environmental regulation — or any kind of regulation that effectively redistributes income or wealth.

THE ALTERNATIVES TO REGULATION: MARKETS AND COMMON LAW

Given all that I have said in the preceding sections, it seems clear that the burden of proof is (or should be) on those who wish to substitute regulation for markets and common law. It is also clear that, despite Brennan’s wishful thinking, government is incapable of delivering an “optimal amount” of regulation — whatever that might be. Markets may be imperfect (from the standpoint of the non-existent omniscient arbiter), but they are less imperfect than government.

General Arguments for Markets and Common Law Instead of Regulation

Is it wishful thinking to suppose that markets and civil litigation can deal with pollution and other kinds of negative externalities? Not at all:

Free-market environmentalism can also be expected to grow. It is the proven private alternative to costly and ineffective command-and-control schemes for protecting endangered species and habitats. To avoid the tragedy of the commons, one can look to the creation of more private, voluntary arrangements for “property rights” over animals, fish, and ecologically sensitive lands—via auctions of cleverly designed contracts to limit kills and catches and via binding covenants to preserve natural lands in perpetuity. Conservation banks, first created in 1995, now number 70 and represent another approach to environmental protection for endangered birds and animals. (Reason Foundation, “Transforming Government through Privatization,” Annual Privatization Report, 2006)

Terry L. Anderson, executive director of the Property & Environment Research Center (PERC) gives many examples of free-market environmentalism at work in “Markets and the Environment: Friends of Foes?” For much more, see PERC’s large catalog of publications. And PERC is but one of the many organizations doing serious scholarly work in the field of free-market environmentalism.

If you are old enough to remember the Love Canal disaster, you will assume (as I did) that it was the fault of the chemical company that had been dumping waste in the abandoned canal. Not so, according to Richard L. Stroup:

[L]iability for pollution is a powerful motivator when a factory or other potentially polluting asset is privately owned. The case of the Love Canal, a notorious waste dump, illustrates this point. As long as Hooker Chemical Company owned the Love Canal waste site, it was designed, maintained, and operated (in the late 1940s and 1950s) in a way that met even the Environmental Protection Agency standards of 1980. The corporation wanted to avoid any damaging leaks, for which it would have to pay.

Only when the waste site was taken over by local government—under threat of eminent domain, for the cost of one dollar, and in spite of warnings by Hooker about the chemicals—was the site mistreated in ways that led to chemical leakage. The government decision makers lacked personal or corporate liability for their decisions. They built a school on part of the site, removed part of the protective clay cap to use as fill dirt for another school site, and sold off the remaining part of the Love Canal site to a developer without warning him of the dangers as Hooker had warned them. The local government also punched holes in the impermeable clay walls to build water lines and a highway. This allowed the toxic wastes to escape when rainwater, no longer kept out by the partially removed clay cap, washed them through the gaps created in the walls….

Nor does the government sector have the long-range view that property rights provide, which leads to protection of resources for the future. As long as … divestibility, is present, property rights provide long-term incentives for maximizing the value of property. If I mine my land and impair its future productivity or its groundwater, the reduction in the land’s value reduces my current wealth. That is because land’s current worth equals the present value of all future services. Fewer services or greater costs in the future mean lower value now. In fact, on the day an appraiser or potential buyer can first see that there will be problems in the future, my wealth declines. The reverse also is true: any new way to produce more value—preserving scenic value as I log my land, for example, to attract paying recreationists—is capitalized into the asset’s present value.

Because the owner’s wealth depends on good stewardship, even a shortsighted owner has the incentive to act as if he or she cares about the future usefulness of the resource. This is true even if an asset is owned by a corporation. Corporate officers may be concerned mainly about the short term, but as financial economists such as Harvard Business School’s Michael C. Jensen have noted, even they have to care about the future. If current actions are known to cause future problems, or if a current investment promises future benefits, the stock price rises or falls to reflect the change. Corporate officers are informed by (and are judged by) these stock price changes. (From “Free Market Environmentalism,” at the Library of Economics and Liberty.)

The Siren Song of Government Intervention

Stroup stumbles, however, by saying that

when many polluters and those who receive the pollution are involved, how can property rights force accountability? The nearest receivers may be hurt the most, and may be able to sue polluters—but not always. Consider an extreme case: the potential global warming impact of carbon dioxide produced by the burning of wood or fossil fuels. If climate change results, the effects are worldwide. Nearly everyone uses the energy from such fuels, and if the threat of global warming from a buildup of carbon dioxide turns out to be as serious as some claim, then those harmed by global warming will be hard-pressed to assert their property rights against all the energy producers or users of the world. The same is true for those exposed to pollutants produced by autos and industries in the Los Angeles air basin. Private, enforceable, and tradable property rights can work wonders, but they are not a cure-all.

If a cure-all is required, one ought to pray for miracles. Short of miracles, the question is whether it is better to rely on government action or voluntary action, supplemented by civil litigation. I say “or” precisely because government action precludes the alternatives. It is “better” to rely on government if one wants a dictated outcome, is willing to impose the costs of attaining that outcome on persons who are not involved in the situation at hand (e.g., distant taxpayers), and is indifferent to the unintended consequences of government action. It is better to rely on voluntary action, supplemented by civil litigation, if one cares about liberty and economic efficiency (as found in Coasean solutions to conflicts of interest).

Taking smog in the L.A. basin first: It belongs to that class of “problem” which includes choosing to live in areas that are prone to hurricanes, floods, and fires. The obvious voluntary solution — for those who find smog, etc., not worth whatever benefits may accrue to living with it (e.g., higher income) — is to quit the locale. Along comes government to impose one-size-fits-all solutions that also impose costs on persons who do not live in areas where there is smog, etc. The immediate results of government intervention are a disincentive to move and massive subsidization of those who choose not to move by persons who have their own problems to contend with. Further results are

disincentives to entrepreneurs who would come forward with ameliorative devices (e.g., air-filtration systems and catalytic converters);

disincentives to persons of a charitable bent who would take it upon themselves to help low-income persons afford ameliorative devices and even help to underwrite the development of such devices;

moral hazard, that is, putting the non-movers in a position to incur further losses that will be subsidized; and

the playing out of the interest-group paradox, wherein those who are subsidized agree (tacitly) to subsidize persons who seek subsidization or other favors from government.

Entrepreneurship is thought to be unlikely (in the circumstance) because of the free-rider problem, but the free-rider problem is overstated. Further, charity (giving without the expectation of more than psychic return) is one proof against the presumption of economic paralysis that is embedded in the statement of the free-rider problem.

Regardless of the arguments against regulation, most politicians and left-wingers would say that it is proper to respond “collectively” to pollution because, after all, that is the hallmark of a “just, caring society,” in which “we” take care of each other. Are disincentives to entrepreneurship, charity, moral hazard, cross-subsidization, and plain old theft by government really the hallmarks of a “just, caring society”? Not at all; they are the facts of life that politicians and leftists prefer to ignore because they prefer collective action (at the point of government’s gun) to effective action. The invocation of a “just, caring society” is a cheap political trick, played by leftists and politicians. In the case of politicians, it is a sign of (cheap) compassion that helps them win elections, feed at the public trough, and slake their power-lust.

No “Problem” Is Too Big for Private Action

Stroup, despite his evident understanding of the power of markets to solve “problems,” seems to hold a viewpoint in common with knee-jerk advocates of government action: If a “problem” exists, it is only a “problem,” not an incidental, negative aspect of beneficial activity. And its “solution” cannot come at too high a price, that is, whatever price government imposes through regulation, inasmuch as “optimal regulation” is a pipe-dream.

Moreover, the “problem” may be so pervasive that only government can solve it. Why? Because those who suffer negative externalities are unable to bargain with or take legal action against the parties responsible for the externalities. Who are those parties? They are us! We — the users of electricity and the many other products and services whose creation results in the emission of carbon dioxide — may be joined in an unwitting suicide pact, despite the warnings of “seers” like Al Gore, James Hansen, Michael Mann, et al.. Those warnings (blatantly hypocritical in Gore’s case) amount to this: “We” (but not “they”) must surrender a large portion of the material gains that have been wrested from nature through ingenuity and industriousness; otherwise, there will be dire consequences for all. (Perhaps it would have been better if our distant ancestors had not learned how to make fire, with all of its dire consequences for humans and their possessions.)

I have written so much about the issue of AGW (e.g., here, here, here, here, here, here, here, here, here, here, and here) that I will not bother to address its validity here. I will assume, merely for the sake of argument, that it is a possibility. But saying that it is a possibility does not mean that it is a dire emergency. Consider, for example, these excerpts of Nobel laureate Ivar Ginever’s letter of resignation from the American Physical Society:

In the APS it is ok to discuss whether the mass of the proton changes over time and how a multi-universe behaves, but the evidence of global warming is incontrovertible? The claim (how can you measure the average temperature of the whole earth for a whole year?) is that the temperature has changed from ~288.0 to ~288.8 degree Kelvin in about 150 years, which (if true) means to me is that the temperature has been amazingly stable, and both human health and happiness have definitely improved in this ‘warming’ period.

If AGW is truly a problem — and not just a “problem” that “demands” government action — it is evidently not an emergency that requires immediate, concerted action by a central authority. To the contrary, if it is a problem it can be addressed by a variety of voluntary actions. These include the gradual migration of heat-sensitive individuals and economic activities to cooler parts of the globe and the development and spread of ameliorative technologies for those persons and activities that cannot or will not migrate. All such adaptive behavior will become more possible and affordable if economic growth is not choked off by regulations that arbitrarily stifle economic activity by curbing the emission of so-called greenhouse gases. (That a large proportion of individuals and economic activities would thrive as their environment warms a bit seems to be lost on climate-change alarmists.)

If the possibility of AGW does not justify government action, what about a true global emergency? Imagine, for example, that reputable scientists around the globe detect a large asteroid that is almost certain to strike Earth in two years, and that the likely result of the strike is the end of human life on the planet. Would that not justify concerted government action?

Again, I say “no.” What it would justify — and encourage — is action by independent (but possibly cooperative) teams of scientists and engineers, underwritten by various groups of super-rich individuals and large corporations. Why should such individuals and corporations fund an effort that would benefit upward of seven billion free riders? Because the existence of those individuals and corporations would be at stake, and many of them would welcome the glory and/or increased sales that would undoubtedly accompany a successful anti-asteroid operation.

I refer you, again, to my earlier post about the free-rider problem, and the link that is embedded in the post. In both posts, I argue that defense and justice — among other so-called public goods — are nothing of the kind. They are goods that, in a relatively open polity like that of the United States, are better provided by an accountable state than entrusted to competing private entities. It should be obvious — and it is obvious to all but obdurate anarcho-capitalists — that such entities would be the equivalent of warlords. The law of the jungle would replace the rule of law. That possibility is the only excuse for the state’s monopolization of justice and defense. But nothing — not even “externalities” — excuses the state’s intrusion into economic activity that is peaceful and voluntary.

Right On!

Jeffrey Lord, writing at The American Spectator (“Iran Bomb Plot Sinks Ron Paul’s Credibility“):

Remember Congressman Paul back at that Fox debate in Iowa saying to Chris Wallace that the threat from Iran was “small”? That “Iran does not have an air force that can come here…. They can’t even make enough gasoline for themselves…” This was in addition to Paul’s attack on former president George W. Bush for signing an executive order designating Iran’s Revolutionary Guard a “terrorist group.” All are of a piece in the consistent Ron Paul theme that many see as a McGovernite foreign policy. Not only far-left wing philosophically but with a startling — and dangerous — naïveté about the nature of America’s enemies.

Comes now the news that lo and behold Iran is being accused by the FBI — with the charge backed up by House Intelligence Chairman Mike Rogers, the Kentucky Republican — of plotting not one but two attacks on American soil. The targets being the Saudi Ambassador to the U.S. and the Israeli Embassy….

All of which is to say, Congressman Paul’s theories about Iran have just been blown to smithereens.

Iran didn’t use an air force to get to America — it had an Iranian, American-naturalized citizen Manssor Arbabsiar — already here.

Suppose instead of a plot to blow up a Washington restaurant — among the charges — with a conventional bomb, Arbabsiar and his cohort had managed to smuggle in a nuclear weapon? What did Paul write in his book The Revolution in addition to scorning the idea that Iran’s Revolutionary Guard was a danger?

I had said all along that Iran posed no imminent nuclear threat to us or to her neighbors.

This time around, luck was on America’s side. Iran didn’t — yet — have the capacity to smuggle in a nuclear weapon. But they were within a whisker of getting a conventional bomb and killing hundreds –on American soil.

An act which all by itself could easily be defined as an act of war.

But the real casualty here?

The Ron Paul movement.

The congressman has just been shown to be wrong about Iran — big time.

Ron Paul is not the only so-called libertarian who has been shown to be wrong. Paul — along with many so-called libertarians and great swaths of leftists — likes to preach the gospel of benign neglect: Leave others alone and they will leave us alone. This is such jejune nonsense that I find it hard to believe that sentient adults profess to believe it. But a dangerously high number of them do.

Rather than repeat the long list of posts that I have written on this subject, I refer you to the list at the end of “Nonsense about Presidents, IQ, and War.”

Nonsense about Presidents, IQ, and War

Peter Singer outdoes his usual tendentious self in this review of Steven Pinker’s The Better Angels of Our Nature: Why Violence Has Declined. In the course of the review, Singer writes:

Pinker argues that enhanced powers of reasoning give us the ability to detach ourselves from our immediate experience and from our personal or parochial perspective, and frame our ideas in more abstract, universal terms. This in turn leads to better moral commitments, including avoiding violence. It is just this kind of reasoning ability that has improved during the 20th century. He therefore suggests that the 20th century has seen a “moral Flynn effect, in which an accelerating escalator of reason carried us away from impulses that lead to violence” and that this lies behind the long peace, the new peace, and the rights revolution. Among the wide range of evidence he produces in support of that argument is the tidbit that since 1946, there has been a negative correlation between an American president’s I.Q. and the number of battle deaths in wars involving the United States.

Singer does not give the source of the IQ estimates on which Pinker relies, but the supposed correlation points to a discredited piece of historiometry by Dean Keith Simonton, “Presidential IQ, Openness, Intellectual Brilliance, and Leadership: Estimates and Correlations for 42 U.S. Chief Executives” (Political Psychology, Vol. 27, No. 4, 2006). Simonton jumps through various hoops to assess the IQs of every president from Washington to Bush II — to one decimal place. That is a feat on a par with reconstructing the final thoughts of Abel, ere Cain slew him.

Before I explain the discrediting of Simonton’s obviously discreditable “research,” there is some fun to be had with the Pinker-Singer story of presidential IQ (Simonton-style) for battle deaths. First, of course, there is the convenient cutoff point of 1946. Why 1946? Well, it enables Pinker-Singer to avoid the inconvenient fact that the Civil War, World War I, and World War II happened while the presidency was held by three men who (in Simonton’s estimation) had high IQs: Lincoln, Wilson, and FDR.

The next several graphs depict best-fit relationships between Simonton’s estimates of presidential IQ and the U.S. battle deaths that occurred during each president’s term of office.* The presidents, in order of their appearance in the titles of the graphs are Harry S Truman (HST), George W. Bush (GWB), Franklin Delano Roosevelt (FDR), (Thomas) Woodrow Wilson (WW), Abraham Lincoln (AL), and George Washington (GW). The number of battle deaths is rounded to the nearest thousand, so that the prevailing value is 0, even in the case of the Spanish-American War (385 U.S. combat deaths) and George H.W. Bush’s Gulf War (147 U.S. combat deaths).

This is probably the relationship referred to by Singer, though Pinker may show a linear fit, rather than the tighter polynomial fit used here:

It looks bad for the low “IQ” presidents — if you believe Simonton’s estimates of IQ, which you shouldn’t, and if you believe that battle deaths are a bad thing per se, which they aren’t. I will come back to those points. For now, just suspend your well-justified disbelief.

If the relationship for the HST-GWB era were statistically meaningful, it would not change much with the introduction of additional statistics about “IQ” and battle deaths, but it does:

If you buy the brand of snake oil being peddled by Pinker-Singer, you must believe that the “dumbest” and “smartest” presidents are unlikely to get the U.S. into wars that result in a lot of battle deaths, whereas some (but, mysteriously, not all) of the “medium-smart” presidents (Lincoln, Wilson, FDR) are likely to do so.

In any event, if you believe in Pinker-Singer’s snake oil, you must accept the consistent “humpback” relationship that is depicted in the preceding four graphs, rather than the highly selective, one-shot negative relationship of the HST-GWB graph.

More seriously, the relationship in the HST-GWB graph is an evident ploy to discredit certain presidents (especially GWB, I suspect), which is why it covers only the period since WWII. Why not just say that you think GWB is a chimp-like, war-mongering, moron and be done with it? Pseudo-statistics of the kind offered up by Pinker-Singer is nothing more than a talking point for those already convinced that Bush=Hitler.

But as long as this silly game is in progress, let us continue it, with a new rule. Let us advance from one to two explanatory variables. The second explanatory variable that strongly suggests itself is political party. And because it is not good practice to omit relevant statistics (a favorite gambit of liars), I estimated an equation based on “IQ” and battle deaths for the 27 men who served as president from the first Republican presidency (Lincoln’s) through the presidency of GWB. The equation looks like this:

U.S. battle deaths (000) “owned” by a president =

-80.6 + 0.841 x “IQ” – 31.3 x party (where 0 = Dem, 1 = GOP)

In other words, battle deaths rise at the rate of 841 per IQ point (so much for Pinker-Singer). But there will be fewer deaths with a Republican in the White House (so much for Pinker-Singer’s implied swipe at GWB).

All of this is nonsense, of course, for two reasons: Simonton’s estimates of IQ are hogwash, and the number of U.S. battle deaths is a meaningless number, taken by itself.

With regard to hogwash, Simonton’s estimates of presidents’ IQs put every one of them — including the “dumbest,” U.S. Grant — in the top 2.3 percent of the population. And the mean of Simonton’s estimates puts the average president in the top 0.1 percent (one-tenth of one percent) of the population. That is literally incredible. Good evidence of the unreliability of Simonton’s estimates is found in an entry by Thomas C. Reeves at George Mason University’s History New Network. Reeves is the author of A Question of Character: A Life of John F. Kennedy, the negative reviews of which are evidently the work of JFK idolators who refuse to be disillusioned by facts. Anyway, here is Reeves:

I’m a biographer of two of the top nine presidents on Simonton’s list and am highly familiar with the histories of the other seven. In my judgment, this study has little if any value. Let’s take JFK and Chester A. Arthur as examples.

Kennedy was actually given an IQ test before entering Choate. His score was 119…. There is no evidence to support the claim that his score should have been more than 40 points higher [i.e., the IQ of 160 attributed to Kennedy by Simonton]. As I described in detail in A Question Of Character [link added], Kennedy’s academic achievements were modest and respectable, his published writing and speeches were largely done by others (no study of Kennedy is worthwhile that downplays the role of Ted Sorensen)….

Chester Alan Arthur was largely unknown before my Gentleman Boss was published in 1975. The discovery of many valuable primary sources gave us a clear look at the president for the first time. Among the most interesting facts that emerged involved his service during the Civil War, his direct involvement in the spoils system, and the bizarre way in which he was elevated to the GOP presidential ticket in 1880. His concealed and fatal illness while in the White House also came to light.

While Arthur was a college graduate, and was widely considered to be a gentleman, there is no evidence whatsoever to suggest that his IQ was extraordinary. That a psychologist can rank his intelligence 2.3 points ahead of Lincoln’s suggests access to a treasure of primary sources from and about Arthur that does not exist.

This historian thinks it impossible to assign IQ numbers to historical figures. If there is sufficient evidence (as there usually is in the case of American presidents), we can call people from the past extremely intelligent. Adams, Wilson, TR, Jefferson, and Lincoln were clearly well above average intellectually. But let us not pretend that we can rank them by tenths of a percentage point or declare that a man in one era stands well above another from a different time and place.

My educated guess is that this recent study was designed in part to denigrate the intelligence of the current occupant of the White House….

That is an excellent guess.

The meaninglessness of battle deaths as a measure of anything — but battle deaths — should be evident. But in case it is not evident, here goes:

Wars are sometimes necessary, sometimes not. (I give my views about the wisdom of America’s various wars at this post.) Necessary or not, presidents usually act in accordance with popular and elite opinion about the desirability of a particular war. Imagine, for example, the reaction if FDR had not gone to Congress on December 8, 1941, to ask for a declaration of war against Japan, or if GWB had not sought the approval of Congress for action in Afghanistan.

Presidents may have a lot to do with the decision to enter a war, but they have little to do with the external forces that help to shape that decision. GHWB, for example, had nothing to do with Saddam’s decision to invade Kuwait and thereby threaten vital U.S. interests in the Middle East. GWB, to take another example, was not a party to the choices of earlier presidents (GHWB and Clinton) that enabled Saddam to stay in power and encouraged Osama bin Laden to believe that America could be brought to its knees by a catastrophic attack.

The number of battle deaths in a war depends on many things outside the control of a particular president; for example, the size and capabilities of enemy forces, the size and capabilities of U.S. forces (which have a lot to do with the decisions of earlier administrations and Congresses), and the scope and scale of a war (again, largely dependent on the enemy).

Battle deaths represent personal tragedies, but — in and of themselves — are not a measure of a president’s wisdom or acumen. Whether the deaths were in vain is a separate issue that depends on the aforementioned considerations. To use battle deaths as a single, negative measure of a president’s ability is rank cynicism — the rankness of which is revealed in Pinker’s decision to ignore Lincoln and FDR and their “good” but deadly wars.

To put the last point another way, if the number of battle death deaths is a bad thing, Lincoln and FDR should be rotting in hell for the wars that brought an end to slavery and Hitler.

__________
* The numbers of U.S. battle deaths, by war, are available at infoplease.com, “America’s Wars: U.S. Casualties and Veterans.” The deaths are “assigned” to presidents as follows (numbers in parentheses indicate thousands of deaths):

All of the deaths (2) in the War of 1812 occurred on Madison’s watch.

All of the deaths (2) in the Mexican-American War occurred on Polk’s watch.

I count only Union battle deaths (140) during the Civil War; all are “Lincoln’s.” Let the Confederate dead be on the head of Jefferson Davis. This is a gift, of sorts, to Pinker-Singer because if Confederate dead were counted as Lincoln, with his high “IQ,” it would make Pinker-Singer’s hypothesis even more ludicrous than it is.

WW is the sole “owner” of WWI battle deaths (53).

Some of the U.S. battle deaths in WWII (292) occurred while HST was president, but Truman was merely presiding over the final months of a war that was almost won when FDR died. Truman’s main role was to hasten the end of the war in the Pacific by electing to drop the A-bombs on Hiroshima and Nagasaki. So FDR gets “credit” for all WWII battle deaths.

The Korean War did not end until after Eisenhower succeeded Truman, but it was “Truman’s war,” so he gets “credit” for all Korean War battle deaths (34). This is another “gift” to Pinker-Singer because Ike’s “IQ” is higher than Truman’s.

Vietnam was “LBJ’s war,” but I’m sure that Singer would not want Nixon to go without “credit” for the battle deaths that occurred during his administration. Moreover, LBJ had effectively lost the Vietnam war through his gradualism, but Nixon chose nevertheless to prolong the agony. So I have shared the “credit” for Vietnam War battle deaths between LBJ (deaths in 1965-68: 29) and RMN (deaths in 1969-73: 17). To do that, I apportioned total Vietnam War battle deaths, as given by infoplease.com, according to the total number of U.S. deaths in each year of the war, 1965-1973.

The wars in Afghanistan and Iraq are “GWB’s wars,” even though Obama has continued them. So I have “credited” GWB with all the battle deaths in those wars, as of May 27, 2011 (5).

The relative paucity of U.S. combat deaths in other post-WWII actions (e.g., Lebanon, Somalia, Persian Gulf) is attested to by “Post-Vietnam Combat Casualties,” at infoplease.com.

Previous posts about Peter Singer:
Peter Singer’s Fallacy
Peter Singer’s Agenda
Singer Said It
Rationing and Health Care
Peter Presumes to Preach

In Defense of Capital Punishment

Edward Feser, writing at Public Discourse on September 29, 2011, “In Defense of Capital Punishment“:

Traditionally, the aims of punishment are threefold: retribution, or inflicting on a wrongdoer a harm he has come to deserve because of his offense; correction, or chastising the wrongdoer for the sake of getting him to change his ways; and deterrence, discouraging others from committing the same offense. Retribution is necessarily the most fundamental. Strictly speaking, we cannot correct someone who doesn’t deserve correction; at most we might try to affect his behavior (via drugs, say) in a sub-personal manner that doesn’t appeal, as true correction does, to his sense of desert and shame. We also cannot justly inflict a punishment on someone for purposes of deterrence unless he deserves that punishment. That retribution is fundamental doesn’t entail that those with the authority to do so must always exact retribution on an offender. It does, however, mean that retribution may be exacted, all things being equal (though of course things are not always equal); it also means that retribution—inflicting a harm that is deserved—must always be part of any act of punishment, even if it is not the only part.

I agree with Feser that retribution is fundamental, though I would go further:

Justice, at bottom, can only be revenge. Murder and mayhem cannot be undone or somehow ameliorated. The loss of a life, a limb, or an organ is permanent. Other injuries take time to heal, and may heal imperfectly; the healing time and its attendant costs are lost, in any event. Theft is rarely made whole.

Aside from the inculcation of morality, our surest protection from predation is the promise of swift and sure vengeance. When the state fails in its duty to exact that vengeance, it becomes illegitimate.(“What Is Justice?,” June 19, 2011)

Deterrence and retribution (vengeance) are tightly bound. As for correction, the best corrective is to keep criminals away from the rest of us, for as long as is reasonably possible.

What about capital punishment? Here is Feser:

If wrongdoers do deserve punishment, and if punishment ought to be scaled to the gravity of the crime (harsher punishments for graver crimes), then it would be absurd to deny that there is a level of criminality for which capital punishment is appropriate, at least in principle. Even if it were claimed that a single murder would not merit it, it is not difficult to imagine crimes that would. Ten murders? Ten murders coupled with the rape and torture of the victims? Genocide? If wrongdoers deserve punishment and the punishment ought to be proportional to the offense, then at some point we are going to reach a level of criminality for which capital punishment is appropriate at least in principle. To claim that no crime could justify capital punishment—to claim, for instance, that a cold-blooded genocidal rapist can never even in principle merit a greater punishment than the lifelong imprisonment inflicted on a bank robber—is implicitly to give up the principle of proportionality and, with it, any coherent conception of just punishment.

My thoughts parallel Feser’s

Capital punishment is the capstone of a system of justice that used to work quite well in this country because punishment was certain…. There must be a hierarchy of … penalties for crime, and that hierarchy must culminate in the ultimate penalty if criminals and potential criminals are to believe that crime will be punished. When punishment is made less severe and less certain … crime flourishes and law-abiding citizens become less secure in their lives and property. (“Does Capital Punishment Deter Homicide?,” October 4, 2004)

Why Stop at the Death Penalty?

Regime Uncertainty and the Great Recession

I have pointed out that the Great Recession is not over.Nor is it likely to end anytime soon, given the anti-business, anti-growth policies and rhetoric of the Obama administration. (Making nice with crony capitalists like Jeff Immelt only underscores Obama’s cynicism.)

Economists Scott Baker, Nicholas Bloom, and Steven Davis have weighed in with a similar assessment; for example:

A major factor behind the weak recovery and gloomy outlook is a climate of policy-induced economic uncertainty. An index we devised [chart below] shows U.S. policy uncertainty at historically high levels….

Our index shows prominent surges in policy uncertainty around the time of major elections, the outbreak of wars and after the Sept. 11 attacks. It shows another surge after the bankruptcy of Lehman Brothers Holding Inc. in September 2008. Policy uncertainty has remained at high levels ever since….

Why has policy uncertainty increased so much? One argument holds that the recent financial crisis created an atmosphere of extreme uncertainty, bringing new and difficult policy issues to the fore. No doubt, the crisis presented policy makers with difficult choices in 2008 and 2009. But the persistence of policy uncertainty wasn’t inevitable. Rather, it reflects deliberate policy decisions, harmful rhetorical attacks on business and “millionaires,” failure to tackle entitlement reforms and fiscal imbalances, and political brinkmanship. (“Business Class: Policy Uncertainty Is Choking Recovery,” Bloomberg.com, October 5, 2011)

Here is the chart that accompanies the article by Baker, Bloom, and Davis:

The rampant uncertainty — due in large part to Obama’s policies and rhetoric — has prolonged the recession because businesses are loath to hire and make job-creating investments:

Source: Mark J. Perry, “The Jobless Recovery Is Really an Investment-less Recovery,” The Enterprise Blog, October 3, 2011.

Greg Mankiw sees it this way:

• The most volatile component of G.D.P. over the business cycle is spending on investment goods. This spending category includes equipment, software, inventory accumulation, and residential and nonresidential construction. And the recent economic downturn offers this case in point about the problem: From the economy’s peak in the fourth quarter of 2007 to the recession’s official end, G.D.P. fell by only 5.1 percent, while investment spending fell by a whopping 34 percent….

Myriad government actions influence the expected future profitability of capital. These include not only policies concerning taxation but also those concerning trade and regulation.

For example, passing the free trade agreement with South Korea, which has languished in Congress more than four years after first being negotiated, would be a step in the right direction. So would reining in the National Labor Relations Board; its decision to block Boeing from opening a nonunion plant in South Carolina may have been hailed by organized labor, but it surely did not hearten investors. (“How to Make Business Want to Invest Again,” The New York Times, September 10, 2011)

Stronger language about the negative effects of Obama’s policies can be found here:

Mark J. Perry, “Thanks to Regulatory Burdens, We’ve Got Both A Creditless Recovery and A Jobless Recovery” ( Carpe Diem, July 21, 2011)

Bruce McQuain, “Why aren’t we seeing a jobs recovery? Maybe it’s ObamaCare’s fault” ( Questions and Observations, July 21, 2011)

Jonathan S. Tobin, “Home Depot Founder: Obama’s Regulations Are Killing Businesses” (Commentary, July 21, 2011)

The present situation is scarily reminiscent of the Great Depression. As Robert Higgs writes,

the economy remained in the depression as late as 1940 because private investment had never recovered sufficiently after its collapse during the Great Contraction [of 1929-33]….

[T]he insufficiency of private investment from 1935 through 1940 reflected a pervasive uncertainty among investors about the security of their property rights in their capital and its prospective returns. This uncertainty arose, especially though not exclusively, from the character of federal government actions and the nature of the Roosevelt administration during the so-called Second New Deal from 1935 to 1940. Starting in 1940 the makeup of FDR’s administration changed substantially as probusiness men began to replace dedicated New Dealers in many positions, including most of the offices of high authority in the war-command economy. Congressional changes in the elections from 1938 onward reinforced the movement away from the New Deal, strengthening the so-called Conservative Coalition. (“Regime Uncertainty: Why the Great Depression Lasted So Long and Why Prosperity Resumed after the War,” The Independent Review, Spring 1997)

By way of closing the circle, I note that Higgs endorses Baker, Bloom, and Davis’s research.

It is more than evident that the only sure route to economic recovery is the replacement of Obama by a Republican (almost any one will do), and firm Republican control of both houses of Congress.

Abortion and the Fourteenth Amendment

“Assessing the Presidential Candidates on Abortion, Supreme Court,” by Robert George, includes this intriguing passage:

Many believe that we need a constitutional amendment to overturn Roe v. Wade. However, Section Five of the Fourteenth Amendment expressly empowers the Congress, by appropriate legislation, to enforce the guarantees of due process and equal protection contained in the Amendment’s first section. As someone who believes in the inherent and equal dignity of all members of the human family, including the child in the womb, would you propose to Congress appropriate legislation, pursuant to the Fourteenth Amendment, to protect human life in all stages and conditions?

Political reasons aside, why not? George asked his question of Michele Bachmann, Herman Cain, Newt Gingrich, Ron Paul, and Mitt Romney at the Palmetto Freedom Forum on September 5, 2011. Ron Paul’s objection is of special interest. According to George,

Ron Paul responded to my question not by embracing judicial supremacy, but by denying that the 14^th Amendment authorizes Congress to legislate to protect the unborn. Interestingly, Paul himself has a perfect pro-life voting record–in Congress. In his view, however, the abortion question is one that the Constitution leaves ultimately to the individual states, not the national government.

In his exchange with me, Congressman Paul argued that reading the 14^th Amendment broadly enough to empower Congress to protect the unborn would be inconsistent with the 10^th Amendment–the constitutional provision reminding us that powers not delegated by the Constitution to the federal government are reserved to the states and the people. But the Constitution, in its 14^th Amendment, plainly does delegate to Congress power to enforce its guarantees of due process and equal protection. Congressman Paul, like the other Republican candidates, believes that the unborn, no less than those human beings at later developmental stages, are members of the human family–in other words, persons–entitled to the same protections as others. And he is right to believe it.

I am hard-pressed to understand Paul’s objection. If the Constitution grants a power to the central government, then the central government possesses that power. Should it be up to the States, individually, to decide the abortion issue? If it should, then why not leave slavery up to the States, individually? In other words, why should the Fourteenth Amendment any less binding than the Thirteenth Amendment? It seems to me that Paul is more enamored of “States’ rights,” than he is of liberty. And make no mistake about it, abortion is anti-libertarian.

P.S. Paul Linton, a pro-life lawyer and special counsel to the Thomas More Society, enters a dissent:

Conclusion

The Supreme Court’s abortion decisions can be overturned only by an overruling decision of the Court itself or by a federal constitutional amendment. Congress has no power under § 5 of the Fourteenth Amendment to define the unborn child as a “person” for purposes of § 1 of the Amendment, when the Court has held (in Roe) directly the opposite. Removal of the Supreme Court’s appellate jurisdiction over abortion cases would not affect the binding force of those decisions and would actually prevent a differently constituted Court from overruling Roe and Casey. The proposals made to the Republican presidential candidates at their “Tea Party” forum do not offer a realistic means of overturning Roe v. Wade and do not deserve the support of the pro-life community.

Roe can be overturned only by a decision of the Court itself overruling Roe or by a federal constitutional amendment–neither a federal statute enacted under § 5 of the Fourteenth Amendment defining the word “person” as used in § 1 of the Amendment, nor a statute removing the Supreme Court’s appellate jurisdiction over abortion cases would have that effect.

This is where “departmentalism” comes in. William J. Watkins Jr. explains departmentalism by way of example:

Departmentalist theory is perhaps best examined in the context of President Jefferson’s approach to the Sedition Act. Upon entering office, Jefferson ordered the cessation of all federal sedition prosecutions and he pardoned those who had been convicted. In 1804, Jefferson received a letter from Abigail Adams criticizing his handling of the Sedition Act controversy. Mrs. Adams argued that because the judges had upheld the Sedition Act, President Jefferson had overstepped his constitutional bounds when terminating prosecutions and pardoning offenders.In a polite response, Jefferson reminded Mrs. Adams that “nothing in the constitution has given [the judges] the right to decide for the executive, more than the Executive to decide for them.” Both branches, continued Jefferson, “are equally independent in the sphere assigned to them.” Jefferson recognized that the judges, “believing the law constitutional, had a right to pass a sentence of fine and imprisonment, because that power was placed in their hands by the constitution.” However, this did not bind him when performing his duties as chief executive. Because he believed the Sedition Act was unconstitutional, he “was bound to remit the execution of it.”

It is conceivable that a Republican-controlled Congress could pass the law suggested by Robert George, and that a Republican president would enforce the law. Perhaps even a Democrat president would enforce the law as long as he was confronted by a Republican-controlled Congress and popular opinion on the morality of abortion, which has been shifting toward the pro-life position. The Supreme Court would be well advised to make like the Three Wise Monkeys.

My main concern is that the precedent of blatant departmentalism on a salient issue would be a dangerous one. Use of the doctrine would invite a Democrat-controlled Congress to conspire with a Democrat president to ignore, say, a Supreme Court ruling that overturns Obamacare or the McCain-Feingold Act.

P.P.S. In “Human Personhood Begins at Conception.” philosopher Peter Kreeft presents the arguments commonly used to explain why the unborn child is not a human person and then shows clearly and simply why each of these arguments cannot possibly be true.

Demystifying Science

“Science” is an unnecessarily daunting concept to the uninitiated, which is to say, almost everyone. Because scientific illiteracy is rampant, advocates of policy positions — scientists and non-scientists alike — often are able to invoke “science” wantonly, thus lending unwarranted authority to their positions.

WHAT IS SCIENCE?

Science is knowledge, but not all knowledge is science. A scientific body of knowledge is systematic; that is, the granular facts or phenomena which comprise the body of knowledge are connected in patterned ways. Moreover, the facts or phenomena represent reality; they are not mere concepts, which may be tools of science but are not science. Beyond that, science — unless it is a purely descriptive body of knowledge — is predictive about the characteristics of as-yet unobserved phenomena. These may be things that exist but have not yet been measured (in terms of the applicable science), or things that are yet to be (as in the effects of new drug on a disease).

Above all, science is not a matter of “consensus” — AGW zealots to the contrary notwithstanding. Science is a matter of rigorously testing theories against facts, and doing it openly. Imagine the state of physics today if Galileo had been unable to question Aristotle’s theory of gravitation, if Newton had been unable to extend and generalize Galileo’s work, and if Einstein had deferred to Newton. The effort to “deny” a prevailing or popular theory is as old as science. There have been “deniers’ in the thousands, each of them responsible for advancing some aspect of knowledge. Not all “deniers” have been as prominent as Einstein (consider Dan Schectman, for example), but each is potentially as important as Einstein.

It is hard for scientists to rise above their human impulses. Einstein, for example, so much wanted quantum physics to be deterministic rather than probabilistic that he said “God does not play dice with the universe.” To which Nils Bohr replied, “Einstein, stop telling God what to do.” But the human urge to be “right” or to be on the “right side” of an issue does not excuse anti-scientific behavior, such as that of so-called scientists who have become invested in AGW.

There are many so-called scientists who subscribe to AGW without having done relevant research. Why? Because AGW is the “in” thing, and they do not wish to be left out. This is the stuff of which “scientific consensus” is made. If you would not buy a make of automobile just because it is endorsed by a celebrity who knows nothing about automotive engineering, why would you “buy” AGW just because it is endorsed by a herd of so-called scientists who have never done research that bears directly on it?

There are two lessons to take from this. The first is that no theory is ever proven. (A theory may, if it is well and openly tested, be useful guide to action in certain rigorous disciplines, such as engineering and medicine.) Any theory — to be a truly scientific one — must be capable of being tested, even by (and especially by) others who are skeptical of the theory. Those others must be able to verify the facts upon which the theory is predicated, and to replicate the tests and calculations that seem to validate the theory. So-called scientists who restrict access to their data and methods are properly thought of as cultists with a political agenda, not scientists. Their theories are not to be believed — and certainly are not to be taken as guides to action.

The second lesson is that scientists are human and fallible. It is in the best tradition of science to distrust their claims and to dismiss their non-scientific utterances.

THE ROLE OF MATHEMATICS AND STATISTICS IN SCIENCE

Mathematics and statistics are not sciences, despite their vast and organized complexity. They offer ways of thinking about and expressing knowledge, but they are not knowledge. They are languages that enable scientists to converse with each other and outsiders who are fluent in the same languages.

Expressing a theory in mathematical terms may lend the theory a scientific aura. But a theory couched in mathematics (or its verbal equivalent) is not a scientific one unless (a) it can be tested against observable facts by rigorous statistical methods, (b) it is found, consistently, to accord with those facts, and (c) the introduction of new facts does not require adjustment or outright rejection of the theory. If the introduction of new facts requires the adjustment of a theory, then it is a new theory, which must be tested against new facts, and so on.

This “inconvenient fact” — that an adjusted theory is a new theory — is ignored routinely, especially in the application of regression analysis to a data set for the purpose of quantifying relationships among variables. If a “model” thus derived does a poor job when applied to data outside the original set, it is not an uncommon practice to combine the original and new data and derive a new “model” based on the combined set. This practice (sometimes called data-mining) does not yield scientific theories with predictive power; it yields information (of dubious value) about the the data employed in the regression analysis. As a critic of regression models once put it: Regression is a way of predicting the past with great certainty.

A science may be descriptive rather than mathematical. In a descriptive science (e.g., plant taxonomy), particular phenomena sometimes are described numerically (e.g., the number of leaves on the stem of a species), but the relations among various phenomena are not reducible to mathematics. Nevertheless, a predominantly descriptive discipline will be scientific if the phenomena within its compass are connected in patterned ways.

NON-SCIENCE, SCIENCE, AND PSEUDO-SCIENCE

Non-scientific disciplines can be useful, whereas some purportedly scientific disciplines verge on charlatanism. Thus, for example:

History, by my reckoning, is not a science. But a knowledge of history is valuable, nevertheless, for the insights it offers into the influence of human nature on the outcomes of economic and political processes. I call the lessons of history “insights,” not scientific relationships, because history is influenced by so many factors that it does not allow for the rigorous testing of hypotheses.

Physics is a science in most of its sub-disciplines, but there are some (e.g., cosmology and certain interpretations of quantum mechanics) where it descends into the realm of speculation. Informed, fascinating speculation to be sure, but speculation all the same. It avoids being pseudo-scientific only because it might give rise to testable hypotheses.

Economics is a science only to the extent that it yields valid, statistical insights about specific microeconomic issues (e.g., the effects of laws and regulations on the prices and outputs of goods and services). The postulates of macroeconomics, except to the extent that they are truisms, have no demonstrable validity. (See, for example, my treatment of the Keynesian multiplier.) Macroeconomics is a pseudo-science.

If there is an ultimate pseudo-science it is exemplified in the line of thought, originated by Ayn Rand, known as Objectivism. Among its egregious emissions is the theory that “natural rights” are a product of evolution.

CONCLUSION

There is no such thing as “science,” writ large; that is, no one may appeal, legitimately, to “science” in the abstract. A particular discipline may be a science, but it is a science only to the extent that it comprises a factual body of knowledge and testable theories. Further, its data and methods must be open to verification and testing. And only a particular theory — one that has been put to the proper tests — can be called a scientific one.

For the reasons adduced in this post, scientists who claim to “know” that there is no God are not practicing science when they make that claim. They are practicing the religion that is known as atheism. The existence or non-existence of God is beyond testing, at least by any means yet known to man.

Patience as a Tool of Strategy

Today is the 14th anniversary of my retirement from full-time employment. I take special delight in this annual observance because my retirement capped a subtle campaign to arrange the end of my employment on terms very favorable to me. The success of the campaign brought a profitable end to my tense relationship with my boss.

I liken the campaign to fly-fishing: I reeled in a big fish by accurately casting an irresistible lure then playing the fish into my net. I have long wondered if my boss ever grasped what I had done and how I had done it. The key was patience; more than a year passed between my casting of the lure and the netting of the fish (early retirement with a financial sweetener).

Without going into the details of my “fishing expedition,” I can translate them into the elements of success in any major undertaking:

strategy — a broad and feasible outline of a campaign to attain a major objective;

intelligence — knowledge of the opposition’s objectives, resources, and tactical repertoire, supplemented by timely reporting of his actual moves (especially unanticipated ones);

resources — the physical and intellectual wherewithal to accomplish the strategic objective while coping with unforeseen moves by the opposition and strokes of bad luck;

tactical flexibility — a willingness and ability to adjust the outline of the campaign, to fill in the outline with maneuvers that take advantage of the opposition’s errors, and to compensate for one’s own mistakes and bad luck;

and — as mentioned — a large measure of patience, especially when one is tempted either to quit or escalate blindly.

Patience is not a virtue that accrues to amorphous masses, like nations. It can be found only in individuals or groups of individuals who share the same objectives and are able to work together long enough to attain those objectives. Whether such individuals or groups lead nations — and lead them wisely — is another matter.

Utilitarianism and Psychopathy

From “No, Utilitarians Are Not Nice,” at Commentary:

The Economist reports two researchers from Columbia and Cornell have been studying the personalities of individuals who, in surveys, express a willingness to personally kill one human in the hope of saving more. Their conclusion is there is “a strong link between utilitarian answers to moral dilemmas . . . and personalities that were psychopathic.” The Economist’s conclusion, in its usual slightly tongue-in-cheek style, is utilitarianism is a “plausible framework” for producing legislation, and the best legislators are therefore psychopathic misanthropes….

What is missing … in the Economist’s praise of law-making as expressing the will of the psychopath, is the point from Friedrich Hayek that Steve Hayward has been making on Power Line recently: “Central planning cannot work because it is trying to substitute an individual all-knowing intelligence for a distributed and fragmented system of localized but connected knowledge.”

I will resist the justifiable temptation to apply the label of psychopath to executive, legislative, and judicial law-makers. But I will call them deluded in the extreme if they believe in the possibility of determining the greatest good for the greatest number. Hayek’s objection to central planning hints at the fundamental problem with utilitarianism, but does not quite hit it dead-center.

The fundamental problem with utilitarianism, as it is practiced by governments, is that it relies on something called cost-benefit analysis. It is modern utilitarianism:

Governments often subject proposed projects and regulations (e.g., new highway construction, automobile safety requirements) to cost-benefit analysis. The theory of cost-benefit analysis is simple: If the expected benefits from a government project or regulation are greater than its expected costs, the project or regulation is economically justified. Luckily, most “justified” projects are scrapped or substantially altered by the intervention of political bargaining and budget constraints, but many of them are undertaken — only to cost far more than estimated and return far less than expected.

Here’s the problem with cost-benefit analysis — the problem it shares with utilitarianism: One person’s benefit can’t be compared with another person’s cost. Suppose, for example, the City of Los Angeles were to conduct a cost-benefit analysis that “proved” the wisdom of constructing yet another freeway through the city in order to reduce the commuting time of workers who drive into the city from the suburbs.

Before constructing the freeway, the city would have to take residential and commercial property. The occupants of those homes and owners of those businesses (who, in many cases would be lessees and not landowners) would have to start anew elsewhere. The customers of the affected businesses would have to find alternative sources of goods and services. Compensation under eminent domain can never be adequate to the owners of taken property because the property is taken by force and not sold voluntarily at a true market price. Moreover, others who are also harmed by a taking (lessees and customers in this example) are never compensated for their losses. Now, how can all of this uncompensated cost and inconvenience be “justified” by, say, the greater productivity that might (emphasize might) accrue to those commuters who would benefit from the construction of yet another freeway.

Yet, that is how cost-benefit analysis works. It assumes that group A’s cost can be offset by group B’s benefit: “the greatest amount of happiness altogether.”

The true psychopathy of (most) law-makers (and others) is not found in their utilitarianism per se but in their raw urge to control the lives of others. Utilitarianism is an excuse to exercise that raw urge, not the source of it.

Texas Does Retirement Better

Merrill Matthews writes about the alternative to Social Security that was adopted by three Texas counties decades ago (“Perry Is Right: There Is a Texas Model for Fixing Social Security“):

Since 1981 and 1982, workers in Galveston, Matagorda and Brazoria Counties have seen their retirement savings grow every year, even during the Great Recession. The so-called Alternate Plan of these three counties doesn’t follow the traditional defined-benefit or defined-contribution model….

As with Social Security, employees contribute 6.2% of their income, with the county matching the contribution (or, as in Galveston, providing a slightly larger share). Once the county makes its contribution, its financial obligation is done—that’s why there are no long-term unfunded liabilities.

The contributions are pooled, like bank deposits, and top-rated financial institutions bid on the money. Those institutions guarantee an interest rate that won’t go below a base level and goes higher when the market does well….

If a worker participating in Social Security dies before retirement, he loses his contribution (though part of that money might go to surviving children or a spouse who didn’t work). But a worker in the Alternate Plan owns his account, so the entire account belongs to his estate. There is also a disability benefit that pays immediately upon injury, rather than waiting six months plus other restrictions, as under Social Security.

Those who retire under the Texas counties’ Alternate Plan do much better than those on Social Security. According to First Financial’s calculations, based on 40 years of contributions:

• A lower-middle income worker making about $26,000 at retirement would get about $1,007 a month under Social Security, but $1,826 under the Alternate Plan.

• A middle-income worker making $51,200 would get about $1,540 monthly from Social Security, but $3,600 from the banking model.

• And a high-income worker who maxed out on his Social Security contribution every year would receive about $2,500 a month from Social Security versus $5,000 to $6,000 a month from the Alternate Plan….

The Alternate Plan could be adopted today by the six million public employees in the U.S.—roughly 25% of the total—who are part of state and local government retirement plans that are outside of Social Security (and are facing serious unfunded liability problems). Unfortunately this option is available only to those six million public employees, since in 1983 Congress barred all others from leaving Social Security.

If Congress overrides this provision, however, the Alternate Plan could be a model for reforming Social Security nationally. After all, it provides all the social-insurance benefits of Social Security while avoiding the unfunded liabilities that are crippling the program and the economy.

Just think of it: real saving to underwrite economic growth, no crushing burden on future generations, and more money for retirees.

It’s a shame that FDR, his successors, and many Congresses have been incapable of grasping basic economic concepts. They have been too busy “governmentizing” the economy and slowing economic growth through their “soak the rich” schemes.

Unemployment and Economic Growth

I just found this at an old blog of mine and decided to re-post it, with a few editorial changes. Perhaps I’ll get around to updating it, but the results given here should be robust because the data set consists of 117 observations (1891-2007).

An increase an the rate of unemployment usually signifies slower economic growth, but it need not signify negative economic growth. Alternatively, slower economic growth need not lead to a higher rate of unemployment. Why is that?

The key to economic growth is greater output per worker. (A note to leftists: Greater output may be due to capital investments.) A sufficiently large increase in productivity can offset a decline in the proportion of workers employed (i.e., a rise in the unemployment rate), with the result that real GDP can rise even as the unemployment rate rises.

Here is the historical relationship between the change in real, per-capita GDP and the change in the unemployment rate:

Sources: Rates of real, per-capita GDP derived from What Was the U.S. GDP Then? (http://www.measuringworth.org/usgdp/). Unemployment rates taken from Statistical Abstracts of the United States: Colonial Times to 1970, Series D85-D86 (http://www2.census.gov/prod2/statcomp/documents/CT1970p1-05.pdf) and Bureau of Labor Statistics, Employment Status of the Civilian Noninstitutional Population, 1942 to date (ftp://ftp.bls.gov/pub/special.requests/lf/aat1.txt).

There is, as one would expect, a negative relationship between economic growth (as measured by year-over-year changes in real, per-capita GDP) and unemployment (as measured by year-over-year percentage-point changes in the unemployment rate). But, note that the unemployment rate must rise by 1 percentage point (i.e. reach +1 on the horizontal axis) before real, per-capita GDP begins to decline (i.e., drop below 0 on the vertical axis).

Or, to look at it the other way around, declining real growth need not lead to a rising unemployment rate. Only when the real growth rate drops below 2 percent does the unemployment rate begin to rise (i.e., the change is 0 or positive). Why is that? At a growth rate below 2 percent, businesses cannot absorb all new entrants to the labor market, given their (generally) low productivity relative to experienced workers.

The State of Morality

David Brooks — who sometimes resembles the conservative that he claims to be — writes about

a research team that conducted in-depth interviews with 230 young adults from across America….

[A]nd the results are depressing….

The interviewers asked open-ended questions about right and wrong, moral dilemmas and the meaning of life. In the rambling answers … you see the young people groping to say anything sensible on these matters. But they just don’t have the categories or vocabulary to do so….

The default position, which most of them came back to again and again, is that moral choices are just a matter of individual taste. “It’s personal,” the respondents typically said. “It’s up to the individual. Who am I to say?”…

[The researchers] found an atmosphere of extreme moral individualism — of relativism and nonjudgmentalism….

Allan Bloom and Gertrude Himmelfarb warned that sturdy virtues are being diluted into shallow values. Alasdair MacIntyre has written about emotivism, the idea that it’s impossible to secure moral agreement in our culture because all judgments are based on how we feel at the moment.

Charles Taylor has argued that morals have become separated from moral sources. People are less likely to feel embedded on a moral landscape that transcends self. James Davison Hunter wrote a book called “The Death of Character.” Smith’s interviewees are living, breathing examples of the trends these writers have described.

In most times and in most places, the group was seen to be the essential moral unit. A shared religion defined rules and practices. Cultures structured people’s imaginations and imposed moral disciplines. But now more people are led to assume that the free-floating individual is the essential moral unit. Morality was once revealed, inherited and shared, but now it’s thought of as something that emerges in the privacy of your own heart.

And where was morality “once revealed, inherited and shared”? In religion, of course. But, as I say here,

[t]he weakening of the Judeo-Christian tradition in America is owed to enemies within (established religions trying in vain to be “relevant”) and to enemies without (leftists and nihilistic libertarians who seek every opportunity to denigrate religion)….

I believe that the incessant attacks on religion have helped to push people — especially young adults — away from religion, to the detriment of liberty. It is not surprising that “liberals” tend to be anti-religious, for — as [Theodore] Dalrymple points out [here] — they disdain the tenets of personal responsibility and liberty that are contained in the last six of the Ten Commandments. It is disheartening, however, when libertarians join the anti-religious chorus. They know not what they do when they join the left in tearing down a bulwark of civil society, without which liberty cannot prevail.

Humans need no education in aggression and meddling; those come to us naturally. But we do need to learn to take responsibility for our actions and to leave others alone — and we need to learn those things when we are young. Such things will not be taught in public schools. They could be taught in homes, but are less likely to be taught there as Americans drift further from their religious roots.

Elizabeth Warren Is All Wet

Elizabeth Warren’s latest “liberal” bleat, in support of Obama’s plan to soak “the rich,” has caused ripples in the blogosphere (here and here, for example). The bleat? It goes like this:

I hear all this, you know, Well, this is class warfare, this is whatever. No. There is nobody in this country who got rich on his own — nobody.

You built a factory out there? Good for you. But I want to be clear. You moved your goods to market on the roads the rest of us paid for. You hired workers the rest of us paid to educate. You were safe in your factory because of police-forces and fire-forces that the rest of us paid for. You didn’t have to worry that marauding bands would come and seize everything at your factory — and hire someone to protect against this — because of the work the rest of us did.

Now look, you built a factory and it turned into something terrific, or a great idea. God bless — keep a big hunk of it. But part of the underlying social contract is, you take a hunk of that and pay forward for the next kid who comes along.

Who said anything about anyone getting rich on his own? But didn’t the factory owner — and other “malefactors of great wealth” — pay a “fair share”of the taxes that support roads, education, and police and fire forces? Yes.* Didn’t the factory owner pay his workers for their labor? Yes, and sometimes (in the case of union workers) at the expense of consumers and those workers who couldn’t find employment because unions effectively limit entry to the labor market.

If anyone owes “the rest of us” anything, it’s the workers who received subsidized educations that enabled them to earn good wages at factories that were built because factory owners, shareholders, bond holders, and (sometimes) venture capitalists put their own money at risk.

Workers and others (including Elizabeth Warren) ought to be grateful to the “malefactors of great wealth” who have — against heavy odds — enabled America’s prosperity.

Related posts:
Asymmetrical (Ideological) Warfare
“Buy Local”
Giving Back, Again
Taxing the Rich
More about Taxing the Rich
Luck-Egalitarianism and Moral Luck
Union-Busting
In Defense of Wal-Mart
Union Thuggery
__________
* Even a union-dominated lobbying organization, Citizens for Tax Justice, acknowledges (backhandedly) that “the rich” pay their “fair share” of all taxes — federal, State, and local:

I won’t vouch for the accuracy of the numbers. But, given the source, this can be taken as a “worst case” depiction of the distribution of the total tax burden. “The rich” are paying their “fair share,” and then some, unless you believe (as leftists seem to believe) that “the rich” are supposed to take care of everyone else.

Why Stop at the Death Penalty?

Some prominent internet libertarians (I use the term to distinguish them from true libertarians) have their knickers in a twist on the subject of the death penalty. Their discomfort seems to have been caused by the allegedly wrongful but actually justified execution of cop-killer Troy Davis.

Jason Brennan weighs in with “Kill the Death Penalty,” a post that is sandwiched by two of Will Wilkinson’s: “The Killing of Troy Davis” and “Moral Progress and Arguments against the Death Penalty.”

Brennan writes:

For a state to have the right to kill criminals, it must make decisions about guilt and hear appeals in a fair, competent, and reliable manner. It must have rules that reliably let the innocent–or those whose guilt is reasonably in doubt–go free. The American criminal justice system fails to meet these standards. Perhaps a government of smart angels should be granted the right to kill.

It’s the old Nirvana fallacy at work: If it ain’t perfect, it’s no good. Well, by Brennan’s “logic,” the state should never exact punishment for anything. After all, how certain can cops, prosecutors, judges, and juries be about anything? Radar guns aren’t perfect; what looks light the running of a red light can be chalked up to parallax; eyewitness testimony is notoriously flawed; etc., etc., etc.

Let’s just do away with punishment, starting with capital punishment and running the gamut to smacking an unruly child. Why not go whole hog and reward anti-social behavior?

Wilkinson makes a more subtle case against capital punishment, in the second-linked post:

I have here advance proofs of Steven Pinker’s forthcoming book, The Better Angels of Our Nature: Why Violence has Declined. It’s a smorgasbord of data on liberalizing moral change. Pinker shows that modernity brought about a stunning shift in norms, including attitudes toward capital punishment….

[graphs indicating steep declines in the use of capital punishment]

In the face of such a decisive trend in moral culture, we can say a couple different things. We can say that this is just change and says nothing in particular about what is really right or wrong, good or bad. Or we can take take say this is evidence of moral progress, that we have actually become better. I prefer the latter interpretation for basically the same reasons most of us see the abolition of slavery and the trend toward greater equality between races and sexes as progress and not mere morally indifferent change. We can talk about the nature of moral progress later. It’s tricky. For now, I want you to entertain the possibility that convergence toward the idea that execution is wrong counts as evidence that it is wrong. This would suggest that those American states yet to abolish the death penalty are cases of arrested development. Looking at these trends, it seems overwhelmingly probable that we will look back on the death penalty as a shameful bit of lingering of savagery. And we won’t be wrong. If our smarter, more angelic future selves wouldn’t concede, even just for the sake of argument, that capital punishment is okay, why concede it now?

I would count convergence toward the idea that execution is wrong as evidence that it is wrong, if … that idea were (a) increasingly held by individuals who (b) had arrived at their “enlightenment” unnfluenced by operatives of the state (legislatures and judges), who take it upon themselves to flout popular support of the death penalty. What we have, in the case of the death penalty, is moral regress, not moral progress.

Human Nature, Liberty, and Rationalism

Michael Shermer writes about political philosophy and human nature in “Liberty and Science” at Cato Unbound:

In the Realistic Vision, human nature is relatively constrained by our biology and evolutionary history, and therefore social and political systems must be structured around these realities, accentuating the positive and attenuating the negative aspects of our natures. A Realistic Vision rejects the blank slate model that people are so malleable and responsive to social programs that governments can engineer their lives into a great society of its design, and instead believes that family, custom, law, and traditional institutions are the best sources for social harmony. The Realistic Vision recognizes the need for strict moral education through parents, family, friends, and community because people have a dual nature of being selfish and selfless, competitive and cooperative, greedy and generous, and so we need rules and guidelines and encouragement to do the right thing….

[T]he evidence from psychology, anthropology, economics, and especially evolutionary theory and its application to all three of these sciences supports the Realistic Vision of human nature….

6. The power of family ties and the depth of connectedness between blood relatives. Communities have tried and failed to break up the family and have children raised by others; these attempts provide counter evidence to the claim that “it takes a village” to raise a child. As well, the continued practice of nepotism further reinforces the practice that “blood is thicker than water.”

7. The principle of reciprocal altruism—I’ll scratch your back if you’ll scratch mine”—is universal; people do not by nature give generously unless they receive something in return, even if what they receive is social status.

8. The principle of moralistic punishment—I’ll punish you if you do not scratch my back after I have scratched yours—is universal; people do not long tolerate free riders who continually take but almost never give….

11. The almost universal nature of within-group amity and between-group enmity, wherein the rule-of-thumb heuristic is to trust in-group members until they prove otherwise to be distrustful, and to distrust out-group members until they prove otherwise to be trustful.

12. The almost universal desire of people to trade with one another, not for the selfless benefit of others or the society, but for the selfish benefit of one’s own kin and kind; it is an unintended consequence that trade establishes trust between strangers and lowers between-group enmity, as well as produces greater wealth for both trading partners and groups.

So far, so good. But Shermer then goes off track: “I believe that the Realistic Vision of human nature is best represented by the libertarian political philosophy….” He defines that philosophy earlier:

Libertarianism is grounded in the Principle of Equal Freedom: All people are free to think, believe, and act as they choose, so long as they do not infringe on the equal freedom of others. Of course, the devil is in the details of what constitutes “infringement”….

(See also the Harm Principle, which is a corollary of the Principle of Equal Freedom.)

Yes, the devil is in the details, as Will Wilkinson explains in “The Indeterminacy of Political Philosophy“:

[E]very conception of freedom or liberty when stated in broad outlines is relatively indeterminate. In order to arrive at a recognizably “libertarian” version of a conception of freedom requires filling out the conception in not-at-all obvious ways. This is true even of the classic libertarian conception of liberty as non-coercion. Generally, libertarians rely on a tendentiously loaded conception of coercion that simply stipulates that commonsense forms of emotional, psychological, and social coercion aren’t really coercive in the relevant sense.

Wilkinson goes too far when he indicts “emotional, psychological, and social coercion,” which he does at greater length here. It would not be far-fetched to say that Wilkinson finds coercion everywhere, even in the exercise of property rights, which are so well established that only a Marxist (I had thought) would consider them an instrument of coercion. It seems that Wilkinson — like most of the so-called libertarians who frequent the internet — yearns for super-human beings who are devoid of basic human traits and impulses.

The fact is that — psychopaths and dictators excepted — we are all “coerced,” not in Wilkinson’s sense of the word but in the sense that we must often constrain our behavior and make compromises with others (i.e., become “socialized”) if we are to live in liberty. This is a point that I made in my first post at this blog (“On Liberty“), and which I have repeated many times:

[T]he general observance of social norms … enables a people to enjoy liberty, which is:

peaceful, willing coexistence and its concomitant: beneficially cooperative behavior

That, simply stated, is liberty or something as close to it as can be found on Earth.

Peaceful, willing coexistence and beneficially cooperative behavior can occur only among actual human beings, with all of their inborn traits and impulses. Yes, peaceful coexistence requires human beings to curb those traits and impulses, to some degree, but those traits and impulses cannot be suppressed entirely. If they could, there would be no need for discussions of this kind: “When men are pure, laws are useless….” (Benjamin Disraeli).

And so, coexistence is shaped by human traits and impulses, just as spacetime is shaped by the masses of gravitational bodies. The conditions of coexistence are as inseparable from human nature as the curvature of spacetime is from its contents. If liberty is to be more than a slogan, it must account for human beings as they really are. That is to say, liberty must account for human beings as Michael Shermer describes them. Thus:

Liberty is a modus vivendi, not a mysterious essence with an independent, timeless existence (like a Platonic ideal).

Liberty arises from in-group solidarity, which is based on shared customs, beliefs (including religious ones), and a moral code that defines harmful acts and requires voluntary, peaceful cooperation among members of the group. (This means that there are many groups whose customs, beliefs, and moral codes are not libertarian, even though such groups may evince solidarity and cooperation.)

Liberty is possible (but problematic) where there are many such interconnected groups under the aegis of a minimal state — one that exacts justice for acts that all groups consider harmful (e.g., murder, theft, rape), keeps the peace among groups, and protects all groups from external predators. (The federalism of the original Constitution fostered liberty, but only to the extent that individual States enforced their Bills of Rights, enabled local governance, and forbade slavery.)

By virtue of geography, a state’s client groups may include some that are predatory, either economically and socially (seeking subsidies and other privileges) or criminally (acting violently toward other groups and their members). A minimal state that is dedicated to liberty will deny privileges and give no quarter to violence.

Resistance to trade and immigration across international boundaries — as social stances taken in full knowledge of the potential benefits of trade and immigration — are legitimate political positions, except when they are held by trade unionists and their political allies, who seek to deprive other Americans of the benefits of trade and immigration. (Economists who presume to lecture about the wisdom of trade and immigration are guilty of reducing what can be deep social issues to shallow economic ones.)

Because liberty is a manifestation of in-group solidarity, it is legitimate for groups that are comprised in a state to question and resist actions by the state that require the acceptance, on equal terms, of persons and groups (a) whose mores are not in keeping with those of extant groups and (b) whose influence could result in the enforcement by the state of anti-libertarian measures.

Liberty, in a phrase, begins “at home” (the state willing) and extends only as far as the social boundaries of a group that coheres in mutual trust, respect, forbearance, and aid. There is a slim possibility of state-fostered liberty, but it can realized only where the state exacts justice for acts that all groups consider harmful, keeps the peace among groups, and protects all groups from external predators. (In those respects, there is a promise of liberty — but a promise not kept — in the Constitution of the United States.)

But liberty is less likely to be found “at home” (or anywhere) because the social fabric has been sundered by the state’s impositions (e.g., usurping charitable functions and discouraging them by progressive taxation, the anti-religion trajectory of judicial holdings, the undermining of swift and sure justice by outlawing the death penalty and making it difficult to enforce, allowing abortion that borders on infanticide, mocking and undermining the institution of marriage).

Liberty, in other words, is a product of social intercourse, not of abstract principles, and certainly not of ratiocination. The last-mentioned, which often yields agreement between “liberals” and “libertarians” on such matters as abortion, defense, immigration, and homosexual “marriage,” also finds them deeply divided on such matters as property rights, regulation, and various forms of redistribution (Social Security, Medicare, humanitarian aid in the U.S. and overseas, and so on). Ratiocination, in other words, is unlikely to transcend the temperament of the ratiocinator. (Wilkinson essentially agrees, in “The Indeterminacy of Political Philosophy,” but seems not to heed himself.)

To put it another way, the desirability or undesirability of state action has nothing to do with the views of “liberals,” “libertarians,” or any set of pundits, “intellectuals,” “activists,” and seekers of “social justice.” As such, they have no moral standing, which one acquires only by being — and acting as — a member of a cohesive social group with a socially evolved moral code that reflects the lessons of long coexistence. The influence of “intellectuals,” etc., derives not from the quality of their thought or their moral standing but from the influence of their ideas on powerful operatives of the state.

In short, the only truly libertarian intellectual stance is anti-rationalism. As Michael Oakeshott explains, a rationalist

never doubts the power of his ‘reason … to determine the worth of a thing, the truth of an opinion or the propriety of an action. Moreover, he is fortified by a belief in a ‘reason’ common to all mankind, a common power of rational consideration….

… And having cut himself off from the traditional knowledge of his society, and denied the value of any education more extensive than a training in a technique of analysis, he is apt to attribute to mankind a necessary inexperience in all the critical moments of life, and if he were more self-critical he might begin to wonder how the race had ever succeeded in surviving. (“Rationalism in Politics,” pp. 5-7, as republished in Rationalism in Politics and Other Essays)

An anti-rationalist refuses to view life through the formalistic lens of “rights, freedoms and personal empowerment,” to lift a phrase from Leon Kass’s “The Wisdom of Repugnance.” An anti-rationalist trusts the wisdom that is accrued in social norms, and thinks very carefully before trying to change those norms. As Kass puts it, in the context of cloning,

repugnance is the emotional expression of deep wisdom, beyond reason’s power fully to articulate it….

Repugnance … revolts against the excesses of human willfulness, warning us not to transgress what is unspeakably profound. Indeed, in this age in which everything is held to be permissible so long as it is freely done, in which our given human nature no longer commands respect, in which our bodies are regarded as mere instruments of our autonomous rational wills, repugnance may be the only voice left that speaks up to defend the central core of our humanity. Shallow are the souls that have forgotten how to shudder.

Share this:

Share this:

Share this:

Share this:

Share this:

Share this:

Share this:

Share this:

Share this:

Share this:

Share this:

Share this:

Share this:

Share this:

Share this:

Share this:

Share this:

Share this:

Share this: