Archive for August, 2009
Do Industrialized Countries Have a Responsibility for the Well-Being of Developing Nations?
Conor Clarke’s second comment at The Atlantic blog on the study, “What to Do About Climate Change,” was that:
Goklany’s estimates are based on global aggregates that hide the unequal distribution of the climate change burden. Yes yes, I know Manzi will say that’s not decisive: As long as global GDP is higher, we can redistribute our way out of the problem more effectively tomorrow than we can today. I would be more comfortable with that debate if I thought vast international restributions of income in the name of global equity were more likely tomorrow than they are today.
RESPONSE:
Global greenhouse gas controls will also have uneven consequences. First, cost of controls will vary from country to country, and sector to sector. Second, because the impacts of climate change will also vary from area to area, the benefits of control will necessarily be uneven. They will also vary over time. In fact, for some sectors, some areas may benefit even under the IPCC’s warmest scenario, at least through the foreseeable future. For example, through at least 2085, climate change would increase the global population at risk of water stress (see Figure 2, here). Therefore controlling climate change would exacerbate the global population at risk of water stress. So both the costs and benefits of climate change controls will also be distributed unevenly. Third, as noted here, implementing climate change controls that go beyond no-regret actions requires that today’s poorer generations delay solving the real problems they face here and now and instead put resources into solving the hypothetical problems that may (or may not) confront tomorrow’s far wealthier — and technologically better-endowed — populations. Nothing equitable about that.
Conor Clarke’s third comment was:
… I’m suspicious of the ethical calculus that says we should not focus on one large global problem because larger global problems might exist. [Emphasis in the original.] That kind of moral math rarely corresponds to the political reality. (Do you think the average congressperson opposed to Waxman-Markey has trouble sleeping at night over new cases of malaria or global hunger?) Nor does it correspond to the historical responsibility: Industrialized nations are more responsible for the global problems created by climate change than the problems of population growth.
RESPONSE:
Government-Run Health Care Will Cost Much More than the Politicians Are Telling Us
As my Cato colleague Chris Edwards has documented, government programs and contracts inevitably cost much more than first projected. This pattern of inaccuracy exists for several reasons, one of which is that politicians have an incentive to lowball cost figures. But a big reason for the mistaken numbers is that government budget estimators do not understand the degree to which people will alter their behavior to get their hands on other people’s money.
I explained recently on Fox Business Network that this means any government-run health care scheme will be much more expensive than we are being told today.
Our friends at Reason TV address this issue in a very compelling three-minute video that looks at how government programs — especially for health care — have cost several times more than politicians claimed when the legislation was first adopted.
Politicians and Economic Policy
A recent study compared the members of the lower house in the Canadian legislature to the members of the U.S. House of Representatives.
The findings reveal large differences between the two nations in the backgrounds of their federal politicians.
- Share of members with a business or private sector background: Canada 61% vs. U.S. 17%
- Share of members with a background in politics (meaning a prior elected office or a prior job working for a politician): Canada 9% vs. U.S. 71%
Perhaps this explains why Canada’s economic policies have been far superior to U.S. policies in recent years.
Socialism and School Choice in India
Sometimes the twists and turns of socialism yield unwitting libertarian outcomes. Indian politicians, who remain socialist at heart despite some recent liberalization, have just enacted a Right to Education Act, giving every child in the 6-14 age group the right to free and compulsory education. Only a socialist state could call a compulsory provision a right! Yet this may ultimately create the biggest school choice program in the world.
The law mandates quality standards for all private schools but none for government schools, although teaching there is so pathetic that many poor people send their kids to private schools rather than free government schools. As a socialist twist, the new law says all private schools must reserve 25% of their seats from grade 1 onward for neighborhood children from “socially and educationally disadvantaged classes” — lower Hindu castes and poor people.
The government will reimburse private schools for actual costs, or pay the cost per student in government schools, whichever is less. This will not be a classical voucher system or scholarship system. Indeed, the word “voucher” is anathema to many politicians. Yet reimbursement of private school fees is a sort of voucher, and will provide school choice to a big chunk of the population.
Elite private schools will find the system a huge tax (the voucher will not cover their actual costs), and will wind up in the courts, which will have the final say on what is reasonable reimbursement. But private schools in slums and other low-income localities already have low fees and will get full reimbursement from the government.
India has an estimated 10 million students in grade 1 in private schools. Of those, 25% or 2.5 million should get government vouchers to attend grade 1. Each year another 2.5 million children will be added as the first batch moves to grade 2. By grade 12, there will be 30 million children attending private schools with government reimbursement of fees. The actual number could be much higher, since state governments are in dire financial straits and will probably depend more on private schools than new government schools to provide the extra education to kids not yet in school.
The central and state governments have yet to negotiate the sharing of costs of universal education. State governments will suffer no penalty if they fail to provide schooling for all kids, and so many will leave their task incomplete. Besides, the new system will be beset by corruption, exclusions, and bogus muster rolls. Many kids will not be covered by the 25% quota, and others may find there are no private schools within walking distance.
Despite all this, the new Indian scheme could become, without saying so, the biggest school choice program in the world.
The Boys Who Cried “Racist”
Some people on the left can’t see any excuse for opposition to collectivism except racism. (Which is, of course, as Ayn Rand said, “the lowest, most crudely primitive form of collectivism.”) Today it’s Paul Krugman:
But they’re probably reacting less to what Mr. Obama is doing, or even to what they’ve heard about what he’s doing, than to who he is.
That is, the driving force behind the town hall mobs is probably the same cultural and racial anxiety that’s behind the “birther” movement, which denies Mr. Obama’s citizenship.
That is, Paul Krugman can’t understand why people would oppose government control of health care — or skyrocketing deficits, or a federal takeover of education, energy, and finance along with health care — unless they’re driven by racism. But he’s not the only one who sees racists under every bed. Take Washington Post cultural writer Philip Kennicott yesterday, in an essay titled “Obama as the Joker: Racial Fear’s Ugly Face”:
[T]he poster is ultimately a racially charged image. By using the “urban” makeup of the Heath Ledger Joker, instead of the urbane makeup of the Jack Nicholson character, the poster connects Obama to something many of his detractors fear but can’t openly discuss. He is black and he is identified with the inner city, a source of political instability in the 1960s and ’70s, and a lingering bogeyman in political consciousness despite falling crime rates…
Superimpose that idea, through the Joker’s makeup, onto Obama’s face, and you have subtly coded, highly effective racial and political argument. Forget socialism, this poster is another attempt to accomplish an association between Obama and the unpredictable, seeming danger of urban life.
He’s talking about a poster that depicts Obama as the Joker from last year’s Batman movie over the word SOCIALISM. It’s not a very effective poster; what does the Joker have to do with socialism? But it’s ridiculous to see racism in it.
Thank Uncle Sam for Looming Sugar Shortage
According to Inside U.S. Trade ($), an alliance of sugar-using industries sent a letter earlier today to Secretary of Agriculture Tom Vilsack asking for an increase in the quotas imposed on imported sugar. The organizations signing the letter complain, quite reasonably, that domestic sugar stocks have fallen to historic lows and that a potential shortage would jeopardize production and jobs in their sectors.
Here’s the letter, dated August 7, 2009:
Dear Mr. Secretary:
The organizations and companies below urge you to increase the sugar import quota immediately. Your experts forecast unprecedented shortages without prompt action. According to USDA’s “World Agricultural Supply and Demand Estimates,” the United States will end the next fiscal year with less than 13 days’ worth of sugar on hand, unless imports are increased. If this forecast is accurate, our nation will virtually run out of sugar.
The shortage does not have to happen. The only reason markets are forecast to be so tight is the restrictive U.S. policy on sugar imports. Imports are subject to restrictive quotas. But you have the authority to increase the sugar import quota, and we urge you to do so immediately, both for the current fiscal year — where high prices already indicate a painfully tight market — and for the upcoming year.
Without a quota increase, consumers will pay higher prices, food manufacturing jobs will be at risk and trading patterns will be distorted. Please act now in the interest of all Americans.
Why I Despise Government, Reason 9,358
Leaving work yesterday for some softball games, I wound up caught in terrible traffic on 15th Street, which is a major D.C. artery for commuters going to Viriginia. This is never a good street to be on since it carries people looking to head south on I-395 and those who want to turn right on Constitution Avenue and then go west into Virginia.
After a 30+ minute crawl to travel three blocks, I finally got close to Constitution Avenue, where the road widens to three lanes, one of which is only for right turns. But since a large number of drivers want to turn right, it is very common for drivers also to turn right from the center lane — which normally is very efficient since Constitution Avenue has three lanes and the traffic flows more smoothly with two lanes of traffic making the right turn.
But when I made the right turn, I discovered why traffic was so snarled on 15th Street. There was a cop standing in the middle of Constitution Avenue waiting to snare drivers turning right from the center lane. Along with many other drivers that day, I got caught and lost another 10 minutes waiting for a ticket. But the $25 ticket is not what got me so irritated. It was the fact that thousands of commuters had to deal with horrible traffic (not only because people like me suddenly got stopped and traffic behind us also had to stop, but also because people in the right-turn-only lane also could not move with the cop blocking traffic) because some bureaucrat from the National Park Police found an easy way to fill his ticket quota.
If the private sector operated the roads (permit me to engage in some libertarian fantasizing), this would never happen. Because of a desire to please drivers (customers), the folks in charge of the road would have made right turns an option from the center lane. But when government sees a bottleneck, the reaction of politicians and bureaucrats is to figure out how to fleece people for more money — not to make travel safer and quicker.
Now, perhaps, you will understand why I chose this license plate.
Another Shot Fired in the Carbon Tariff Debate
I’ve written before about the “carbon tariff” debate, and will continue to do so as the Senate gears up to write a climate change bill. Indeed, I have a paper coming out in early September with a fuller analysis of the effects of slapping tariffs on countries in an effort to force them to sign up to international carbon-limiting agreements. [Spoiler alert: you'll be shocked to know that I conclude that using trade measures in climate change policy is possibly illegal under world trade rules, definitely costly to the U.S. economy, and more than likely counterproductive in the efforts to forge a climate agreement (for what that's worth).]
Seemingly unconcerned about the costs of green protectionism, ten Democratic senators crucial to the upcoming Senate vote (long-standing protectionists all, with the exception of newbie Al Franken) sent a letter to the White House yesterday, urging President Obama to rethink his (lukewarm) resistance to carbon tariffs. They argue that a dreaded “unlevel playing field” would result from saddling U.S. industries with higher carbon costs while, say, Chinese ones remain unencumbered.
You’ll have to wait for my paper for a full examination of those arguments, but in the meantime here’s some excellent analysis of the politics of it all by former Catoite, international trade lawyer, and friend of liberty Scott Lincicome. He assesses the scorecard as follows:
Pro carbon tariffs – Ten protectionist Senators, the US House of Representatives (in Waxman-Markey), France [link added], and Paul Krugman.
Anti carbon tariffs – the rest of the world.
Flood Insurance: Mend It or End It, But Don’t Just Extend It
Before leaving for the August recess, the House of Representatives passed a bill (HR3139) to extend the authority for the National Flood Insurance Program (NFIP) until March 2010. The program was set to expire on Oct. 1, 2009. The bill now goes to the Senate. Instead of taking up HR3139, the Senate should insist on real reforms to the NFIP, rather then a blanket extension.
Since Hurricane Katrina, the NFIP has operated under a deficit of close to $17 billion, which had to be borrowed from the Treasury in order to pay claims. Under the NFIP’s current structure, it cannot even make the interest payments on its borrowing; these losses will ultimately hit the taxpayer.
The Senate last Congress passed a strong reform bill that would have eliminated almost half of the subsidies in the NFIP. The House decided to instead seek an expansion of the broken program, adding wind coverage and raising the coverage levels (despite the availability of private flood insurance).
Many of the homes receiving subsidies under the NFIP are either vacation/second homes or properties where the government has paid repeated claims. In one instance, a house in Houston this is valued at around $100,000 received over $800,000 in flood insurance claims over a 20-year period, before it was finally destroyed.
Not only does the NFIP subsidize at taxpayer expense beach-front vacation homes, but there is growing evidence that the program causes substantial harm to the environment and local fisheries. Just last year, the National Marine Fisheries Service issued a finding that the NFIP is pushing orcas and some runs of salmon to extinction. Before the federal government forces significant costs on the private sector to protect the environment, perhaps it should take a close look at the damage its own activities inflict.
Senator Harkin Laments Lack of Poverty
An AP story today contains a quote that caught my eye, an indication that apparently jet-gate hasn’t jaded me as much as I thought it had. In the context of rising enrollment in the federal food stamp program (now known as the Supplemental Nutrition Assistance Program, or SNAP) and private charity efforts to feed poorer Americans, Senate Agriculture Committee chairman Tom Harkin (D, IA) says this:
Ensuring that our kids have enough to eat during summer months is critically important, especially during these tough economic times… Unfortunately, despite repeated efforts, the number of children participating in federally reimbursed summer nutrition programs in 2008 was the same as it was 15 years ago. (emphasis added)
At first I thought maybe he was saying how unfortunate it was that there had not been progress in reducing the number of kids receiving nutrition assistance, which would be fair enough. But the context of the quote suggests that Senator Harkin would prefer that more kids receive federal food assistance.
Sometimes I get the impression that politicians want increased power over our lives.
G. A. Cohen
I was contacted by several people about the death of G. A. Cohen, to whose ideas I devoted a chapter of my book Realizing Freedom. (The chapter, originally published in Critical Review, is also available in a PDF form here.)
I’ll just make two points about Cohen here, as I believe it generally best (there are exceptions) not to speak ill of the dead. In a meeting in his office when he reviewed an early draft of the essay above, he admitted that I had found a serious flaw, but demanded to know (and “demanded” is the right word) what my point was: “Are you attacking the argument, or the conclusion?!” I said I did not understand the question. He answered, “Well, the conclusion does not follow from the argument, so which are you attacking?” I was rather flabbergasted, and replied that the conclusion of an argument is a part of the argument, not some separate thing. But that was not how he saw things, and it showed in his entire career.
There are arguments, and there are conclusions. You attach yourself to a conclusion, and then you look for arguments that lead to it. That’s why he was an “analytical Marxist,” i.e., someone who agreed with what he took to be Marx’s conclusions, but who thought that the arguments by which Marx reached them were erroneous or fallacious, so his job was to come up with new arguments. If those didn’t work, you kept the conclusion and looked for other arguments. (In this case, however, despite acknowledging to me that his argument failed to reach the conclusion, he never acknowledged it publicly, but took some pains to lobby journals not to publish my critique, as was confided to me by editors of those journals.)
To get a sense of what kind of man he was, think a bit on this defense of the Soviet Union:
The Soviet Union needed to be there as a defective model so that, with one eye on it, we could construct a better one. It created a non-capitalist mental space in which to think about socialism.*
Millions had to die so that Cohen and his rich friends could enjoy “a non-capitalist mental space in which to think about socialism.” Words almost fail me. But not entirely. He should have spent his life begging forgiveness from all of the people who suffered from his pro-Soviet (he spent a good bit of his youth as a Soviet propagandist, which was essentially a family enterprise) and pro-Communist activities. He was no different than any old National Socialist who might have regretted that National Socialism wasn’t nationally socialist enough, but who enjoyed the “mental space” it created to construct fantasies of an ideal life.
I will merely point out that his attacks on charity and assistance to others is consistent, not only with his political philosophy, but with his personality and life.
*From p. 250 of his 1995 book Self-Ownership, Freedom, and Equality (Cambridge: Cambridge University Press), in which he strings together the “argument” that does not lead to the “conclusion” that property rights are unjustified.
Summer — or Back to School — Reading
The Cato Institute has published thousands of books, studies, articles, and op-eds, and most of them are on our website. But there’s lots of good reading material published elsewhere, and now our analysts are offering handy guides to the best reading in such fields as Principles of Liberty, Constitutional Studies, Health Care, Foreign Policy, and more.
I know that reading lists can sometimes be intimidating — where to start? — and too much of just a list. So these lists are annotated; each recommendation is briefly described. And at my insistence, (almost) all the analysts have started their lists with “Read This First” to suggest a foundational or introductory book or essay. Check them out here.
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