Cafe HayekCafe Hayek - where orders emerge - Article Feed

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Some Links

Posted: 24 Sep 2019 04:18 AM PDT
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(Don Boudreaux)




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Steve Davies describes what he believes is, today, not a collapse of
democracy but realignment.

In this short radio interview, my intrepid Mercatus Center colleague
Veronique de Rugy discusses Elizabeth Warrens scheme for Social Security.

Jeff Jacoby wonders why there is no more clamor over the gargantuan and
growing indebtedness of the U.S. government. A slice:

For the first time since World War II, the governments debt ($22.02
trillion) is bigger than Americas entire economy ($21.06 trillion).

Tim Worstall offers some adult advice to St. Greta of Stockholm. A slice:

Economic growth is not a problem in beating climate change, it’s the cause
of doing so.

Mark Perry summarizes some of the many failed predictions of environmental
calamity.

Arthur Diamond sings the praises of market-tested innovation.

David Bier argues that legal immigration will resolve Americas real border
problems.

Richard Epstein laments Californias assault on the gig economy.




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Quotation of the Day

Posted: 24 Sep 2019 03:13 AM PDT
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(Don Boudreaux)




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is from page 295 of Thomas Sowell’s 2009 book Intellectuals and Society:

By encouraging or even requiring students to take stands when they have
neither the knowledge nor the intellectual training to seriously examine
complex issues, teachers promote the expression of unsubstantiated
opinions, the venting of uninformed emotions, and the habit of acting on
those opinions and emotions while ignoring or dismissing opposing views,
without having either the intellectual equipment or the personal experience
to weigh one view against another in a serious way.

DBx: Indeed.

And nothing is more childish than supposing that youth supplies an
especially rich source of knowledge and wisdom about social and economic
matters matters that are inherently complex and involve the making of
countless trade-offs at the level of the individual.




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My Coming Webinar On Labor-Market Realities

Posted: 23 Sep 2019 01:57 PM PDT
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(Don Boudreaux)




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This Wednesday, starting at 4:00pm EDT, I will do an hour-long webinar
hosted by Freedom Hub titled Labor Market Realities Arent Optional.

Join in!




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So-Called "Price Gouging" Under Desperate Circumstances

Posted: 23 Sep 2019 11:01 AM PDT
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(Don Boudreaux)




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In my latest column for AIER, I further explore so-called price gouging,
this when it occurs under very extreme and desperate circumstances. A slice:

Everyone understands that the looting of stores leads only to an arbitrary
distribution of who gets available supplies and who goes without. There’s
simply no reason to suppose that successful looters are more worthy or
needy than are unsuccessful looters or people whose morality won’t permit
them to loot.
Everyone understands also that the distribution of available supplies
through looting does nothing to inspire suppliers to bring more supplies
into the region.
Yet very few people see the similarity, visible to economists, of queueing
to looting. As with looters, there’s simply no good reason to suppose that
successful queuers are more worthy or needy than are unsuccessful queuers
or people whose time or circumstances won’t permit them to queue.
And if available supplies are so limited that some people must do without
and die, no conceivable distribution of these supplies will prevent people
from dying.
The gallon of water sold to Jones at a “gougingly” high price saves Jones’s
life, but it also results in Smith dying of thirst. If the price of that
gallon of water had instead been held down to what politicians consider to
be “normal,” it’s possible that Smith — able to afford that lower price and
fortunate enough to be near the front of the queue — will get the water and
survive. But in this case the unfortunate person to die of thirst will be
Jones.
Deaths in these bitter circumstances can be avoided only if additional
supplies are brought in. And what most economists understand that most
non-economists don’t is that “gougingly” high prices are the market’s means
of attracting to devastated regions these vital supplies. If government
prevents these prices from rising, the market process is thwarted — which
in cases such as this one means that people will perish.





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Are You Sure Stollers Piece Really Isnt from The Onion?

Posted: 23 Sep 2019 07:45 AM PDT
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(Don Boudreaux)




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For anyone who has studied the work and influence of the late Aaron
Director especially as that work and influence helped to successfully
bulldoze off of antitrust economics and policy the heavy, thick layers of
truly awful economics that had encrusted it for much of the 20th century
encountering Matt Stollers post on Director is surreal.

I encountered this post through David Henderson at EconLog.

David is too kind to Stoller. Stoller is correct that what by the mid-1970s
had come to be known as the New Learning about antitrust was very much a
product of Aaron Directors influence. But Stoller unable to understand
that bit of economics, and also apparently in the grip of the juvenile
notion that big business means monopoly business resorts to telling a
childish and economically ignorant tale.

Ive not now the time to offer a more comprehensive criticism of Stollers
error- and myth-ridden analysis. David does a good job.

But I will here make two points.

First, the market-process understanding of competition that was championed
by Director and that was polished and explained by the many scholars whom
he influenced has a long and honored pedigree. I believe, for example,
much of it can be traced to Adam Smith. Some of the other notable scholars
who had this market-process understanding include (in no particular order):

Joseph Schumpeter

Ludwig von Mises

F.A. Hayek

Israel Kirzner

Mario Rizzo

Ronald Coase

Harold Demsetz

Armen Alchian

Kenneth Elzinga

Yale Brozen

Thomas Sowell

Donald Dewey

Fred McChesney

Thomas Hazlett

George Bittlingmayer

Dom Armentano

Vernon Smith

Jim Liebeler

Bob Higgs

Perhaps Stoller thinks that all of these scholars were and are in the
pockets of oligarchs.

Also, Stollers portrayal of H.L. Mencken is comically wrong. Heres a
comment that I left on Davids post at EconLog:

Not only is Stoller’s understanding of Aaron Director’s economics utterly
misbegotten, his reading of H.L. Mencken can be described only as – well, I
have no words to convey just how mistaken that reading is.

Mencken argued for individual liberty – for keeping each individual as free
as possible from what Thomas Sowell calls “the rampaging presumptions of
their betters.” It’s nothing short of astonishing that Stoller accuses
Mencken of believing that some people are fit to rule others.

From where might such a deeply erroneous interpretation come? One
possibility is that Stoller never actually read more than a few
out-of-context snippets of Mencken’s writings and judges Mencken either
exclusively from those snippets or from some extant popular caricature of
Mencken – a caricature itself the bastard child of such out-of-context
snippets.

Another possibility is that something is going on along these lines:
Mencken warned of the many dangers of majoritarian democracy and, hence, is
believed by people such as Stoller to support, therefore, some sort of rule
by aristocracy. One of the sad realities of popular understanding is that
to oppose majoritarian democracy is necessarily to endorse rule by some
over others.

In reality, of course, Mencken feared unlimited majoritarian democracy for
the same reasons that unlimited majoritarian democracy was feared by the
likes of James Madison and America’s other founders – namely, not because
unlimited majoritarian democracy prevents rule by an aristocracy but,
rather, because it poses a threat to the freedom of each individual to rule
himself and herself.

To describe the ‘analysis’ offered by Stoller as juvenile and shallow is to
treat it too kindly.




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Some Links

Posted: 23 Sep 2019 06:15 AM PDT
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(Don Boudreaux)




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My intrepid Mercatus Center colleague Veronique de Rugy offers some options
on how to deal with that great geyser of cronyism, the U.S. Export-Import
Bank, if its politically impossible to slay the damn thing. A slice:

As the narrative goes, without Ex-Im many foreign companies would buy
Airbus rather than Boeing; hence the need for support. This is a weird
argument at many levels. First, as a believer that the government’s job is
never, ever, ever to prop up private companies, I would say, “And so what?”
But in this town, where people believe it is totally normal for Uncle Sam
to work overtime so that a company will make extra private profit, that
argument doesn’t go very far.
I have others. Doesn’t it bother anyone how little faith in Boeing those
who are claiming that without Ex-Im airlines wouldn’t buy Boeing planes
have? Effectively what these guys are saying is “This is a bad product that
people wouldn’t want without with Ex-Im.” If this is true, why should the
federal government ask us to stand behind Boeing?


James Peron warns of the danger to liberty posed by some who pose as
friends of liberty. A slice:

The GOP is no party of free enterprise. They are led by a corrupt advocate
of cronyism, worse than any stereotype the Bernie Sanders of the world
could invent. The GOP may vote for protectionism, for big government, and
for the regulatory state — provided it redistributes wealth to their
favored groups — but in the minds of many voters, especially young people
with limited experience, they think Republicans are the standard bearers of
liberty.

More fracking? Or more war?

Jeffrey Tucker is among the fans of Downton Abbey.

Jonah Goldberg writing about the current hysteria over vaping notes that
those who self-righteously boast of being reality-based ignore reality.

George Will ponders what Hong Kongs resistance means for Taiwan.

Wendy Kaminer is unimpressed with an attempt to make a case against free
speech.

Chris Preble remembers Earl Ravenal.




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