The Plane: Economics in two parts

From The Writer in Black

The Plane: or Why Interest is Justified

This is my own telling of one of Frederic Bastiat’s essays. I like it because it makes clear, why those to provide capital–the means of production–are entirely justified in receiving ongoing recompense for providing that well beyond. Suppose there was a rough carpenter, let’s call him John. He makes a certain amount of money in […]

And here’s part 2:

The Plane (part 2)

Last time we left carpenter turned capitalist John retired, with his capital passed on to his son John Jr.

This time we take a look at John Sr’s old workshop. It’s still sitting there. John Jr. could go into that workshop and start doing carpentry. That’s one measure of the value of that workshop sitting there. Another is that he could simply sell it and let someone else worry about doing the carpentry. But there’s a third possibility. Someone, let’s call him Andre, approaches him. Andre wants to do carpentry but Andre doesn’t have any tools or workshop. Andre could, in principle build his own workshop and acquire his own tools but there’s this one John Jr. has. So he suggests John Jr. let him work in it.

[snip]

So the same principles that applied to John Sr. and his plane apply to John Jr. and his factory. And it’s entirely proper that the people providing capital, the means of production, be compensated based on whatever benefit they could obtain through alternate uses of that capital. And the people managing capital be compensated based not on the “labor” they provide but on the value they bring to the enterprise.

Trigger Warning: Trigger warning ahead

A new study suggests that trigger warnings may actually increase student vulnerability to offensive or troubling material.

Is it possible that “trigger warnings” — warnings to students and others that they are about to encounter potentially offensive or disturbing material — do more harm than good? A new study suggests that may be the case.

Trigger warnings may inadvertently undermine some aspects of emotional resilience. Further research is needed on the generalizability of our findings, especially to collegiate populations and to those with trauma histories.

Source

It’s not just Jonah Goldberg

Bill Flax in Forbes Magazine:

In Argentina, everyone acknowledges that fascism, state capitalism, corporatism – whatever – reflects very leftwing ideology. Eva Peron remains a liberal icon. President Obama’s Fabian policies (Keynesian economics) promise similar ends. His proposed infrastructure bank is just the latest gyration of corporatism. Why then are fascists consistently portrayed as conservatives?

In the Thirties, intellectuals smitten by progressivism considered limited, constitutional governance anachronistic. The Great Depression had apparently proven capitalism defunct. The remaining choice had narrowed between communism and fascism. Hitler was about an inch to the right of Stalin. Western intellectuals infatuated with Marxism thus associated fascism with the Right.

Later, Marxists from the Frankfurt School popularized this prevailing sentiment. Theodor Adorno in The Authoritarian Personality devised the “F” scale to demean conservatives as latent fascists. The label “fascist” has subsequently meant anyone liberals seek to ostracize or discredit.

Fascism is an amorphous ideology mobilizing an entire nation (Mussolini, Franco and Peron) or race (Hitler) for a common purpose. Leaders of industry, science, education, the arts and politics combine to shepherd society in an all encompassing quest. Hitler’s premise was a pure Aryan Germany capable of dominating Europe.

While he feinted right, Hitler and Stalin were natural bedfellows. Hitler mimicked Lenin’s path to totalitarian tyranny, parlaying crises into power. Nazis despised Marxists not over ideology, but because they had betrayed Germany in World War I and Nazis found it unconscionable that German communists yielded fealty to Slavs in Moscow.

[snip]

While political correctness as manifest in the West is very anti-Nazi and those opposing multiculturalism primarily populate the Right, it’s false to confuse fascism with conservatism. Coupling negatives is not necessarily positive. Because the Nazis would likely detest something that conservatives also dislike indicates little harmony. Ohio State hates Michigan. Notre Dame does too, but Irish fans rarely root for the Buckeyes.

America’s most fascistic elements are ultra leftwing organizations like La Raza or the Congressional Black Caucus. These racial nationalists seek gain not through merit, but through the attainment of government privileges. What’s the difference between segregation and affirmative action? They are identical phenomena harnessing state auspices to impose racialist dogma.

The Nation of Islam and other Afrocentric movements, like the Nazis, even celebrate their own perverse racist mythology. Are Louis Farrakhan and Jeremiah Wright conservatives? Is Obama?

Racism does not exclusively plague the Right. Many American bigots manned the Left: ex-Klansman Hugo Black had an extremely left wing Supreme Court record, George Wallace was a New Deal style liberal – he just wanted welfare and social programs controlled by states. Communists always persecute minorities whenever in power.

The Nazis’ anti-Semitism derived indirectly from Karl Marx, who despite Jewish ancestry was deeply anti-Semitic. Bankers and other capitalists were disproportionately Jewish. Elsewhere, Jews played prominent roles. Before falling under Hitler’s sway, Mussolini’s inner circle was overly Jewish. Peron was the first leader to let Jews hold public office in Argentina. Franco, a Marana, welcomed Jews back into Spain for the first time since 1492 and famously thwarted Hitler by harboring Jewish refugees.

Very little of Hitler’s domestic activity was even remotely right wing. Europe views Left and Right differently, but here, free markets, limited constitutional government, family, church and tradition are the bedrocks of conservatism. The Nazis had a planned economy; eradicated federalism in favor of centralized government; considered church and family as competitors; and disavowed tradition wishing to restore Germany’s pre-Christian roots.

Despite Democrats’ pretensions every election, patriotism is clearly a conservative trait so Nazi foreign policy could be vaguely right wing, but how did Hitler’s aggression differ from Stalin’s? The peace movement evidenced liberals being duped as “useful idiots” more than pacifistic purity. Note the Left’s insistence on neutrality during the Hitler/Stalin pact and their urgent switch to militarism once Germany attacked.

After assuming power, Nazis strongly advocated “law and order.” Previously, they were antagonistic thugs, which mirrored the communists’ ascension. The Nazis outlawed unions perceiving them as competitors for labor’s loyalties, i.e. for precisely the same reason workers’ paradises like Communist China and Soviet Russia disallowed unions. To Nazis, the state sustained workers’ needs.

Even issues revealing similarity to American conservatism could also describe Stalin, Mao and many communists. This is not to suggest liberals and fascists are indistinguishable, but a fair assessment clearly shows if any similarities appear with American politics they reside more on the Left than Right.

Inevitable Blood On Your Hands

A golden oldie, from Marginal Revolution:

…Every law is violent. We try not to think about this, but we should. On the first day of law school, I tell my Contracts students never to argue for invoking the power of law except in a cause for which they are willing to kill. They are suitably astonished, and often annoyed. But I point out that even a breach of contract requires a judicial remedy; and if the breacher will not pay damages, the sheriff will sequester his house and goods; and if he resists the forced sale of his property, the sheriff might have to shoot him.

This is by no means an argument against having laws.

It is an argument for a degree of humility as we choose which of the many things we may not like to make illegal. Behind every exercise of law stands the sheriff – or the SWAT team – or if necessary the National Guard. Is this an exaggeration? Ask the family of Eric Garner, who died as a result of a decision to crack down on the sale of untaxed cigarettes. That’s the crime for which he was being arrested. Yes, yes, the police were the proximate cause of his death, but the crackdown was a political decree.

The statute or regulation we like best carries the same risk that some violator will die at the hands of a law enforcement officer who will go too far. And whether that officer acts out of overzealousness, recklessness, or simply the need to make a fast choice to do the job right, the violence inherent in law will be on display. This seems to me the fundamental problem that none of us who do law for a living want to face.

But all of us should.

Any law that is enacted in your name will be backed up by the thread of deadly force. Inevitably, the threat will have to be followed through upon. That means sooner or later, someone will die because of that law. So some blood on the hands is inevitable.

I thought of this column today after reading about Santa Barbara’s ban on plastic straws:

On Tuesday, the Santa Barbara City Council unanimously passed a bill that prohibits restaurants, bars, and other food service businesses from handing out plastic straws to their customers. …Santa Barbara… has banned even compostable straws, permitting only drinking tubes made from nonplastic materials such as paper, metal, or bamboo. The city also has made a second violation* of its straw prohibition both an administrative infraction carrying a $100 fine and a misdemeanor, punishable by a maximum fine of $1,000 and up to six months in jail. Each contraband straw or unsolicited plastic stirrer counts as a separate violation, so fines and jail time could stack up quickly.

…Assistant City Attorney Scott Vincent tells me criminal charges would be pursued only after repeat violations and if there were aggravating circumstances.

I wonder what direction the slippery slope runs in this case.

Why Trump’s Detractors Cry ‘Treason’

He won’t go along with their efforts to deny the legitimacy of his election. Can you blame him?

source

President Trump is, as ever, fortunate in his enemies. Whatever one thinks of what he said in Helsinki, the overreaction is helping him plow through yet another media meltdown. Cries of “treason,” charges that the president is a Russian “asset,” and insistence that remarks at a press conference constitute impeachable offenses fire up the Democratic base. To everyone else, they seem unhinged.

The Mismatch Effect

An “effect” is defined as “a phenomenon that follows and is caused by some previous phenomenon”. We have to be careful when labeling something as an “effect”, to make sure we’re pretty sure we’ve correctly assigned causation.

That being said, we have a phenomenon called the “mismatch effect”. When people are placed in a competitive environment on the basis of something other than their merits or qualifications, they find it much more difficult to keep up and wind up in the bottom rank or drop out entirely.

In the case of programs that aim to increase the number of certain groups admitted to top-rank colleges, we often find that members of these groups have lower average test scores or GPAs than the average among those who graduate from those schools.

We can imagine that of people who enroll in any school, there will be an average score and some variation around that average. It may well be that, say, two thirds of those admitted will do well and graduate. The students who fail to graduate will most likely be in the bottom third of that distribution. Now imagine a mismatched group (we’ll pick on Martians) is admitted on the basis of some sort of affirmative action program. Suppose their average test scores are one standard deviation lower than the average for the rest of the school. In this case, nearly 72% of these students will have test scores that place them below the cut-off for “likely to graduate”. This is not to say that no Martians will graduate from that school, merely that far fewer will, and at a rate that’s not at all similar to the graduation rate for non-Martians.

At the Volokh Conspiracy, Eugene Volokh offers:

The Mismatch Effect: A Danger for Students of All Races

[snip]

That’s the debate about the “mismatch effect,” which I’ve followed over the years (though from a distance); it has mostly focused on whether race-based affirmative action causes problems (such as lower black bar passage rates) as a result of this effect, but it can also be relevant to many students of all races. I was first exposed to it because of the work of my UCLA School of Law colleague Rick Sander, and Robert Steinbuch at Arkansas / Little Rock has been working in it as well; Rob has been kind enough to pass along these thoughts on the subject:

[snip]
Analysis of a large dataset containing information on graduates from the law school at which I teach, the University of Arkansas at Little Rock, Bowen School of Law, demonstrates that LSAT scores of students enrolled at the school (1) solidly predicted bar passage, and (2) varied significantly in relation to ethnicity.

Although color-blind admissions should produce roughly 25 percent of both Whites and African Americans in each LSAT-score quartile, over two-thirds of graduating African Americans were admitted with LSAT scores in the bottom quartile, as contrasted with only 16 percent for White students. (For more details, see the recent article I coauthored: Steinbuch and Love, Color-Blind-Spot: The Intersection of Freedom of Information Law and Affirmative Action in Law School Admissions, 20 Tex. Rev. L. & Pol. 1 (2016)). Although almost exactly a quarter of White students were admitted in the top quartile of LSAT scores (as expected), remarkably, only one percent of enrolled African Americans fell into the top quartile of LSAT scores. Predictably, this led to dramatic differences in bar passage: 80 percent of Whites passed the bar (the first time), while only 60 percent of African Americans did.

Given that the African-American cohort in our dataset on average had much lower LSAT scores than the bulk of the student body, it’s fair to conclude that this cohort overall was mismatched. This profile dominated because affirmative-action considerations are designed to consider factors beyond traditional credentials and explains why debates on how to deal with poor bar-passage rates often focus on race-based admissions. However, the ensuing discussion often misses that, while on average Whites will not be mismatched because they have such a large population — putting many at or above the mean of the class, the number of Whites who are mismatched could easily equal or exceed that of any other racial group.
[snip]

 

 
And also from the Volokh Conspiracy, Rick Sander offers this:

An emerging scholarly consensus on mismatch and affirmative action (ideologues not welcome)

[snip]
Williams’s paper presents equations testing dozens of different combinations of models and outcomes. With impressive consistency, his analysis shows very powerful evidence for law school mismatch, especially for first-time takers. His results are all the more compelling because, as Arcidiacono and Lovenheim point out, the weaknesses of the BPS data bias all analyses against a finding of mismatch. Williams concludes his piece, too, with a plea for the release of better data.

Meanwhile, not a single one of the law school mismatch critics has managed to publish their results in a peer-reviewed journal, though at least some of them have tried. As I will discuss in another post, many of these critics still shrilly hold to their earlier views. But it should be clear now to any reasonable observer that mismatch is a serious issue that the legal academy needs to address.

The above references two survey-scale papers, both taking great effort to eliminate ideological bias. Links are in the cited piece.

The Questions Stephen Colbert Should Have Asked Democratic Socialist “Rock Star” Alexandria Ocasio-Cortez – Foundation for Economic Education

Source: The Questions Stephen Colbert Should Have Asked Democratic Socialist “Rock Star” Alexandria Ocasio-Cortez

Here are other questions Colbert did not ask, and those who support socialism aren’t asking either:

Do you believe only socialists are “moral”?

Do you think other people are opposed to proper housing, jobs, and healthcare and block simple solutions because they are not as caring as you?

In his book The Law the 19th Century French economist Frédéric Bastiat exposed the false premise behind those who think government is the only way to achieve social and economic ends:

Socialism, like the ancient ideas from which it springs, confuses the distinction between government and society. As a result of this, every time we object to a thing being done by government, the socialists conclude that we object to its being done at all.

We disapprove of state education. Then the socialists say that we are opposed to any education. We object to a state religion. Then the socialists say that we want no religion at all. We object to a state-enforced equality. Then they say that we are against equality. And so on, and so on. It is as if the socialists were to accuse us of not wanting persons to eat because we do not want the state to raise grain.

Generative Questions

A generative question is something that points us to the unknown and stimulates further inquiry. Here are a few generative questions that Colbert could have asked:
What are the conditions under which human beings flourish?
Why does power corrupt?
Why until recently in human history did each generation live in poverty, much the same as the generation before?

….

Ocasio-Cortez, Stephen Colbert, and millions of Americans leaning toward socialism have no knowledge of the economic problem. Invincibly ignorant, they assume the problem away by embracing the idea of redistributing other people’s money.

If you don’t know what the economic problem is, there is no possibility of discovering solutions to the problems you see. With a willingness to explore questions, more knowledge will be discovered. Freedom, not simplistic answers based on coercion, promotes voluntary human cooperation and creates economic progress, raising the well-being of all.

If Trump supporters are Nazis…

…what is your obligation?

When Your Enemies Are Nazis You Have The Moral Imperative to Kill Them


Thankfully the defense of Humanity wasn’t left up to Gandhi but instead to the likes of Churchill and Roosevelt, and Hitler and his Thousand Year Reich ended up charred, half-burnt bones in a shell crater.

Looking back we realize the Nazis posed such a moral threat to Humanity that no moral person of conscience could waste such an opportunity if given the means to stop Hitler and his regime, since inaction would itself be considered immoral. One would have to act and would have all the moral justification needed to do so.

Fast-forward to today and the recent anti-Trump hysteria propagated in leftist social media echo-chambers.

The Anne Frank Center in a Twitter post warns of the alarming parallels between the Trump administration and the Nazi regime, including “He exploits youth at a rally,” and “He strips vulnerable people of their families, jobs and ability to live.”
Wikipedia lists the detention centers housing children and families for deportation alongside the Jewish concentration camps of the Nazi regime.
A 2017 article in Foreign Policy in Focus states, “The presidency of Donald J. Trump, hoisted on the shoulders of white supremacists, is a glaringly dangerous period for our country. It’s important to recognize this dangerous mix of moral turpitude, dereliction of duty, and incompetence before we fall deeper into fascism and moral tragedy.”
Adam Roy’s essay for the Jewish magazine Forward is titled, “Yes, We Should be Comparing Trump to Hitler.”
In a New York Times Op-ed, Charles Blow notes the following similarities between the two leaders (as summarized by Kyle Smith).
HITLER: Wanted to make Germany great again.
TRUMP: Wants to make America great again.
HITLER: Wore funny little mustache.
TRUMP: Wears funny little hat.
HITLER: Shunned alcohol.
TRUMP: Shuns alcohol.
HITLER: Time magazine Man of the Year, 1938.
TRUMP: Time magazine Person of the Year, 2016.
HITLER: Fascist.
TRUMP: Republican.
HITLER: Lied about Jews being the source of Germany’s misery.
TRUMP: Lied about ratings for The Apprentice, his Electoral College victory being the biggest since Reagan’s, and whether anyone else had been on the cover of Time more than he.

But if you truly believe that Trump = Hitler, you are morally obligated to act not just against him, but against his regime and those who continue to support him. We are seeing this sentiment appearing in the following recent examples:

In the refusal by the manager of a restaurant in Virginia to serve White House press secretary Sarah Huckebee Sanders and her family.
In the harassment of Florida Attorney General, Republican Pam Bondi by Leftists at a movie theater.
In the harassment of DHS Secretary Kirstjen Nielsen at her home after a DOJ employee verbally assaulted her at a Mexican restaurant.
In the attacks by actor Peter Fonda on Barron Trump, stating “We should RIP Barron Trump from his mother’s arms and put him in a cage with pedophiles,” as well as Fonda’s misogynistic reference to DHS Secretary Nielsen as a “lying g-sh&*.” “The g-sh* should be pilloried in Lafayette Square naked and whipped by passers by while being filmed for posterity.” Consider that Barron Trump is a 12 year old boy. Kirstjen Nielsen a 46 year old graduate of the University of Virginia Law School and Georgetown’s School of Foreign Service. Peter Fonda is a 78 year old actor with father issues.
More ominous incidents have occurred which the liberal media has refused to link in a patter of dangerous behavior caused by liberal incitement.

  • 2017 Shooting of Republicans at a baseball game. The shooter, 66 year old James Hodgkinson, was a Bernie Sanders supporter and an anti-Trump activist.
  • 2016 Trump supporters including children are attacked by anti-Trump activists outside a rally.
  • 2016 murder of Trump supporter Mitchell Mormon, Jr after telling an Hispanic man that he voted for Trump and would soon be deported. The man shot him to death.
  • 2013 Shooting at the Family Research Center, a group targeted by the Southern Poverty Law Center, as a hate group for its opposition to gay marriage. The shooter, Floyd Corkins, told investigators and the judge in the case that he hoped to intimidate gay rights opponents.

When you demonize your opponent using hyperbolic rhetoric, not only do you dehumanize them and their supporters, but you claim the moral right to act. If you believe that you are living in Weimar Germany in 1933 then you must act now to prevent the Holocaust and war which looms. As Gandhi’s statements prove, there is ultimately no non-violent alternative. Misogynistic Twitter screeds and kicking those you disagree with out of restaurants will only take you so far: Trump and his administration still stands. Ultimately a liberal convinced of the Nazi analogy will have no choice but to act as Hodgkinson and Corkins acted – and that is why the hysteria over Trump has gone too far, and why the remaining adults among liberals need reign in the crazies on their side, because if they don’t someone is going to take the Hitler analogy to its ultimate violent conclusion.

As we see the danger isn’t limited to the President: anyone associated with his administration is at risk. Some of those shot at in 2017 weren’t even Trump supporters, but they were Republicans and that was good enough for Hodgkinson.

Kyle Smith in the National Review challenges these comparisons, pointing out the obvious differences between the two leaders:

HITLER: Murdered 11 million according to one analysis.

TRUMP: Has murdered no one thus far.

HITLER: Invaded the sovereign states of Austria, Belgium, Czechoslovakia, Free State of Danzig, Denmark, France, Guernsey, Hungary, Italy, Jersey, Lithuania, Luxembourg, Monaco, the Netherlands, Norway, Poland, San Marino, the Soviet Union, and Yugoslavia.

TRUMP: Has invaded no sovereign states.

HITLER: Started a world war that killed more than 5 million in his armed forces alone, plus many millions more in other countries.

TRUMP: Has started no world wars.

In 2005 Evan Derkacz at AlterNet wrote, referencing Andy Warhol’s famous quote as a base, “In the future everyone will be Hitler for fifteen minutes.” The future has arrived and the Hitler Hysteria is at a fever pitch. This time no time machines will be needed in the eyes of the self-appointed, delusional moral guardians of History. Their myopic view of the past is enough to blind them to present realities that Trump is not Hitler, that his administration is not populated by Nazis, and the true threat to our freedom does not emanate from the White House but the indoctrinated footsoldiers of the liberal elites willing to do anything to achieve their righteous goals.

The social upheavals of the 1960s gave the US the Black Panthers and SLA, and Europe the Red Army and Bahder-Meinhoff Gang. Antifa’s antics and the showboating of a DoJ employee are merely the early warning signs. Unless the liberal elites act, there will be blood, and the destruction of the country which they’ve desired for 50 years will be at hand.

Update: Maxine Waters: “God is on our side” and calls for more confrontations, and the Trump administration is recommending officials arm themselves. This is going to end well…