For Most Things, Recycling Harms the Environment

Is Recycling Useful, or Is It Garbage?
The problem with recycling is that people can’t decide which of two things is really going on.
One possibility is that recycling transforms garbage into a commodity. If that’s true, then the price of pickup, transport, sorting, cleaning, and processing can be paid out of the proceeds, with something left over. That’s how it is with real commodities, such as wheat or pork bellies, after all. It’s expensive and complicated to produce wheat or pork bellies, and then deliver them to the market in a form that they can be used. But people will pay you for the wheat or pork bellies. In fact, the “profit test” shows that people will pay you enough to cover all those costs and still have something left over.
The other possibility, and it’s a completely different possibility, is that recycling isn’t a commodity at all. But it is a cheaper or more environmentally friendly way to dispose of garbage. After all, if you bury something in a landfill, it’s gone. And you still had to collect it, transport it, and process it into the landfill. Recycling might cost money, but if you can sell the stuff for any price you are getting some of those costs back. Further, recycling keeps things out of landfills, and we systematically underprice landfill space. The reason is that we don’t want people dumping garbage in vacant lots or by the side of the road. But that means that recycling may be cheaper, all things considered, than using the space in the landfill. The problem is that “all things considered.” You really do have to add up all the costs — resources, money, convenience, environmental damage — of landfilling, and recycling, and then compare them.
These arguments are often muddled and mixed together, by both proponents and critics. And “recycling” is, after all, not just one homogeneous activity, but a whole collection of possible streams of waste or resources, each of which has to be evaluated separately. Should we recycle aluminum cans? Probably, because the price of recycling aluminum compares very favorably to using virgin materials, the mining and smelting of which are expensive in terms of energy and harmful to the environment. 
Should we recycle toilet paper? We could, at some price. But it’s likely not worth it, because it can be composted, it would be awfully hard to clean and sort, and in any case paper products are actually a renewable resource, rather like wheat. You rarely hear someone saying, “Save the wheat! Give up bread!” But that kind of argument is often made for paper, even though the trees grown to produce pulp are simply a fast-growing crop grown on farms expressly for that purpose.
For recycling to be a socially commendable activity, it has to pass one of two tests: the profit test, or the net environmental-savings test. If something passes the profit test, it’s likely already being done. People are already recycling gold or other commodities from the waste stream, if the costs of doing so are less than the amount for which the resource can be sold. 

American Institute for Economic Research

Hate Crime Hoaxes: What Gets Rewarded Gets Repeated

Jonah Goldberg writes on manufactured hate crimes in his weekly newsletter.


Here’s something you might not know: In Nazi Germany, very few Jews staged bogus hate crimes against themselves.

Here’s some more trivia: Very few blacks in the Jim Crow South went to great lengths to pretend that they were harassed or attacked by racists.

You know why? Because that would be incredibly stupid. What, exactly, would the German Jew who staged an assault on himself gain from it? Where would he or she go to ask for sympathy or recompense? Conjure any horror story you like, the Nazi official you brought it to would say, “Yeah, and . . . ?” The black sharecropper who took the time to make his own cross and burn it on his own property would benefit . . . how?

Why am I bringing this up? Well, for a bunch of reasons. I have more points to make than can be found at an English Setter competition.

First, people who live under real oppression have no need to fabulate oppression. To paraphrase Madge from the old Palmolive ads: They’re already soaking in it.

Second, when you live in an oppressive country, there’s no one you can take your grievances to because that is what it means to live in an oppressive country! 

The Hate Hoax Bonfire

And indeed, calling a real racist “racist” doesn’t work. “Name and shame” is not very effective against those who aren’t ashamed.

Which brings me to the third point: In non-oppressive countries, there are people to take your case to. Sohrab Ahmari put it nicely in an essay a couple of years ago:

And as Pascal Bruckner wrote in his essay “The Tyranny of Guilt,” if liberal democracy does trap or jail you (politically speaking), it also invariably slips the key under your cell door. The Swedish midwives driven out of the profession over their pro-life views can take their story to the media. The Down syndrome advocacy outfit whose anti-eugenic advertising was censored in France can sue in national and then international courts. The Little Sisters of the Poor can appeal to the Supreme Court for a conscience exemption to Obamacare’s contraceptives mandate. And so on.

This is a hugely important point, and there’s an urgent need for more people to understand it. A free society is a rich ecosystem of competing institutions. Some are powerful, some weak. Some have great influence in a specific sphere of life: the American Bar Association, the military, the Catholic Church, whatever. Some only have power in a certain place: the county zoning board, the local police, your parents, etc. But none have unchecked power over the whole of the society and, thanks to the Constitution, that goes for the government itself, too.

A free society is a honeycomb of safe havens, competing authorities — legal, moral, cultural — that allow for people to find safe harbors from other institutions

ibid

And the hoaxes often get rewarded, at least for a while. And it’s rare to see one punished.

Goldberg wanders into economics. But what is economics except the organized study of how people respond to incentives?

A truism of economics is that you get more of what you subsidize and less of what you tax. I have no quarrel with that. But it seems to me we don’t think enough about how this principle applies to areas we see as outside of economics.

For instance, contrary to what one hears in the left-wing punditsphere, there’s a high cultural penalty — a tax, if you will — on open racism, which is one reason there is so much less of it today.Already, I can hear throats clearing to say “Oh yeah, what price has Donald Trump paid!!!?!?!” Well, leaving aside the merits of the cases for and against the claim that Donald Trump is a racist, it’s transparently obvious that he’s paid a political price for the perception that he is one. The reflexive opposition to Trump by many of the media outlets from which he craves approval is driven in no small part by the widespread liberal assumption that he’s a bigot of one kind or another. Similarly, he’s almost surely paid a price among many independent and moderate voters, including the millions who voted for both Trump and Obama, because of how he’s perceived, fairly or not.

But my point here isn’t to talk about Trump, but to check the box so I don’t have to talk about him further.

….

The sort of racism Smollett manufactured has never been lower in the United States, but rather than celebrate or express gratitude for this incontestable fact, people look for proof it’s worse than ever. Bereft of giants to slay, they construct windmills and pretend they are heroes for levelling their lances at them. Like the elders of Salem, they mistake their quiet hysteria for sober reality and believe every tale of witches beyond the tree line. On the principle that some things have to be believed to be seen, wearing a blanket at Oberlin is all the proof one needs for a moral panic over the invading armies of the Klan, just as the splash of a dolphin’s tale was proof of mermaids for horny sailors centuries ago.

….

Hoaxes and hysteria-fueled misinterpretations are common on the left because a certain kind of pity and hate has become institutionalized, monetized, and sacralized. But while pity and hate take a certain recognizable, custom-made form on the left — call it bespoke woke — the left doesn’t have a monopoly on the larger phenomenon. Donald Trump demands pity almost daily, and he gets it. And the pitiers get their opportunities for hatred, too. Christopher Hasson is an exceptional case, but only because he took the rhetoric of pity and hate duopoly to an extreme conclusion.

….

So I’ll leave with this depressing prediction. Obviously more Smollett-style hoaxes are coming. If the negative attention heaped on mass shooters is enough to inspire other losers to commit that kind of evil, it’s easy to imagine that the attention Smollett has gotten will inspire losers to do likewise. But that’s not my prediction. There will be a hoax involving MAGA hats, but the fake victims will be those wearing them. We already saw the hunger for this kind of thing in the Covington case — but those kids were in fact victims. President Trump invited that kid named Trump to the State of the Union precisely because he wanted to exploit this great reservoir of pity. And the coverage of this legitimate outrage will no doubt encourage others to get a piece of that on the cheap.

So mark my words, some loser, desperate to be lionized by Candace Owens or applauded at CPAC, will manufacture some story of victimhood that will ignite a bonfire of outrage on the right and a riot of sympathy about MAGA persecution. The mainstream media will suddenly remember the professional integrity it forgot in the Smollett case and debunk it. But before then, the pitiables of the right will claim victimhood by proxy and denounce the insensitivity of an uncaring media that hates them. The roles will be reversed, but the script will be the same, and the actors will all yell just a little bit louder, as the snake ups the tempo of its own repast.

ibid

What Science Could Teach Ocasio-Cortez About Climate Change — Bjorn Lomborg

The truth is comparatively boring: According to the United Nations climate science panel’s latest major report, if we do absolutely nothing to stop climate change, the impact will be the equivalent to a reduction in our incomes of between 0.2 percent and 2 percent five decades from now.

Yet by the 2070s, personal incomes will be some 300 percent to 500 percent higher than they are today.

Far from the “end of the world,” the impact of warming is what we’d expect from roughly a single economic recession taking place over the next half-century.

Many of us question how this could be true when we are constantly told that extreme weather is wreaking ever-greater devastation. In fact, research shows that extreme weather is having a rather minimal economic effect.

Since 1990, the cost associated with extreme weather worldwide has actually declined, to 0.25 percent of the global gross domestic product, from 0.30 percent.

Green fretting about Armageddon is nothing new, of course. In the 1960s, mainstream environmentalists worried that the world was running out of food.

In the 1980s, acid rain was going to destroy the planet’s forests. There were good reasons for concern, but a panicked response led to a poor, overly expensive response.

We need to get smarter. Climate change is a problem but not the end of the world. The United States now has little or no federal climate policy, which is inexcusable.

But almost every other nation is making climate proclamations that would impose huge costs for rather paltry gains.

This approach has failed to deliver progress against climate change for decades. We should instead embrace ingenuity and innovation and spend far more on green-energy research and development.

If we push the price of green energy below fossil fuels through innovation, everyone will switch.

If Ocasio-Cortez had stuck to the facts, she would have said: “The world is going to see costs worth about 1 percent of GDP in 50 years if we don’t address climate change — and your biggest issue is how to pay for it?”

Well, yes: We need to make sure our solution doesn’t cost more than the problem. If we look at the science and stop believing the end of the world is nigh, our decisions will be much smarter.

SOURCE

Medicare for All

Charles Blahous puts a price on Sanders’s proposed legislation in “The Costs of a National Single-Payer Healthcare System.” These are his key findings.

  • M4A Would Place Unprecedented Strain on the Federal Budget
    By conservative estimates, this legislation would have the following effects:
  • M4A would add approximately $32.6 trillion to federal budget commitments during the first 10 years of its implementation (2022–2031).
  • This projected increase in federal healthcare commitments would equal approximately 10.7 percent of GDP in 2022. This amount would rise to nearly 12.7 percent of GDP in 2031 and continue to rise thereafter.

These estimates are conservative because they assume the legislation achieves its sponsors’ goals of dramatically reducing payments to health providers, in addition to substantially reducing drug prices and administrative costs.

Setting Political Time Bombs

via Setting Political Time Bombs

Politics is one field where an individual or group can take economically foolish actions for which they pay no price, indeed for which they can receive praise and reward, only to leave the aftermath to be blamed on someone else.

Thomas Sowell refers to “intellectuals” as those whose only work product is ideas. In particular, they are those whose ideas are never tested against reality.

In the case of politics, the ideas may well be tested, but if they blow up, it’s never the fault of the shiny program the politicians enacted.

The “time bombs” referred to above deal with the mortgage crisis, but there are lots of time bombs in pace or on the assembly line.

Why inequality is good

Seen on Marginal Revolution:

As I pointed out in my post, Do Boys Have a Comparative Advantage in Math and Science? results like this can explain why there are proportionately fewer women entering STEM fields in richer and more gender-equal countries than in poorer and less gender-equal countries.

One point which many people are missing is that small but growing gender differences with development are only one minor effect of a much bigger phenomena. In a primitive economy, everyone does more or less the same thing, subsistence farming. Only in a market economy under the division of labor can people specialize. Specialization reflects and amplifies diverse personalities and interests. People sometimes complain about “excess” variety in a market economy but do they extend that complaint to careers, arts, and lifestyles? In a market society we get Corn Flakes, Frosted Flakes and Coconut Flakes and we get cardiologists, dermatologists and otolaryngologists and we get Chicago Blues, dub step, and K-Pop and we also get a flowering of sexual preferences and lifestyles. As Mises once said the very idea of personality as we know it today is a result of the market economy. The small gender differences some people focus on are merely the averaging by gender of much larger individual differences. Thus, I would revise the authors:

In sum, greater availability of material and social resources facilitates the independent development and expression of individual-specific preferences, and hence may lead to an expansion of individual differences in more developed and equal-opportunity countries.

 

 

Law Givers, Law Makers, Law Bearers

Cafe Hayek Quotation of the Day for Saturday the Thirteenth:

The early “law-givers” did not make the law they “gave”; they studied social traditions and informal rules and gave voice to them, as God’s, or natural, law. The common lawyer, Sir Edward Coke, championed seventeenth-century social norms as law commanding higher authority than the king. Remarkably, these forces prevailed, paving the way for the rule of law in England. Similarly, the cattlemen’s associations, land clubs, and mining districts in the American West all fashioned their own rules for establishing property rights and enforcing them: the brand on the hindquarters of his calf was the cattlemen’s indelible ownership signature on his property, enforced by gunmen hired through his cattle club; squatter’s rights were defended ably (possession is nine points of the law?) by the land clubs composed of those brave enough to settle wilderness lands in advance of veterans exercising their land script claims, and of settlers under the Homestead Act; mining claims were defined, established, and defended by the guns of the mining clubbers, whose rules were later to become part of public mining law.


DBx: Yes.

No myth is responsible for as much mischief through the ages as is the myth that proclaims that social order must be designed, as if society is a mechanism to be engineered. And no particular instance of this myth is worse than that which insists that law – the rules that govern human interactions – is and can only be the product of the state.

The state makes legislation (including, sometimes, codifications of law). The state never makes law.

This puts human law in the same realm as natural law. When scientists, or earlier, “natural philosophers”, propounded “laws of nature”, they were not drafting legislation. Rather, they were attempting to deduce the underlying laws by which nature ran.

The difference between the human realm and the natural realm is that it’s possible to impose rules (within limits) in the human realm.

Amazon and Minimum Wages

From Marginal Revolution:

What Do We Learn from Amazon and the Minimum Wage?

Amazon’s widely touted increase in its minimum wage was accompanied by an ending of their monthly bonus plan, which often added 8% to a worker’s salary (16% during holiday season), and its stock share program which recently gave workers shares worth $3,725 at two years of employment. I’m reasonably confident that most workers will still benefit on net, simply because the labor market is tight, but it’s clear that the increase in the minimum wage was not as generous as it first appeared.

What lessons does this episode hold for minimum wage research? Amazon increased its wages voluntarily but suppose that the minimum wage had been increased by law. What would have happened? Clearly, Amazon would have, at the very least, eliminated their bonus plan and their stock share plan! In this situation, researchers examining employment data would discover that the increase in the minimum wage did not much lower employment. Such researchers might conclude that minimum wages don’t reduce employment much because the demand for labor is inelastic. The conclusion is correct but the reasoning is false. The correct conclusion and reasoning would be that the minimum wage didn’t reduce employment much because the minimum wage didn’t increase net wages much.

Amazon is a big and newsworthy employer so its actions have been closely monitored but in most cases we never know the myriad ways in which firms respond to a law. Even using administrative data it would be difficult to pick up changes in a stock share plan or a pension plan, as this compensation doesn’t show up in earnings until years after the work is completed. Even a simple employment contract is a complicated bargain with many margins. During the holiday season, for example, Amazon hires a CamperForce of workers who live in RVs and it pays their campsite fees–no big deal, but that is a form of compensation that is hard to find on a W-2. More generally, firms can respond to a minimum wage by changing compensation on non-wage margins, adjusting working conditions, reducing benefits, changing wage growth patterns, and adjusting the type of workers they hire, to give just a few examples–and notice that all of these changes are difficult to measure and none of them have a first-order effect on employment.

Discrimination, Prejudice, and Racism

Walter Williams comments:

So much of our reasoning about race is both emotional and faulty. In ordinary, as well as professional, conversation, we use terms such as discrimination, prejudice, racial preferences and racism interchangeably, as if they referred to the same behavior. We can avoid many pitfalls of misguided thinking about race by establishing operational definitions so as to not confuse one behavior with another.

Discrimination can be operationally defined as an act of choice. Our entire lives are spent choosing to do or not to do thousands of activities. Choosing requires non-choosing. When you chose to read this column, you discriminated against other possible uses of your time. When you chose a spouse, you discriminated against other people. When I chose Mrs. Williams, I systematically discriminated against other women. Much of it was racial. Namely, I discriminated against white women, Asian women, fat women and women with criminal backgrounds. In a word, I didn’t offer every woman an equal opportunity, and they didn’t offer me an equal opportunity.

One might be tempted to argue that racial discrimination in marriage is trivial and does not have important social consequences, but it does. When high-IQ and high-income people marry other high-IQ and high-income people, and to the extent there is a racial correlation between these characteristics, racial discrimination in mate selection enhances the inequality in the population’s intelligence and income distribution. There would be greater income equality if high-IQ and high-income people married low-IQ and low-income people. But I imagine that most people would be horrified by the suggestion of a mandate to require the same.

Prejudice is a perfectly useful term, but it is used improperly. Its Latin root is praejudicium — meaning prejudgment. Prejudice can be operationally defined as making decisions on the basis of incomplete information. Because the acquisition of information entails costs, we all seek to economize on information cost. Sometimes we use cheap-to-observe physical attributes as proxies for some other attribute more costlier to observe. The cheaply observed fact that a person is a male or female can serve as a proxy for an unobserved attribute such as strength, aggressiveness or speed in running.

In the late 1990s, a black taxi commissioner in Washington, D.C., warned cabbies against going into low-income black neighborhoods and picking up “dangerous-looking” passengers whom she described as young black males dressed a certain way. Some pizza deliverers in St. Louis who were black complained about delivering pizzas to black neighborhoods for fear of being assaulted or robbed. In 1993, the Rev. Jesse Jackson was reported as saying that he is relieved when he learns that youthful footsteps walking behind him at night are white and not black.

Here’s the question: Does the wariness of Washington’s predominantly black cabbies to pick up “dangerous-looking” black males or black pizza deliverers’ not wanting to deliver to some black neighborhoods or Rev. Jackson’s feeling a sense of relief when the youthful footsteps behind him are those of white youngsters instead of black say anything unambiguous about whether cabbies, pizza deliverers and Jackson like or dislike blacks? It’s a vital and often overlooked point — namely, that watching a person’s prejudicial (prejudging) behavior alone can tell us nothing unambiguous about that person’s racial tastes or preferences.

Consider policing. Suppose a chief of police is trying to capture culprits who break in to autos to steal electronic equipment. Suppose further that you see him focusing most of his investigative resources on young males between the ages of 15 and 25. He spends none of his investigative resources on females of any age and very few on men who are 40 or older. By watching his “profiling” behavior — prejudging behavior — would you conclude that he likes females and older males and dislikes males between the ages of 15 and 25? I think that it would take outright idiocy to reach such a conclusion. The police chief is simply playing the odds based on the evidence he has gathered through experience that breaking in to autos tends to be a young man’s fancy.

Comparative Advantage, continued

Comparative Advantage is one of those concepts that’s far from intuitive, at least for most people.

Don Boudreaux looks at one case I’d been wondering about, whether it’s possible for one side of a trading partnership to have an advantage in everything.

You ask what you are to make of your roommate’s “fear that China will end up with comparative advantage to produce everything.”

You are to make nothing of this fear other than the fact that it reflects your roommate’s misunderstanding of comparative advantage. It’s impossible for any person, entity, region, country, planet, or galaxy to have a comparative advantage – that is, an advantage compared to potential trading partners – at producing everything. To have a comparative advantage at producing X implies a comparative disadvantage at producing Y.

This reality is best seen with an example involving only two people (Ann and Bob) and two goods (fish and bananas). Suppose that the resources necessary for Ann to use to produce one banana are such that, were she instead to use these resources to catch fish, she’d catch two fish. Ann’s cost of producing one banana is, thus, two fish – which implies that Ann’s cost of catching one fish is one-half of a banana.

As for Bob, suppose that the resources necessary for him to produce one banana are such that, were he instead to use these resources to catch fish, he’d catch one fish. Bob’s cost of producing one banana is, thus, one fish – which implies that Bob’s cost of catching one fish is one banana.

Bob has a comparative advantage over Ann at producing bananas and Ann has a comparative advantage over Bob at catching fish. If Ann and Bob both want to consume fish and bananas, they can both gain if Ann specializes in catching fish and Bob specializes in producing bananas, and then trading with each other.

Suppose now that Ann decides that she wants to have a comparative advantage also at producing bananas. She must then lower her cost of producing bananas to less than Bob’s cost of producing bananas – that is, to less than one fish per banana. But if Ann achieves this goal, she loses her comparative advantage at fishing.

If, for example, Ann becomes so good at producing bananas that each banana that she produces now costs her only one-quarter of a fish, Ann’s cost of catching fish rises from its previous level of one-half of a banana per fish to four whole bananas per fish. Because Bob’s cost of catching fish remains at one banana per fish, if Ann succeeds in gaining a comparative advantage over Bob at gathering bananas she necessarily creates for herself a comparative disadvantage at catching fish – meaning that Ann thereby causes the comparative advantage at catching fish to switch from herself to Bob.

People have many baseless fears about free trade. None is more wrongheaded than is the fear that any one subgroup of people – say, the people of one country – can have a comparative advantage at producing everything.

Someday I may want to sit down with this and see if it’s possible to generate “strange loops” where A>B, B>C, and C>A.