DISQUS

This post is just weird. Economists are useless... once you've learned enough economics to use and apply analytical tools that were, by and large, invented and developed by economists?

Will, I think you've given in too much on the "right answer" business. There are plenty of things where I know you do think there is a right answer -- free trade, for instance. And if democracy tends to result in protectionism, that is rightly counted as a black mark on democracy.

If libertarian ideas are to gain any traction, we absolutely must overcome the tendency of people to equate "the policy was democratically chosen" with "the policy is right." And when arguing with regular people, I find that tendency to be incredibly widespread. To overcome it, we need to show the chinks in the democratic armor. Public choice theory is one route of attack. Caplan's irrational voter concept is another. And yet another is the recognition -- which you clearly share -- that some policies are just wrong, democratic or not.

And you're probably thinking, "Glen, everything you've just said is bloody obvious." But it's not obvious, not to many members of the public whose opinion you're concerned about. So when you say things like, "You have agreed to politics, and there is no guarantee things are always going to your way," you're not helping. We're not just whining that things haven't gone our way -- we're establishing that democracy is highly imperfect, and that it systematically gets certain things wrong. That's wrong as in "failing to get the right answer."

I say all of this as a non-anarchist. I'm one of those minimal statists, as you know. But accepting the state as a necessary evil does not commit us to accepting its full legitimacy. The state is legitimate insofar as it helps us move toward, yes, right answers. I think it's most likely to do so when it's relatively democratic -- but also when it's limited by a constitution, by competition among jurisdictions, and so on. To get our fellow citizens on board with creating that kind of institutional structure, it's absolutely necessary to be critical of democracy.

Cut yer hair, ya damn hippie!

I like the un-PC implication of the study... but really, this is kind of a no-brainer. The food fascists' whole point is that fatty, sugary foods have short-run benefits and long-run costs. On this point, they are obviously correct. So I'm sure their response will be, "Of course they're happy now. The question is how they'll feel later in life."

I agreed with almost the entire video. But near the end, the speaker implies that current law prohibits churches from marrying gay couples. As far as I know, that's not true. It simply does not grant legal recognition to those marriages. But I'm pretty sure a church can perform a gay marriage ceremony in all 50 states.

Almost 100% of the libertarians I've talked to about it take Will's position. They differ only in the degree to which they emphasize that no state involvement would be the ideal position. But given the state's involvement in marriage, they all say it should recognize gay marriage as well.

Maybe there are more right-leaning libertarians in Washington.

This post is a study in mixed metaphors. But I like it.

I like William's point.

More broadly, I think Loury is a little off the mark in how he pins the blame on racism. Not that racism isn't involved -- it clearly is. But I think it's more of a supporting than a leading role. We have some badly designed and poorly justified policies, particularly in the areas of drugs, education, and welfare. These policies aren't necessarily racist in intent (though to some extent they may owe their historical origins to racism). People who support these policies now don't do so on racist grounds, per se. But ignorance of, and indifference to, the plight of the people who suffer most from these policies is part of what allows them to persist.

Or to put it more simply: Because it's mostly black people getting thrown in prison because of the drug war, white people have less incentive to stop the drug war. Because black people are disproportionately harmed by the monopoly public school system, white people have less incentive to break the monopoly.

I wish Loury had focused more on policies, less on attitudes. The attitudes matter, but they are enabled by a particular set of policies that make it easier for people to indulge their residual racism.

By the by, new Energy Secretary Stephen Chu has stated that he is, indeed, counting on scientific breakthroughs, not incremental progress.

http://www.latimes.com/news/custom/scimedemail/...

Manuelg, it's true that a college education commands a premium, but that doesn't mean the college is actually making the student more productive. I suspect most of the premium is attributable to signaling of pre-existing quality. The student who graduates proves that he is relatively persistent and does the busy work. But there are surely cheaper ways of performing the signaling function than encouraging everyone and his dog to go to college in order to see who pops out the other side.

Nobody wants to do bad things per se. But lots of people want to do things they think are good, but that are really bad. The drug war is the case in point.

As for the causal mechanism, I think there's more than one. First, any demand for bad programs (whose sponsors may think they're good) is a demand for the resources to fund them. For public choice reasons, that demand will typically be filled by taxes or borrowing or inflation, not by cuts in other programs. Second, as Patrick indicated, a larger source of resources enables more bad stuff to be done; his example of the Iraq War being enabled by a bloated military establishment is excellent. (This example also supports the first mechanism, inasmuch as the demand for an ill-considered war in Iraq justified a big jump in government spending.) Third, gov't programs create interest groups that lobby for their preservation and expansion. There are probably more mechanisms, but I think I've said enough.

As for how more Denmarks and Singapores would screw up the correlation... well, yeah. If we had more outliers, the correlation would be lower. And if we had more Frances, the correlation would be higher. So what? Point is, we don't have more Denmarks and Singapores, and I suspect the mechanisms listed are among the reasons.

Will, you're right that small gov't and limited gov't are cross-cutting distinctions. In principle, you can have one without the other. But Patrick is absolutely correct that there are systematic reasons to expect them to be correlated in practice. A gov't with more resources is capable of doing more bad things. And a desire to do bad things leads to demand for more resources.

Your point about Social Security is too glib. Yes, there are some major programs that can be run cheaply. But are these the rule? Fact is, intrusive programs tend to be expensive ones; the drug war is a nice example.

The correlation between small and limited gov't is not 1, but it's surely positive. And it's a correlation that reflects underlying causation.

Why do you assume that "success" is a reference to (relative) status? I agree that's one possible interpretation -- which could be a problem for interpreting the survey. But is it the most natural interpretation? When I read the question, I took "success" and "better life" to mean approximately the same thing, and so the spectrum made perfect sense to me (I would have answered with a 7).

I agree with Will's general perspective, but I would caution again the facile assumption that higher-order desires are somehow more "real" or indicative of the "true" self. They may simply reflect the reification of first-order desire that are being more or less frustrated in the status quo. Your "true" self, if there is one, may well represent a compromise between competing desires or levels of desire.

If you take multiple selves seriously, then the difficulty (I won't say impossibility) of interpersonal utility comparisons comes into play. There may just be a genuine conflict of interests between different selves. When someone says they want to develop better time management skills, that might just be one (currently frustrated) self looking for a better strategy to use in its ongoing conflict with other selves.

I haven't read all the comments above, so I apologize if this point has already been made.

If I robbed you *and* raped you, that would surely be regarded as more coercive than if I had merely robbed you. I hope this is obvious.

Okay, now suppose I robbed you yesterday, and then I robbed you again today. That's more coercive than if I had robbed you only yesterday (assuming the amount I took yesterday is the same in both hypotheticals). I think this follows directly from the same principle as robbery + rape above.

But does the interval between the two robberies matter? What if I robbed you an hour ago, and then I rob you again right now? You can see where I'm going. Keep shortening the interval until it's zero. Unless you think the crucial difference is how many times I flip open your wallet, I think we must agree that the taking of a greater amount of money is more coercive.

I think some confusion is arising from failing to distinguish between absolute dollars and percentage of income. Say you have $200 in your wallet, and I have $100 in mine. Someone steals $10 from each of us. I would say we have been coerced equally, but that the significance of the coercion might be less for you (supposing the money in our wallets is reflective of our incomes).

The amount of coercion depends, I think, on the absolute amount taken, but the significance of the coercion depends on how much is taken *relative to your income or wealth*. This line of thought leads, I think quite reasonably, to the conclusion that rich people are coerced more than poor people by a progressive (or even proportional) income tax, but that the significance of the coercion might well be greater for the poor.

Hmm. Economic growth is presumably a function of overall savings and investment in the economy, so it seems unlikely that redistributing income to a particular stratum would lead to a higher rate of income growth in that particular stratum. I wonder if what's really going is something like this:

Suppose that, with three consecutive Republican presidents, incomes for some stratum would follow this path: 10, 11, 12. This translates to 10% growth and then 9.1% growth, and 20% growth from beginning to end.

But now insert a Democrat in the middle term. The Democrat transfers some income to this stratum. As a result, the path is: 10, 11.5, 12. This translates to 15% growth and then 4.3% growth. From beginning to end, it's still 20% growth.

In other words, the Democrat has no real effect on growth; he just transfers wealth during his term. But this creates the impression of a higher rate of growth during his term AND a lower rate of growth during his Republican successor's term!

Every time you post something like this, you should reiterate your point (made in prior posts) that the appearance of diminishing returns could be explained by the mapping of an infinite scale (income) against a finite scale (satisfaction with an upper bound).

Was it a butter knife?

I liked the old analogy better. I agree that the Bouguereau is terrible... but Rothko is better? Seriously? Allow me to play the philistine by saying that Rothko sucks. Yes, I took the requisite college art classes that were supposed to make me appreciate modern non-representational art, I even went to see the Rothko exhibit in person... and I still think it sucks. C'mon, it's big stripes of color. Okay, okay, they're layered and stuff. Whatever, they're still just big colored stripes. Simultaneously pretentious and unimpressive.

"When a better life is a bus ride away, it is obviously inhuman to slap a tax on tickets. And just how different from that is a subsidy to stay?"

Well, the former shrinks the choice set, while the latter expands it. A larger choice set shouldn't reduce anyone's utility, unless we are willing to posit some kind of cognitive bias on the part of the poor subsidy recipients that prevents them from seeing the full benefits of going elsewhere (or the full costs of staying).

Bryan Caplan has made this argument with respect to public welfare; basically, the idea is that the traditional conservative "welfare trap" argument works only if we have irrational welfare recipients, since rational people will only accept the hand-outs if doing so will make them (on net, in the long run) better off. Thus, Caplan says the paternalistic arguments coming out of behavioral economics sometimes militate against state intervention.

I'm sure you already know this, but if you're listing off the problems with looking at quintiles' shares of income, this must be said: average real income has risen for all five quintiles. The rich have gotten a lot richer, while the poor have gotten a little richer.

That sounds to me like a fairly major concession to utilitarianism. Far from challenging the central premise of utilitarianism, Spencer seems to regard it as a truism.

The prima facie evidence that the current system is not working efficiently is that karaoke producers are employing musicians and studio technicians to create (usually inferior) versions of musical works, when it would be cheaper to just strip the vocals out of the original recordings. Those are real resources being spent, and their only function is to avoid monopolistic prices and the transaction costs associated with license negotiations. That's deadweight loss.

"How much of your income would you be willing to put at risk to get a chance at twice your current income? If you’re like most Americans, the answer is “not much”—and for a simple reason: While you’d love to have more money, your life would be thrown into turmoil if your income dropped by, say, half."

Loss aversion is a real phenomenon, but it irritates me when people use it willy-nilly. The attitude described in the passage above doesn't require anything more than plain old risk aversion (though loss aversion *could* also be involved).

DED -- Again, interesting points. Three responses. First, I don't think people have total control over their own preferences, but they do have limited control. To a great extent, they choose which status competitions to enter. When I was in high school, I very much cared about my status in debate -- something the jocks couldn't have cared less about.

Second, even if you rule out individual control entirely, and say our preferences are fully culturally determined, Will's point still stands: Western-style capitalist societies tend to generate a wider range of status competitions into which people will be sorted. That reduces the winner-take-all nature of the social process, because there can be many different ways to be a winner.

Third, you're right that winning in the soccer status race isn't as fungible as winning in the income status race. And none of us can do without income; even if you're totally soccer-focused, you need money to buy food, send your kids to college, etc. But remember the context of the discussion: Liberals have been trying to argue that income inequality is undesirable. Will and many others have argued in response is that we shouldn't care about inequality *per se* as long as people are generally getting better off, even at the bottom of the ladder -- which is assuredly true. The liberals have responded by saying inequality is bad *as such*, because it makes the people at the bottom feel bad by comparison (the status competition argument). That's where Will's argument in the current post refutes that defense.

In short, there are only two reasons to care about inequality. The first is absolute deprivation -- but that's not problem in America, because absolute welfare has increased for just about everyone. The second is relative deprivation -- but that position relies on the status model, which Will smacks down here.