29 July 2011

Five More Days

With the doomsday clock showing that America is five days away from the Economic Apocalypse, I can’t help but wish that Boehner finally grows a pair and stands up against any proposed increases in the federal debt ceiling.  I’ve noted multiple times before how an increase in federal debt is a horrible, horrible idea, and generally unsustainable, so at this point it seems that maintaining the current debt ceiling is a good idea.  And, there are several possible positive outcomes.

First, we could default on our debt.  This has the valuable outcome of making it harder for the federal government to borrow money, which should help to keep the budget in check.  Of course, the government may find that it would just as well use inflation to bring more into the system in the even that it can’t find lenders, but that’s a risk worth taking.

Second, we could actually balance our budget.  The beauty of the hitting the debt ceiling is that it makes a balanced budget amendment largely unnecessary.  (Although, it should be noted, if one is using GAAP accounting techniques, one’s budget is, by definition, balanced.  Of course, the general sentiment of the balanced budget amendment is, hopefully, that revenues equal expenses, and that the government does not take on more debt.)  Anyway, the point in all this is that if Boehner really wants a balanced budget, all he has to do is make sure house Republicans vote against increasing the debt ceiling.  This way, he no longer has to concern himself with passing an additional piece of legislation then having it ratified by the states.

Third, Obama could ignore the law and tell the Treasury to issue more debt.  This would be a violation of the law, naturally enough, and should be grounds for impeachment.  I almost want to see this happen, just to see what it would look like. Of course, given our luck, the Senate would laud Obama for his bold, decisive action, so all that would happen would be an increase in executive powers, leading America closer to being ruled by a dictator.

Finally, it’s possible that the government shuts down at the behest of President Obama in the attempt to play chicken with the Republicans.  I sincerely hope this is what eventually happens, but mostly because I have nothing but contempt for the federal government.  In fact, I hope that the federal government not only shuts down on August second, but that it stays shut down for all eternity.  There is not a single federal function that is either a) necessary or b) can’t be replicated by the state governments.  As such, it is time for this behemoth to die, and to that end I say let the debt ceiling stay the same.  Let’s starve the beast!

Two Quick Questions for IP Defenders

AV Club has some exciting news:

In the rare story that ends with George Lucas not getting money, George Lucas has lost a copyright case before the British Supreme Court in which he sought to stop his former Star Wars prop designer Andrew Ainsworth, who came up with the original iconic Stormtrooper helmets, from selling replicas of his most famous work online. Lucas had successfully blocked Ainsworth from doing business in the U.S., arguing that profiting from a decades-old George Lucas creation should be the sole province of George Lucas. However, while the British court recognized that selling the helmets in America would be a copyright violation, according to the judgment there, it ultimately decided that ruling shouldn’t also apply in the U.K., as the props were considered functional, rather than artistic works.

I have two questions, one each for those who defend IP on ethical grounds (i.e. those who claim IP is a natural extension of natural rights) and for those who defend IP on utilitarian grounds (i.e. those who claim that IP is necessary to encourage innovation).

For the former:  How much of the original idea is owned by Lucas and how much is owned by Ainsworth?  (Note: there appears to be no clause in Ainsworth contract indicating that Lucas owned the copyright on the specific appearance of the helmets produced.)  Lucas certainly came up with the concept of stormtroopers and presumably came up with an idea of how their helmets should look, but it was Ainsworth, ultimately, who came up with the specific design and idea of what the helmets would look like.  How do you split natural ownership in this case?

For the latter:  Given that Lucas has a net worth of over $3 billion, is collecting licensing fees from Ainsworth really going to inspire him to be more creative?  Remember, the whole point of IP is to encourage creativity.  Would Lucas really be more creative if he got paid a fee for every Star Wars tie-in?  If not, what modifications should be made to the law to make it less detrimental to consumers?

28 July 2011

I’m Glad He’s Not Partisan

Paul Krugman on the current budget tomfoolery:

There’s actually a simple way to resolve the debt ceiling crisis: non-crazy Republican leaders could support something like the Reid plan — which is, let’s be clear, a huge victory for the right and defeat for progressives — and pass it with limited GOP support and overwhelming Democratic support. Situation resolved.

The Reid Plan, for those who may not know, is to cut spending by $2.7 trillion and increase the debt ceiling by $2.7 trillion.  The cuts are spread out over ten years, and are made possible by winding down America’s involvement in foreign wars (which I support, by the way).  Of course, what Harry Reid means by “cuts” are actually decreases in the rate of projected spending growth.  But even assuming that “cuts” actually means cuts, Reid’s plan isn’t tenable.

Using 2011 as a base year, with a budget of $4 trillion, revenues of $2.5 trillion, and debt issuance of $1.5 trillion, Reid’s Plan simply doesn’t have math on its side.  If projections are correct, the federal government will spend $40 trillion over the next decade, minus $2.7 trillion in cuts, for total expenditures of $37.3 trillion.  Unfortunately, revenue over the next decade is projected to be $25 trillion, which is $12.3 trillion short of budget.  Since the credit card is, for all intents and purposes, already maxed out, the proposed increase in the debt ceiling means that the federal government can borrow up to $2.7 trillion, which still leaves a budget gap of $9.6 trillion.

There are basically four ways to handle this budgetary shortfall:  The federal government can increase revenue, cut spending, increase borrowing, or some combination of the three.  Increasing revenue is very tricky because the federal government has never been able to collect more than 20% of GDP in taxes, save for one very brief period in the 1950s.  It’s currently collecting 17.5% of GDP, and it’s doubtful that it will be able to collect much more, because it appears that 20% is the point where tax avoidance is more profitable than tax payment.

And increasing the borrowing is also untenable.  Assuming a 1% year-over-year growth of GDP, 2011 GDP is projected to be $14.395 trillion, based on a 1% increase of 2010’s GDP of $14.25 trillion.  The current debt outstanding is 14.34 trillion, meaning that the federal government has a leverage ratio of 1 (a leverage ratio, in this case, is the ratio of federal debt to current assets).  Anything beyond that is unhealthy because the federal government will owe than it could possibly pay if all current assets were liquidated.  And this analysis doesn’t even begin to account for the federal government’s liabilities.  Quite simply, more federal debt at this point is going to be nothing short of toxic.

This means that the only viable option is to cut spending, and by more than $2.7 trillion over ten years.  The federal government needs to cut at least $1.5 trillion from this year’s budget, and needs to cut at least $10 trillion total, assuming that GDP averages $15 trillion per year over the next decade, the federal government can collect 20% of GDP in taxes per year over the next ten years, that there is no increase in the debt ceiling, and the cumulative baseline budget for the next ten years is $40 trillion.

As such, one is forced to conclude that Reid, is either, stupid, ignorant, lying, or cowardly given his current proposal.  Raising the debt ceiling is toxic, and a $2.7 trillion cut over the next decade is simply piddling.  And Krugman is a partisan hack for supporting him.

27 July 2011

Herman Cain

How would he deal with the debt problem?
"We will not default ... . (P)ay the military people and their military families, make sure we pay the interest on debt, pay Medicare bills, and then make sure we pay the Medicaid bills. (E)verything else should be on the table."
Cain says government is not only too big -- it's too complex. To change that, he said congressional bills should be no more than three pages. He's taken a ribbing on that from Jon Stewart
"(T)hree pages was a number to exaggerate a point. Make sure bills are short enough and understandable enough for the American people to understand."

I’m not entirely sure what he means when he says to pay the military people.  It could mean that the government should only feel obliged to take care of service members or it could mean that defense spending in general is untouchable.  Since he’s a Republican candidate, I’m inclined to believe the latter.  And if that’s the case, I’m not sure his debt solution is very serious.

This year’s current federal budget is expected to be around $4 trillion, federal revenue is projected to be $2.5 trillion, which means that the federal government will be taking on additional $1.5 trillion in debt.  At this point, any more debt, even a penny’s worth, is simply unacceptable.  America cannot afford any more deficits, period. If Herman Cain is serious, and if Herman Cain is disinclined to cut military spending, then his proposal is simply not going to work.

Interest on the debt is going to be around $400 billion this year, Medicaid and Medicare combined are going to cost around $1 trillion, and the military budget is going to be around $1 trillion as well.  The sum of these three obligations is $2.4 trillion, which is $100 billion under projected revenues.  Everything else is not only going to have to be on the table, it’s going to have to be cut.

The current military and health care spending is unsustainable, and will eventually have to be cut, even if all other federal spending is cut today.  The fun times of imperialism are over, and the promise of free unlimited health care is lie. Better to recognize this today and adjust the budget now than to stick one’s head in the sand until everything blows up.  Unfortunately, Herman Cain would rather do the former, and, as such, is not worthy of being considered a serious candidate.

Of course, the suggestion that congressional bills be no longer than three pages should also show that he’s not a actually a serious candidate, for the president cannot exactly implement this as law on his own volition (although it can be informally instituted if the president has the guts to veto any and all bills longer than three pages, which, it should be noted, is not something Cain promised to do).

Plus, the belief that the American people would actually care enough the read the laws Congress passes strikes me as absurd.  If elected officials represent their voters’ interests, then it would appear that the American people simply aren’t interested in reading legislation.  As such, Cain’s proposal is nothing more than frivolous political pandering, and does not behoove a serious politician.

Oh The Oppression

A lesbian couple is asking for changes at Dollywood after an employee asked one of the women to turn her T-shirt reading "marriage is so gay" inside-out to avoid offending others on a recent visit to the Tennessee theme park complex.
Olivier Odom and Jennifer Tipton said Tuesday they want the park to be more inclusive of lesbian, gay, bisexual and transgender families after Odom was asked to reverse her shirt when they visited Dollywood Splash Country next to the Pigeon Forge amusement park. The story was first reported by WBIR-TV in Knoxville.
Dollywood spokesman Pete Owens said on Tuesday that Dollywood is open to all families, but their dress code policy is to ask people with clothing or tattoos that could be considered offensive to change clothes or cover up.

There are a couple of things worth noting from this.

First, a privately owned and operated business, such as Dollywood, has the right to refuse service or require customers meet certain requirements.  This isn’t publicly owned land, and isn’t (or, more accurately, should not be) required to follow anti-discrimination laws.  Dollywood is privately owned and operated, and it can do what it pleases with its property.  If anyone has a problem with that, they can take their business elsewhere.

Second, since Dollywood’s main customer base is Bible Belt conservative families, their dress/behavioral  code, as enforced, is good for business.  Religious conservative parents do not like having their young children exposed things that are properly considered part of the adult world, like human sexuality.  Families go to Dollywood to have a good time, not learn about two random adults’ sexual orientation and political preferences.  Furthermore, it should be noted that the general preferences of religious conservative parents is merely anti-homosexual; they would not exactly be supportive of slutwalks, or of, say, men wearing shirts emblazoned with a slogan saying, “I just f*cked my wife.”

The issue here isn’t simply that two openly gay people went to a park.  The issue is that the vast majority of Dollywood’s customers don’t want to take their families to a place where sexual mores are discussed, debated, and supported openly.  They are there to ride rollercoasters; they are not there for a conversation on human sexuality.  As such, Dollywood is not only well within its rights to ask that people with offensive clothing to change or cover up, given its consumer base, one could credibly argue that it has a responsibility to.  Dollywood exists to make a profit, and having your target market boycott or desert you is not going to help accomplish that.  Just ask Six Flags.

Third, it’s not conservative Christian families’ fault that homosexuals have an inferiority complex and need validation.  Just because homosexuality is a completely unnatural way of life that increases practitioners’ risk for STDs, alcohol and substance abuse, and depression and thus leads them to conclude that what they’re doing may not be the best idea in the world doesn’t mean that they need to pester other people into validating their lifestyle choices.  If you choose to practice homosexuality, accept the consequences and just accept you for who you are.  After all, if you already have self-validation, what does it matter what others think of you?

Finally, conservatives would be more accepting of practicing homosexuals if they just weren’t so obnoxious about everything.  Is it really that great an injustice to turn your potentially offensive shirt inside out?  Wouldn’t you prefer for someone wearing a shirt that says “God hates gays” to be told to turn his shirt inside out so he doesn’t offend other patrons?  Civility cuts both ways, which is a lesson that at least two homosexuals have apparently failed to grasp.  Most Christians have (they call it “The Golden Rule”), which is why it is very rare to see Christians wear shirts with anti-homosexual messages to theme parks, and why you never hear them complaining about the injustice of having to turn their offensive shirt inside out.

Quite simply, homosexuals need to get over their obvious self-esteem issues and stop seeking validation from other people.  And, in the meantime, they would do well to quit forcing others to accept their sexual preferences.  This isn’t endearing to anyone, and quite counterproductive to their cause.

26 July 2011

A False Analogy

Robin Hanson makes a predictable mistake:

Similarly, the kinds of innovation activities and intellectual property rights that make sense depend on available institutions and technologies. I’m happy to admit that today intellectual property (IP) is not obviously a good idea. Such property can create large “anti-commons” transaction and enforcement costs that greatly raise the cost of combining old ideas into valuable new ideas. Such costs often outweigh the social benefits of the incentives to create IP, in order to sell it. Today, it is often better to rely on other social incentives to innovate, incentives that don’t require such expensive support.
But if true, this is a sad fact about our limited abilities, not a fundamental natural law or right. You have no fundamental right to enjoy the innovations produced by others without compensating them. You owe them, at least your gratitude. Yes for now it may be best to let you take innovations freely without paying, since the alternative seems too expensive. But you have no right to expect that situation to last forever, any more than ranchers had a right to expect they could forever let their animals trample nearby farms.

The problem with Hanson’s comparison of IP rights to real property rights is that intellectual production is not tangible whereas real property is, and one can adapt another’s idea without in any way diminishing its usage by its originator.  As Jefferson aptly observed centuries ago, as it is possible to use another’s candle to light one’s own without diminishing the other’s flame, so too can one use another’s idea as one’s own without diminishing the other’s usage of their idea.  Taking another person’s ideas and using them does not any way prevent him from using his own ideas in whatever way he sees fit.  Since using another’s ideas does not trample upon his rights, it is absurd to compare this to cows trampling a neighbor’s fields.  Using an idea is not inherently deprivatory in the way that using property is, and so the comparison is false.

At any rate, since ideas are not tangible, there is no conceivable limit to their spread save for demand.  Basically, demand, not supply, is the limiting factor for the production of any given idea and, as such, there is no need for prices or any other limitation of ideas.  Prices indicate scarcity relative to demand, and attempting to attach prices to ideas is essentially an attempt to attach scarcity to ideas.  Since there are an infinite number of ideas and production costs of ideas are close to nil (or at least so close to infinity and nil respectively that the upper bound makes a price schedule impossible), the only effect that bringing costs to ideas would be to limit something that is naturally unlimited.

Also, note that Hanson’s claims that “you have no fundamental right to enjoy the innovations produced by others without compensating them” and “you owe them, at least your gratitude” are both spurious.  The first is false, but only because of how he qualifies it.  He is correct in saying that no one has the right to enjoy the innovations of others.  No one has the right to anything save for life, liberty, the pursuit of property, and any derivatives thereof.  But it does not stand to reason that anyone deserves to be paid for what they produce, whether it be an idea or a physical object.  Quite simply, no one has a right to an income of any sort.  If you wish to be paid, convince consumers that you deserve it, whether it be on the technical merits of your product or whether it be on the ease of purchase relative to the cost of piracy.  In keeping with this, if one does not have a right to income for producing something, then one certainly does not deserve gratitude either.  Again, if a producer wants something from consumers, he must make or do something that causes consumers to respond favorably.

As can be seen, Hanson’s argument is riddled with plenty of intellectual errors, leading to erroneous conclusions.  He would do well to simply acknowledge that IP is a myth, and that no one is inherently deserving of anything just because they happened to produce something.

24 July 2011

Homemaking and SAHMs

The Social Pathologist and Ulysses have written quite a bit about stay-at-home-mothers and careerism and a whole host of other things related to women’s roles in society (see here, here, here, here, here, and here).  In short, feminists and other leftists have told women to pursue a career alongside the boys and traditionalists have told women to stay at home and take care of their kids.  However, it appears that while most women enjoy domestic duties, they would also like to spend some time engaging in work outside of the home.  In essence, optimal reality is somewhere between the extremes.

Anyway, I want to look at the religious traditionalists’ assertion* that women should be stay-at-home-mothers.  Religious traditionalists assert that women should stay at home and take care of the family.  This assertion is justified by citing Titus 2:5, which says that the older women should teach the younger women to be homemakers.

The question that should be asked of the traditionalists is:  does being a homemaker require one to be a stay-at-home-mother?  Answering in the affirmative requires one of two possible conditions: either the word translated “homemaker” in Titus 2 is an unqualified implication** that women must stay at home or the rest of the Bible is silent on women working outside the home.***

The former question is easily answered by consulting with Vine’s Expository Dictionary of the New Testament.  The word translated “homemaker” in Titus 2:5 is the Greek word oikouros  (Strong’s 3626:  οικουρος).  The New King James renders this word “homemaker;” the King James renders it “keepers at home.”  The literal meaning of the word is “working at home.” Thus, the command in Titus 2:5 is that women are to work at home.

This means, first and foremost, that women are expected to work, a lesson that often seems lost on far too many modern American women.  Additionally, they are expected to work at home, which means that women have a moral imperative to do work on behalf of their family within the setting of the home.  However, there is no qualification on the command to work at home, especially the qualification “only.”  This means that women are not explicitly forbidden from working outside the home, although it should be clear that the woman’s work at home is a non-negotiable imperative.****

Therefore, the teaching of Titus 2:5 is that women need to work at home, which only implies their presence at home insofar as they are required to work at home.  It would appear that the application of this verse would be that women must not shirk their duties to their families to pursue other things.   Since the word “work” is unqualified, and since wives are to submit to their husbands, it is reasonable to conclude that the work women do in the home is done under the authority of their husband and that the specific role each woman plays in the home may vary based on the specific circumstances each woman finds herself in.

Since Titus 2:5 does not specifically detail the work that a woman is supposed to do at home, a final question remains:  Are there any passages that state, imply, or otherwise teach that a homemaker (as the Bible uses the phrase) can work outside the home?  If the answer is no, then one can reasonably infer that that being a homemaker is equivalent to being a stay-at-home-mother.  If, on the other hand, the answer is yes, then one can infer that being a homemaker does not necessarily require one to be a stay-at-home-mother.  It should be noted, however, that neither implies that there is an imperative for a woman to work outside the home.  Thus, working outside the home can be forbidden or allowed, but never compelled, at least directly in a moral sense.

Proverbs 31 is worth considering as an answer to the question of whether it is possible for a woman who meets the biblical definition of homemaker to work outside the home.  It is obvious that the woman described in Proverbs 31 works at home:  “She rises while it is yet night and provides food for her household,” “She watches over the ways of her household,” and “her household is clothed with scarlet.”  Obviously, this woman works at home, in keeping with God’s expectation in Titus 2:5.  But she also works outside the home:  “She considers a field and buys it,” “She makes linen garments and sells them, and supplies sashes for the merchants,”  and “she is like the merchant ships, she brings her food from afar.”

Since the woman of Proverbs 31 is described as virtuous, and thus has God’s stamp of approval, it is clear that being a homemaker does not imply that one is a stay-at-home-mother and it is likewise clear that being a homemaker does not preclude a woman from working outside the home.  Therefore, it should be obvious that the religious traditionalists’ assertion that women should stay at home as a matter of biblical imperative is wrong.
However, this is not to say that women must work outside the home, nor is this to say that it is bad for women to stay at home.  Instead, the only conclusion that can be drawn from this study is that women do have responsibilities at home that should not be shirked, and these responsibilities will vary by each woman’s situation.  Each woman should submit to her husband, who can legitimately require that his wife stay at home and tend to the family.

In sum, there is much freedom in the carrying out of the specific command found in Titus 2:5.  Religious traditionalists should understand that working outside the home is not inherently evil, though it can be in some cases.  As such, they should not stigmatize and ostracize mothers who work outside the home unless it is obvious that said mothers’ working outside the home is having a detrimental effect on their family.  There is freedom in Christ, and those who claim to follow him would do well to recognize this.

(As a closing aside, I would like to point out a couple of things in regards to women’s desires to balance family and career.  One, obtaining optimal balance is impossible.  One can get close to it, but there will be times when the mix is less than optimal.  Two, perfect, continuous happiness is impossible.  One’s job will be frustrating at times; one’s domestic responsibilities will be frustrating at times.  Three, sometimes women desire the impossible.  The optimal mix of careerism and domestic responsibility as one envisions it may simply not exist.  Fourth, a woman’s family should take precedence over a woman’s personal desires, by which I mean that a woman should do what is best for her family, not her happiness.)

* Lest anyone accuse me of creating a straw man, let me simply say, for the record, that the argument that women should stay at home and take care of the home/children is a faithful reproduction of what my father and mother have taught me.  Additionally, the argument that my father has made regarding the necessity of a mother’s staying at home is largely consistent with arguments made by his preaching buddies.  And yes, I am the son of a preacher man.

**  That there is a controversy over this specific verse would indicate that the meaning of “homemaker” is not obvious, and the command must be unqualified elsewise one could only argue for staying at home as a matter of principle, which would then yield to pragmatism.  And if the issue is inherently pragmatic, than the principle is not absolutely binding, and the application becomes a matter of circumstance, and the traditionalist argument does not yield itself to modern conveniences, which is a matter for another post, or possibly the comments section.

*** The biblical principle of silence is addressed in Hebrews 7:14.

**** Which is to say that while women can work outside the home, whatever work they do outside the home should not interfere with their work at home.  Essentially, their work at home carries the highest priority.

22 July 2011

Incentives Matter

Why is there widespread cheating by America's educators? According to Diane Ravitch, who is the research professor of education at New York University, it's not teachers and principals who are to blame; it's the mandates of the No Child Left Behind law, enacted during the George W. Bush administration. In other words, the devil made them do it.

While Williams is correct in sarcastically noting the lack of moral fiber among America’s educators, it is worth pointing out that Ms. Ravitch does have a legitimate complaint about No Child Left Behind.  Consider the mandates of the bill, as summarized by Wikipedia:
No Child Left Behind requires all government-run schools receiving federal funding to administer a state-wide standardized test (all students take the same test under the same conditions) annually to all students. The students' scores are used to determine whether the school has taught the students well. Schools which receive Title I funding through the Elementary and Secondary Education Act of 1965 must make Adequate Yearly Progress (AYP) in test scores (e.g. each year, its fifth graders must do better on standardized tests than the previous year's fifth graders).
If the school's results are repeatedly poor, then a series of steps are taken to improve the school. Schools that miss AYP for a second consecutive year are publicly labeled as being "in need of improvement" and are required to develop a two-year improvement plan for the subject that the school is not teaching well. Students are given the option to transfer to a better school within the school district, if any exists. Missing AYP in the third year forces the school to offer free tutoring and other supplemental education services to struggling students. If a school misses its AYP target for a fourth consecutive year, the school is labeled as requiring "corrective action," which might involve actions like the wholesale replacement of staff, introduction of a new curriculum, or extending the amount of time students spend in class. The fifth year of failure results in planning to restructure the entire school; the plan is implemented if the school fails to hit its AYP targets for the sixth year in a row. Common options include closing the school, turning the school into a charter school, hiring a private company to run the school, or asking the state office of education to directly run the school.

The whole is nothing more than liberal nonsense.  It’s predicated on the assumption that humans are born tabula rasa and that genetics do not have any correlation to intellectual abilities.  In essence all children can be exceptional if only the stupid teachers didn’t hold them back.  Thus, the bill attempts to incentivize academic improvement because the theory is that teachers are the ones who need prodded.  Not once did it ever occur to the authors of the bill that some children are smart or gifted and others aren’t.  It also never occurred to the authors of the bill that the recent failures of the education system aren’t due to a lack of funding.

Anyhow, No Child Left Behind makes the crucial mistake of allowing those who are handling the testing to determine the standards by which they will be tested.  This already leads to a cheater’s mindset, since the states now have an incentive to play to their strengths and gloss over their weaknesses.  The states also have lots of pressure to improve.  Note that each state’s scores each year have to improve on the prior year’s scores (which, if one thinks about it, will eventually become mathematically impossible once one gets perfect scores) in order to have access to federal funding.  Since humans vary significantly in ability, this sort of thing is impossible to keep up over time.

Of course, audibly observing that humans are not blank slates, and do, in fact, vary in ability is verboten.  And so, as standards become increasingly and comically more difficult, the incentive to cheat becomes stronger, and downright necessary in some cases.  Thus, as Ms. Ravitch observes, No Child Left Behind does deserve some blame for creating such a perverse set of incentives.  Such is the price of folly.

Paradigm Shifts

Robin Hanson still misses the point:

Of course in the long run innovation must run out, and then we’ll have a long stable future with little innovation. But I expect the innovation era to last a few more centuries at least, with the best innovation yet to come.

First, note that Robin Hanson’s conclusion is implicitly predicated on the assumption that there will never be any paradigm shifts, and is thus false. There are an infinite number of paradigms, so innovation can continue infinitely.  Now, it is true that every paradigm of human understanding tends to run out of innovation eventually, but when this occurs, it is replaced by another paradigm.  And since there an infinite number of paradigms, there is thus an infinite amount of future innovation.

Of course, it helpful to recall that all human understanding is inherently subjective, and thus subject to change when the imperfections of each paradigm hinder growth.  This is seen in the sector of computers.  Computers were originally envisioned to work with punch cards.  Once this paradigm no longer yielded improvement, the paradigm shifted to electrical impulses over a motherboard and related components, and is currently being replaced by quantum computing.  On a macro level, the paradigm of computer itself shifted from man to machine once mathematical innovations made the paradigm shift feasible.

Human understanding, being subjective in nature, is inherently perceptual.  Humans make use of certain things based on how they perceive the world.  If humans begin to see the world differently, the way they interact with it will change as well.  Innovation will always occur because man is always refining his knowledge of the world, and is thus constantly changing his perception of the world.  Since innovation is always paradigmatic, it stands to reason that it will always exist because new paradigms are constantly appearing.

Also, note that Hanson’s model implicitly requires social stability (cf. Neurodiversity for proof that society requires a minimal amount of population and social stability in order to be maintained).  Given the current global economic mess, it seems somewhat short-sighted to argue that we’re closer to civilizational stability than destruction.  Only time will tell if Hanson’s optimism is warranted.

So Many Problems

We are richer than our ancestors mostly because of innovation. But most of the innovation benefits we receive are externalities – we only pay our ancestors (or those to whom they transferred their property rights) for a small fraction of that benefit. If we instead had better property rights for innovation, we’d pay a large fraction of our income as compensation for past innovation. That would increase incentives to innovate, the rate of innovation, and the fraction of the economy devoted to innovation. With good institutions, I could imagine more than half of all income being paid to the innovation industry.

There are several problems with this paragraph.  First, as net-based pirates have shown, there are plenty of people who try to avoid paying for rights to use IP,* which invalidates his claim that “we’d pay a large fraction of our income for past innovation.”  We’d likely pay more, to be sure, but given man’s tendency to avoid paying these sort of things, it foolish to say with any degree of certainty that we would pay a lot.

Second, there is absolutely no basis for saying that there would be more incentive to innovate.  Since we have tried IP rights, we cannot tell what the rate of innovation would be in their absence, and cannot therefore properly compare the rate innovation under a system of IP to a system with no IP rights.  Any attempt to do so is pure conjecture.  Furthermore, all innovation is derivative, so even if people were more inclined to innovate more, IP law would more than likely prevent them from doing so since they would either have to license the product being innovated or be forcibly prevented from innovating.

Third, the stifling nature of IP enforcement, as noted before, would (and has) actually stifled innovation.  Patent jumpers have forced people to redesign improvements because their proposed solution would infringe on their patent.  This hardly encourages innovation, and it is hard to see how more of this would do so.
Alas, it is devilishly hard to design good innovation property rights. Patents are supposedly the best we have now, and they are often terrible. But over the next few centuries, we might just create better institutions (e.g., futarchy) to better encourage institution design, and within those institutions, folks may well come up with better designs for institutions to encourage innovation. Optimist that I am, my best guess is that we will succeed at this. 

Perhaps the reason it is so difficult to design good innovation property rights is due to the fact that innovation is not actually property, and thus cannot be protected with rights.  It is hard to see how copying someone or something diminishes them in any way.  Some might argue foregone income, but this argument is riddled with errors (for one, there is no guarantee that a given consumer would have purchased from the innovator anyway, and no one has a “right” to be paid anyway).

Of course, it is possible that “society” will create institutions that actually incentivize innovation.  I would bet that said institutions will consist mostly of educating people how IP is a myth, and does not deserve any form of monopoly or protection from the government.
Of course in the long run innovation must run out, and then we’ll have a long stable future with little innovation. But I expect the innovation era to last a few more centuries at least, with the best innovation yet to come.
I will deal with this in a separate post.

* Note:  it is assumed that Hanson’s call for property rights on innovation either largely resembles patent and possibly some forms of copyright, at least in principle.

21 July 2011

Book Review

The Tyranny of Good Intentions by Paul Craig Roberts and Lawrence M. Stratton

The Tyranny of Good Intentions is an incredibly sobering read that details just how fascist the current “justice” system has become in America.  In order to show how far America has fallen, the authors first detail “the rights of Englishmen,” a concept upon which the bulk of the American legal system is predicated.  The authors explore Blackstone’s legal philosophy in some depth, which, in my opinion, is a mark of excellence.  Blackstone is an oft-neglected jurist even though his commentaries were one of the most popular books in America in the late eighteenth century, and his philosophy undoubtedly leached over into the American system.

After showing what was, the authors next show what is.  Rule of law has been replaced by rule of convenience and trial by jury has been replaced by plea bargains.  The penal code does not exist to ensure justice, but to give prosecutors leverage in targeting people for prosecution.  Prosecutors don’t even have to target actual criminals.  Thanks to the vagaries of some statutes, prosecutors are pretty much able to get a guilty verdict on anything [Note:  Three Felonies a Day does a very thorough job of showing how this is the case].

Additionally, prosecutors love plea bargains because they can easily use them to get easy convictions on lesser charges.  Criminal litigation is very expensive and time-consuming (whatever happened to the 6th amendment?), and so prosecutors are able to essentially blackmail targets into pleading out.  The common threat used by prosecutors is to overstate their case against the defendant and then promise to go easier on the defendant if he pleas to a lesser charge.  Most people accept the bargain because they view conviction as inevitable, and so they pick the lesser sentence.  Prosecutors also offer leniency in exchange for testimony, which has the effect of causing those who have been charged with lesser crimes to commit perjury favoring the prosecution because it makes their sentences lighter.

With these distortions in place, it should be obvious that the legal system that exists today is not concerned with justice but rather with conviction.  The current system has little resemblance to its origins, and the bloodlust of the public has led to a leviathan that favors an unduly harsh stance against the accused (as opposed to an unduly harsh stance against the guilty). It has reached the point where an accusation of criminality is almost as bad as a conviction.  Consequently, the view has gone from “innocent until proven guilty” to “presumed guilty unless proven otherwise.”  This is not healthy for any society, and is a sign of fascism to come.

In all, this book is a necessary albeit depressing read.  The book is chock-full of relevant law and cases, and presents a clear history of legal decline.  Furthermore, this book is predicated on a clear-eyed and consistent philosophy of natural rights, which makes its analysis spot-on and useful.

Strange Bedfellows

You know, if I were an environmentalist I would embrace the TSA as a way to kill air travel.  The reason for this is because the TSA makes air travel more inconvenient and time-consuming, which would presumably drive down the demand for air travel.  This should have the effect of reducing the current number of flights, planes, and possibly airlines, which in turn means reducing emissions and demand for oil, which is supposedly good for the environment.

While most environmentalists are leftists, one would suspect that they would be opposed to having their precious rights being stepped upon.  Especially since, in this case, their rights are being trampled upon at the behest of an organization that is part of DHS, which was created by Bushitler in 2002.  On the other hand, the TSA targets middle-class people (the poor can’t afford planes at all and the rich use private jets and get to skip the TSA), so the environmentalists would get to vicariously thumb their noses at the bourgeoisie who don’t care about Mother Gaia.  Really, it’s quite a conundrum, which makes me glad that I don’t have to try and rationalize my way through it.

19 July 2011

Like A Dog Returns to Its Vomit

Tuesday's release of the Fed minutes contained the first indication that a third round of quantitative easing (QE3) is being considered. The notes described unanimous agreement that QE2 should be completed, along with the following comment: "depending on how economic conditions evolve, the Committee might have to consider providing additional monetary policy stimulus, especially if economic growth remained too slow to meaningfully reduce the unemployment rate in the medium run." Since the unemployment situation is deteriorating, and by all accounts will continue to do so, the Fed is essentially pledging to keep the spigot turned on. The committee also decided to look only at current "overall inflation" in making their judgments, as opposed to "inflation trends." Since new dollars take awhile to circulate around the economy and raise prices, this means the Fed is sure to be too late in tightening once inflation starts to run away, causing more dislocations in the American economy.

Will these clowns never learn?  QE1 didn’t work, QE2 isn’t working, and, contra the Krugster, the problem is not that enough hasn’t been pumped into the system.  The problem is that we have spent tomorrow’s money on yesterday’s stuff and must now pay the price.  Inflating the currency doesn’t change the fact that we have leveraged ourselves to the hilt and have to pay the price.  We’ve spent beyond our means, and it is now time to tighten our belts.  We cannot continue to spend more and we cannot continue to take on debt.  It’s time to stop with this quantitative easing nonsense.

Yeah, This’ll Solve Problems

How about we create a law that makes it illegal to pass legislation in the immediate aftermath of a media-hyped trial instead of this one:

There should be a new law created called Caylee's Law that will make it a felony for a parent or guardian to not notify law enforcement of a child going missing within 24 hours
Let's keep another case like Caylee Anthony out of the courts.  Contact your State Senators and Representatives.

In many ways, this reminds of the rationale behind gun control:  if we just have more laws on the books we can prevent more injustice.  And it suffers from the same problems as gun control:  If someone is going to commit murder, they probably aren’t going to be concerned with violating a lesser crime.

I suspect the real rationale for passing this law is to ensure that despicable moms can be put in jail when the prosecutor fails to make their case on murder.  Of course, the circumstances around Caylee’s murder are somewhat exceptional—how many future moms are going to allegedly murder their child and then delay reporting their child’s disappearance?

What’s lost in this discussion is the potential abuses of this legislation.  As Harvey Silverglate has amply demonstrated in his wonder tome Three Felonies a Day, most laws are used to convict people who never intended to break the law and thought they were acting in good faith.  And plenty of seemingly innocuous laws, like those against mail fraud, for example, have been used to prosecute people who were only guilty of being targeted by prosecutors.  Why, then, does anyone think it is a good idea to give prosecutors more power?  Especially when doing so doesn’t even guarantee that justice will be better served as a result?

Reputational Capital

One example he used was of Jonathan's Coffeehouse, a private club that preceded the London Stock Exchange. In the 18th century, the government refused to enforce stock exchange contracts, seeing them as a form of gambling. Nevertheless, the Coffeehouse became a centre of commerce and contracts were usually upheld voluntarily. If you were a trader, you could rip somebody off once, but would be barred from the club. For people whose livelihoods were based on stock trading, it wasn't worth it.
The same phenomenon exists today in a whole range of exchanges. When I go to a restaurant and get a bland meal, it's practically certain that I won't sue. Does this mean that profit-maximising restaurants will constantly give out bland meals? No – if it serves bad food, I'll stop going and tell my friends not to go either. Reputational capital, so to speak, is enormously valuable, and losing it can be worse than just losing a court case. As a side-point, the reason that restaurants in touristy areas are usually so bad is down to this fact as well. Tourists typically don't know anything about the restaurants they go to – could things like TripAdvisor bring an end to tasteless, expensive tourist food?
One complaint about the unfettered free market is that there is no way to “make sure” that people behave ethically and fairly in their business dealings. The unspoken assumption is that only government can provide the final guarantee against fraud, presumably through the use of force. What’s neglected in this fairly shallow analysis is that most people expect to participate in the market over the long term, the market can exert plenty of force, and the government is far from perfect anyway.

Since most people expect to participate in the market over the long term, it would be foolish for them to do things that would cause consumers to distrust them. As was already noted, if someone were to even sell a shoddy product, they would presumably suffer negative consequences. And if they intentionally defrauded customers, they would find that they would go out of business quite quickly.

The reason for this is due to the effect of social pressure, which exists outside of the state. Most people with decent faculties will find that it is in their best interest to “play by the rules” because doing so ensures that will have social acceptance, which in turn ensures that there is some degree of implicit trust which then enables trade. This social pressure ensures that most people conform to social norms, and this is itself a form of force.

Unlike the state, though, the market does not have coercive power, in the sense that conformity can be forced. Anyone can opt out of the society in which they live, if they so choose. Incidentally, if one were to opt out of a given society, the market in that society would improve because those who opted out would no longer participate in that market.

Finally, the coercive force of the government is not always used for good. Even if the market cannot ensure that no one ever gets hurt when engaging in market transactions, it does not follow that the government will. As such, the argument that the government needs to regulate the market for the good of consumers is simply specious.

17 July 2011

Why I Hate Republicans

I’ve been trying to ignore this story for a while because contemplating it makes me indescribably angry, but I just need to get this off my chest: I hate republicans because they are complete idiots with nary a shred of knowledge.

I say this because they have decided to ask for future budget cuts in exchange for raising the debt ceiling. This despite some calling for (eventually) a balanced-budget amendment. I hate to break the news to these clowns, but if the government is legally prohibited from borrowing money, the budget is balanced by default from that point forward. The only way the government can borrow more money is if it pays off its debt. And debt can only be paid off with tax revenue, which means that part of the budget has to be cut in order to get money for cutting the debt in order for the government to borrow money so they can spend more money on…you get the idea.

Anyway, the point I’m driving at is that Republicans need to grow a pair. If they block an increase in the debt ceiling, they will effectively have a balanced budget amendment. Yet, it appears that they are either too stupid to realize this or they are too cowardly to act. Either way, I hate them and hope that such an ignorant, cowardly lot never gets elected again.

International Economics

In which I disagree with Captain Capitalism:
Arguably the single largest threat to freedom in the world is the "harmonization" of tax rates. Of course politicians like to use euphemisms so the ignorant masses can continue on watching their Lady Gaga or the latest professional sports competition, but trust me it is a threat. The reason why is if tax rates are "harmonized" then there is no incentive for business, investment or labor to go to one country versus another. And if tax rates are moved in conjunction with one another, then the governments essentially form an OPEC-like cartel ensuring that labor and capital are more or less trapped at their home country. Since there is no advantage to moving investment and labor to one place or another, governments (if working together) and implement whatever policies they want on their people because "where you going to go? Every place is the same."
Tax rates are not the only concern, or even the largest, for a company looking to build overseas. Labor costs and capital costs are larger concerns for most companies since capital and labor tend to be the largest expenses a business faces. The reason companies chartered in America build crap in China isn’t because taxes are lower in China but because labor is cheaper in China.

I’m not trying to suggest, of course, that tax rates don’t factor in to the decision to locate overseas. I’m simply saying that taxes are, for the most part, a marginal concern, which in turn means that the claim that “there is no incentive for business, investment or labor to go to one country versus another” is simply economically ignorant.

Moral Posturing

Tom Clougherty on bankers:
This is a point I've often tried to make to left-wingers, usually without success. Too many people are so blinded by hatred of the financial industry, that they simply assume that all its problems are caused by bad people with bad motivations. It leads them to completely overlook the very real structual and systemic problems in banking, and produces little more than shallow, populist rhetoric.

It's why so much public debate has focused on marginal issues like executive pay and bonuses, and so little attention has been given to the all-important skewed incentives created by bailouts, central banks, and government regulations. Political discourse seems inevitably to focus on the personal, which hardly matters at all, and ignores structures and systems, which matter a great deal.
If signaling theory is to be believed, it would appear that leftists are more concerned with appearing morally superior than with actually addressing the root of the issue. It’s easy to say that one would never defraud others if they faced the same situations the bankers faced, but one can never be truly sure until one actually faces those decisions. It’s incredibly easy to turn down millions in bonuses when one never stands a serious chance of receiving them anyway.

What’s difficult to accept is that most people, leftists included, would succumb to the same pressures the bankers did if they faced the same decision and incentives. And so, leftists and populists demand—quite reasonably—the lying cheating bankers’ heads on stakes. But they never demand systemic reform, which was the problem in the first place.

Thus, if leftists were serious about fixing the problem of fraud and corruption in the banking sector, they would start with changing the incentive structure. That they would rather crucify bankers and demand that humans act as morally perfect agents would suggest that they are more concerned with moral posturing than real solutions. At least they’re sticking it to the man.

14 July 2011

You Can Always Count On Politicians

President Obama on Tuesday said he cannot guarantee that retirees will receive their Social Security checks August 3 if Democrats and Republicans in Washington do not reach an agreement on reducing the deficit in the coming weeks.
"I cannot guarantee that those checks go out on August 3rd if we haven't resolved this issue. Because there may simply not be the money in the coffers to do it," Mr. Obama said in an interview with CBS Evening News anchor Scott Pelley, according to excerpts released by CBS News.

If one were to look at box 4 of IRS form W-2, one would see that part of their pay goes specifically to Social Security.  Why, then, if part of one’s taxes are earmarked for specifically for Social Security, is the government unable to mail out Social Security checks as promised?  They claim on everyone’s W-2s that they have earmarked a certain amount of tax money for Social Security.  Why are they suddenly unable to pay it?

Yes, people, you’ve been lied to.  For all intents and purposes, there is no Social Security fund.  There are simply a bunch of empty promises made by soulless parasites, and now there is no denying the fact that Social Security was a Ponzi scheme from the get-go. We were all suckers for believing politicians about Social Security, and we get what we deserve.  Let’s not make the same mistake about the debt ceiling.

Thomas Sowell on Foreign Trade

I knew there was a reason I still liked the guy:

The quick fix that got both Democrats and Republicans off the hook with a temporary bipartisan tax compromise, several months ago, leaves investors uncertain as to what the tax rate will be when any money they invest today starts bringing in a return in another two or three or ten years. It is known that there will be taxes but nobody knows what the tax rate will be then.
Some investors can send their investment money to foreign countries, where the tax rate is already known, is often lower than the tax rate in the United States and -- perhaps even more important -- is not some temporary, quick-fix compromise that is going to expire before their investments start earning a return.
Although more foreign investments were coming into the United States, a few years ago, than there were American investments going to foreign countries, today it is just the reverse. American investors are sending more of their money out of the country than foreign investors are sending here.
Since 2009, according to the Wall Street Journal, "the U.S. has lost more than $200 billion in investment capital." They add: "That is the equivalent of about two million jobs that don't exist on these shores and are now located in places like China, Germany and India."
President Obama's rhetoric deplores such "outsourcing," but his administration's policies make outsourcing an ever more attractive alternative to investing in the United States and creating American jobs.

One cannot have free trade, an anti-market domestic trade policy, and a growing domestic economy simultaneously.  One might be able to have two of the three, but there is no way to have all three.  Unfortunately, Obama is trying to have all three, and it’s just not going to work out.

An Asinine Question

Foseti shows the stupidity of open-border libertarians:

A chorus of beltway libertarians decries the fact that if we don’t have illegal immigrants, we won’t be able to pick our fruit. Who will save the fruit? Think of the fruit!

Who will pick fruit if the illegals won’t?  Probably legal citizens.  I know this is a surprise to some, but the market can still allocate scarce resources even in the event of governmental interference.

If all the illegal immigrants were kicked out of the country, farmers would hire legal citizens.  They would probably have to pay considerably more for the labor of legal citizens, but it can certainly be done.  That’s how the market works.  Libertarians of all people should know that.

I Thought They Were Supposed To Represent The Voters

The hotter precincts of the blogosphere were calling this a sellout yesterday, though they might want to think before they shout. The debt ceiling is going to be increased one way or another, and the only question has been what if anything Republicans could get in return. If Mr. Obama insists on a tax increase, and Republicans won't vote for one, then what's the alternative to Mr. McConnell's maneuver?

In all the pontification about what’s best for the Republican party, it seems that some have managed to overlook what’s best for the country and what the voters want.  Quite simply, most people don’t care about the Republican Party.  They care about the long-term future of the country and keeping the debt under control.  Since this is a democracy, at least for the time being, Republicans better start caring about the long-term tenability of the current spending and borrowing trends, and they better find a way to get it under control.  Better to die on principle than stand on pragmatism.

Also, given the massive unpopularity of raising the debt ceiling, what exactly is the upside of selling out?   The Democrats will betray the Republicans later on and the voters will the Republicans, so siding with the Democrats on raising the debt ceiling is a generally horrible idea.  It’s too late for Republicans to own this issue, and why would they want to anyway?  The mind boggles.

13 July 2011

Job Creation Isn’t Inherently Good

Here’s some balderdash from climatologists:

In a recent report (PDF) published by RenewableUK and Energy & Utility Skills, the authors suggest that the wind and marine energy industries have the potential to contribute heavily to job creation given that a correct policy and legislative framework is implemented. Although this is an encouraging message, we ought to study the lessons to be learned from Denmark, the once so promising first mover in renewable energy.
Three market development scenarios, measured by the extent of deployment of wind and marine energy, are set out in the report. By 2021, the low growth scenario envisages the support of 44,000 jobs, medium growth is anticipated to result in the creation of 67,200 jobs, and high growth may well create 115,000 jobs, most of which require a particularly skilled workforce. These numbers account for full-time employees whose jobs are directly or indirectly (i.e. in the supply chain) created by the growth of these industries. For this growth to be possible, however, the authors call for substantial investments in the workforce in order to facilitate the provision of much needed skills.

One of the more hilarious aspects of “green” energy proposals is the promise of more jobs, with the implicit assumption that more jobs equal a lower unemployment rate.  From a practical standpoint, this sort of argument is specious because energy contractors rarely hire unemployed people who have never worked in the energy sector.  As such, the pool of potential candidates is usually relegated to those who aren’t part of the current unemployment metric (because they are either currently employed or being “educated”).

Another implicit claim of jobs in “green” energy is that having more jobs will lead to more wealth.  This may or not be true; although the necessity of subsidies for green energy would suggest that it destroys wealth.  Anyway, a simple thought experiment should suffice to demonstrate how more jobs doesn’t always equal more wealth:  Imagine two countries, each having a population of 500 that are equally productive at producing everything except energy.  Country A requires the labor of two people in order to produce 100 megawatts of electricity in one hour; Country B requires the labor of one person in order to produce 100 megawatts of electricity in one hour.  Assuming that both countries have identical natural resources, capital, and governmental infrastructure, etc., which one is wealthier?

To ask the question is to answer it:  the country that can produce more electricity with less labor is wealthier, because it can divert more human capital to producing things other than electricity.  This thus shows that having more energy jobs may not be a good thing because it does not indicate whether the increase in jobs will produce more energy more efficiently, which is actually the relevant metric.  Employing people simply for the sake of employing people is not economic growth, it is charity, and should be viewed as such.

Nothing to Fear

I’m sure that there are no worries about this if you’re a law-abiding citizen:

Microsoft has admitted that it will hand over data to the U.S. government, if properly requested, even if that data is stored somewhere other than the U.S.
The issue, according to ZDNet's Zack Whittaker, is that because Microsoft is a U.S. company it has to comply with the Patriot Act, and that means handing over data that may be offshore. The same rules would apply to Amazon Web Services and any other U.S. based cloud provider that has servers overseas.

Two things.

First, I wonder how much more paranoid people would be if they knew their data was potentially viewed by the government and not just advertisers and businesses.   If you can’t trust big business, then you certainly can’t trust the government.

Second, why is Microsoft being so wimpy about this?  The Patriot Act is a gross violation of civil liberties and Microsoft should protest it on behalf of its customers.   Of course, doing so would undoubtedly lead to greater government scrutiny, which is why Microsoft and other cowardly companies refuse to stand up to tyranny.

And people wonder why I avoid the cloud.

Paragraphs to Ponder

An oldie but goodie from ASI:

We know that pouring out skills is not one of the key ways in which you generate growth. Look at past experiments. Did the Soviet Union become the greatest economy in the world through a combination of planned allocation of resources and making everyone do engineering and science? No, it didn’t. Take a look at some of the successful economies. Look at Switzerland. It has one of the lowest higher-education enrolment rates in the world, yet it has a fantastic economy. If the economy demands skills and you’ve got a decently responsive higher-education system you’ll end up with an equilibrium situation… You don’t generate growth through number of graduates.

I believe it was Neil Postman who once observed that there is no correlation between educational attainment and economic well-being.  Quite simply, a larger number of college-educated people does not lead to fewer recessions.  And spending more money on education will not make the current depression end sooner.  In fact, it is really quite remarkable that otherwise normally intelligent people seemingly accept without hesitation the somewhat specious assertion that there is a correlation between education and economic growth.  It’s even more remarkable that they conclude causality.

Ignorance Is Bliss (But Not For Very Long)

The ignorance about our country is staggering. According to one survey, only 28 percent of students could identify the Constitution as the supreme law of the land. Only 26 percent of students knew that the first 10 amendments to the Constitution are called the Bill of Rights. Fewer than one-quarter of students knew that George Washington was the first president of the United States.
Discouraging young Americans from identifying with their country and celebrating our traditional American quest for liberty and equal rights removes the most powerful motivation to learn civics and U.S. history. After all, Damon asks, "why would a student exert any effort to master the rules of a system that the student has no respect for and no interest in being part of? To acquire civic knowledge as well as civic virtue, students need to care about their country." Ignorance and possibly contempt for American values, civics and history might help explain how someone like Barack Obama could become president of the United States. At no other time in our history could a person with longtime associations with people who hate our country become president. Obama spent 20 years attending the Rev. Jeremiah Wright's hate-filled sermons, which preached that "white folks' greed runs a world in need," called our country the "US of KKK-A" and asked God to "damn America." Obama's other America-hating associates include Weather Underground Pentagon bomber William Ayers and Ayers' wife, Bernardine Dohrn.

Obviously, this does not bode well for the future of America.  The absence of knowledge about one’s country and civic institutions is problematic for two reasons.

First, it is hard, if not downright impossible, for people to love their country if they know nothing about it.  Cultivating civic pride requires people to know about the things that make their country unique and to know about the heroes of their country.  How many Americans know who Paul Revere is?  How many know who Alvin York is?  General Patton?  These men were heroes, and now their names are historical footnotes.  And how many people have read the constitution and the Declaration of Independence?  How many have read Blackstone’s commentary or the federalist papers?  People cannot feel proud of their country if they are ignorant of it.

Second, if people have no familiarity with their country’s civic institutions, they will find it difficult to mount a coherent defense of said institutions.  If one never reads the constitution, then one will be hard-pressed to determine when it is under assault and how it is being assailed.  If one has no familiarity with the underlying philosophy of America’s governmental and legal structure, then one can hardly be expected to argue coherently in its defense.

As an aside, Vox Day posted on a test that attempts to measure one’s civic literacy.  Frighteningly, college educators, on the average, had a failing score. Again this does not bode well.  (For what it’s worth, I aced the test.)

12 July 2011

Intellectual Insecurity

This has been a post I’ve developing for some time.  I first suggested it in a response to a comment the Social Pathologist left on this esteemed blog.  Then alcestiseshtemoa left this comment on a recent blog post:

In turn, the bulk of self-described conservatives rally around these same figures as if they were the saviors of America who would, like a sort of modern Republican St. Patrick, drive the snakes of liberalism from our shores. The truth is that Palin, Beck, and the rest are not any sort of threat to the dominance of liberalism, because they are themselves infected with a mindset very much shaped by liberalism.

I would also place Jonah Goldberg on that list.  My personal preferences notwithstanding, one thing that I have observed about most mainstream conservatives is that they seem to suffer from what I call intellectual insecurity.  Quite simply, some conservatives are concerned about being mocked for having “backward,” “archaic,” or “outdated” beliefs (and this concern is quite legitimate in Palin’s case, in light of how the media has treated her).  And so conservatives, in the effort to appear contemporary in thought, take on the assumptions and basic premises generally espoused by progressives.

Conservatives thus accept the premises of gender equality, racial equality, sexual-orientation equality, and other definitions of equality* generally accepted or proposed by progressives.  Of course, once one accepts the premises proposed by progressives, one must generally accept most of the basic conclusions derived from the assumptions.  And make no mistake: progressives are a very logical bunch.  That their policies fail time and again when put into practice should strongly suggest that the premises are flawed.  Nonetheless, conservatives seem incapable of following this rudimentary logic and so they accept the flawed premises upon which progressivism is founded.

Unsurprisingly, it is difficult, if not downright impossible, for conservatives to begin with progressive assumptions and end up with conservative conclusions.  Because they fear being mocked and ostracized by the intellectual elites, they buy in to the intellectual paradigm established by progressives.  In so doing, they bring about their eventual downfall.  If they accept progressives’ premises, they must also eventually accept their conclusions, which is why they cannot be trusted.

The solution to this problem, then, is for conservatives to simply begin with their own premises and stick to them no matter what.  This requires a great deal of intestinal fortitude, as well the ability to feel secure in their own beliefs.  If they can attain this, then they can be trusted, and maybe, just maybe, they can finally begin to get the results they keep promising.  Personally, though, I wouldn’t hold my breath.

* And here I use equality in the same sense that progressives do, which presupposes that all people are identical regardless of race, gender, sexual orientation, etc.  This also requires a relativistic version of morality and ethics.  In contrast, paleo-conservatism (also known as “liberalism” in the good old days of the 18th century) assumes equality before the law, which simply means that the government, which administrates the law, is forbidden from treating citizens differently solely on the basis of sex, race, or sexual orientation (e.g. a gay man is not presupposed guilty of a crime while a straight man would be presupposed innocent if accused of the same.  Alternatively, a woman wouldn’t have her rights suspended simply because she’s a woman.) Of course, paleo-conservatives take a negative view of rights (i.e. the government doesn’t do x) whereas modern progressives take a positive view of rights (i.e. each person should have x).

10 July 2011

Owe No Man Anything

In a June 21 response, attorneys for the church indicated the church had strategically defaulted on the mortgage after learning its real estate – a 23,635-square-foot office building housing the church – is worth only $2.375 million vs. the $7.653 million owed to the bank.
This strategic default involved an analysis of whether it made sense to use church members’ donations to pay the underwater mortgage while also trying to save money for expansion needs.

I remember arguing with a preacher once over the morality of strategically defaulting on one’s mortgage.  He was of the opinion that, per Romans 13:8, we each have an obligation to pay off our debt.  His argument struck as somewhat asinine (but less asinine than the argument that Romans 13:8 forbids the Christian from going into debt).

Anyway, the flaw in this preacher’s thinking was that defaulting did not lead to repayment of the debt.  Most mortgage agreements work like this:  the borrower agrees to borrow a certain amount of money and repay it, plus a usury charge called interest.  The borrower is generally expected to offer some property as collateral.  If the borrower fails to pay per the terms of the agreement, then he is in default, and the lender usually reserves the right to confiscate the collateral in order to cover the remainder of the principal.  For most mortgages, confiscation of property is generally considered sufficient compensation in the event of a default (which is predicated on the theory that housing prices always go up and never come down).

Thus, the lender is essentially saying that the property offered as collateral is equivalent to the value of the foregone cash.  Whether this assumption proves to be true in the long run is not the concern of the church, in this case, but of the bank that makes the loan.  And if the bank’s estimation of the future value of property is wrong, it does not follow to claim that the church must repay the bank for a mistake the bank made. Furthermore, the bank has already said that ownership of the property in the event of a default essentially marks the debt as paid, so there is nothing wrong with the church defaulting on its payments in order to save money (in fact, the church would do well to default and then repurchase the property once the bank sells it).

Therefore, it is not wrong for the church to default on its loan, for it is simply making a prudent financial decision and will, even by defaulting, pay its debt.  The bank, not the church, is responsible for determining market risk, and the bank, not the church, should bear the consequences of making the wrong decision.