Quote of the Day
Let no one delay the study of philosophy when young nor weary of it when old.Epicurus
Over the Hump: Hurricane Sandy
I realize over 7.5 million without power and over 30 fatalities {my thought and prayers to the families). the howling wind and heavy rain peaked overnight, with only a brief outage in my case.
An Earlier One-Off Posted
I wrote a somewhat tongue-in-cheek "Why You Should Read Me" earlier today.
I somehow lost my first draft of this post which I'm having to rewrite from memory. Part of it I'll include in tomorrow's post.
Beware the "Hurricane Sandy Stimulus/Recovery"
This is just a variation of Bastiat's broken window fallacy where an act of God breaks a window. The window replacement transaction ripples through the economy with a high multiple. Of course the shopkeeper isn't better off than when he had the original window and the window cost in his pocket to buy things.
Even if you build again newer, better, the insurers aren't better off; their reserves are lower to cover other events. Don Boudreaux writes another signature spot-on pithy letter on related "Vulgar Keynesianism". Let me assure you government does its part: say, failing to maintain public infrastructure, never mind the hugely subsidized federal flood insurance program.
A Libertarian Critique: Obama/Romney the Same?
Thumbs DOWN!
I'm a huge fan of Cafe Hayek's Russ Roberts' weekly podcast EconTalk (highly recommended). But, whereas I agree with most of the points he makes in this post from an economic standpoint--in particular, I have criticized Romney on the China issue and I have criticized singling out small business, I find the overall analysis fairly superficial, failing to take into account necessary political context. We know from the past 4 abysmal years of the Obama Presidency to separate rhetoric from performance. Romney has always had a messaging problem (e.g., "flip-flops"), which I attributed to trying to win statewide election in a deep blue state of Massachusetts. (During the recent debates, I cringed to hear him pay lip service to the progressivity of federal revenue outcomes: a proportional/flat rate system would control for the anti-growth effect of a progressive tax scheme.)
First, I think it's disingenuous to compare Romney to Bush, which is buying into a polemical Obama talking point. (Not to mention Russ can't seriously compare Bush's deficits which were less than half of Obama's). In fact, Romney was asked a related question during the debates. The GOP is talking about holding the federal government to at most 20% of GDP. Romney has dealt with underwater companies, an Olympics, and state; Bush rarely vetoed--but debt did not exceed the size of the economy. Almost all conservatives, including myself, criticized Bush policies, like expanding, without funding, Medicare benefits (the Dems are politically disingenuous here because they wanted MORE unfunded liability, not less, e.g., "closing the doughnut hole"), the huge funding increases in domestic spending, particularly, education, and the giant DHS bureaucracy.
Why won't Romney be more specific on cuts? Look at what happened in Europe for modest reform. Any budget cut will bring opponents out of the woodwork. Obama will demagogue against any cut: it's political suicide in a tough election. Personally, I think the American people would prefer straight talk and legitimate shared sacrifice (not Obama's perverse use of the phrase which is code for class warfare policies). Obviously what Romney can do depends on the cards he's dealt: if voters keep spendthrift Democratic senators in power, fiscal reform is more difficult (if the GOP controls the Senate, you can do more in filibuster-proof budget reconciliation). But Romney had an 87% Dem legislature in Massachusetts and still managed to balance the budget--and did not shy away from vetoes. The next Congress will sustain his vetoes.
Russ doesn't seem to be aware that Romney has a 59-point economic plan: there was pressure on him to distill his economic program into a more manageable set for voters. I have made the same points about China and the need for broad-based versus winners and losers policies. Romney has long talked about lowering globally noncompetitive business tax rates--not just for small companies.
So why is Romney stressing "small" in his talking points? I think it has to do with the fact that small companies (like my late Grandfather's grocery) are part of the GOP base, and Obama has thought that he is clever in trying to pander for in, a stealth fashion, small business in an extension of class warfare policies; just like the professional military, a traditional GOP constituency, is not buying into Obama's pandering to military families, neither is small business, choked by government regulations: even if you're shielded partially from anti-competitive regulations, the incentive is not to grow your business and jobs: we need broad-based regulatory reform to offset the economic drag (hidden cost) of nearly $1.75T on business and ultimately consumers.
I'm not going to analyze everything Roberts said here, but the Obama "more of the same" 'plan' was only recently released (Obama put a higher priority on attacking Romney.) Just one point here: Obama has already nationalized college student loans. Of course he is trying to grab traditional control from states/locals in education, not unlike healthcare.
I would make a couple of points here Roberts doesn't: (1) we need to privatize education; (2) I don't like to see education/training promoted as a publicly-funded way of subsidizing employee development costs.
Political Humor
What? No Obama disguise as he spread the treats around? No zucchini,carrot and celery sticks for fun-size Snickers bars?
Musical Interlude: my Favorite Groups
The Carpenters, 'We've Only Just Begun". A classic often played at wedding receptions and graduations. This is a unique quasi-a capella version.
