Steve Landsburg on the Unseen and bias (or ignorance depending on your take).
(HT: Cafe Hayek)
Showing posts with label Frederic Bastiat. Show all posts
Showing posts with label Frederic Bastiat. Show all posts
More Bootleggers and Baptists. Or Just Bootleggers.
Russ Roberts on US sugar quotas and imports. The comments section is worth reading as well.
One of the books I'm currently reading is Bastiat's Economic Sophisms. Very early on Bastiat makes the (not original) point that production is not an end in and of itself but is a means for consumption. For example, sugar is not produced because it is enjoyable to make or because it "creates jobs" or for any other production-based reason. It is manufactured because there is significant demand to consume it.
Now if consumption is the end, it should be done in the most efficient manner possible so that costs are reduced and prices go down. There are many obstacles to achieving such a process, but some are more avoidable than others. Tariffs and subsidies should be some of the more avoidable obstacles.
Unfortunately our political system makes the abolition of said policies nearly impossible. As long as hypocrites like Michelle Bachmann are the ones making the rules, you can be sure all sorts of coercive government actions will be taken to maintain the status quo.
One of the books I'm currently reading is Bastiat's Economic Sophisms. Very early on Bastiat makes the (not original) point that production is not an end in and of itself but is a means for consumption. For example, sugar is not produced because it is enjoyable to make or because it "creates jobs" or for any other production-based reason. It is manufactured because there is significant demand to consume it.
Now if consumption is the end, it should be done in the most efficient manner possible so that costs are reduced and prices go down. There are many obstacles to achieving such a process, but some are more avoidable than others. Tariffs and subsidies should be some of the more avoidable obstacles.
Unfortunately our political system makes the abolition of said policies nearly impossible. As long as hypocrites like Michelle Bachmann are the ones making the rules, you can be sure all sorts of coercive government actions will be taken to maintain the status quo.
Broken Window Fallacy Logic
Peter Klein on some of the bone-headed logic behind enacting the stimulus plan:
Not to worry [about measuring "created or saved jobs"], says John Irons of the Economic Policy Institute. Indeed, the Obama Administration’s silly attempt to count “jobs saved” may actually underestimate the beneficial effects of stimulus, because “that construction worker [hired by stimulus funds] then goes out and spends money at a local diner, at a local McDonald’s or the local movie theater. That could very well mean an additional job.” Well, yes, but there’s the construction worker who wasn’t hired because investors, spooked by regime uncertainty, wouldn’t fund the construction project; the construction worker who won’t be hired tomorrow when taxes are hiked to pay for today’s stimulus; the construction workers who will sit idle at home when hyperinflation destroys the construction industry; and many other members of Bastiat’s “unseen” who would have spent money at diners and McDonald’s and movie theaters. But we never see those lost jobs, so — poof! — they don’t exist, and shouldn’t be counted against the free lunches wished into existence by Stimuluspalooza.
Some arguments defending the stimulus, such as Rob's fear of too much saving taking place, contain much more merit than what Irons is saying.
Relying on the broken window fallacy is just dumb.
Not to worry [about measuring "created or saved jobs"], says John Irons of the Economic Policy Institute. Indeed, the Obama Administration’s silly attempt to count “jobs saved” may actually underestimate the beneficial effects of stimulus, because “that construction worker [hired by stimulus funds] then goes out and spends money at a local diner, at a local McDonald’s or the local movie theater. That could very well mean an additional job.” Well, yes, but there’s the construction worker who wasn’t hired because investors, spooked by regime uncertainty, wouldn’t fund the construction project; the construction worker who won’t be hired tomorrow when taxes are hiked to pay for today’s stimulus; the construction workers who will sit idle at home when hyperinflation destroys the construction industry; and many other members of Bastiat’s “unseen” who would have spent money at diners and McDonald’s and movie theaters. But we never see those lost jobs, so — poof! — they don’t exist, and shouldn’t be counted against the free lunches wished into existence by Stimuluspalooza.
Some arguments defending the stimulus, such as Rob's fear of too much saving taking place, contain much more merit than what Irons is saying.
Relying on the broken window fallacy is just dumb.
Thoughts on Health Care, Part I: A Right to Health Care Access?
Over the next few months I wish to weigh in on the health care debate with a series of short essays. Here is the first:
One of the most relied upon arguments of proponents of socialized medicine is that health care access is an inherent right all human beings possess. I wish to challenge this assertion.
There are numerous practical arguments one can make against this claim. For instance, who will pay for the costs? How will perverse cost incentives be dealt with? How will the distribution of effective services be done efficiently? How will information be shared? The list goes on and on. But I wish to deal with one distinct issue: the fundamental contradictory nature of a so-called "right" to health care access.
Claiming health care is a right is to give credence to the notion of positive rights; rights which are based on action, or require one party to give and another party to receive. Examples are access to health care, as mentioned, or access to public education. Contrast this with negative rights, which are based on inaction, or the freedom "from" something. Popular examples are the rights of freedom of speech and assembly (freedom from coercive measures). Negative rights are a one party system; positive rights are a two-party system. To clarify, take crime as an example. A negative right application of crime in society would be "freedom from crime." If this right were to be violated, society would take ex post measures to compensate the victim for any damages suffered. A positive right application of crime would be the "right" to be served by a public police force, security cameras, etc... to prevent such violations from occuring in the first place.
The key difference between these two types of rights is that positive rights comes at a cost to some party to maintain the right of another party, whereas negative rights do not come at a cost to any second party. I am free to say what I wish, but no one is required to listen. I am free to assemble with others, but I cannot coerce others to assemble with me. On the other hand, if I have a right to health care access, I do not have to endure any cost to attain the benefits of the services of health care. But because health care is a limited resource, to receive it, it must come at some cost to another party. In this simple scenario, that party would be the provider. The cost would be endured in forms of lack of monetary compensation due to time spent, skill applied, effort applied, emotional capacity spent and others.
At its core, a right to health care access is a violation of property rights. The consequence of this would be the extreme perversion of The Law. Frederic Bastiat writes in The Law, "As long as it is admitted that the law may be diverted from its true purpose - that it may violate property instead of protecting it - then everyone will want to participate in making the law, either to protect himself against plunder or use it for plunder." A right to health care access legitimizes the idea that The Law exists not to protect, but to provide. The consequences of such thinking can only lead to totalitarian ends.
As Michael Cannon and Michael Tanner write in Healthy Competition, "Fundamentally, creating a legal "right" to health care is incompatible with the idea of individual rights. People cannot legitimately claim a right to something if that claim infringes on the rights of another." A right to health care is a seductive idea that thrives in the minds of reality-deluded utopian thinkers. All it will provide is a subtle avenue for government to seize individuals' liberties under the guise of paternal altruism.
Do not be fooled.
One of the most relied upon arguments of proponents of socialized medicine is that health care access is an inherent right all human beings possess. I wish to challenge this assertion.
There are numerous practical arguments one can make against this claim. For instance, who will pay for the costs? How will perverse cost incentives be dealt with? How will the distribution of effective services be done efficiently? How will information be shared? The list goes on and on. But I wish to deal with one distinct issue: the fundamental contradictory nature of a so-called "right" to health care access.
Claiming health care is a right is to give credence to the notion of positive rights; rights which are based on action, or require one party to give and another party to receive. Examples are access to health care, as mentioned, or access to public education. Contrast this with negative rights, which are based on inaction, or the freedom "from" something. Popular examples are the rights of freedom of speech and assembly (freedom from coercive measures). Negative rights are a one party system; positive rights are a two-party system. To clarify, take crime as an example. A negative right application of crime in society would be "freedom from crime." If this right were to be violated, society would take ex post measures to compensate the victim for any damages suffered. A positive right application of crime would be the "right" to be served by a public police force, security cameras, etc... to prevent such violations from occuring in the first place.
The key difference between these two types of rights is that positive rights comes at a cost to some party to maintain the right of another party, whereas negative rights do not come at a cost to any second party. I am free to say what I wish, but no one is required to listen. I am free to assemble with others, but I cannot coerce others to assemble with me. On the other hand, if I have a right to health care access, I do not have to endure any cost to attain the benefits of the services of health care. But because health care is a limited resource, to receive it, it must come at some cost to another party. In this simple scenario, that party would be the provider. The cost would be endured in forms of lack of monetary compensation due to time spent, skill applied, effort applied, emotional capacity spent and others.
At its core, a right to health care access is a violation of property rights. The consequence of this would be the extreme perversion of The Law. Frederic Bastiat writes in The Law, "As long as it is admitted that the law may be diverted from its true purpose - that it may violate property instead of protecting it - then everyone will want to participate in making the law, either to protect himself against plunder or use it for plunder." A right to health care access legitimizes the idea that The Law exists not to protect, but to provide. The consequences of such thinking can only lead to totalitarian ends.
As Michael Cannon and Michael Tanner write in Healthy Competition, "Fundamentally, creating a legal "right" to health care is incompatible with the idea of individual rights. People cannot legitimately claim a right to something if that claim infringes on the rights of another." A right to health care is a seductive idea that thrives in the minds of reality-deluded utopian thinkers. All it will provide is a subtle avenue for government to seize individuals' liberties under the guise of paternal altruism.
Do not be fooled.
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