Archive for February, 2007

Putting a caveat to my demagoguery….

Monday, February 12th, 2007

Anger hath a privilege“, as Kent said in Shakespeare’s King Lear, but it does not do well to abuse it. I do not regret my demagoguery of the other day, but I do think I need to clarify one thing.

I do in fact believe that it is possible for someone of good faith to argue that slavery would have gone away on its own. Though I have rarely seen it happen.

I thought of making this clear when I was writing my last post, but I decided against it for style reasons. If one is going to be demagogue, one can’t go putting in caveats every time one turns around. But since the Grumpy Old Man is putting it about that I claim that it is a sin to “have asked whether, if the North had let the South go without war, slavery would have long persisted in the South” I feel I ought to offer up a more nuanced view of what the Grumpy Old Man’s sin was.

Whitewashing the South and slandering Lincoln

Sunday, February 11th, 2007

I got a question for you. Do you believe that the Civil War was all about tariffs that the North was imposing on the South? Do you believe that Lincoln did not really care about slavery? Do you believe that slavery was dying out on its own and that the South would have ended it peacefully without the Civil War?

If you profess to believe those things you are either ignorant or a liar.

Sad to say, you are probably either a Conservative or a Libertarian as well. It has become a trend in such circles to slander Lincoln and whitewash the South. I must confess that if it were liberals saying these types of things, I would not bother to even take notice.

But when lies that would shame a holocaust denier are spewing forth from the so-called friends of liberty, I feel compelled to register my objections in the strongest possible terms. They lie and it is plain for any honest man to see.

Take their absurd claim that the civil war was about the oppressive tariffs that the North was imposing on the poor persecuted South. Tell me, if tariffs were such a big issue why did the Democratic Party split over the issue of slavery in the territories? Why did the Southern candidate (John Cabell Breckinridge) campaign on the issue of slavery in the territories?

Why don't European tradesmen use pickup trucks?

Saturday, February 10th, 2007

Why don’t European tradesmen use pickup trucks? As best as I can tell from what I read, European tradesmen use a mixture of small vans and one ton (and up) trucks. The half ton and three quarter ton pickup trucks that are widely used in America are almost unheard of in Europe. Why is this?

This question has been really bothering me lately. It seems like somebody somewhere should have come up with a reasonably good answer by now. Sadly, this does not seem to be the case.

I think the main obstacle to the serious study of this question is the fact that everyone thinks that the answer is obvious. If I were to ask any economist that question, they would tell me that the answer was “high gas prices and narrow streets” without even stopping to think. But while this answer is perfectly fine for explaining why your average European consumer does not drive a truck, it does not explain why the trades do not make more use of pickup trucks in Europe.

To state the problem as simply as possible: High gas prices and narrow streets should pressure tradesmen to use the smallest possible vehicle. But given the vehicles that European tradesmen are reported to use it would seem that they are using vehicles that are too big for the job on a regular basis. As best as I can tell from what I read, Europeans will use a one ton flat bed for a job that could be done by a half ton pickup truck. This does not square with the idea that they should feel immense pressure to use the smallest possible truck.

The idea that a half ton or three quarter ton pickup truck is the most gas efficient vehicle for many trade jobs is a hard sell in some circles. So many people nowadays are buying these trucks for reasons that have nothing to do with economics that they have become a symbol of excess. This obscures the fact that American tradesmen (as opposed to the general consumer) generally use the most economically efficient vehicle to do their job. (more…)

Is it possible to be morally relativistic?

Wednesday, February 7th, 2007

This is a comment I posted recently on this blog (on this post). I will probably regret it in the morning. In my opinion, if you address any philosophical issue in under 30 pages you are guaranteed to make a fool out of yourself. So read this quick, before I think better of it and take it down. (I should note that I made a few changes that I wish I could have made to original comment)

Mr. Pollack,

I am afraid that I am being a bit presumptuous by interjecting myself into this discussion, but your question is one that fascinates me. I have been toying with your question in my mind for some time now. But I have been stuck on one particular problem: I cannot conceive of an imaginary rational (i.e he tries not to hold contradictory beliefs) person who truly believes in moral relativism, much less an actual rational person.

For example, let us imagine that there is a man who believes that having multiple wives is good thing in one situation and a bad thing in another. Let us say that he believes that it is a good thing where war has changed the balance between males and females. Let us say that he thinks that it is a bad thing where the balance between males and females is equal. Let us say that this man is rational (using the definition above). So let us say that he unifies his contradictory positions by saying that multiple wives are good in the one situation because it promotes social stability and bad in the other because it harms social stability.

Is this man a moral relativist? Some people would say yes. But I would say no because the man is entirely consistent in what he values. He always values social stability; it is just the means of achieving that value that change. To my mind, what you value=your morals.

Let us take an even more extreme case. Let us say that there is a totally selfish man. Let us say he makes moral judgments based entirely on what pleases himself. Is this man relativistic? Again, I would say no. He is entirely consistent in what he values.

It seems to me, Mr. Pollack, that your very question presumes an objective morality. For you say “Many feel that our evolved moral intuitions – which have explicable adaptive reasons for being what they are – are all that there is (which is not to say that we mightn’t refine them as needed, as has plainly happened over recent centuries)” your are implying a constant set of values. For otherwise your use of the word “needed” would have no meaning.

Why should the SEC do anything to protect shareholders from management?

Tuesday, February 6th, 2007

Now let me say right off that I don’t really think that the government should do absolutely nothing to protect shareholders. It is one of the proper functions of the government to protect property after all. But it is not proper for the government to mow your lawn, clean your house, or supervise your employees. Can we all agree with that statement?

Then why does there seem to be such a common consensus that the government should be heavily involved in protecting shareholders from their management? If you hired employees for your small business it would be your lookout to make sure they treated you right. Sure, you can take action to try to recover some money if they rip you off, but all business owners know that it is their job to make sure their employees behave. Why should shareholders be different?

Shall we starve Mexicans to fuel innovation?

Monday, February 5th, 2007

Vinod Khosla (among many other people) wants the government to spend vast amounts of money to help along the production and adoption of ethanol. In other news, the Mexicans are having trouble buying corn to feed themselves because of existing ethanol production.

Cheap shot?

Maybe. But I have serious problems with Khosla and those like him. You see, Khosla admits that ethanol will currently do almost nothing to help American achieve energy independence. But he argues that if we throw enough money at the problem innovation will change that and he invokes Moore’s law to prove his point!! (more…)

Meet our local Muslim militia….

Sunday, February 4th, 2007

If someone told you that there was a Moslem group that does military-type exercises near the reservoirs that supply much of New York City’s water you would probably think that it was some right-wing fantasy. But it happens to be true. The group calls themselves the Jamaat ul-Fuqra.


A trillion dollars gets my attention too….

Saturday, February 3rd, 2007

Brad Setser has an excellent overview of the Yen carry trade in his latest post. Nouriel Roubini reminds people of how fast things can go wrong in this post.

A lot of people are responding to them by arguing that the fundamentals justify the out flows and there is nothing to worry about. But that begs the question: what is truly fundamental?

In once sense, I agree that the current fundamentals in Japan, China, Saudi Arabia, and other countries favor foreign investment over domestic investment. When a central bank tries to keep the value of its own currency down, rational people will try to profit from that fact. Why fight city hall?

But why in the world would a rational government want its citizens to invest overseas rather then in their own country?

We all know the answer; they want to protect their exporters. But is it sustainable to continually encourage your citizens to invest their money in some other country?

I am just an ignorant hillbilly, but if I had a company and my accounts receivables were growing faster then my income I would be getting scared. By the same token, if I were running Japan or China and I saw that my reserves were climbing faster then my GDP I would be getting scared.

As Warren Buffet famously said, something that mathematically cannot go on forever won’t. It is impossible for reserve growth to outpace GDP growth forever. Therefore, GDP growth needs to pick up or reserves growth needs to slow down in China, Japan, and company.

But how can GDP growth pick up if Central Banks are encouraging their citizens to invest elsewhere?

It is thoughts like these that make me think that Yen carry trade is not sustainable.