The Liberal Order

Nolan Finley Exposes the Differences Between "Occupy Wall Street" and the Tea Partiers

The Detroit News's Nolan Finley can't wait for "Occupy Wall Street" to make it to Detroit. In describing the differences between them and the tea partiers, he notes:

State lawmakers in New York have received emails reportedly connected to Occupy Wall Street containing this cheery call to action: "It's time to kill the wealthy."

I haven't taken a poll, but my hunch is more Americans relate to "cut the spending" than to "kill the wealthy."

That's why I'm eager to see this freak show arrive in Detroit.

Here are two previous posts on the protest. 

Robert Samuelson Gets It Wrong On Chinese Subsidies of Its Exports

Robert Samuelson, who is normally correct in his economic reasoning, misses it this week.

Even if [the measure before the U.S. Senate] becomes law — not certain — it wouldn’t work for two reasons. In 2010, our imports from China totaled $364 billion. (American exports to China were $86 billion, leaving a deficit of $278 billion.)

Wait, wait, wait! I thought there was a problem. The Chinese are giving us $364 billion worth of neat stuff - stuff we apparently want - and are receiving just $86 billion of U.S. goods in exchange. What's the problem here? Would Mr. Samuelson be complaining if I gave him my $364,000 home in exchange for his $86,000 car? Is he being victimized by such an exchange?

He continues:

True, the Chinese did permit the RMB to rise beginning in July 2005 but only at a pace that, given productivity gains, didn’t much change their competitive advantage. The only way to get them to do more is to threaten an increase in U.S. tariffs of 25 percent or more, says the EPI’s Scott. The idea is to pressure China to revalue its currency. He’s right.

Suppose that in the United States two software packages of some sort produced in the U.S. exchange for a 42" television set also produced here. Now suppose that some Chinese company or national offers to give someone in the U.S. a comparable television set for just one of the software packages. It doesn't matter how it comes to be that the Chinese national is willing to trade the television set for just one package, be it he has a comparative advantage in television sets relative to software or that the Chinese government subsidizes him the difference, the U.S. resident is better off.

It's also the case that a) the U.S. resident now has more money to spend elsewhere since he or she is spending half as much on the television set than they were, and b) Chinese demand for software has not abated just because that country's government may or may not be subsidizing something in which they are comparatively disadvantaged in producing. Any policy that thwarts the process of voluntary exchange between the two parties - the Chinese and U.S. residents - makes us and them poorer, not richer. Trade policies are always about protecting less efficient domestic producers at the expense of a nation's consumers, and by default, it's producers that have comparative advantages in producing other goods.

And What Exactly Is the Objective?

City Attorney Nathan Davis stated, “The Municipal Court advises that 187 citations have been issued and fines collected of $3,916.49,” since the ordinance went into effect Nov. 23.

The ordinance bans anyone from wearing pants or skirts more than three inches below the top of the hips, exposing the skin or undergarments.

First-time offenders pay a $25 fine. On subsequent offenses, the fine can go up to $200.

Considering that the Albany Police Department is averaging more than 20 citations a month for the indecent exposure saggy pants ordinance, it is possible the rest of the year could add another $1,500 to the city’s general fund pot.

Story here. You see this with speeding tickets, though this is even more dubious. The objective of issuing a speeding ticket is all too often not intended to make the roads safer, but instead to increase the revenue available to politicians and bureaucrats to spend. The same is true with this "baggy pants" fine; it's a nefarious form of taxing, and it's a tax that falls almost exclusively on lower income people.

Extreme Justice

At least we live in a semi-sane society where, for the time being, the government is constrained from a) acting without due process, and b) imposing cruel and unusual punishment. 

The economic reasons for why we in civilized countries don't permit government from meting out justice like that depicted in the video below is that the social loss of the car destroyed is far greater than the perverted glee enjoyed by the mayor of Vilnius from destroying it. Sorry, it isn't funny. But for him, he received much publicity to promote his next campaign. Let's hope he loses big.

Notice how the streets in this major city are totally empty? As much as I believe rules and legislation should normally be obeyed, there appeared to be no cost to residents of and visitors to Vilnius from the illegally parked cars.

 

    

 

 

Oh why, oh why can't we have a better press?

The editorial page and columnists at the Raleigh News & Observer are pushing hard for Republicans in the state House and Senate to retain the "temporary" one-percent increase in the state's sales tax rate that was enacted in 2010. The arguments made in both an editorial and in a column claim that

1. the added tax is not much of a burden on North Carolina's citizens;^a
2. the tax increase raises government revenue by $1 billion annually;
3. repealing the "temporary" tax would lead to many state employees losing their jobs.

Here is the editorial, "Penny Foolish," about which I sent the following letter.

Your recent editorial, "Penny Foolish," where you implore Republicans in the state House to retain the “temporary” one-percent sales tax increase because it will save state government jobs, is shortsighted and foolish on its own.

First, it confuses the means/ends relationship of any provider of goods and services. Just as Microsoft doesn't exist to provide Bill Gates a place to work, government does not exist to create jobs. It is a means for serving constituents by protecting their property, enforcing their contracts, building and maintaining roads, etc. Your insistence that the tax should remain in force to protect current government employees mistakes this and proposes that government is an end in itself.

You do the same with education, too. After controlling for inflation, per pupil spending on public schooling in this state increased more than 125% since 1980. We have nothing to show for it. Between 1998 and 2008, the number of teachers, administrators and professional support staff (i.e., psychologists and consultants) per pupil increased by more than ten, eleven and twelve percent, respectively. Schools have become bloated and cutting their budgets seems reasonable. Our school systems don't exist for providing high wage job opportunities for bureaucrats who so far haven't demonstrated that their efforts have created any value for taxpayers.

Second, the view that labor is a good is a common Keynesian fallacy. Labor is a cost of production and the fewer people we employ for providing us any given good or service, the better off we are. If this weren't the case, let's replace backhoes with spoons, computers with manual typewriters and abacuses, and all contemporary communications devices with couriers on horseback. 

The column by Jim Jenkins, "Penny Saved, Nothing Earned," to which I sent this letter.

{Jim Jenkins' recent editorial, "Penny Saved, Nothing Earned,} and the editorial ["Penny Foolish," written by] staff of the N&O, champion retaining the one percent "temporary" sales tax as a means of protecting government jobs. 

The recent editorial, "Penny Foolish," claims that in retaining the tax the state government will have $1 billion more than if it cut the sales tax rate to its former level. From where did that $1 billion come? If cutting that $1 billion from the state government's reveenue will destroy government jobs, then isn't it the case that when the tax was increased "temporarily" to begin with, increasing the government's revenue by $1 billion, private sector jobs were then destroyed?

The increase in the sales tax rate imposed a $420 increase in total taxes paid by the average family of four in NC, money they had been spending at clothes stores, restaurants, and for tuition for their children, etc. Won't cutting the tax simply shift the type of jobs from those we least prefer to others we are more likely to prefer?

In other words, if the one percent tax increase is a jobs saver/creator, why not increase it to 50% and eliminate employment totally in NC?

----

a. The editorial and column erroneously refer to the temporary tax increase as a "penny" increase in the sales tax rather than a one-percent increase in the sales tax rate. A one-percent tax on $100 is 100 times greater than one cent tax on that same purchase.

Oh, please, please, please! Why couldn't I have been there?

It would be like watching your two evil and despised stepbrothers duking it out.

Among those counter-protesting at the cemetery's main entrance: About 10 members of a group that claims to be a branch of the Ku Klux Klan from Virginia called the Knights of the Southern Cross. They were cordoned off separately in a nearby area, but drew little attention as they gave out small American flags behind a banner that read "POW-MIA."

They said they were there to object to the Westboro Baptist Church's anti-troop message.

"It's the soldier that fought and died and gave them that right to free speech," said Dennis LaBonte, the self-described "Imperial Wizard" of the KKK group that he said he formed several years ago.

"That's fine," said Abigail Phelps, the daughter of Westboro Baptist Church founder Fred Phelps. "They have no moral authority on anything.

"People like them say it's white power ... white supremacy," Phelps said. "The Bible doesn't say anywhere that it's an abomination to be born of a certain gender or race."

 

Really!?!

From Overlawyered comes this bit of legislation out of California.

THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 6714 is added to the Labor Code, to read:

   6714.  (a) The standards board shall, no later than September 1, 2012, adopt an occupational safety and health standard for lodging establishment housekeeping. The standard shall apply to all hotels, motels, and other lodging establishments in California. The standard shall require all of the following:

   (1) The use of a fitted sheet, instead of a flat sheet, as the bottom sheet on all beds within the lodging establishment. For the purpose of this section, a "fitted sheet" means a bed sheet containing elastic or similar material sewn into each of the four corners that allows the sheet to stay in place over the mattress.