There are two fundamentally different ways of thinking about complex social systems: the economic approach and the engineering approach. Social engineers see society as disorganized, unplanned, and inefficient. Wherever they look, they see underperforming people in flawed organizations producing imperfect goods and services. The solution? Let experts study the problem, discover what should be...
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Many readers will be aware that last week in a speech President Obama said “If you’ve got a business — you didn’t build that. Somebody else made that happen.” There have been many comments on this already — most of them I’ve seen have been negative — but I’m still going to add a...
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Emails released last week between representatives of major pharmaceutical companies (“big Pharma”) and top Obama administration officials, including White House Chief of Staff Rahm Emanuel, reveal insider-dealing sufficient to kill any remaining Hope that Obamacare was designed to deliver on the promises of its official name: there is no Patient Protection or Affordable Care...
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Today President Obama was advocating the renewal of wind energy tax credits to promote green energy. Meanwhile, last week the Obama administration placed a 31% tariff on the importation of solar panels from China. So, is he for green energy, as the wind energy tax credit would suggest, or against it, as his raising...
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With every Keynesian trick having failed to bring the economy out of its post-meltdown Great Recession, and having apparently concluded that there’s no more conjuring they can do to improve it before the election, President Obama’s re-election strategists look to be latching firmly onto social issues. Really? In an era of continuing depression-level unemployment...
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When JPMorgan announced it had sustained a $2 billion trading loss a few weeks ago, some commentators, including Paul Krugman, argued that their irresponsible investing was more evidence that we need stronger financial regulation. The evidence in the JPM case actually shows the opposite. Krugman’s column presents the arguments on both sides. The correct...
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Last week there was a shoot-out in Tallahassee, Florida, my home town, after a drug deal gone bad. Two men were shot when, it appears, the buyers attempted to make off with marijuana without paying for it. (Here’s a link to the story, but sorry, for subscribers only.) Sheriff Larry Campbell said “Many people...
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Capitalism without bankruptcy is like religion without hell, the saying goes. The grain of truth here is that we depend on markets for error-correction; “people are fallible, but competition selects”, as Adam Smith well noted. But many who fail in the marketplace seek a way out via politics. This includes bail-outs, as well-documented in...
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Last week I posted a blog about crony capitalism, with the suggestion that crony capitalism is undesirable. The next day Vice President Joe Biden was bragging that he and President Obama support crony capitalism, as if crony capitalism is a good thing. Mr. Biden was criticizing Republican presidential candidates for their opposition to the...
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Economic policy issues often divide on “pro-business” and “pro-government” arguments, with the pro-government side arguing that we need big government to correct the failures of the market, regulate business activity, and stand up to crony capitalism. The problem with this pro-government view is that crony capitalism inevitably comes with big government. In a democracy...
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