In 1971 Hubert Humphrey was running for president (again; but lost the Democratic nomination to George McGovern), and I was an economics major at the University of Florida. Humphrey was giving a campaign speech on campus and I went to listen.

Humphrey was facing a very rowdy crowd which was so loud in its jeers as he was introduced that I wondered if he would even get a chance to speak. He managed to quiet down the crowd by telling them, “Listen to what I have to say, and if you don’t like my message then you should boo me. But wait to hear me out before you pass judgment.

Having calmed the crowd, Humphrey went on to give a masterful speech, met by enthusiastic cheers when he was done. The man who was almost booed off the stage before he started had completely won over the crowd. I was amazed.

As an economics major I still remember the wisdom Humphrey shared on the subject. He said, “The economy is like an eight cylinder automobile that is only running on six cylinders. We have to get those other two cylinders running again.” The crowd went wild with approval!

I am still in awe of the wisdom Humphrey showed. His proposal to fix the economy was, “We have to get those other two cylinders running again,” and the crowd loved it.

This is but one example of a broader political truth. You can get more political support by being critical of the status quo than by proposing some specific change. Lots of people are dissatisfied with current conditions, or think we could do better, but everybody has a different idea about what we should do to change things. If you want to improve the status quo in some vague way, you’ll get lots of support; if you are in favor of some specific change you lose the support of those who think a different change would be more appropriate.

This is why all politicians are vague about their plans and policies. Humphrey’s brilliant speech was filled with bits of wisdom like getting those other two cylinders running, but was short on specifics of how those things might actually be accomplished. I have seen this time and time again in the decades since Humphrey’s speech impressed this on me.

Now, as the nation is contemplating major health care policy reforms, I see the same thing. Lots of people want change, but everybody has a different idea of what changes would be appropriate. The easy part was for President Obama to rally support for reform. The status quo can be improved. But it will be impossible to get agreement on what reforms are appropriate because everyone has different ideas. Even if the Democratic majority is able to pass something, whatever passes will still leave a huge amount of dissatisfaction in its wake. It’s partly partisan, but even the Democrats in Congress don’t agree on what should be done.

The direct lesson from Humphrey’s brilliant speech is that politicians can gain more political support from being against something than in favor of a specific replacement. Isn’t this what “hope and change” meant when Obama was campaigning last year?

A more indirect lesson is that market solutions have an advantage over government solutions because more people can get the alternatives they prefer. When government passes a policy, it applies to everybody. In the market, people have a choice, and the choices some people choose don’t close off options for others. Your having a Coke doesn’t interfere with me drinking a Dr Pepper.

What has many people concerned about impending health care reform is that options now available to them will be cut off. It’s not unreasonable to think that a government-subsidized public option will crowd out private sector alternatives. It’s also not unreasonable to think that even without a public option, additional government regulation will limit private sector alternatives, because that has already happened.

The lesson I picked up from Hubert Humphrey all those years ago still rings true. Lots of people support health care reform, but far fewer will support any specific reform.  Humphrey’s lesson shows why Obama’s reforms face a rocky road, and why, even if something passes, it won’t gain the president political support.

My favorite Francophilic American blogger, Arthur Goldhammer, defends the French tradition of military parades. The US, he argues, actually has a more militaristic culture.

It’s true that one doesn’t often see armor rolling down Pennsylvania Ave. . . . It’s more common in America to lament ostentatiously the sacrifices of “our men and women in uniform” than to flex muscle Moscow-style.

We dote on this sort of poshlost, to borrow a word from Nabokov. It’s actually rather convenient to place the accent on one’s own sacrifice rather than on one’s country’s superior equipment. The equipment, if displayed, might actually get Americans to think, as they rarely do, of the sacrifices of those against whom it is deployed.

Compare us Americans to (gasp!) the Germans:

The large recent loss of civilian life in Afghanistan may have been due to an error or inadvertence by German soldiers. For Germans this has become an issue. But the collateral damage has barely been noticed in an America inured to incidents of this kind. For us the issue is framed in terms of whether the continued sacrifice of American lives is justified by any achievable American interest. The Afghans barely figure in the debate except as instruments. To my mind, that is the mark of a militarized culture.

Even when no one is being accused of a criminal act, even when someone is in need of medical assistance, the police coming to the rescue are at best an unpredictable mixed bag. In Kansas, police forced a woman to stop giving CPR to her toddler grandson. The family thinks the kid might have survived had she been permitted to save the boy. The authorities say the officer did nothing wrong, which isn’t surprising, since today criminal negligence and brutality are practically part of the official code of conduct.

Many of the biggest critics of Obama’s address to the nation’s public school students today backed off at the last minute. Newt Gingrich, Laura Bush and Jim Greer ultimately endorsed the speech, with Gingrich pointing out that Republican presidents have done similar things before.

Apparently, the critique for many was that Obama would try to push a leftist socialist message in his talk. Once it was discovered to be a generic “stay-in-school” kind of message, many conservatives flip-flopped and urged people to listen to it.

But of course, the real problem remains. Why did the president address the nation’s public schools? Why are the national government and especially the presidency seen as relevant institutions for education nationwide? It is troubling that so many would come out to support such a speech simply because the overt, controversial statist elements did not come through as expected, leaving intact the more generally accepted nationalist statist indoctrination we can expect from the public schools on a daily basis.

If you think that Obama and Palin are polar opposites, think again. As Mark Brady points out, Obama has pretty much endorsed their world policing agenda through his Afghan surge. So too has Sarah Palin.

In an open letter, the heroine of the town-hall rabble rousers embraces Obama’s Afghan policy, albeit adding some gentle criticism. Co-signed by such neocon stalwarts as William Kristol (her debate coach), David Frum, and Max Boot, the letter asserts that Obama needs to do even more to escalate the war in Afghanistan:

“we urge you to continue on the path you have taken thus far and give our commanders on the ground the forces they need to implement a successful counterinsurgency strategy. There is no middle course. Incrementally committing fewer troops than required would be a grave mistake and may well lead to American defeat. We will not support half-measures that repeat the errors of the past.”

Last year, it seemed that spectacular failures in foreign policy had finally discredited the neocons. The reality this year could not be more different. The neocons not only landed on their feet after Obama’s victory but are stronger than ever before.

If the Republicans nominate Palin in 2012 (even if they don’t), we can look forward to a non-debate on foreign policy comparable to the Cold War harmonies of Kennedy v. Nixon in 1960. It looks like the advocates of muscular Wilsonianism have safely co-opted the town halls for the cause.

If you got to the Blog page by passing through the Independent Institute’s home page, I hope you noticed the announcement of the publication of Housing America: Building Out of a Crisis, which I co-edited with Benjamin Powell.  Ben and I have been working on this project for years, so it is nice to see the final product.

I joke with people that the reason we put together an edited volume rather than just writing the book ourselves is that we wanted to do a book on housing, but we don’t know very much about it so we got some real experts to write the book for us.  Despite the fact that we did author a few chapters, there is some truth to this, and we were fortunate to get some really good authors on board for the project.  I will speak for myself and say the chapters we got are much better than what I could have written.

While I would like to go through and tell you what makes each of the book’s 15 chapters special, I will limit my comments here to three chapters that are noteworthy because of the timing.  We started working on this book in 2005, and most of the chapters were complete in 2006, when the housing bubble was hitting its peak.

Mark Thornton’s chapter on the housing bubble is noteworthy because when he completed it, the conventional wisdom was that housing prices would keep rising for the foreseeable future.  Now, Mark’s chapter might read like a good case of Monday morning quarterbacking, but when he wrote it most analysts didn’t see the collapse coming, even though it was right around the corner.  Similarly, Lawrence White’s chapter on Fannie Mae and Freddy Mac was written when their promoters in Congress were touting them as a government success story.

Finally, on a sad note, Bernard Siegan’s chapter on the benefits of nonzoning is the last of a long series of works he did on the subject.  Professor Siegan passed away in March 2006, after delivering the draft of his chapter to us.  Professor Siegan had written extensively on the way that market forces efficiently allocate land uses, and more broadly, was a consistent champion of liberty.  I am honored that we were able to include his chapter in our book.

The U.S. rate of unemployment has been rising since March 2007, when it stood at 4.4 percent. In 2007 it rose slowly, then in 2008 and 2009 much more quickly. In August 2009 it reached 9.7 percent. The increase in unemployment represents for most people the most troubling aspect of the current recession.

However, during the past year, so much attention has been focused on the financial debacle in its various dimensions, and on the Fed’s and the Treasury’s efforts to deal with it, that the growing unemployment – now amounting to approximately 15 million persons – has become almost a footnote to the welter of troubles besetting the economy, and the labor market itself has received relatively little attention. Of course, the government’s “stimulus” spending programs purport to be aimed at restoring employment, and, if we subscribed to vulgar Keynesianism, we might expect them to do so.

Sound economists know, however, that, as some of them like to say, the labor market clears in the labor market, not in the product market or the bond market. When we seek to understand changes in the volume of employment (and by loose implication, the amount of unemployment), we are well advised to pay closest attention to what is happening in the labor market.

When we shift our gaze there, we behold an interesting, almost totally neglected, yet critical fact: while unemployment has been rising steadily, the real hourly wage for all workers employed in private industries has also been rising. According to the Bureau of Labor Statistics, the average hourly earnings of workers in all private industries rose from $17.23 in March 2007 (when the rate of unemployment was 4.4 percent) to $18.59 in July 2009 (when the rate of unemployment was 9.4 percent). During this same period, the consumer price index for all urban consumers rose by about 5 percent. Using this index to adjust the earnings data, we find that real hourly earnings rose by 2.8 percent during this 28-month period of deepening recession.

Even introductory economics courses teach students that the quantity of labor services demanded is a negative function of the real wage rate. If the real wage rate rises, other things being equal, employers will demand a smaller quantity of labor services. Thus, in view of the rise in the real wage during the past 28 months, we might well have expected employment to fall – and hence the unemployment rate to rise – simply because labor services were becoming more expensive.

However, other things were not equal during this period. Because the demand for labor services is derived from the demand for the goods and services that the laborers produce, and because that final demand has declined recently, the effect of the increase in the real wage has been magnified. The obvious question: why, in a situation of falling demand for labor services, has the real wage risen? This outcome is not what we would expect to see in a freely functioning labor market. Economists have advanced a variety of explanations to account for this anomalous occurrence (as observed on other occasions), but they have yet to agree on how it may be understood best.

We might well note, however, that an increase in the real wage at a time of deepening recession is an occurrence first observed in the United States between 1929 and 1933, during the Great Contraction. Economists from that time onward, including C. A. Phillips, T. F. McManus, and R. W. Nelson (1937), Murray Rothbard (1963), Lowell Gallaway and Richard Vedder (1993), and most recently Lee Ohanian (2009 unpublished), as well as yours truly (1987 and later works), have attributed a large part of the responsibility for the depth of the Great Contraction to this failure of the real wage rate to fall – as it invariably had fallen in economic downturns before 1929, including the sharp but brief contraction of 1920-21. It is scarcely reassuring to see that in the present contraction, the labor market is, in this regard, mimicking its behavior during the Great Contraction.

In 1937, Phillips, McManus, and Nelson wrote: “The brutal truth is that the standard of life for the American people has fallen drastically since 1929 for the simple reason that the policy of maintaining high wage rates has resulted in reduced employment and decreased production of the goods and services that constitute ‘real income'” (p. 225).  Today, although we have not yet suffered the same reduction in living standards that our forebears suffered during the Great Depression, essentially the same brutal truth is haunting us again. Whether the increased real wage rate of the past two years reflects government policies or other causes, it has exacerbated the decline of real output. A reduction of the real wage rate would hasten a recovery from our present economic misfortunes.

Please see “Sustainability is a Waste”: here.

This relates to issues I raised with the Sustainability Scam back in November 2008. See also “Plants Have Rights Too!”

Even in hard times, gullible people are willing to give up their money and their freedom to a radical movement that is “anti-rational.” Let’s stop the waste of money on “third circle” projects (see my link above) and devote it to students, books and learning.

The controversy about carrying guns in public is not new. In 1967, however, the political alignments on this issue were completely different. Many conservatives (and others) objected when the Black Panthers insisted on exercising this right. In response, Governor Ronald Reagan signed the Mulford Act banning the carrying of guns in public.

Many defenders of liberty have felt the need to reflexively defend gun-toting citizens at these rallies. This is a mistake, or at least an incomplete response. A far more productive contribution to an otherwise impoverished debate is to emphasize privatization as a solution. We can only find a just and efficient resolution by treating this as a tragedy of the commons issue.

Both sides have a point but neither can ever be satisfied as long as thoroughfares, parks, and other venues for town halls or rallies continue to be government owned. Under private property, the issue becomes a relatively simple one: the owner decides who can carry guns. The problem (to the extent it is a problem) arises only when we take private property out of the equation. In the absence of privatization, the controversy will never end until one side or the other forces its will over the commons through the brute force of legislation.

September 1, 1939—exactly seventy years ago today—is customarily considered the day when World War II began, owing to the German invasion of Poland. Of course, some belligerents, most notably the Japanese and the Chinese, had already been at war for years, and others did not join the fray until later. The United States actually began to participate in the war almost immediately, but its participation remained for the most part covert until the Japanese attack on Pearl Harbor on December 7, 1941.

I was born in the midst of this terrible event, and all my life, whenever anyone referred to “the war,” I have assumed, as most Americans have, that the reference was to World War II. It was the largest and the most horrible of all wars, although, sad to say, it no more proved to be “the war to end war” than its predecessor (1914-18) had been. In many ways the two world wars are best understood as two phases of a single conflict, although the matter is much more complicated than that formulation might suggest.

No one knows with much confidence how many people died as a result of the war. Estimates range widely, from a low of about 50 million to a high of nearly 80 million. Perhaps two-thirds of the dead were civilians. Countless others were wounded or harmed in various ways, as by malnutrition. Millions were spiritually scarred for life. The war was very productive of nightmares that, for some individuals, recurred for decades. After all that had taken place between 1939 and 1945, it was difficult to believe that the human beings of the mid-twentieth century, many of whom had regarded themselves as civilized, were any better than their savage ancestors of ten thousand years ago.

Yet, oddly enough, World War II has developed a reputation in this country as “the Good War”—an unfortunate turn of phrase, if ever there was one. The war is taken to have been good primarily because (1) the Allied side is believed to have represented the morally virtuous side, in opposition to the manifestly evil Axis side; (2) it got the U.S. economy out of the Great Depression; and (3) it left the world a better place, mainly because of Nazi Germany’s defeat.

For me, these ideas fall under the rubric of myth. I am not saying that no good came of the war, because obviously some did. As much as anyone, I believe that the destruction of the Nazi regime in Germany was a splendid thing for the human race. But every good end must be weighed against the means by which it was achieved, and in this perspective the war’s positive achievements take on a sickly pallor.

In this war, the belligerents plumbed new depths of depravity: operation of mass-destruction death camps, torture of every conceivable kind, terror bombing and other attacks systematically aimed at civilian populations, crowned by the gratuitous atomic bombing of two large, defenseless cities. I am aware that some people still defend some of these heinous actions, but in my mind nothing the war achieved can justify them. Indeed, I seriously doubt that anything can justify them. Yet such wanton, barbaric cruelties were deeply woven into the fabric of the war’s conduct from its earliest days. One is scarcely engaging in moral equivalence if one concludes that neither side represented “the good guys.” There was plenty of evil to go around.

I have been combatting for decades the widely believed notion that the war got the U.S. economy out of the Great Depression. For readers who still labor under this misconception, I recommend the first five chapters of a book called Depression, War, and Cold War.

Finally, the idea that the war left the world a better place seems to me unacceptable as a flat, unqualified statement. Yes, the defeat of Hitler’s regime was an excellent outcome—may such utter beastliness never dare to show its face again. But over large parts of the territory where Hitler’s troops had reigned supreme in the early 1940s, Stalin’s troops reigned supreme from 1945 to 1989. It is difficult to count Stalin as anything less than first-rate in the category of monstrous tyrants. Yet, if the war had a clear political winner, it was he. Moreover, he and the evil Soviet regime that carried on after his death wreaked massive human and material destruction over a wide swath. Similarly in the East, the defeat of Imperial Japan counts as a positive accomplishment. But that defeat removed a bulwark against Communism’s expansion and ultimate victory in China, and like the eastern Europeans held under Stalin’s sway, the Chinese were to pay a terrible price—the major political consequence of Japan’s defeat on the mainland of Asia.

World War II is an immense subject. Thousands of books have been written about it from almost every conceivable angle, and thousands more books will probably be written in years to come. The complexities being so great, nearly everything one might say about it cries out for qualification and clarification. Nevertheless, I am willing to assert that in important regards the prevailing American view of the war rests on a foundation of myths. The entire enterprise of understanding the war needs to be rebuilt from the ground up.