Black Adder
Caritas in Veritate 25, By the Numbers
My co-blogger Tim recently highlighted the following statement from Pope Benedict’s latest social encyclical, Caritas in Veritate:
The global market has stimulated first and foremost, on the part of rich countries, a search for areas in which to outsource production at low cost with a view to reducing the prices of many goods, increasing purchasing power and thus accelerating the rate of development in terms of greater availability of consumer goods for the domestic market. Consequently, the market has prompted new forms of competition between States as they seek to attract foreign businesses to set up production centres, by means of a variety of instruments, including favourable fiscal regimes and deregulation of the labour market. These processes have led to a downsizing of social security systems as the price to be paid for seeking greater competitive advantage in the global market, with consequent grave danger for the rights of workers, for fundamental human rights and for the solidarity associated with the traditional forms of the social State. Systems of social security can lose the capacity to carry out their task, both in emerging countries and in those that were among the earliest to develop, as well as in poor countries. Here budgetary policies, with cuts in social spending often made under pressure from international financial institutions, can leave citizens powerless in the face of old and new risks; such powerlessness is increased by the lack of effective protection on the part of workers’ associations.
Now in this passage, the Pope makes a number of factual and causal claims. First, he claims that the global market has led countries to “attempt to attract foreign businesses” by adopting “favourable fiscal regimes and deregulation of the labour market.” Second, the Pope claims that these reforms (i.e. adopting “favourable fiscal regimes and deregulation of the labour market”) have led to “a downsizing of social security systems” and “cuts in social spending.”
On Not Having Sex At Harvard
From the New York Times:
There was a time when not having sex consumed a very small part of Janie Fredell’s life, but that, of course, was back in Colorado Springs. It seemed to Fredell that almost no one had sex in Colorado Springs. Her hometown was extremely conservative, and as a good Catholic girl, she was annoyed by all the fundamentalist Christians who would get in her face and demand, as she put it to me recently, “You have to think all of these things that we think.” They seemed not to know that she thought many of those things already. At her public high school, everyone, “literally everyone,” wore chastity rings, Fredell recalled, but she thought the practice ridiculous. Why was it necessary, she wondered, to signify you’re not doing something that nobody is doing?
And then Fredell arrived at Harvard.
Progressives Are Not Cynical Enough About Business
One thing my study of economics has taught me is that businesses will tend to act in whatever way they think will bring them the most profit. There may be rare exceptions, and of course businessmen often have mixed motives. But the overall tendency in this direction is very strong.
My guess is that if you surveyed people, many more self-described progressives would say that they agreed with the statement than self-described conservatives. Indeed, progressives often criticize conservatives and libertarians for being insufficiently attuned to the rapacious self-interest motivating businessmen.
Yet oddly enough, it seems to me that one of the main problems with progressive thought is that they don’t take the idea that businesses act to maximize profit seriously enough. For a group that claims to have a low opinion of businessmen, progressives have a strange habit of advocating policies that will only work on the supposition that businesses won’t act to maximize profit, and then react with shock when they proceed to do so.
HHS Statement on Abortion Funding
The Department of Health and Human Services has released the following statement regarding allegations that newly approved Pre-Existing Condition Insurance Plans would cover abortions:
As is the case with FEHB plans currently, and with the Affordable Care Act and the President’s related Executive Order more generally, in Pennsylvania and in all other states abortions will not be covered in the Pre-existing Condition Insurance Plan (PCIP) except in the cases of rape or incest, or where the life of the woman would be endangered.
Our policy is the same for both state and federally-run PCIP programs. We will reiterate this policy in guidance to those running the Pre-existing Condition Insurance Plan at both the state and federal levels. The contracts to operate the Pre-existing Condition Insurance Plan include a requirement to follow all federal laws and guidance.
Remembering Bastille Day
Today is Bastille Day, typically associated with the start of the French Revolution. In honor of that blessed event, I offer up this classic piece by John Zmirak:
Remember when the L.A. riots spun out of control, and engulfed the whole United States? The key moment was no doubt when police and Army commanders took fright and changed sides, throwing their support to the Committee for Public Safety led by Tom Hayden, along with Noam Chomsky, Barbara Boxer, Michael Moore, and Edward Said. After Hayden’s fall and execution, his successor, Marion Barry, insisted that President Bush and his wife Barbara be tried for treason. Their executions shocked the world but sparked wild celebrations in the capital, as the First Couple’s severed heads danced on poles in daylong parades. A crack whore was duly enshrined in the National Cathedral as the Goddess of Reason.
Inequality: Can't Live With It, Can't Live Without It
In my last post I looked at the question of how to calculate the just or living wage, using figures from Father Ryan’s classic text A Living Wage brought up to date by adjusting for inflation. Commenter Restrained Radical, however, thinks that in merely adjusting for inflation I was being too stingy:
Adjusting for inflation isn’t necessary the best way to adjust Fr. Ryan’s figures. Real GDP per capita grew faster than inflation. In other words, Americans got wealthier. Using Fr. Ryan’s figures today adjusted for inflation would be appropriate if real GDP per capita was stagnate for 89 years. In 1919, GDP per capita was $805. If you only adjust for inflation, that would be $9,897 today. That’s somewhere between Cuba and South Africa. So $6.15/hour would be an appropriate living wage for a family of 5, in Cuba.
If instead we adjust for unskilled labor wage increase (4.24% annualized since 1919), $1,400 to $1,500 then would be $56,388 to $60,416. That’s probably closer to what Fr. Ryan had in mind.
In 2008, median household income in the United States was $52,029. If Restrained Radical’s interpretation is correct, then it would seem Father Ryan was advocating a kind of Lake Wobegon society, where everyone has the right to an above average income.
Just How Much Is a Just Wage?
Catholic Social Thought has long recognized the right to a “just wage” (sometimes called a “living wage”), which is defined as a wage “sufficient to enable [a man] to support himself, his wife and his children.” CA 8. One common objection to the idea of the just wage is what might be called the calculation problem. Sure, the criticism goes, everyone would agree in the abstract that wages should be sufficient to support oneself and one’s family, but how are we to decide what is sufficient? What, specifically, is the minimum wage that a man may be paid without violating his right to a just wage?
For answers, I went to Father John Ryan’s A Living Wage, which is the classic American text in defense of the right to a just wage. Chapter five of the book, A Concrete Estimate of A Living Wage, tackles the calculation problem head on, and Father Ryan offers a specific estimate of the amount of wages a man must be paid as his due in justice (in what follows all figures appear to assume a five person family of husband, wife, and three children).
In the first edition of A Living Wage (published in 1906), Father Ryan gave $600 a year (or $14,143.39 in 2009 dollars*) as the minimum wage necessary to qualify as a just wage in the United States. Father Ryan opined that this wage was “probably” sufficient in certain parts of the country (such as the South) where the cost of living was lower, and was possibly sufficient elsewhere, though he noted that there were “certainly” parts of the country where it was insufficient.
The Advantage of Ideology
One of the main problems with politics is that it is complicated. Take, for example, the recently passed health care bill. The bill was over 2,000 pages. I haven’t read it. Neither, I imagine, have most of our readers (indeed, it would not surprise me if no single person has read every word of the bill, though obviously each of the bill’s many provisions has been read by someone).
Of course, even if someone had read every word of the bill, this would not be sufficient to have a truly informed position on it. To have a truly informed position one would have to not only read the bill but understand it. And to do that would require a great deal of knowledge about fields as complicated and diverse as the law, medicine, political science, economics, bureaucratic management, etc.
And, mind you, even if one were somehow able to master and muster all of this information, that would only entitle one to a have a truly informed position on that one bill.
Libertarians vs. Rand Paul
A couple of months back Republican Senate candidate Rand Paul stirred up a hornets’ nest of controversy when he (briefly) indicated his opposition to Title II of the Civil Rights Act of 1964, which banned racial discrimination in “public accommodations” like restaurants and hotels. The controversy was notable not only for its utterly irrelevance to any current political issue, but also for the fact that even many libertarians distanced themselves from Paul’s position. I was out of the country at the time and so didn’t get a chance to comment, but libertarian think tank the Cato Institute recently published a libertarian defense of Title II and other civil rights legislation, which got me thinking about the issue again.
Defenders of Paul’s position (and there were a few) typically made one of two arguments; one based on an appeal to principle; one based on free market economics. The first argument is the straightforwardly libertarian one that individuals have the right to dispose of their property as they see fit, and while we might not like it if a business owner refuses to serve members of a particular racial group, it is still wrong to violate his property rights by telling him he can’t do so. I don’t have much to say about this argument, except to note how incongruously unpersuasive it is to most everyone today. Libertarianism is also criticized as being absolutist, but of course there are areas in which lots of people are willing to be comparably absolutist in their defense of individual freedom. Had Paul said, for example, that he supported the right of neo-Nazis to march through the streets of Jewish neighborhoods waving swastikas, his views would have been in keeping with those of most of the intelligentsia. Yet displaying a similar solicitude when the subject involves commercial activity is viewed as borderline crankish. The reasons for this discrepancy are probably worth further reflection, but I won’t dwell on them here.
Perhaps sensing that the argument from principle is a surefire loser, others have contended that laws such as Title II weren’t really necessary to end private discrimination by businesses. According to this argument, any business that turned away a substantial number of potential customers would soon find itself out of business, and absent legal mandates segregation would simply collapse under its own weight (call it the ‘everyone’s money is the same color’ argument).
I Give Up, Here's a Links Round-up
“The Vatican” endorses the Blues Brothers.
North Korea embraces neoliberalism (baby steps).
Matt Yglesias is my kind of liberal.
The Onion channels Bertolt Brecht.
Israel further loosens border restrictions with Gaza.
A lot of people seems to think this is good news for Afghanistan. Have they never heard of the resource curse?
The menace of friendship. Paging Eve Tushnet.
What the Left Cannot Supply, the Right Will Not Demand
Recently I’ve been toying with the idea of doing a series of posts looking at the recent survey purporting to know a lack of economic knowledge on the Left, with one post for each of the eight questions on the survey. As I look at the list of questions, however, a clear theme emerges, namely that liberals tend to think that the price of a good or service isn’t much affected by the supply of that good or service or visa versa. According to the survey, liberals tend to think that restricting the supply of housing doesn’t increase the price of housing (question 1), that restricting the supply of doctors (through licensing) doesn’t increase the price of doctors (question 2), and that price floors won’t decrease the supply of either rental space (question 4) or jobs (question 8).
Coincidentally, I’m currently reading a (surprisingly good) book by Paul Krugman, in which he argues that conservatives tend to minimize or dismiss the part changes in demand have on getting us into or out of recessions. Naturally this got me thinking whether one of the things separating left from right in this country is a difference in the importance of supply and demand in economic phenomenon. For the above issues, at least, liberals seem to be ready to discount the importance of supply, whereas conservatives underestimate the importance of demand.
Is Collective Punishment Always Wrong?
As readers of this blog are probably aware, I am not a fan of the Israeli blockade of Gaza. I find the blockade to be morally unjustifiable and ultimately not in the interests of Israel’s security. Yet I do wonder about some of the moral claims made in the course of the controversy.
For example, a recent Vox Nova post by contributor Morning’s Minion contains the following aside:
Remember, collective punishment is absolutely forbidden under the moral law.
Morning’s Minion, of course, is hardly the only one to make this point, and at first blush it seems fairly sensible and obvious. It’s easy to see why punishing one person for the crimes of another, which is what collective punishment seems to consist in, would be morally objectionable, and one might readily conclude that, just as a straightforward application of moral logic, collective punishment is always and everywhere morally wrong.
Israel to Loosen Gaza Blockaid
Palestinian official Raed Fattouh, who coordinates the flow of goods into Gaza with Israel, said soda, juice, jam, spices, shaving cream, potato chips, cookies and candy were now permitted. He said Israel rebuffed Palestinian requests for construction goods, raw materials for factories to operate and medical devices.
Israeli officials, speaking on condition of anonymity because they were discussing internal policymaking, said their goal in allowing more goods into Gaza was to defuse pressure for an international investigation of the sea raid.
More. Since the blockaid is essential to Israel’s security and right to defend itself, one can only assume that the country will now cease to exist.
The Nuclear Option
It was September of 1966, and gas was gushing uncontrollably from the wells in the Bukhara province of the Uzbek Soviet Socialist Republic. But the Reds, at the height of their industrial might, had a novel solution. They drilled nearly four miles into the sand and rock of the Kyzyl Kum Desert, and lowered a 30-kiloton nuclear warhead — more than half-again as large as “Little Boy,” the crude uranium bomb dropped over Hiroshima — to the depths beneath the wellhead. With the pull of a lever, a fistful of plutonium was introduced to itself under enormous pressure, setting off the chain reaction that starts with E = MC2 and ends in Kaboom! The ensuing blast collapsed the drill channel in on itself, sealing off the well.
The Soviets repeated the trick four times between 1966 and 1979, using payloads as large as 60 kilotons to choke hydrocarbon leaks. Now, as the Obama administration stares into the abyss of the Deepwater Horizon spill, and a slicker of sweet, medium crude blankets the Gulf of Mexico, slouching its way toward American beaches and wetlands, Russia’s newspaper of record is calling on the president to consider this literal “nuclear option.”
As well he should. It’s a little less crazy than it sounds. The simple fact is that the leak has confounded all conventional efforts to quell it, forcing British Petroleum and its federal overseers to resort to a series of untested, increasingly unwieldy, and heretofore unsuccessful backup plans as the American people’s impatience and rage grow at geometric rates. In the madness that is Deepwater Horizon, The Bomb may be the sanest choice.
Political Correctness Trumps Expertise in Gulf Oil Spill Response
During his press statement last week, President Obama said that in dealing with the recent oil spill in the Gulf, he was “examining every recommendation, every idea that’s out there, and making our best judgment as to whether these are the right steps to take, based on the best experts that we know of.”
That, however, is not entirely true:
A St. Louis scientist who was among a select group picked by the Obama administration to pursue a solution to the oil spill in the Gulf of Mexico has been removed from the group because of writings on his website, the U.S. Energy Department confirmed Wednesday.
Washington University physics professor Jonathan Katz was one of five top scientists chosen by the Department of Energy and attended meetings in Houston last week.
Though considered a leading scientist, Katz’s website postings often touch on social issues. Some of those writings have stirred anger in the past and include postings defending homophobia and questioning the value of racial diversity efforts.
Why Aren't There More Worker Co-Ops?
Despite their obvious potential advantages, employee owned businesses tend to be rare. In 2004, there were an estimated 300 worker owned cooperatives in the United States. If that sounds impressive, consider that in 2001, there were over 18.3 million nonfarm proprietorships in the U.S. Nor is the situation much different overseas. The Mondragon Cooperative Corporation is typically cited as an example of a successful worker cooperative, and it is indeed quite successful . . . for a co-op. Compared to other types of businesses, however, Mondragon performs well, but not stellar. It is the seventh largest corporation in Spain, and despite being a conglomeration of more than a 100 different companies, it accounts for less than 4% of the GDP of the Basque region of Spain where it is located. When one considers that Mondragon is in all likelihood the most successful worker cooperative on the planet, the idea that the co-op’s success proves the viability of worker cooperatives generally begins to seem doubtful.
There’s nothing legally preventing people from choosing to start a workers-owned cooperative rather than some other form of business, and in fact cooperatives receive more favorable tax treatment than do standard business corporations. Why then, aren’t they more common? The question has actually inspired a fair amount of research, which has identified at least four obstacles to the success of worker owned businesses.
Is the Means of Production an Obsolete Idea?
The “means of production” (which may be defined, roughly, as consisting of capital goods minus human and financial capital), is a central concept in Marxism, as well as in other ideologies such as Distributism. The problems of capitalism, according to both Marxists and Distributists, arise from the fact that ownership of the means of production is concentrated in the hands of the few. Marxists propose to remedy these problems by having the means of production be collectively owned. Distributists want to retain private ownership, but to break the means of production up (where practicable) into smaller parts so that everyone will have a piece (if you wanted to describe the difference between the Marxist and Distributist solutions here, it would be that Distributists want everyone to own part of the means of production, whereas Marxists want everyone to be part owner of all of it).
Where a society’s economy is based primarily on agriculture or manufacture, thinking in terms of the means of production makes some sense. In an agricultural economy wealth is based primarily on ownership of land, and in a manufacturing economy ownership of things like factories and machinery plays an analogous role. In a modern service-based economy, by contrast, wealth is based largely on human capital (the possession of knowledge and skills). As Pope John Paul II notes in Centesimus Annus, “[i]n our time, in particular, there exists another form of ownership which is becoming no less important than land: the possession of know-how, technology and skill. The wealth of the industrialized nations is based much more on this kind of ownership than on natural resources.”
Arizona, Immigration, and Moral Panic
When I first heard of the controversy swirling around Arizona’s “draconian” new immigration law, I’ll admit I was skeptical. It’s not that I thought I would approve of the Arizona law (I tend to be of the view that immigration is a net benefit to America). But hyperbole is an all too common feature of political discourse, and I had to wonder whether the bill was really as harsh and wrongheaded as its critics were making out.
After reading the text of the bill, however, I have to say that, yes, it really is that bad. The bill would criminalize charitable activities directed at illegal immigrants, would making it a crime for an illegal immigrant to try to get a legitimate job, and, in an Orwellian twist, would make illegal immigrants guilty of trespassing for being on private property even with the owner’s permission.
The law also requires state officials to enforce federal immigration laws, effectively turning every Arizona cop into a part time border patrol agent. Arizona’s politicians may like the idea of having cops enforce the immigration code because it makes them look tough, but actual police tend to hate the idea, as it makes their job more difficult and forces them to take resources away from actual police work. (During the debate on the Bush immigration bill back in 2006, for example, the Major Cities Chiefs Associations came out against a requirement for state police to enforce immigration laws, arguing that doing so “undermines trust and cooperation with immigrant communities, which are essential elements of community oriented policing,” and would require scarce resources to be devoted to immigration enforcement rather than other, higher priorities). Continue reading
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