A Stitch in Haste

"A building has integrity, just like a man — and just as seldom."
--The Fountainhead

Goldilocks and the triplicate permit forms:

John Jessop earned a cult following among his colleagues after his withering comments were leaked in an e-mail which has been sent all round the country.

After being asked to fill in a "design access statement" for a storage shed on a small farm, he wrote: "The density is like on a farm, the social context is a farm in the country, the economic context is farming in the United Kingdom in 2008 (which is not very economic), the opportunities are to store equipment inside rather than the outside, the constraint is the planning system."

And under a section headed Context Analysis, he said: "The use is compatible with a farm because it is a farm building."

"It is located where it is because it is in the most convenient place, being on the farm and near the farmhouse."
...
"It can not be lower because nothing could be stored in it. It is not made any higher because that would be silly."

But since when did being "silly" stop a planning bureaucrat?

The notion that a farmer needs anybody's permission to build a farming shed on his farming land to store his farming equipment that he uses to earn his farming income shows how far the half-sibling notions of "zoning" and "environmental impact statements" have corrupted what used to be a rationally based concern for negative externalities. In the past, such reviews were cursory, common sense inquiries. Today? Yes, we the central planners have graciously allowed you to call your land a "farm," but that obviously did not mean that we would also allow you to "do farming" on it. We'll get back to you on that after we review your design access statement...

Other gems omitted from the media account:

--"Landscaping: The applicant and pervious [sic] occupants have spent a long time, probably more than a thousand years, making the countryside around the house look like farmland so that everyone can enjoy the pretty English countryside."

--"Access: There is an airport at Bristol which can be accessed by driving your tractor along the road. This gives direct access to warm sunny places all over the world."

--"Appearance: It looks like a typical modern agricultural shed in green profiled metal sheeting because that is what it is, and a great architect once said, 'Buildings should look like what they are'."

Methinks Mr. Jessop has read The Fountainhead.

Kip's Law: Every advocate of central planning always — always — envisions himself as the central planner.

Original 3-page document PDF here. (Via Fark.)

(I sincerely hope this does not become a regular feature here.)

One of the first industries the looters went after in Atlas Shrugged was, of course, oil.

And who is better at looting than politicians?

U.S. Rep. Paul Kanjorski said it's time for America to stand up to the big oil companies and shout out, "We've had enough."

Kanjorski, D-Nanticoke, was in town Monday to announce his introduction of House Resolution 5800, the Consumer Reasonable Energy Price Protection Act of 2008. The bill, introduced on the House floor April 15, would allow the federal government to tax windfall oil and gas profits resulting from historically high oil and gas prices that average Americans struggle to afford, he said.

Kanjorski said industries yield windfall profits when earnings exceed what a Reasonable Profits Board determines is rational, as laid out in the legislation.

Rational profits? As determined by a Reasonable Profits Board? Would Hugo Chavez or Robert Mugabe be eligible to serve on it? (If not, then perhaps Ms. Maureen Felix of West Orange, New Jersey, is available.)

The futility of pointing out, "reasonable to whom, by what standard" is not lost on me. The impermeability of the blood-brain barrier between politicians and reasonableness is common knowledge.

Also not lost on me is the futility of pointing out, yet again, that "big" oil companies actually consist of numerous small shareholders, either directly as individuals and households (such as those that the "reasonable" Representative Kanjorski putatively serves), or indirectly — as employees (whose pension funds own oil company stock), small business owners (who retirement accounts include index funds that include such stock), students (whose college endowment funds own such stock) or anyone else who indirectly benefits from "obscene" oil company profits.

Equally futile would, I suppose, be asking where one goes to apply for a seat on the Reasonable Taxation Board:


(Click to enlarge.)

Via Tax Policy Blog.

(For the uninitiated, Directive 10-289 here.)

There are certain axioms, certain fundamental pillars, upon which this blog is based. One is that all politicians are, by definition, moral defectives. Another is the ubiquitousness of the Politics of the Warm Fuzzy Feeling. Another is Kip's Law.

Yet another — one you have seen repeatedly here — is that the laws of economics are no more subject to repeal by a legislature than are the laws of physics.

Perhaps it's time to add a flying buttress to that last pillar: No truth, including economic truth, can ever be "elitist" —

Democratic presidential candidate Hillary Clinton on Sunday dismissed the "elite opinion" of economists who criticized her gas tax proposal, using a term that has dogged rival Barack Obama in recent weeks.
...
"I'm not going to put my lot in with economists," Clinton said when asked to name an economist who backed her proposal.

"We've got to get out of this mind-set where somehow elite opinion is always on the side of doing things that really disadvantage the vast majority of Americans," said Clinton, a former first lady who would be the first woman president.

When Clinton or a member of her family becomes sick or injured, does she rely on "elite" physicians for care? If she becomes president, will she dismiss the "elite" pilots who fly Air Force One? Why does she need Air Force One at all — the only thing stopping people from flying around like Superman are the "disadvantageous" views of "elite" physicists.

Economics does admittedly lie in a twilight zone between the metaphysical certitudes of the hard sciences and the subjective gobbledygook of the humanities. Point conceded.

But an economic truth such as, "all resources are scarce and must somehow be rationed" is closer to a physics-based law of conservation than to a humanities-based pronouncement that "everyone has a right to..." An economic truth such as, "people respond to incentives" is closer to a physics-based "for every action..." than to a humanities-based "from each according to..." A graph containing a supply and demand curve — and the distortions government policies impose on them — is closer to a Grand Unified Theory than to a piece of indecipherable "abstract art."

To call economists "elitist" is to call economics "elitist" — which is also to call science, logic and reason "elitist."

More thoughts from — heck, too many people to cite.

Obsidian Wings, critiquing John McCain's health care not-quite-reform not-quite-proposal, relays an anecdote:

Shirley Giarde of Walla Walla, Wash., was not prepared when her husband, Raymond, suddenly developed congestive heart failure last year and needed a pacemaker and defibrillator. Because his job did not provide health benefits, she has covered them both through a policy for the self-employed, which she obtained as the proprietor of a bridal and formal-wear store, the Purple Parasol.

But when Raymond had his medical problems, Ms. Giarde discovered that her insurance would cover only $22,000, leaving them with about $100,000 in unpaid hospital bills.

Even though the hospital agreed to reduce that debt to about $50,000, Ms. Giarde is still struggling to pay it — in part because the poor economy has meant slumping sales at the Purple Parasol. Her husband, now disabled and unable to work, will not qualify for Medicare for another year, and she cannot afford the $758 a month it would cost to enroll him in a state-run insurance plan for individuals who cannot find private insurance.

To which I relayed a comment:

Perhaps the problem isn't so much with health insurance as with Ms. Giarde's "Purple Parasol" business model. If her business can't produce enough income for her to pay her bills, then she's in the wrong business.

Debate a "right to health care" all you like, but don't claim that there is a right to run an unprofitable, sub-mediocre business and then get taxpayer-extracted health insurance on top of that.

P.S. What exactly was the back story of Mr. Giarde taking a job with no health benefits in the first place? Because I have no doubt that there was in fact a back story.

It's bad enough seeing starving (i.e., crappy) artists demand — and receive — forced taxpayer purchase of their "art" through public funding. Are we now to see the equivalent of forced consumption of bridal gowns (among countless other services) from inadequately profitable (i.e., badly run) bridal shops (among countless other services), through the money laundering socialist concept known as "universal health insurance"?

And who, you might be wondering, is Ms. Maureen Felix of West Orange, New Jersey?

She holds the prestigious position of "random interviewee on the street" — and now seeks the higher office of your mommy:

The thought of taxing a Big Mac or a Wendy's burger came up at a New Jersey Hospital Association meeting where Gov. Jon S. Corzine was asked if it could be an option to help fund struggling hospitals. At the meeting, he reportedly called it a "constructive suggestion."

A spokesperson for the governor, however, told CBS 2 on Wednesday: "The governor is open to reasonable solutions to help solve our financing problems, but there are no plans for any fast food tax."
...
"I think this country has gone too much in the direction of fast and unhealthy food, and if people are taxed they may terminate that and turn toward more healthy foods," said West Orange resident Maureen Felix.

Of course, why anyone should give any kind of a damn what Ms. Maureen Felix of West Orange, New Jersey, thinks about whether fast food (defined how? by whom?) should be taxed (to what extent? with revenues deployed how?) — or about anything else, for that matter — remains unanswered. As does the precedent question of what basis a free society has in the first place for using taxation to control behavior rather than solely to raise revenue to fund legitimate public goods.

Because to nanny-staters, no such reason is required. Ms. Maureen Felix of West Orange, New Jersey, has an opinion, damn it. The fact that her opinion is baseless, uncorroborated, un-American, anti-freedom — not to mention mind-bogglingly stupid — in no way changes the fact that Ms. Maureen Felix of West Orange, New Jersey, has an opinion, damn it. What right do you have to mock it? And, more importantly, what right does a politician have to ignore it?

She is, after all, Ms. Maureen Felix of West Orange, New Jersey!

Kip's Law: Every advocate of central planning always — always — envisions himself as the central planner.

Via Fark. More thoughts at QandO.

Tyler Cowen asks a simple question:

How good would the abolition of zoning in New York City be?

Of course, that question completely drops the context within which "good" is embedded. Stated differently: "Good" -- by what metric? Real estate values? Total available housing stock? Aesthetics? Whose aesthetics?

Suddenly it's not so simple a question after all.

How about defining "good" as "respecting property rights and constitutional principles"? As I commented at Cowen's blog:

Sorry for the Clintonism, but it depends (as you note) on what your definition of "zoning" is.

First-order zoning -- an area is simply designated "residential," "commercial" or "industrial" -- is not an excruciating abomination to libertarians and can be defended, at least in the abstract, as externality-correcting.

Second-order zoning -- height restrictions are the best example -- are less defensible and should be presumed illegitimate (i.e., restrictions should be subject to heightened scrutiny). This is the kind of "zoning" imposed on most of Manhattan.

Third-order zoning -- where any and every alteration, expansion or demolition must be submitted to an unelected board with near-plenary authority to approve or reject the project -- for any reason up to and including the whim and caprice of the board members -- is per se illegitimate, and under any sane jurisprudence such an infringement of fundamental property rights would be an irrebuttable due process violation. (So-called "historic districts" -- of which there are many in New York City -- are the most egregious example.)

Yes, the "first-second-third" nomenclature is my own concoction, inspired by similar terminology in the context of price discrimination.

More thoughts from Perfect Substitute

Of all the various forms of economic protectionism available to faction-pandering activist legislators, the one that has always befuddled me the most is the anti-dumping law. If a foreign, state-controlled "mixed economy" is perfectly willing to sell us stuff below cost, then why would we possibly say no? Lower prices for consumers is the beginning, and the end, of the analysis.

The (entirely fraudulent) consequentialist rationalization (it is not a "rationale") for anti-dumping laws is a dynamic one: if the foreign competitor "undercuts" American firms, the latter will eventually go out of business and the former will then be able to charge higher prices. But of course, "dynamism" cuts both ways in a market: if the "evil" foreign firm ("evil," remember, because it dared to sell us cheap stuff) suddenly tries, having finished off the competition, to now "exploit" us by charging higher prices, then those "eliminated" competitors will simply re-emerge. All market power is fleeting.

In reality, anti-dumping laws -- which, remember always, prevent consumers from buying cheap stuff -- protect not consumers (or "the economy") but the domestic competitors supposedly "threatened" by the dumping. The protectionist restrictions allow them to continue to charge higher prices to consumers. This, the politicians will tell you -- is "good for America." Somehow.

Of course, protectionism is not always a simple case of politically favored industries rent-seeking excess profits from consumers. Sometimes there is another industry wedged in between the protected industry and consumers, collateral damage in the War on Low Prices.

One example of an industry taken to the cleaners by interventionism is -- the cleaners:

After a federal tariff was imposed last month on wire hangers imported from China, [Young Hoon] Jung explained, the wholesale price skyrocketed. As a result, many dry cleaners say, already slim profits have grown even slimmer.

"It increased 60 percent from one week to the next," Mr. Jung said of hanger prices. "We do 4,000 pieces a week, so obviously we need 4,000 hangers. Raise the price a little, O.K., but not 60 percent."
...
"Everyone in the Korean community is talking about it," continued Mr. Jung, who said that he might have to raise prices soon. "They're saying: 'What are we doing this for? The government? The landlords? We can't do this business anymore.'"

But of course any economically literate, or politically savvy, observer knows full well "what we are we doing this for." We are doing this, not to help dry cleaners, not to help consumers, not to help "the economy," but to help one uncompetitive industry -- one that happens to be far more influential in Washington than Korean dry cleaners.

Even ignoring the dynamic counterargument to the assertion that dumping "hurts domestic companies," what about the additional counterargument that anti-dumping also hurts domestic companies (as well as consumers, obviously).

The only resolution of the paradox is to admit that protectionism is not about economics but about politics.

"A provision of the Constitution, it is hardly necessary to say, does not admit of two distinctly opposite interpretations. It does not mean one thing at one time and an entirely different thing at another time."
--Home Building & Loan Assn. v. Blaisdell, 290 U.S. 398 (1933) (Sutherland, J., dissenting)

If this doesn't violate the Contracts Clause, then nothing ever does:

Warning that America is experiencing a "housing emergency," six Boston city councilors want to force lenders who foreclose on Hub properties to rent seized houses and apartments back to occupants.
...
The proposal would order lenders to lease foreclosed properties back to ex-owners or tenants at market rates until either third parties buy the homes or the measure expires in 2014. Violators would face fines of at least $10,000.
...
Ross said the measure aims to primarily help tenants who've paid rent on time but face eviction anyway because their landlords fell into foreclosure. However, the measure would also cover individual homeowners who fell behind on their own mortgages.

That was a trick observation, incidentally: It doesn't violate the Contracts Clause because, under current Supreme Court precedent, nothing ever does.

---

There are two distinct issues here that need to be disentangled.

As a common law principle (individual jurisdictions may of course have their own nuances), renters are already insulated from any and all changes in title to the property they rent (with one huge exception — eminent domain). If I own a house and rent it to you, then (absent mutually agreed-to provisions to the contrary) your lease is binding on any future owners of the land during the period of the tenancy. Even if I sell the house, gift it, die — or default on my mortgage — the lease is the lease and you are protected by it while it remains in effect.

These activist legislators are, therefore, offering you a protection that you already have. Don't you feel "indebted" to them?

---

I as the owner facing foreclosure, on the other hand, am screwed. As I should be, given that I'm a defaulter who failed to meet my voluntarily-entered-into obligations. Maybe I was the victim of circumstance, maybe I was reckless in my finances, maybe I was a predatory borrower. It doesn't really matter which. I defaulted on a debt, I breached a contract, my counterparty has both a legal and equitable remedy.

And, under the Constitution, there ought not be a damned thing either I or these hack politicians could do about it:

No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility.

The Contracts Clause (Article I, Section 10, Clause 1) is one of the least appreciated libertarian aspects of the Constitution. The fact that it applies only to states and not the federal government is, one could plausibly argue, the single worst flaw in the original 1787 document.

But it is still there and still wholly applicable to this fact pattern. A mortgage is unarguably a "contract," the requirement to surrender to a valid foreclosure is unarguably an "obligation" and requiring lenders to lease to defaulters is unarguably an "impairment." Q.E.D.

Or not: Essentially the exact same law was enacted in Minnesota in 1933 and the same five Supreme Court Justices who would later finish off the last traces of economic liberty in America* also killed off economic substantive due process — and an entire clause of the Constitution as collateral damage — in the nightmarish case, Home Building & Loan Assn. v. Blaisdell.

The policy of protecting contracts against impairment presupposes the maintenance of a government by virtue of which contractual relations are worthwhile — a government which retains adequate authority to secure the peace and good order of society. This principle of harmonizing the constitutional prohibition with the necessary residuum of state power has had progressive recognition in the decisions of this Court.

In other words, a state's "police power" (a grant of power that appears only implicitly in the Tenth Amendment) can summarily trump the Contracts Clause (a limitation of power that appears explicitly in Article I), whenever "the peace and good order of society" require it (i.e., whenever activist legislators feel like it).

I'm surprised the Bush Administration never cited to Blaisdell in the War on Terror. The decision's twisted "police powers" reasoning makes John Yoo's memos seem like ACLU briefs.**

It is sad to have to repeat such a axiomatic statement, but it is precisely during emergencies that we need constitutional limitations on government power the most. It is precisely during emergencies that the more vague elements of constitutional law (e.g., "police power" or "executive authority") must yield to the less vague (e.g., "no impairment of contracts" or "no suspension of habeas corpus"). It is precisely when the government wants to act the most that it needs to be constrained the most.

(Incidentally, who but the most opportunistic malcontents would dare suggest that the current housing "crisis" rises to the level of the Great Depression — or the War on Terror? Note that the hack politicians in Boston were quite careful to label their proposal a "housing emergency" measure and to give it a specific expiration date — precisely as the Blaisdell court suggested was necessary to survive a Contracts Clause challenge. Someone on their staff certainly did their homework.)

If I were to expand my list of the Ten Worst Supreme Court Cases to twenty or even fifteen, Blaisdell would definitely make the cut.

More thoughts from Cato.

---

*Via Nebbia v. New York, 291 U.S. 502 (1934), impliedly overturning Lochner v. New York, 198 U.S. 45 (1905).

**But, cf., this oft-quoted passage from Blaisdell:

Emergency does not create power. Emergency does not increase granted power or remove or diminish the restrictions imposed upon power granted or reserved. The Constitution was adopted in a period of grave emergency. Its grants of power to the Federal Government and its limitations of the power of the States were determined in the light of emergency, and they are not altered by emergency. What power was thus granted and what limitations were thus imposed are questions which have always been, and always will be, the subject of close examination under our constitutional system.

How the Blaisdell majority gymnastically went from that to actually upholding the "no foreclosures" law remains one of the great embarrassments of Supreme Court jurisprudence.

I suppose it's marginally better than May Day:

America trusts in the abiding power of prayer and asks for the wisdom to discern God's will in times of joy and of trial. As we observe this National Day of Prayer, we recognize our dependence on the Almighty, we thank Him for the many blessings He has bestowed upon us, and we put our country's future in His hands.

From our Nation's humble beginnings, prayer has guided our leaders and played a vital role in the life and history of the United States. Americans of many different faiths share the profound conviction that God listens to the voice of His children and pours His grace upon those who seek Him in prayer. By surrendering our lives to our loving Father, we learn to serve His eternal purposes, and we are strengthened, refreshed, and ready for all that may come.
...
NOW, THEREFORE, I, GEORGE W. BUSH, President of the United States of America, do hereby proclaim May 1, 2008, as a National Day of Prayer. I ask the citizens of our Nation to give thanks, each according to his or her own faith, for the freedoms and blessings we have received and for God's continued guidance, comfort, and protection. I invite all Americans to join in observing this day with appropriate programs, ceremonies, and activities.

Would it have been so damnable (either figuratively or literally, depending on your particular form of mysticism) to toss in a "many" or "most" here and there?

For example:

Much of America trusts in the abiding power of prayer and many Americans ask for the wisdom to discern God's will in times of joy and of trial. As we Jews and Christians observe this National Day of Prayer, we they recognize our their dependence on the Almighty, we they thank Him for the many blessings He has bestowed upon us them, and we they put their hope for our country's future in His hands.

From our Nation's humble beginnings, private prayer has guided several of our leaders and, coupled with a perpetual and sacred commitment to the separation of religion and government, played a vital role in the life and history of the United States. While America is now and has always been a country also for Muslims, Buddhists, Hindus and other less common beliefs, Americans of many different faiths share the profound conviction that God listens to the voice of His children and pours His grace upon those who seek Him in prayer. By surrendering our their lives to our their loving Father, we they learn to serve His eternal purposes, and we they are strengthened, refreshed, and ready for all that may come.
...
NOW, THEREFORE, I, GEORGE W. BUSH, President of the United States of America, do hereby proclaim May 1, 2008, as a National Day of Prayer. I ask the religious citizens of our Nation to give thanks, each according to his or her own faith or other moral code, for the freedoms and blessings we have received and for God's continued guidance, comfort, and protection. I invite all Americans to join in observing this day with appropriate programs, ceremonies, and activities.

Notice that I'm not even playing the atheist card -- just the non-Judeo-Christian card.

But I suppose even that's too much to ask from our Theocrat-in-Chief.

Last year's post here. More thoughts from Americans United.

An astonishingly arrogant, and economically oblivious, op-ed in today's Washington Post by the mayors of Cincinnati, Rochester and Stamford:

Although the House and Senate have both defeated a moratorium on earmarks, the debate about direct congressional grants rages on. And generally absent is any mention of the pressing needs that these grants have helped so many of our nation's communities meet.

Are programs to reduce gang violence a good use of taxpayer funds? How about keeping sewage out of local streams? Or fixing unsafe roads and bridges before another tragedy?

By any reasonable standard, nearly all congressionally directed grants would be considered a good use of taxpayer funds.

Putting aside the Bridge to Nowhere, let's dissect (actually, "psychoanalyze" might be a better word) this bizarre reasoning:

1. It completely ignores opportunity cost, a/k/a the Broken Window Fallacy. The question, properly framed, is not whether "programs to reduce gang violence are a good use of taxpayer funds." The question, properly framed, is whether such programs are a better use of funds than the next best alternatives: Is "reducing gang violence" more important than whatever it was that we didn't get instead?

(And yes, that "whatever it was that we didn't get instead" can be lower taxes or budget deficits and not just some other expenditure. There are "public benefits" to low taxes and fiscal restraint and not just to unbridled majoritarian spending.)

From the op-ed:

Contrary to conventional wisdom, such congressional grants do not increase federal spending but only help to guide how this funding is directed. For fiscal 2008, Congress held to the total discretionary spending caps that President Bush demanded. So congressional grants did not add one dollar to federal spending or to the deficit.

You read that right: When we spend taxpayer money we're not really spending taxpayer money. There really is such a thing as a free lunch. Somehow.

2. It completely ignores fiscal federalism. Reducing gang violence in Cincinnati may be a "good use of taxpayer funds" when it's Cincinnati taxpayers who do the funding. But why should I pay taxes to reduce gang violence in Cincinnati? Why should taxpayers in Cincinnati pay to give me a Second Avenue subway? ("Because we took a vote" is of course not a valid answer.)

There is a moral justification (except perhaps to the anarcho-capitalists) to requiring people to pay taxes to fund legitimate public goods that they cannot help but benefit from. But that requires strict fiscal federalism: Federal taxes should only be extracted to fund federal public goods, state taxes should only be extracted to fund state public goods, and local taxes should only be extracted to fund local public goods. Any breach of those barriers is pure looting by the majoritarian mob.

3. It completely ignores progressive income taxation. There are defenders of earmarks (and their cousins, block grants) who are less unapologetic than these three mayors and who will, when called out on the fiscal federalism question, default down to the argument that, when all the taxes and expenditures are netted out, it reduces to a case of, "Everybody pays for everything, and what's so bad about that?"

Well, what's "so bad about that" is that it conveniently omits the fact that not everybody is paying for everything. It omits the fact that the bottom 40% of households, reflecting almost 50% of the population, pays no federal income tax. So, when the three mayors assert ...

In addition to local taxes, Americans send more than $1 trillion in federal taxes each year to Washington to fund projects that localities cannot undertake alone: building highways, providing for defense and so on.

... they really mean a subset of Americans — the small subset that pays the overwhelming majority of federal income taxes. So earmarks and block grants are not merely a case of "New Yorkers funding Cincinnati programs," (bad enough) but actually a case of "New York taxpayers funding Cincinnati non-taxpayers" (much worse). How is that not naked, brazen looting?

4. It completely betrays "the democratic process." It would still be illegitimate even if it didn't — "two wolves and a sheep," etc. But to suggest that it is somehow "the democratic process" to simply give legislators taxpayer money to dole out as they see fit, with no debate, no individual votes and no independent oversight (beyond the legislators patting each other on the back for their "civic-mindedness") is about as far from "the democratic process" as a non-dictatorship can get.

(Incidentally, does it really need repeating that the Senate — where North Dakota has the same representation as California — is hardly a "democratic" institution? See also, "farm subsidies.")

5. It completely ignores the fact that all politicians are, by definition, moral defectives. The three mayors:

For fiscal 2007, Congress placed a moratorium on grants ... and spending decisions were left solely to the Bush administration. What happened? The administration picked a select group of winners that got all the money — and hundreds of smaller and less well-connected communities were left out in the cold.

So the Bush administration succumbs to rent-seeking, but members of Congress do not? That lunacy does not require a detailed response any more than would a belief that the Sun-God revolves around the Flat Earth.

One last point, from the original excerpt:

By any reasonable standard, nearly all congressionally directed grants would be considered a good use of taxpayer funds.

When the ad hominem card is the only card you have, you play it. Anyone who disagrees is simply not "reasonable." Q.E.D.

Could you imagine someone saying, "Chocolate is better than vanilla, because it is unreasonable to suggest that vanilla is better than chocolate..."? It makes no sense in ice cream, and it makes no sense in economics or politics.

Indeed, the very fact that earmarks and pork are so controversial would, if anything, suggest that the "reasonable" conclusion is to scrap them. But when you're the local hack politician who is doing the actual sucking at the teat of an anonymous taxpayer halfway across the country, "reasonable" seems to take on a whole new meaning.

More thoughts from Cato@Liberty.

Kip's Law: Every advocate of central planning always — always — envisions himself as the central planner.

Far too much cyber-ink is being spilled regarding a new book by a noted legal scholar, Cass Sunstein, and an equally noted economist, Richard Thaler, called Nudge.

An excerpt from the book's introduction:

Many of the policies we recommend can and have been implemented by the private sector (with or without a nudge from the government). Employers, for example, are important choice architects in many of the examples we discuss in this book. In areas involving health care and retirement plans, we think that employers can give employees some helpful nudges. Private companies that want to make money, and to do good, can even benefit from environmental nudges, helping to reduce air pollution (and the emission of greenhouse gases). But as we shall show, the same points that justify libertarian paternalism on the part of private institutions apply to government as well.

The premise of Nudge, usually referred to as "soft paternalism" (or, outrageously, "libertarian paternalism") can be summed up with great ease:

You're stupid.
If "stupid" seems too harsh a word, then substitute "irrational."

You're irrational, for example, because you don't max out or even contribute at all to your 401(k) plan, even if your employer matches your contributions. You're irrational because you don't sign your organ donor card. You're irrational because you make all kinds of choices that are "wrong."

What (supposedly) makes Sunstein and Thaler different from any other two-bit hubris-drenched central planner wannabe is that they claim to define "wrong" not by their own subjective tastes and preferences, but by objective standards. To ignore a costless opportunity to get free money is, they submit, objectively irrational. To deny some innocent person access to your organs after you're dead is, they submit, objectively irrational. And so on.

What also (supposedly) makes Sunstein and Thaler different is that they claim not to want to coerce anybody to behave rationally. They do not want to force you to enroll in your 401(k) plan. They do not want to seize your body after you die. All they want is to rejigger the rules a bit so that you do not have to "choose to be rational" (e.g., by having to opt in to a 401(k) plan) but rather that you would have to "choose to be irrational" (e.g., by having to opt out of your 401(k) plan). Yes, they're going to be paternalistic toward you, but not at the point of a gun.

All they want to do is "nudge" you.

What of course does not make Sunstein and Thaler different, meanwhile, is that they want to be ones doing the nudging. Kip's Law prevails yet again.

Two things amaze me about the excessive hype over Nudge. First, it seems to me that the book's thesis is, at the end of the day, its own worst enemy. A complex, dual-disciplined (i.e., law and economics) theory that, when put to the test, can only generate a handful of de minimis policy recommendations — default opt-in to 401(k) plans, a presumption of consent in organ donation, etc. — can hardly be described as revolutionary — or, for that matter, useful. To the extent that the soft paternalists truthfully say, "this far, no further" (i.e., to the extent they are eager to assure us that their proposals are "no big deal"), then they only win by losing. If the debate is simply whether the entry for "soft paternalism" should read, "harmless" or "mostly harmless,"* then the soft paternalists have lost that debate before they've even started.

Second, and far more relevant in the context of Kip's Law, is that the debate is definitely not between "harmless" and "mostly harmless." No activist legislator, nanny-stater or other anti-freedom malcontent is going to take a theory like "soft paternalism" and invoke it only in the context of 401(k) plans and organ donation. Even if all you promise to do is "nudge," then suddenly you're going to start seeing lots of things that need "nudging."

The tax code is one giant nudge: nudging us into home ownership, child rearing, charitable donating, etc. Apologists for Social Security insist that it is merely a "nudge" into saving for retirement (indeed, Thaler was a leading advisor to President Bush on Social Security reform). Hillary Clinton insists that she is not a health care socialist — she just wants to "nudge" us into (compulsory) insurance programs (which, somehow, does not constitute "socialized medicine" — but that's a whole other blogpost).

Practically any incursion into personal autonomy can be repackaged as a "nudge" — from seat belt laws to the war on drugs. Some anti-liberty laws are "nudgier" than others, to be sure. But all derive from a belief that the government is legitimately authorized not just to protect us from each other, but also to protect us from ourselves — to "nudge" us.

Mario Rizzo, a noted free-market economist at NYU, puts this in terms of "slippery slopes" —

The new paternalism claims that careful policy interventions can help people make better decisions in terms of their own welfare, with only mild or nonexistent infringement of personal autonomy and choice. This claim to moderation is not sustainable. Applying the insights of the modern literature on slippery slopes to new paternalist policies suggests that such policies are particularly vulnerable to expansion. This is true even if policymakers are fully rational. More importantly, the slippery-slope potential is especially great if policymakers are not fully rational, but instead share the behavioral and cognitive biases attributed to the people their policies are supposed to help. Accepting the new paternalist approach creates a risk of accepting, in the long run, greater restrictions on individual autonomy than have been heretofore acknowledged.

Or you can just "opt out" of Rizzo and "opt in" to Lewis Black: Government is human beings.

More thoughts from Will Wilkinson.

Kip's Law: Every advocate of central planning always — always — envisions himself as the central planner.

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(*Explanation, for the uninitiated, here.)

My recent post on some reported shenanigans by Cablevision in the wake of FCC-mandated digitization of broadcast television reminded me that I haven't blogged about "net neutrality" -- where my position qua libertarian is somewhat anti-consensus -- in some time.

Fortunately Tony gives me an excuse to summarize and restate my position:

I actually support government-imposed net neutrality because these backbone companies (AT&T, Comcast, etc.) were spawned by the government in the first place.

Government-chartered monopoly = government rate regulation.

(The fact that they are no longer rate-regulated does not change the fact that it was the original monopoly charters that gave them the backbone in the first place.)

But if, e.g., Google were to build its own pipe with its own money — as it has threatened to do — then it should be free to price it however it sees fit.

The notion, meanwhile, that the backbone companies need more revenue to build more capacity is all well and good, but you can still get that revenue from one end of the pipe exclusively — the subscriber.

If I use twice as much bandwidth as you do, then I can pay twice as much as you do. No objection there. But leave whence I'm getting all that content (e.g., Netflix, iTunes or YouTube) out of it.

The idea that NetNeut will "choke the pipe" is a Chicken Little canard spread by its opponents, pure and simple.

Counterarguments welcome.