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.

To review: The problem with the way the Internal Revenue Code treats employer-provided health care benefits to employees is not that employers can deduct such benefits (most notably insurance premiums), thereby providing them tax-free (or at least tax-advantaged) to employees. The problem is that only employers can deduct the cost of such benefits (i.e., if the employer were to substitute more wage for less benefit, then the employee would be worse off net of taxes). The problem is not one of magnitude, but one of neutrality. An expense -- such as health insurance premiums -- either should or should not be tax advantaged. Who nominally pays the premium should be utterly irrelevant.

This is why I'm having so much trouble processing John McCain's proposal:

McCain's prescription would seek to lure workers away from their company health plans with a $5,000 family tax credit and a promise that, left to their own devices, they would be able to find cheaper insurance that is more tailored to their health-care needs and not tied to a particular job.

Under McCain's plan, $3.6 trillion worth of tax breaks over a decade that would have gone to businesses for coverage of their employees would be redirected to individuals, regardless of whether they are covered by a company plan.
...
McCain's plan is aimed primarily at giving individuals the power to make health-care decisions by granting the same tax breaks for insurance whether workers get a policy from an employer or on their own. Aides call it a "radical" rethinking of health care that would drive costs down and give people more choice.

I'm not sure that's correct:

Under current law, the federal government gives a tax benefit when employers provide health-insurance coverage to American workers and their families. ... Many workers are perfectly content with this arrangement, and under my reform plan they would be able to keep that coverage. Their employer-provided health plans would be largely untouched and unchanged.

But for every American who wanted it, another option would be available: Every year, they would receive a tax credit directly, with the same cash value of the credits for employees in big companies, in a small business, or self-employed. You simply choose the insurance provider that suits you best.

So which is it -- true tax neutrality or the abolition of employer-based health insurance? They're not the same thing.

And is a $2,500 tax credit a true and fair equivalent of a year's worth of employer-provided health insurance? Why should there be any limit, if the policy goal is "more health insurance"? And would the credit be insulated from progressivity in the income tax?

If McCain's answers to those questions are the correct ones, then his proposal has merit. Stated differently, when McCain says employer-based benefits would be "largely untouched and unchanged," what precisely does he mean by "largely"?

(Of course, a hypothetical "President McCain" would face a not-at-all hypothetical "Democratic Congress," so this is all academic anyway.)

More thoughts from Cato's Michael Tanner, Reason's Jacob Sullum, Rolling Doughnut.

---

Meanwhile, still no one discusses the modest first step of scrapping the absurd "use it or lose it rule" for flexible spending accounts. Oh well...

---

Also meanwhile:

We need to adopt new treatment programs and financial incentives to adopt "health habits" for those with the most common conditions such as diabetes and obesity that will improve their quality of life and reduce the costs of their treatment.

Watch your diet, walk thirty or so minutes a day, and take a few other simple precautions, and you won't have to worry about these afflictions.

Dr. McCain's Miracle Elixir: Just walk thirty minutes a day and you'll live happily forever after!

What is it about politicians that makes it impossible for them to give a speech without making at least one asinine remark? In any case, it's rather sad to see a supposed "conservative" capitulate so abjectly on the question of anti-liberty nanny statism meant to "nudge" people into the "correct" decisions. File that under "M for Maverick" I suppose.

A self-contained comment left elsewhere:

While I certainly embrace cynicism toward the politicians, I don't entirely embrace cynicism toward the gas tax itself.

The gas tax is either a legitimate Pigou tax or it isn't. Reasonable people can disagree on that.

But what reasonable people cannot disagree on is the absurdity of suggesting that the gas tax can somehow be a legitimate Pigou tax on Thanksgiving Day but not on Independence Day.

So in that sense, "advantage Obama." (The fact that he may have flip-flopped on the issue [since his state legislator days] simply returns them to "Deuce.")

One should also note the Econ 101 truth that abolishing a per-unit tax on a good will not lower the equilibrium price of the good by the full amount of the tax, but only by a fraction of the tax — the size of the fraction determined by the price elasticity of demand for that good. Gasoline and diesel demand may be very price inelastic, but not perfectly so.

(Inspired by posts at QandO, Reason, Greg Mankiw, DealBreaker.)

---

Via Obsidian Wings:

Dean Baker: "Actually, almost all economists would agree that the tax cut proposed by Senators Clinton and McCain would save consumers nothing."

I sincerely hope that none of those "almost all economists" are teaching Econ. 101, because they are dead wrong.

Tax incidence is determined by BOTH price elasticity of supply AND by price elasticity of DEMAND.

Even if supply were highly inelastic (a questionable premise except in the very very short run), the low elasticity of demand (NOT a questionable premise under any circumstances) would far outweigh the supply effects and the bulk of the rebate would therefore be passed on to consumers.

(This is not to say I advocate any candidate's specific policy position.)

More on this from Econbrowser, which estimates that the benefit of a tax holiday would be shared roughly 50-50 by buyers and sellers.

Finally, let's also recall that:

--The federal gas tax is a puny 18.4 cents per gallon.

--There is a difference between an oil producer and an oil refiner.

--Record profits mean record taxes on those profits.

--There is more to "oil" than "gasoline." The markets for diesel and jet fuel also factor into the economics of "the price at the pump."

"This money is going to help Americans offset the high prices we're seeing at the gas pump and at the grocery store, and it will also give our economy a boost to help us pull out of this economic slowdown."
--Remarks by President Bush, 25 April 2008

Of course, giving people more money to buy even more gas and groceries will only drive the demand -- and therefore the prices -- of those goods higher. And in a time of government budget deficits, giving free money to people today will only make buying gas and groceries more expensive for their children tomorrow.

No matter how great the need to "stimulate the economy" ever becomes, the need to stimulate basic economic literacy is always far greater.

---

For those who need a refresher course on "Our MBA President."

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.

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.)

Another unfortunate case of confusing "Democratic" with "gay friendly" --

Phase 1:

Maryland's legislature is predominantly Democrat with a 33 to 14 advantage in the State Senate and 103 to 36 in the House. The leaders of both chambers are Democrats, as is the Governor.

Phase 2: ???

Phase 3:

In the end, Maryland legislators granted same-sex couples just a few new privileges, such as hospital visitation rights, before they adjourned last week.
...
Vic Basile, a former Human Rights Campaign executive director who lives in Baltimore, said that "it was pretty clear right from the beginning that marriage had zero chance of passing" the legislature this year.

Might I proffer, as I did in a comment left at the first link, a possible Phase 2:

Maryland is 23% Catholic, and also 18% Baptist.

Mystery solved.

Gay Democrats remain the political equivalent of styrofoam packing peanuts: you use them to get your merchandise to its destination -- then you throw them out.