Free markets
NBC News recently reported what Rush Limbaugh and many others have been saying for some time now: The push for biofuels — in particular, ethanol — is a major factor in higher food prices. These high prices hurt not only Americans, but consumers worldwide.
This year roughly one-forth of the U.S. corn crop will go to make biofuels. Next year? As much as one-third will go for fuel, not food.
The impact is huge. Corn, in part because of other government subsidy and regulation, has become an ever-bigger part of the food supply. When prices go up, it’s trouble — especially for the poor.
But it’s worse than that. Ethanol is a big scam. Tough talk? No, just the facts, ma’am. Ethanol has been sold as a way to energy independence, as environmentally friendly, and as good for our economy. Three strikes.
Ethanol doesn’t have much effect on foreign oil because it initially substitutes for more expensive domestic oil. Moreover, most environmentalists now insist that producing ethanol is worse, not better for the environment.
And ethanol is not good for the economy. If it provided real economic benefits, its use wouldn’t have to be mandated, nor its production subsidized to the tune of $1 a gallon.
Soaking the taxpayers to wreck the environment and to increase hunger — with no gain in energy independence — well that just doesn’t make any sense.
This is Common sense. I’m Paul Jacob.
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For 18 years, the U.S. government studied algae as a source for biofuel, giving up over a decade ago because managing pond scum was just too hard.
Ah, but algae is just too efficient a source of oil to let it fizzle.
Plant physiologist and multiple patent holder Glen Kertz has figured out a way to manage algae growth and harvest.
Forget ponds. Place the algae in plastic bags and line them up vertically. Like corn, I guess.
Except that corn is amazingly inefficient at producing biofuel. Yeah, the government is subsidizing ethanol grown from corn. But farmers only get 20 gallons of fuel per acre per year. Kertz estimates 100,000 gallons per year from his method, which he calls Vertigro.
Vertical rows of algae-and-water bags move on conveyor belts to maximize sunlight. And, if this research pans out, it won’t be just algae moving, it will be Kertz’s own wealth moving upwards.
The project is a joint venture with Global Green Solutions, a Canadian alternative energy company. They’ve invested about $5 million in a Texas facility, where right now they’re trying to figure out which kind of algae makes which kind of biofuel best.
Now our government is getting involved in algae research, again. But we’ve dumped so much money into scummy ponds, and on almost certain failures like corn ethanol, that at this point subsidy seems a waste.
This is Common Sense. I’m Paul Jacob.
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Dentistry! What a job, sticking fingers into opened mouths. Probing. Drilling. Filling. Ugh.
And it must not be easy managing patients, or clients, or whatever they call the people who pay their bills.
It’s bad enough here in America; It is obviously much harder in Britain, where dentists were just told to go on vacation. By the government. Why? They had filled their work quotas. Even while millions — yes, millions — of English people can’t get in to see any dentist!
Dentistry is socialized in Britain. The government hires the dentists. Tax money — not patients directly — pay for the dental work.
So no wonder there aren’t enough dentists in Britain, and why British teeth, in general, are getting worse, even though the service is “free of charge.”
Just try to provide a free service using tax monies — you still can’t void the laws of scarcity and value by edict. If you want something, you still have to pay for it. You still have to invest. Scarce resources must go from some use and be put to another.
The trouble, as economists starting with the Austrian Ludwig von Mises have shown, is that when you try to run things by bureaucracy, forfeiting private means of production and capitalist investment and competitive markets, you give up some amazingly effective tools to organize scarce resources. And you are left with guesswork. And politics.
And, under socialized medicine, bad teeth.
This is Common Sense. I’m Paul Jacob.
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Everybody who wants a car that gets 100 miles per gallon, raise your hand.
Me too.
The Progressive Automotive X Prize is an international competition that will award ten million dollars to the first team to produce and market an affordable 100-mile-per-hour car.
Many groovy possibilities are in the works. One prototype would be powered by compressed air. Another is an all-electric automobile slim as a motorcycle. Another runs on gas fumes.
I like the contest even though I dislike some of the ideas of some people who also like the contest. Modern “green” activists — as opposed to blue or yellow — too often pursue their goals by trying to block human exploitation of nature that they disagree with. They often treat property rights as an annoying impediment.
Free markets are vibrant because they provide so many ways for producers to reach us with goods we are willing to pay for. We are willing to pay for something when we’re persuaded it would be of value to us. So, it’s great when economic entrepreneurs test new products in the marketplace. Not so great it when political entrepreneurs try to impose new products on us by force. Or try to stop us from using viable alternatives.
Frankly, I’d go for a decent-priced car that gets 100 miles a gallon even if politicians and environmentalists weren’t trying to tax oil and gas out of existence.
That’s just — well, this is — Common Sense. I’m Paul Jacob.
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Bear Stearns. You gotta like an investment company with the word “bear” in it. If you are the kind of investor to go bullish over anything big, Bear, Stearns & Co., Inc., was BIG. For years its subprime mortgage biz made investors go all squirmy with bullishness.
They could pretend that the word “bear” was there for irony.
Call it prophecy, instead: The Bear Stearns bull lies on the ground, gored. Time to sell off the carcass.
The Federal Reserve has forced through a takeover deal, with J.P. Morgan buying out the dead bull. At a low, low price — though not nearly as low had the Federal Reserve stayed out. It’s another so-called capitalist bailout, an attempt to make a failure not seem so big.
This is not free-market capitalism, folks. This is big business welfare-statism.
In their normal run of operation, businesses negotiate the uncertainties of markets using tools like the profit-and-loss statement, aiming for profit. When they don’t manage this, they fail. Remember that term, loss?
Well, in today’s truly bipartisan political economy, the bigger you are the more scared our rulers get when you fail. So they prop up, as best they can, the biggest failures.
Forget welfare queens. The welfare kings are businessmen on the take from government. The losers are everybody else, as idiotic risks and bad business practices get propped up by government.
This is Common Sense. I’m Paul Jacob.
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I’m all for democracy, but I’m sure glad science isn’t put up for a vote. If geocentrism were up for political grabs, would governments be forced to go against Galileo again? After all, a plurality could say: See, the sun rises and sets — all the proof you need that the sun revolves around the Earth!
Just so with trade policy. There are few truths so firmly established as comparative advantage and the notion that with free trade we all gain.
But some see only the negatives, fearing competition. Who? Some businessmen, some workers.
Which is why Barack Obama has been making noises to renege on NAFTA.
Now, NAFTA is no free trade utopia. It’s a real-world political document that freed up a lot of trade, far from perfectly. Still, most of the complaints against it are nonsense.
Which is also why major Obama campaign consultants have whispered to Canadians that, no, Obama does not mean what he says. The candidate’s only saying nasty things about NAFTA to pick up extra votes.
I don’t know what Obama really believes. Right now he’s pandering to the protectionist Democrats. I am glad, however, not to feel such a need to lie.
And I am happy to affirm, once again, that the Earth revolves around the sun.
This is Common Sense. I’m Paul Jacob.
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Going to the hospital requires a certain . . . humility, I guess. You get dressed up in flimsy gowns, and if your situation renders you immobile, you no longer remain in charge of what you might normally think of as your bathroom functions.
Dignity is not always easy to maintain.
Now, if I were in the hospital biz, I’d be trying to figure out ways of maintaining and catering to customer — I mean, patient — dignity.
But then, if I were in the hospital biz, it would be as an entrepreneur, not as the head of a government bureau.
Sweden, on the other hand, has what Hillary and Obama other Democrats say they want here: nationalized care.
Now, so does neighboring Norway, and their system is so far in the red, and so chaotic that we should be hearing about it in the news, nightly. But we don’t.
Still, the costs associated with socialized care do leak into the American consciousness. The latest? Sweden’s decision to buy unisex boxer shorts for patients. Come summer, no longer will Swedish patients get to wear underwear designed for their precise anatomy. It saves money, you see.
Yes, they ration underwear!
I remember, years ago, hearing a prominent socialist complaining that, under capitalism, he couldn’t buy his exact size of sock. He had to buy a sock designed for feet sized 10-13.
If he suffers in more socialistic Sweden, he’ll have to place that size sock somewhere else.
This is Common Sense. I’m Paul Jacob.
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Just because something can be done doesn’t make it economical to do. There is a big difference between physics and economics.
Take ethanol. It might seem nifty to grow the fuel for our cars and trucks like we do our food, in fields. But niftiness alone is not enough. Nifty notions, like un-nifty ones, must prove out in terms of all the costs involved.
A growing amount of research shows that ethanol doesn’t cut costs at all.
The most recent ethanol debunker I’ve come across is Robert Bryce, author of a forthcoming book with a provocative title, Gusher of Lies: The Dangerous Delusions of “Energy Independence.” Interviewed on ReasonOnline by Brian Doherty, Bryce offers some fascinating perspectives on energy economics and policies.
- Did you know that for every gallon of ethanol, there’s at least 51 cents of subsidy?
- Had you heard that corn-based ethanol produces more greenhouse gases than does our use of fossil fuels?
- Have you stopped to think about all the water that raising more corn would require, and the increasing expense of getting gargantuan more amounts to farms in the midwest?
These and other considerations lead Robert Bryce to call current ethanol policy a “scam” and “the longest running robbery of taxpayers in American history.”
Some forms of bio-product may be more economically feasible than ethanol, like the biodiesel made from the unused parts of slaughtered animals. But we should wait to see how they cost out, too, without subsidy.
This is Common Sense. I’m Paul Jacob.
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The trouble with making government the solution for our medical system’s failures is that government is without a doubt the chief cause of those failures.
Greg Blankenship, founder and president of the Illinois Policy Institute, recently made this very clear in a fascinating column. Blankenship looks at the regulations that beset planning for medical care in his state, Illinois, and gives it a name: Protectionism.
As he makes clear, protectionism isn’t just for busybody politicians in nation-states. State governments, when they heavily regulate an industry, get in on the act, too.
And, like nationwide protectionism, special interest influences come to play, with one or two businesses reaping most of the rewards. Blankenship likened the practice to fast food restaurant regulatory boards getting captured by McDonald’s. Suddenly, Burger King outlets can’t get permission to expand.
Economists have been writing on this for 50 years or more. Regulatory capture. And in Illinois it means that a hospital in Joliet hasn’t been allowed to add beds to its mental health and OB-GYN clinics for years now. Nearby hospitals in Aurora, Joliet, Bolingbrook and Morris oppose the project.
So people in Joliet suffer.
And no doubt blame insufficiencies on doctors, or nurses’ unions, or markets in general.
Yet the real blame rests solely on the state of Illinois and its Health Facilities Planning Board. A sad case, yes. And a sick system.
This is Common Sense. I’m Paul Jacob.
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What's the difference between a reporter and a pundit? The reporter looks behind the obvious. All pundits do, most of the time, is belabor the obvious.
Alas, sometimes what seems obvious happens to be false.
Take Charles Gibson, TV journalist. He sort of pretends to be a reporter, right? But when he asked questions, recently, of GOP candidates, he made a statement that set him squarely in the pundit class. And proved him wrong.
He said that "intellectual honesty" required just plain admitting that oil prices can only go up.
Yup, only up.
He thought "honesty" demanded such a statement of the obvious.
But I get the feeling that all Good Ol' Charlie has proved is he doesn't have one ounce of skepticism in his head . . . or any decent economic perspective.
Why say this? Well, though it may seem we've entered a time of "peak oil" production, much of today's scarcity has little to do with normal production, but with war and the limitations of supply and delivery caused by war.
Further, throughout much of the world the price of oil has been pretty flat. But because the value of the dollar has plummeted, the prices we Americans have to pay for oil have shot up.
If we weren't at war, and our government weren't horribly in debt, the dollar would be better, supplies would be better, and Charlie Gibson would widely be seen as wrong, wrong, wrong.
This is Common Sense. I'm Paul Jacob.
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Wall Street and the real estate markets have taken big hits, and so, to prevent a major recession, our president and representatives immediately began one-upping each other about a “stimulus package.”
And my thoughts go back to my classroom days. In biology.
There were these frogs, see. Dead frogs. On the table. Some of the kids would take a battery with some wires attached, and prod the dead frog, stimulating nerves to make the dead, half-dissected frogs jump.
Half the boys in the class thought it a hoot, half the girls thought it gross. Or maybe more than half.
Sometimes I think this is about as much as we ever were prepared for thinking about stimulus packages.
The economy is not a dead frog. it’s alive, and it’s received a shock. A better analogy might be to someone who’s received a blow to the head. You don’t necessarily immediately start applying shock therapy to get the person moving. Ask a nurse what to do. Most of the time, the body repairs itself. In due time. With care taken not to jar the person again.
But a blow to an ecosystem — like an economy — is more complicated than even some guy with a concussion. And, listening to the debate over the stimulus package, and then reading actual, astute economists consider the politicians’ proposals, and I’m thinking . . .
Frog or no frog, the stimulus notions politicians prefer seem more directed towards influencing voters than getting the economy to jump back into action.
This is Common Sense. I’m Paul Jacob.
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A few months ago, some New York cabbies went on strike . . . not against their employers, but against the city, which has insisted on micromanaging their businesses.
Meanwhile, the city of Minneapolis went the other direction. Minneapolis moved to deregulate taxis. The number of allowed cabs will increase, and by 2010 all caps will be removed. A free market!
So of course the taxicab cartel sued.
Into the fray came the Institute for Justice, a national group of lawyers defending individual rights. These are my kind of lawyers, doing great work for freedom, trying to bring back the U.S. Constitution one case at a time. In their ads they call themselves “IJ.”
The group is based not far from where I live, and I was pleased to learn that they have a Minnesota chapter. I was also pleased to learn that the chapter has taken up a good case, the freedom of individuals to go into the taxi biz.
Even more pleasing? Their work has been successful! U.S. Magistrate Judge Franklin L. Noel sided with the city and IJ and against the taxi cartel. The judge was matter-of-fact: “The [established] taxi vehicle license holders do not have a constitutionally protected freedom from competition.”
Nice choice of words. We have a lot of freedoms, but freedom from competitors isn’t one of them. Freedom to trade with potential customers is.
Competition? Ya sure, you betcha.
This is Common Sense. I’m Paul Jacob.
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Every time there’s a fire out west, I think of that ’70s song, “It Never Rains in California.” When I heard, recently, a news reader on NPR say that the fires’ devastation might be good for the local economy, I thought, Man, that song was right: It pours.
Rebuilding all those houses will increase employment amongst carpenters and building supply warehouses and landscapers. But that doesn’t mean “the economy” is better off.
Think of all those people who have lost so much, things that cannot be replaced. These people have suffered, and are suffering. And will continue to suffer. Oh, sure, it’s great that insurance policies will help most of them recover.
But none of the rebuilding makes up for all the fortunes lost. Many, many people — the underinsured — will not be able to build homes as nice as the ones they lost to the fires.
The fact that some people gain as they help the unfortunate regain some of what they lost does not make up for the loss. To speak, even for a moment, about how this could be “good for the economy” is to be callously ignorant.
Remember this when experts say that government regulation and taxation can be “good for the economy.” A new tax hurts a whole bunch of people. Who then try to compensate, enlisting the help of merchants, professionals. What’s good for one isn’t necessarily good for all, or even most.
Disasters really aren’t all that good for us.
This is Common Sense. I’m Paul Jacob.
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On the Ides of October, the first baby boomer applied for Social Security retirement. A Maryland teacher, born a second after midnight on Jan. 1, 1946, will become eligible to receive early retirement benefits next New Year’s Day.
And so begins the next crisis.
When Social Security was set up, its supporters pooh-poohed critics who warned that by not investing the collected funds, the government was setting up a major fiasco. The pooh-poohers were wrong, of course; the skeptics, right.
Now, all those baby boomers whose FICA withholding kept the system afloat for years will begin to drain funds. Soon, the money going to retirees will far exceed money coming in. Hence the crisis.
What to do?
Putting the whole thing on an investment basis is essential. But we still have to pay out generations expecting retirement help whose funds were not invested. Raise FICA taxes? Been there, endured that. Raise the retirement age to, say, 72? Yikes.
To postpone Social Security's inherent insolvency by either a dramatic tax increase or a setting back of the retirement age — or both — would be to admit, quite plainly, the swindle at the heart of the system, the system that politicians devised and politicians exploited and politicians still praise.
And as for a new government health care plan: Fix Social Security first!
This is Common Sense. I'm Paul Jacob.
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Is there something wrong with the job of flipping burgers?
Pundits sometimes belittle certain kinds of job growth. For example, they say that all the good jobs, like high-paying manufacturing jobs, are fading away. And eventually we'll all end up serving hamburgers to each other.
Yet I still see a very wealthy country in which most able-bodied adults have little trouble getting three squares, shoes, cars, cheap and powerful electronic gadgetry, and all manner of entertainment. And even if some folks overseas are answering phones or doing computer programming for some U.S. firms, such "outsourcing" hasn't resulted in a mass transfer of American wealth and capital to India or Mexico. Just lower costs for U.S. firms and their customers. Trade benefits all the partners in trade.
Our economy has evolved, yes. Sometimes painfully. But Americans are still very well off, still enjoy many opportunities. And plenty of cheap hamburgers.
Who flips them? Sometimes retirees looking to supplement income. Usually kids. I go to McDonald's, I see kids behind the counter. Is this a bad thing? That they're starting out behind a counter instead of as CEO of General Motors?
You can bring diligence, honesty, pride in your work to any job. As author Charles Sykes puts it, "Flipping burgers is not beneath your dignity. Your grandparents had a different word for burger flipping. They called it 'opportunity.' "
This is Common Sense. I'm Paul Jacob.
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I like economics so much that I’d like to be an actor. You know, so I could play an economist on TV.
Actually be one? I believe in the division of labor, leaving that job for others.
Interestingly, the number of young people who actually want to become economists is increasing. A recent report on college enrollments shows that computer science is on the way out. Economics? On the way in.
People at Microsoft and elsewhere are worrying. Where will they get their future talent to make further progress in technology? People wonder whether there’s a major malfunction in the education market, since more kids are heading towards economics rather than computer science.
But I wonder: Mightn’t this reflect an emerging consensus? We have really cool computers. Great software. Amazing technology. Sure, I still have trouble getting my email, but other people seem to be having a grand time working with their computers.
Maybe students have come to an economic conclusion: marginal returns to further computer development will not be as high as marginal returns to investment in other disciplines by people who know how to use computers to do work. Actual work.
And if that’s the case, the last thing we need is another government program to encourage more progress in a realm that will lead to only very small improvements.
Better to let the market decide. At least, that’s what my favorite economists would say.
This is Common Sense. I’m Paul Jacob.
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Big Apple cabbies are on strike.
Against whom? The companies leasing the cabs and licenses?
Nope, it's the New York City government, seeking to impose onerous GPS and credit-card machine requirements. The cabbies fear they'll end up paying the cost individually.
Of course, as in other towns, New York's cab market is oppressively controlled. Licenses are expensive. Cabbies are often ordered about. They may not even refuse fares to neighborhoods they deem life-threatening. One New Yorker, commenting online, says all this bureaucratic breathing down the neck of the cabbie community is fine with him. He claims: "It's a tremendous privilege to use NYC streets to ply your trade. We have the right to regulate you." Yikes.
This notion, taken to its logical conclusion, would destroy the rights of anybody who regularly uses public spaces — in short, everybody. So, no, the extent to which government is already running our lives and roads does not justify forfeiting whatever freedom of action remains. The liberty to peacefully make a living is a right, not a privilege to be revoked at will.
So I'm with the cabbies on their stike. It's a cause well worth a long work or two.
And I've liked it when customers have protested arbitrary caps on the supply of taxicabs. But instead of tweaking decades of coercive controls that hurt everybody, let's throw out all these burdensome regulations, and try some free enterprise.
This is Common Sense. I'm Paul Jacob.
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At the start of the school year, in Bethel, Washington, the local teachers' union went on strike.
Isn't the word "strike" a funny word for not showing up to work? It's such an active word. When I don't show up for work, it's not usually because I'm being active.
The word is also violent. I don't have the right to strike you in the face. You don't have the right to strike me with a bowling pin. Our very liberties don't allow aggression.
Now, barring some legal, binding contract, everyone has a right not to show up to work. And employers should have the right to not pay those who don't show up.
And, while the strike lasted, this was a case where a contract hadn't been signed. Why not just start hiring non-union teachers?
I don't belong to a union, as you can guess. But I do employ union workers. After all, as a citizen, I'm a shareholder in our government. More and more, it is in government that we find unionized workers.
But I'm not a Washingtonian, so it wasn't my biz to tell Bethel's teachers to start looking for other jobs.
I can quote the state's Attorney General, though: "In Washington, state and local public employees do not have a legally protected right to strike. No such right existed at common law, and none has been granted by statute."
The strike lasted only three days. During that time, the school website emblazoned a "schools closed" notice, adding, "athletics to continue."
Ah, well, at least essential services were preserved.
This is Common Sense. I'm Paul Jacob.
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Why did the Ukrainian Canadian cross the border into the U.S.?
A decade or more ago, a young teenage Ukrainian visited Minnesota under a charity program. He had a bad heart, and needed help. An American family housed and fed the lad and his mother. Many people from around the world come to America to get free care just like his. He would have died without it.
The lad eventually emigrated to Canada. He's grown up now, and has a job and a girlfriend and is, in general, living the Canadian Dream. What could be better? A good job, a nice house, and free health care?
The young man's heart has been giving him problems again, recently. He went to the "free" Canadian doctor. The doctor put him on a list. It would be six months before Canadian doctors would apply the treatment.
So our Ukrainian Canadian visited America again, this time with money he'd earned. He called the hospital he had visited before, made an a appointment, and got in for a corrective treatment within a week. He was in and out in two visits. And his heart appears, now, to be in much better condition.
That's the great thing about the free Canadian health care system: it's best part is the freer-in-a-different-sense health care south of the border. Which is, believe it or not, the American health care system.
This is Common Sense. I'm Paul Jacob.
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The headline in the British newspaper The Telegraph overstated it: "UK cancer survival rate lowest in Europe." Four paragraphs down we learn, instead, that "In total, 52.7pc of women survived for five years after being diagnosed between 2000 and 2002. Only Ireland, Northern Ireland, Scotland, the Czech Republic and Poland did worse."
The funny thing about the predicament — and by "funny" I don't mean to imply that I'm laughing in any way — is that Britain's National Health Service spends three times more per patient than Poland does.
Well, as we've seen here in America's schools, throwing money at problems just doesn't work. Not when the real problem is the quasi-socialist method of distributing the goods. Incentives go all out of whack, even information goes out of whack. Bureaucrats and managers suck up huge hunks of money without actually directing services where services are due.
One researcher in Britain explained the cause pretty well: "We have good evidence that survival for lung cancer has been compromised by long waiting lists for radiotherapy treatment."
Yup, I've argued this before: socialized medicine rations care. And the chief way socialized medicine does this is with rationing by waiting.
You cut down demand,
To meet your limited supply,
If, by making them wait,
Enough patients die.
There's rhyme there, but not much reason.
This is Common Sense. I'm Paul Jacob.
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I found a couple oil companies to cheer for.
Wait, let me correct that. I applaud all oil companies. I love gas, don't you? Couldn't drive my car without it.
Sure, I complain when the prices I pay go up. But it's fine with me, really, when oil companies — and other producers of great stuff — make a lot of money. We know what happens when we interfere with those profits: We interfere with our ability to get what they produce. Remember the long lines at the pumps back in the '70s? Thank price controls.
Venezuelans, alas, are going to have to learn this lesson again, the hard way.
The crackpot government down there has been nationalizing the oil industry. Hugo Chavez's administration — a de-term-limited administration, mind you — wants the victims to pretend all is well. Oil firms are supposed to accept a minority stake in the stolen companies if they want to remain involved in Venezuelan oil at all. That way, the government holds all the assets, but also perhaps gets some management expertise to help them keep pumping and distributing.
Many companies are co-operating, but ConocoPhillips and Exxon Mobil have refused to sign off on the surrender. Good for them: when thugs steal your stuff at gun point, show a little backbone, a little resistance. I only wish these oil companies would say as much in their press releases.
This is Common Sense. I'm Paul Jacob.
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After World War II, ridership on the ferries that transported workers in Seattle's shipyards fell off. So the state of Washington took over the business of running Puget Sound's ferries.
The reason some wanted the takeover of the ferries is that they didn't want to pay increased fees. But the takeover didn't magically make the costs go down. Instead, the state — that is, taxpayers — covered the losses.
Now Washingtonians learn that their system has a different kind of a ticket problem. Some of the millions earned from sales may be missing.The amount? Well, in the words of state auditor Brian Sonntag, "it might be zero."
But it might be a whole shipyard more than that. "The ferries department cannot identify if any is missing," Sonntag said. The problem isn't new, either. This is actually the 21st year the ferry system has confessed to not knowing where its money went.
This is one of the problems of state-run businesses. They are protected from competition. The workers and managers know that the budget shortfalls will be met by the government. So they tend to be a little lax about matters like, uh, accounting.
I'm not saying this kind of thing doesn't happen in private business. We all know horror stories. But when this happens, heads tend to roll. Businesses go out of business, and new ones emerge to take their place.
The trouble with state ferries is, well, the same as their advantage: there's no end in sight.
This is Common Sense. I'm Paul Jacob.
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If Democrats have their way, the federal government will soon do for energy what it has already done for sugar.
Congress has this idea — admittedly very popular — to reduce Americans' dependence on foreign oil. Well, Congress has decreased our dependence on foreign sugar. And look what that's got us!
Americans pay far more for sugar than what they would pay were it not for Congress, and this costs us dearly. Do we really want this to happen with oil?
And yes, the cost of our sugar policy is extremely high. As a recently released report by Cato Institute scholar Chris Edwards makes clear, the federal government's guaranteed prices, trade restrictions, and production quotas on sugar cost consumers and taxpayers billions. And, "for each sugar-growing and sugar-harvesting job saved by current sugar policies, nearly three confectionary manufacturing jobs are lost."
Do you hear that Giant Sucking Sound? Jobs go both north and south because both Canada and Mexico have much lower sugar prices. So "imports of food products that contain sugar are growing rapidly. . . ."
The last twist of the knife is, of all things, environmental damage. As Edwards writes, "Large areas of the Florida Everglades have been converted to cane sugar production because of federal protections and subsidies."
Let's not sugarcoat it: Expect similar problems and worse with any new energy policy. Having no policy is better than the kind of policy Congress regularly prefers.
This is Common Sense. I'm Paul Jacob.
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I've never been to Scotland. So I've never been disappointed on how hard it s to find Adam Smith's tomb in Edinburgh. Meanwhile, Karl Marx's monument in London is often visited, and kept in good repair.
Solution? Build a new monument to the great economist Adam Smith, the cholar whose 1776 masterwork The Wealth of Nations helped create the vibrance of the modern world.
Let's go for it. The idea that people visit Marx's monument to do anything nicer than throw tomatoes is still rather shocking. Marx's ideas led, directly and indirectly, to more killings than any other person's ideas in history. Millions and millions dead by starvation. Millions more by suppression and slaughter. All to keep the bad idea of Communism chugging along.
Adam Smith, on the other hand, stood for liberty: Limited government, private property, freedom to trade, freedom to choose. All great ideas, still relevant.
So the Adam Smith Institute's project to build a big bronze statue of Smith in Edinburgh, near his friend David Hume's monument, is a good idea. Go to adamsmith dot org; send money, if you like public art. This is a decent project.
And yet, and yet . . . Smith's most famous literary touch was his phrase "the invisible hand," a term he used to show how good, sociable things happened -- even to the general well-being -- when mostly selfish people traded in markets.
Wouldn't a bit of modern art depicting that hand be more apt?
If it were truly invisible, it'd be cheaper.
This is Common Sense. I'm Paul Jacob.
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Potato farmers have a tough row to hoe. Demand is down. McDonald's has nixed the Super Size fry. Diet gurus have convinced millions that the potato is a dangerous starch bomb. And even Mad Cow panic has hurt the spud. Many potatoes are first fried in beef fat before being frozen for export; understandably, recent events have stranded truckloads of spuds at the dock.
Of course, there's nothing strange or catastrophic here. When demand for a product goes down, we expect businessmen to produce less. Many farmers will switch to other produce. Some will go out of business. And none of this is tragic.
After all, the reason these farmers are in business is to serve customers. When customers want something else, farmers are just as obliged as manufacturers and wholesalers to adapt. It's not always easy, but it's always necessary.
Expect to be see more reports about the potato farmers' plight. Unfortunately, we'll increasingly endure suggestions and then demands for special help, too. Strictly speaking, protection and subsidy are unnecessary. Most farmers are quite able to switch crops. Those few who can't will let their land lie fallow. No tragedy here, either.
So endeth the Age of the Potato. The high point, 1996, was reached not too many years after Dan Quayle misspelled it. I'm confident if consumers as citizens stand fast against political bailouts, we'll all be eating better and producing better before you can misspell . . . broccoli.
This is Common Sense. I'm Paul Jacob.
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