New Olympic Games to be hosted in North Korea, China, and by various other pompous dictators henceforth

After decades of more or less irresponsible spending in most of Western welfare-state civilization, the return on investments of throwing money down bottomless pits aren't looking so good. A few of us caught on many years ago:

Sports teams bring little net economic benefit. No disinterested economist has found any justification for the premise that they improve the local economy - instead, they just shift benefit around.

Teams take better care of stadiums they actually own....

Teams always underestimate the tax burden of the stadium and the implied subsidy. Often you see them arguing that the stadium will be funded only out of the revenues from the stadium itself -- well if that's the case, then why does the public need to be involved at all?

Fast forward to 2014, when it's time to bid on the 2022 Olympics. The only bidders left interested are Kazakhstan and China. Haha:

Bidding on the Olympics has been justified for years by one big economic lie: investing in hosting Olympic Games will lead to long-term economic growth.

It doesn't.

In a 2006 paper, "Mega-events: The effect of the world's biggest sporting events on local, regional, and national economics," Holy Cross economics professor Victor Matheson took this idea to task:

"Public expenditures on sports infrastructure and event operations necessarily entail reductions in other government services, an expansion of government borrowing, or an increase in taxation, all of which produce a drag on the local economy. At best public expenditures on sports-related construction or operation have zero net impact on the economy as the employment benefits of the project are matched by employment losses associated with higher taxes or spending cuts elsewhere in the system."

Matheson also argues that Olympic economic impact reports often ignore the significant costs for things like security and conflate "general infrastructure" with "sports infrastructure."

Read the whole thing, and be sure to check out the video showing a lot of the abandoned Olympic stadiums of yesteryear. The only places left willing to throw money down that hole are desperate countries/dictators attempting to prove themselves to the rest of the world.

$8 Milk

Why would our seemingly inexpensive milk soar to $8 a gallon? According to this Time article, because modern subsidies and government manipulation would cease, reverting to older forms of subsidies and government manipulation!

Here's an idea: Don't pass a new farm bill. Repeal the laws we might revert to in the absence of a new farm bill.

Despite what we've been led to believe, it won't be the end of the world. Some important food products are actually not subsidized. ¡Qué horror! 

Don't get me wrong, I like farmers. I'd prefer to live in a community of farmers than just about any other community. But handing them money because they happen to grow a certain crop, or milk cows, is just horribly misguided wealth redistribution (as most redistribution is, especially welfare for the not-poor).

When's the last time we tried a more or less market-based approach to setting the prices for our milk, corn, and various other subsidized agri-products? Sometime before WWI?

Now I'm no expert, but perhaps things have changed since then. I don't mean to sound facetious, and I do realize our farm subsidies are updated with some regularity. But they are based on a principle that was never economically sound to begin with, developed during a time very dissimilar to this one: protectionism.

image credit: Michael Ramirez

Can we try it without the relics of a bygone age?

Re: Left-Libertarian-ist Manifesto

Scott Alexander has an interesting post up at Slate Star Codex, A Something Sort Of Like Left-Libertarianism-ist Manifesto, which is good. And well, bad.

Besides the many compliments and many complaints about it I could articulate here, I'll just include a few (because lazy).

First and foremost, I'm very happy to see people much smarter than I, embrace libertarianism (to various extents), and use their not-insignificant pedestals to extol the virtues of said government philosophy. No two libertarians will pass the other's litmus test, so we are necessarily an inclusive--however critical--group. So, thank you Scott, for writing this and other articles like this.

But you're worse than Hitler^TM for failing to see the shortcomings of democracy, shortcomings virtually every political junkie of every stripe complains about, especially libertarians.

Your line of reasoning concerning affirmative action for Martians for example, starts out well, but then you miss somewhat obvious potential problems:

Modern affirmative action says that given the choice between a Martian or an equally qualified Earthling, one must hire the Martian. One big obvious problem here is that “equally qualified” is a matter of opinion. It may be that a boss is prejudiced against Martians, and so tells an excellent Martian candidate that ve is underqualified for the position – the Martian may never know. Or a Martian who was genuinely underqualified may paranoidly believe ve was denied out of prejudice and start a costly lawsuit.

There are other problems as well. Some jobs may have legitimate reasons not to hire Martians – maybe Martians make lousy pilots because their single lidless eye gives them terrible depth perception. Certainly a Martian actor is unqualified to play Abraham Lincoln in a historical biopic. One could offer to let these jobs apply for exemptions, but this means a costly bureaucratic process, and is likely to end with large companies with good lawyers obtaining the exemptions, small companies with poor lawyers not obtaining the exemptions, and no concern about fairness to Martians in any case.

In the worst possible situation, a non-prejudiced boss may decide not to hire Martians because it would be harder to reprimand or dismiss a Martian when they could threaten to sue the company or start a viral Tumblr post accusing the company of speciesism.

Compare a market-informed solution: run a bunch of controlled studies in which bosses get identical Earthling and Martian resumes, find out exactly how strong the prejudice against Martians is, then levy an appropriate tax on hiring Earthlings (or give a subsidy for hiring Martians). Maybe hiring Earthlings costs 5% extra, which is funnelled into scholarships for impoverished Martian larvae. . . .

If ten years later the social scientists do some studies and find that companies are still more likely to accept Earthling resumes over identical Martian resumes, they can raise the tax until that’s no longer the case. If they find that companies are more likely to accept Martian resumes now, then prejudice has decreased and the tax can decrease as well.

I think everyone has a lot to like about this proposal.

Assuming this tax is successfully implemented and collected, you've just created another incentive for the Martians to vote for this particular (however just) form of wealth redistribution. Affirmative action doesn't take place in a political vacuum. Whole constituencies are affected by this. Unless you plan to deny voting rights to Martians and/or deny Martians from holding office (and possibly Martian sympathizers), identity poltics, quid pro quos, the new status quo and the voice of its beneficiaries haven't magically disappeared.

You might be able to increase the tax, if the non-Martians aren't too vocal about it. But the only way you will realistically and democratically decrease or eliminate the tax is if the Martians, who originally were so oppressed as to require this policy, have either transcended their want of wealth, or more likely have been politically oppressed, instead of economically. It's not as if weaning is a smooth process, especially when it involves the government and thousands, if not millions of voters.

This is why we have revolutions, because it's hard to un-ratchet government, short of drastic measures (although I concede the U.S. has had a much easier time of un-ratcheting than most, but it's still a huge problem).

That's the gist of my complaint. You're aknowledging a lot of the problems with progressive policies, which is good, but then you completely omit (or are ignorant of) the institutional (congressional, executive & bureaucratic, sometimes judicial) and environmental (democracy, culture) problems that contribute to the formation and continuance of bad policies.*

Mabye I shouldn't complain. I mean, I hate democracy but I'm not to the point where I'm willing to throw it out. The proto-conservative Burke had a point when he cautioned against replacing the Old with the New, when at least the Old didn't kill everybody. Who knows what the New will bring. But I'm getting off point.

The idea of taxing rather than banning is not an un-libertarian idea, but it is unoriginal and (for libertarians) rarely the go-to proposal. I very much like where Scott starts and following his thought processes, but in the end I'm left very disappointed. He seems to be very utilitarian/technocratic oriented so long as the goal of caring for the less-fortunate is kept conspicuously on high priority. I'm all about helping the less fortunate, but does every policy have to be about the poor? Does it always have to include a tax? More often than not, it seems it does. Which brings me back to one of my central annoyances with lefty solutions: they are boring and incessantly unoriginal.

At least the neoreactionaries are interesting, even if unoriginal.

*Maybe Scott has discussed this in his anti-neoreactionary peice (which I haven't read yet), but why overlook the significant difficulties produced by democracy here? Is it because libertarianism kind of assumes democracy? Why is nobody talking about significant reform of democracy?

Leftists admit taxes are too much

The 21st century is already full of amazing things: handheld touchscreen gadgets that you can video chat with, a wealth of almost instantaneously accessible information, a ton of extreme-budgeted and horrible movies, several excellent tv-series, flying cars [seriously engineers, these are way overdue], and Starbucks.

So why am I so surprised to find leftists essentially admitting that taxes are too high? Socialists at that! Is there truly hope for oppressed civilizations everywhere?

For the record, this is happening in France (as if any American progressive would admit such a thing):

Returning from their summer break, the French are about to discover stinging rises in tax bills in
their letter boxes – the result of a series of new levies enacted by President François Hollande as he seeks to plug the French deficit and bring down public debt – now riding at 92 per cent of GDP.

But the extent of the hikes has apparently even shocked the very Socialist ministers who implemented them. . .

Pierre Mosovici, the finance minister, told France Inter radio: “I’m very sensitive to the French getting fed up with taxes We are listening to them.” Laurent Fabius, the foreign minister followed suit, warning Mr Hollande to be “very, very careful” as “there’s a level above which we shouldn’t climb”.

I guess when some people are paying over 100% in taxes, then yeah, perhaps it is bit too much.

It's a tax, it's a penalty, it's both. Romney campaign confused.

First we have Romney adviser Eric Fehrnstrom going on MSNBC and saying the Obamacare mandate penalty/Obamatax is, contrary to the Supreme Court decision, not a tax but a penalty.

And right on cue every partisan enveloped in the tit-for-tat horse-race collectively climaxed in joy or anger depending on their persuasion.

So apparently these semantics are a BFD, as the President would say.

Enter Chris Christie:

I don't think it's exclusively a tax or a penalty, it's both.

Wait, wait. So it goes both ways? Does this have something to do with bipartisanship where both sides win? I r confused.

But Romney isn't. He's had enough of the rhetorical kama sutra required for the Obamatax:

For an issue that's supposedly potent against Democrats, Romney's campaign is declaring a cease fire. This, even as the law polls unfavorably and it proved to be a motivating force for Republicans and disaffected independents in the 2010 midterms.

It's becoming clear that Romney has decided to focus on the economy at the expense of everything else... He's avoided criticizing the administration's handling of the botched Fast and Furious operation, even as it threatens to become a serious vulnerability for the president.

So Romney is trying the successful McCain strategy of playing nice? But let me say seriously that I think the National Journal overstated the facts. Actually they just linked to the story about Fehrnstrom and decided that was enough to call it a "cease-fire". Great work guys!

In response to Mr. Fehrnstrom going off message, conservatives are upset about Romney's apparent silence:

The Obama campaign has seized on remarks made by Romney adviser Eric "Etch-A-Sketch" Fehrnstrom this morning on MSNBC, to the effect that the individual mandate in Obamacare (and Romneycare) is not a tax. Fehrnstrom allowed Chuck Todd to push him off message--and re-ignited the fears that conservatives have long had about Romney's will and ability to fight. In response, conservatives--who had just coalesced around opposition to what many now call "Obamatax"--exhort: Mitt, start fighting, or give up and let someone else do it.

This just won't do; McCain strategy off. I guess rhetorical kama sutra sprinkled with semantic foreplay is back on.

So is the Romney campaign, in fact, declaring a “cease-fire” on Obamacare? No, no, no, says Romney spokesman Ryan Williams. “From our perspective, Obamacare has been and will continue to be a central issue in the campaign,” says Williams. “It presents voters with a bright line that divides the two candidates. Gov. Romney is going to repeal Obamacare and President Obama is going to keep it. There is a clear choice in November.”

To make matters worse for team Romney, Mitch "squishy balls" McConnell throws in this stinkbomb:

"Odds long to undo health care law."

[Republicans] promise to efficiently manage the Leviathan with a measured hand. And maybe some tax breaks from time to time. And who better to keep that promise than the man whose team gave us state-run health care in the first place?

I'm beginning to doubt the competence of Romney's campaign. Their messaging is so confused and changes day to day, compounded by the fact Romney is known as a flip-flopper. If your guy can't stay on message, fire him on the spot. Make him walk out of the interview in shame. But if there is any truth to the "cease-fire", Susan Duclos explains why it might be a good idea:

Obamacare will be a defining issue in the November 6, 2012 presidential election as will the economy and jobs, but the individual battles fought until that day must be divided up accordingly where Romney's strength in business can be utilized by his campaign and his weakest area, health care, can be utilized by other sources.

Yes, Romney's campaign is confused, or at least incompetent at appearing otherwise. They need to get on message, stay on message, and don't be afraid of a little multitasking. There's gold in them there hills!

75% of Obamacare costs fall on middle class

According to the Wall Street Journal's senior economist, Stephen Moore, 75% of Obamacare's costs "will fall on the backs of the families" making less than $120,000 a year.

Great, it's as if the economy needed another shot of industrial strength horse tranquilizer.



Wait a sec... Just got an email from Friedrich Engels telling me not to worry, it's actually better this way. Well now, looks like we have a surefire way to finally nail down that elusive "recovery".

White House: The Obamacare tax is a penalty

It's pretty obvious they would avoid using the word "tax", especially given it is the one piece of legislation so central to the administration, so close to an election.

But to me frankly, "penalty" doesn't sound much better. Here's what Press Secretary Carney said:

“You can call it what you want... If you read the opinion, it is not a broad-based tax. It affects one percent, by CBO estimates, of the population.”  Pressed on whether that 1 percent will be paying a tax or a penalty, he responded, “It’s a penalty because you have a choice. You don’t a have a choice to pay your taxes. You have a choice. If you can afford health insurance, if you don’t buy it.”

So if you decide not to pay the "penalty" you go to unicorn and rainbow prison, instead of that other kind? Penalty or tax, it still sucks being coerced into buying something. Second look at Freeganism (no income, no taxes)?

And only 1% paying a new tax? Really? I'm not so sure. It's not like health care costs are going up either.

The same way penalties are not taxes, the Affordable Care Act is not costly.