Wednesday, May 23, 2018


"I have not the pleasure of knowing my reader but I would stake ten to one that for six months he has been making Utopias, and if so, that he is looking to Government for the realization of them."--Bastiat

Identity politics has engulfed the humanities and social sciences on American campuses; now it is taking over the hard sciences. The STEM fields—science, technology, engineering, and math—are under attack for being insufficiently “diverse.” The pressure to increase the representation of females, blacks, and Hispanics comes from the federal government, university administrators, and scientific societies themselves. That pressure is changing how science is taught and how scientific qualifications are evaluated. The results will be disastrous for scientific innovation and for American competitiveness. (from an article by Heather Mac Donald in City Journal)

Led by a president who doesn’t appear to understand basic economics and who insists that the long-term drivers of America’s unsustainable national debt—Social Security and Medicare—can’t be touched, the mainstream GOP has proven that the grumbling about big government under Obama was mere political posturing. After years of swearing to repeal the Affordable Care Act, unified Republican power has instead come with a noticeable new taste for Medicaid expansion and support for other provisions of the law. --deRugy

In 1869, Americans spent 95% of their food budgets on food prepared at home and only 5% on food away from home, mostly at restaurants but also for “food purchased at hotels and motels, recreational places, vending machines, and schools and colleges.” But the turn of the last century, it wasn’t much different, Americans spent 90% of their food budget at home and only 10% away from home. By 1950 the shares were 75% (food at home) and 25% (food away from home), as Americans gradually became wealthier and restaurants became more popular and more affordable. In 1970, the shares were 2/3 (food at home) and 1/3 (food away from home). And then in just the last few years, Americans spent slightly more on food away from home (50.2% in 2016 and 50.1% in 2017) than on food at home for the first time in history.

To offer to rent a room in your own home through Airbnb in Arlington County, Virginia, now requires a business license--to rent a room in one’s own home---a 7.25 percent tax and filing a monthly tax return for the unit.

Today only one organization in the world legally does not have to make others happy but can be happy on its own. That organization is government. Government receives revenues through taxes. Taxes are forced, not voluntary, because the government has the power to collect taxes forcefully. Even if in theory we require government to serve the people and to provide public goods to citizens, we have no way of guaranteeing that the taxes collected by the government are not higher than the value of the public goods provided while serving the people. In fact, taxes collected by government often exceed the value of services provided. --Weiying Zhang

Who is...Christopher Thomas?

"Intellectuals hate progress. Intellectuals who call themselves “progressive” really hate progress. It’s not that they hate the fruits of progress, mind you: most pundits, critics, and their readers use computers rather than quills and inkwells, and they prefer to have their surgery with anesthesia rather than without it. It’s the idea of progress that rankles the chattering class – the Enlightenment belief that by understanding the world we can improve the human condition."
Pinker means by this, I think,  they hate progress without their specific intervention, the idea that improvement of the human condition can develop without their help--and usually violence under their leadership.

Walmart is said to be considering buying Humana.

Oil producers, not consumers, are the anti-carbon activist's target.  Coal producers, petroleum producers and natural gas producers draw all their fire while the eager consumer, the other half of the supply and demand equation, gets a pass. But it is more complicated than simply the producer being the favored target. Multinational oil companies produce just 10% of the world's oil and gas reserves. State-owned companies now control more than 75% of all crude oil production. Yet it is the private companies that get the activist's ire despite the fact they produce only a fraction of the carbon fuel.  Saudi Arabia and Russia come to mind. So the carbon activists attack the private companies despite knowing that the impact--even with success--will be minor.
Why is that?

Suzanne Patmoe Gibbs, a widely respected TV development executive who shepherded “Grey’s Anatomy” during her time at ABC and most recently headed Sony Pictures TV’s TriStar TV banner, died  after complications from minor surgery. She was 50.

According to a new report by a steel lobbyist group called the Coalition for a Prosperous America, the Trump tariffs on steel and aluminum imports will create 19,000 jobs and reduce the United States’ gross domestic product by only $1.4 billion.
First, let’s consider these findings in the most favorable light. Let’s assume that the tariffs will actually produce 19,000 jobs. Let’s also assume that the creation of these jobs will cost only $1.4 billion in economic growth. As George Mason University economist Donald Boudreaux notes, “each job created will cost $73,684 (which is $1.4 billion divided by 19,000). The typical worker in a steel mill earns in annual wages about $55,556. If we assume that this worker gets another 20 percent of this pay in the form of fringe benefits, each steel-mill worker, on average, is annually paid about $66,667. It appears, therefore, that the price we Americans will pay per job created will be roughly $7,000 more than each of these jobs is worth.” (de Rugy)

The Los Angeles Times (3/29, Kaplan) offers coverage of a report issued Thursday by the Centers for Disease Control and Prevention which says opioid overdose deaths continue to rise across the US. “From 2015 to 2016, opioid-involved deaths increased in males and females and among persons aged ≥ 15 years, whites, blacks, Hispanics and Asians/Pacific Islanders,” the researchers from the CDC’s National Center for Injury Prevention and Control wrote. “Deaths involving synthetic opioids increased in every subgroup examined.”

The Republicans are discussing a Balanced Budget Amendment, probably a Russian idea. This after passing a 1.3 trillion Omnibus Bill, a bill that grants, but does not direct, money to the government. The original uprising in the Republican party was over spending--and the debt. It morphed into a Trumpish nationalism. It is hard to imagine the original enthusiasm returning. But all the talk about the health care expenses being a drain on the economy might imply that some are beginning to feel that taxes and spending are actually important.

Enterprise is the largest of the car rental companies, as big as the next three combined. It owns one million cars and has annual revenues in the range of 14 billion dollars. It includes National Car Rental and Alamo Rent a Car. And it is private, family owned.

Christopher Thomas was released in January from prison in New York. He, in 1984, murdered 10 people. He must be all better now.

The Giant Brains in Washington are planning a "Family Leave Bill" to subsidize the desires of new parents. Amazingly, this will be added on to the already insolvent Social Security program.

Golden oldie:

Justice Stevens wants to repeal the Second Amendment. So does that mean these people really do want to be able to outlaw guns?

The constitution of Wisconsin prohibits the governor from coining new words:
“... the governor may not create a new word by rejecting individual letters in the words of the enrolled bill ...”

From 2007-2015 there was a decrease in the proportion of vasectomies performed in all age groups and in all locations of the country.

AAAAaannnndddd.....a graph ( “When someone says ‘diversification is the only free lunch in finance,’ the phrase may not truly resonate as well as a picture, and the picture above says it all,” he wrote on The Disciplined Systematic Global Macro Views blog. “I can honestly say that for all of the educating in investments, this picture is not used enough.”
He starts with a risk-adjusted return of a single asset and then adds asset classes that have the same risk but different correlations. )

Tuesday, May 22, 2018

Congenital Grievance

When intellectuals are unable to find enough contemporary grievances to suit their vision or agenda, they can mine the past for harm inflicted by some members on others. By conceiving of those involved in the past as members of intertemporal abstractions, the intelligentsia can polarize contemporary descendants of those involved in past acts. The kind of society to which that leads is one in which a newborn baby enters the world supplied with prepackaged grievances against other babies born the same day.--Sowell

The insult-from-the-grave mentality allows the living no progress, no improvement. Every ounce or inch of achievement comes with the asterisk that reminds everyone of some deed or attitude one may have no sympathy with--or even knowledge of--which hangs over the present innocent like original sin, damning him by his very nature. Reminds you a lot of bigotry.

Being held responsible for the errors or circumstances of distant strangers is a classic in modern homicidal European thought. And, of course, it is always on display--with less philosophy--in the Middle East.

We are all allowed to chose our models. But, as always, knowledge helps.

Monday, May 21, 2018


A few months after demonstrating its dominance over the game of Go, DeepMind’s AlphaZero AI has trounced the world’s top-ranked chess engine—and it did so without any prior knowledge of the game and after just four hours of self-training.

AlphaZero taught itself its first chess lesson. The quality of chess in game two was a just a tiny bit better than the first. Nine hours and 44 million games of split-personality chess later, AlphaZero had (very possibly) taught itself enough to become the greatest chess player, silicon- or carbon-based, of all time.

And a provocative generalization from Kissinger's article in The Atlantic:

"On its own, in just a few hours of self-play, [AlphaZero] achieved a level of skill that took human beings 1,500 years to attain. Only the basic rules of the game were provided to AlphaZero. Neither human beings nor human-generated data were part of its process of self-learning. If AlphaZero was able to achieve this mastery so rapidly, where will AI be in five years? What will be the impact on human cognition generally? What is the role of ethics in this process, which consists in essence of the acceleration of choices? . . .. . . The Enlightenment started with essentially philosophical insights spread by a new technology [printing]. Our period is moving in the opposite direction. It has generated a potentially dominating technology in search of a guiding philosophy."

Saturday, May 19, 2018


A recent article by Gershowitz laments the decline of truth in American politics. He originally described the rise of "The Narrative" as Truth's replacement. So our leaders call Cormac McCarthy as witness for their defense. This recalls Zito's wonderful and insightful description of Trump: "The Press takes him literally but not seriously, his voters take him seriously but not literally."

The partisanship in American politics has made all analysis insincere. The Press supports their liars--the Progressives, the Clintons--and FOX theirs, Trump. The Gershowitz article has the openhandedness to blame both.

President Trump defines truth as being that version of events that best satisfies his needs or objectives, or salves his sense of self. Hence his inaugural crowds were the largest ever, and he would have won the popular vote but for the three million illegals who voted for Hillary Clinton. Both ridiculous assertions. President Trump simply says what serves his interest with complete abandon. For example, he blithely stated that his budget plan would offer “one of the largest increases in national defense spending in American history.” But in fact, Congress raised defense budgets by larger percentages than the 10 percent increase that Trump proposed three times since 2000. The base defense budget grew by 14.3 percent, in 2002; by 11.3 percent, in 2003, and by 10.9 percent, in 2008.

After all, President Barrack Obama knowingly assured the nation that under his healthcare program, (1) premium costs would decline $2400 by the end of his first term, (2) that everyone who wanted to keep his or her doctor could, (3) everyone who liked his or her plan could keep it, and (4) that he would veto the Affordable Care Act if it increased the deficit by one dime. To which, for emphasis, he added “period!” It wasn’t true.  It was never true, and the President knew it wasn’t true.

Remember when one of the key architects of the federal healthcare law, MIT Professor Jonathan Gruber told a panel that a “lack of transparency” and the “stupidity of the American voter” were essential in getting Congress to approve Obamacare. “Lack of transparency, he said, “is a huge political advantage,” Gruber continued, “And basically, call it the stupidity of the American voter or whatever, but basically that was really, really critical for the thing to pass.” He said that voters would have rejected Obamacare if the penalties for going without health insurance (the so-called mandate) were interpreted as taxes, either by budget analysts or the public. “If CBO scored the individual mandate as taxes, the bill dies,” Gruber said. “If you had a law that made it explicit that healthy people are going to pay in and sick people are going to get subsidies, it would not have passed."

Gershowitz' overall point, however, is not criticism of liars but rather of their acquiescing victims who continue to excuse the lies to advance the narrative they favor.


Democracy and socialism have nothing in common but one word: equality. But notice the difference: while democracy seeks equality in liberty, socialism seeks equality in restraint and servitude.--deTocqueville

There's a Nobel prize-winning economic model that explains why even the most irrelevant coursework and silliest majors can be financially rewarding.  It's called signaling.  Basic idea: Academic success is a great way to convince employers that you've got the Right Stuff - to show off your brains, work ethic, and sheep-like conformity.  Since people with these traits are productive workers, employers happily reward people who display them - even if the display itself has nothing to do with the job.

The opening of a Lemeiux thought experiment: Assume that the state is not a benevolent organization. It pursues its own interests, which means the interests of those who occupy positions of command at its helm. These interests may require it to satisfy the interests of certain electoral or quasi-electoral clienteles whose support is necessary to those in power. Under our assumption, the state will use the rule of law and the constitution as mere commitment devices to gain the confidence of the populace. State rulers will ignore the rule of law when they can get away with it--while proclaiming that "we are a nation of laws."

Olson on the WashPo's recent editorial to lower the voting age to 16:
At what point are young people to be entrusted with important life responsibilities? The Post has repeatedly opposed easing the drinking age from 21 so as to allow persons of 18 or 20, who may include service members returning from combat missions, to enjoy a glass of beer. It opposes subjecting late-teen juvenile offenders to the level of accountability applied to adult criminal defendants. Its coverage suggests sympathy with proposals to raise the marriage age to 18, which would mean that a couple of 17 is not deemed mature enough to enter on binding vows of mutual support even with parental blessing and judicial ascertainment of their independent choice.
Now the Post supports slashing the voting age to 16. Perhaps the pattern here is that the Post sees 16 year olds as incapable of making decisions to govern their own lives, yet competent to govern everyone else’s.

An interesting thought about over-fished areas. The writer said the reason areas were overfished is that they were not owned, that property rights had not been established and so there was no incentive to preserve or protect the fish.

HealthLeaders Media (3/25, Commins) reports hospital prices increased 3.8% last month, compared to February 2017, which was “the highest growth rate in more than a decade, according to Altarum’s Health Sector Economic Indicators.” Charles Roehig, a healthcare economist at Altarum, said, “Hospital prices averaged 1.6% growth in 2017, increasing to 3.5% during the first 2 months of 2018. Further, growth has accelerated for each of the three main payers: Medicare, Medicaid, and private health plans.”

So when planners and politicians say they want to cut the costs that health care runs to the economy, they do not mean simply shifting from the private payer to the public state payer, they mean decreasing what is paid, period. A decrease in health care costs means a decrease in health care work, right?

Holy smokes 1! Pitt has hired Jeff Capel as their new head basketball coach. Most did not think Pitt would even have their phone calls accepted. He has been head coach at both Oklahoma and VCU. The past seven years, he's been the right-hand man and top recruiter for Hall of Fame coach Mike Krzyzewski, most recently holding the title of associate head coach.

Capel owns a 175-110 record as a head coach with three NCAA Tournament appearances, taking Oklahoma to the Elite Eight in 2009. 

He is 43 years old and was named coach of VCU in 2002 at age 27 — the youngest in the country at the time — and took the Oklahoma job four years later at 31.

His departure from Oklahoma came under the specter of NCAA sanctions levied on the program within months of Capel's firing in 2011. The NCAA said its findings included unethical conduct by assistant Oronde Taliaferro, extra benefits, preferential treatment and ineligible participation. Capel was not implicated by the NCAA.

What is....the CBO?

Holy smokes 2! During a three-day stop in Beijing, Kim met Chinese President Xi Jinping and other senior officials, where they discussed bilateral ties and Korean peninsula tensions, Chinese state media said Wednesday.

In a meeting, Kim told Xi that North Korea is committed to denuclearizing the Korean peninsula, and is willing to start dialogue with the U.S. and hold a summit meeting, the government-run Xinhua News Agency said.
April Fool!

In 1979, the worst accident in the history of the U.S. nuclear power industry begins when a pressure valve in the Unit-2 reactor at Three Mile Island failed to close. Cooling water, contaminated with radiation, drained from the open valve into adjoining buildings, and the core began to dangerously overheat. By early morning, the core had heated to over 4,000 degrees, just 1,000 degrees short of meltdown. In the meltdown scenario, the core melts, and deadly radiation drifts across the countryside, fatally sickening a potentially great number of people. At the height of the crisis, plant workers were exposed to unhealthy levels of radiation, but no one outside Three Mile Island had their health adversely affected by the accident. Nonetheless, the incident greatly eroded the public’s faith in nuclear power. The unharmed Unit-1 reactor at Three Mile Island, which was shut down during the crisis, did not resume operation until 1985. Cleanup continued on Unit-2 until 1990, but it was too damaged to be rendered usable again. In the more than two decades since the accident at Three Mile Island, not a single new nuclear power plant has been ordered in the United States.

When you're admitted to a hospital, you are given the option to sign a Do Not Resuscitate order, also known as a DNR.
New research shows having those three letters on your chart could put you on course to getting less medical and nursing care throughout your stay. Fewer MRIs and CT scans, fewer medications or even fewer bedside visits from doctors.
What did they expect?

After the Pirates traded McCutchen and Cole, the NL Central-champion Cubs added pitchers Tyler Chatwood and Yu Darvish, the second-place Brewers added outfielders Lorenzo Cain and Christian Yelich and the third-place Cardinals added outfielder Marcell Ozuna.

Golden oldie:

The business world has a different lens. Here is an interesting note on that lens: Selling in Telsa bonds has intensified, driving prices to fresh lows, a day after the electric-vehicle manufacturer suffered a credit-rating downgrade.

In a study of 2,232 broken bats, the league found that maple bats were three times more likely to shatter than bats made with ash. Maple bats are also more likely to explode when they shatter, while ash bats more often splinter into small fragments. Maple bats became popular after Barry Bonds started using them about a decade ago and are used by about half of the players in the Major Leagues. It seems to me there are fewer such incidents this year.

The written words of a constitution do not enforce themselves.  People must be generally willing to abide by its letter and spirit both, instead of regarding it as something to be twisted or ignored as suits their immediate purpose.  A tradition of political morality is necessary to keep a written constitution meaningful. This is an observation from Yeager. This may be a very profound point. The culture may change and the underlying constitution that created it may just hang on, perhaps against the culture's will.

From Bloomberg:
"Affiliates once had to guess what kind of person might fall for their unsophisticated cons, targeting ads by age, geography, or interests. Now Facebook does that work for them. The social network tracks who clicks on the ad and who buys the pills, then starts targeting others whom its algorithm thinks are likely to buy. Affiliates describe watching their ad campaigns lose money for a few days as Facebook gathers data through trial and error, then seeing the sales take off exponentially. “They go out and find the morons for me,” I was told by an affiliate who sells deceptively priced skin-care creams with fake endorsements from Chelsea Clinton."

CBO, a nonpartisan independent government agency responsible for providing economic and budgetary analyses, projects the federal deficit — the net difference between incoming revenue and outgoing spending — will swell by about 188% over the next 10 years, increasing the deficit from its current value of $487 billion to more than $1.4 trillion in 2027.
By 2028, the value of net interest payments will equal about 3.1% of U.S. GDP, "nearly double the 1.6% projected for 2018."

In most markets, solar and wind power survive purely because the states mandate that as much as 30% of residential and commercial power come from these sources. The utilities have to buy it regardless of price. The California state legislature just mandated solar panels for homes built after 2020 (an added construction cost of about $10,000 per home).

A November 2015 New York Times/CBS News poll found that 56% of Democratic primary voters said they held a positive view of socialism. A Morning Consult/Politico survey in June 2017 asked if a hypothetical replacement for House Minority Leader Nancy Pelosi should be a socialist or capitalist. More Democrats opted for socialism, with 35% saying it's somewhat or very important that her replacement be a socialist, while only 31% said the same for a capitalist.

Americans currently carry about $765 billion in credit card debt. That represents money already spent to buy goods and services. Comparing that debt to the average disposable personal income, we find the typical American carries credit card balances equal to about 6% of DPI. That number jumped sharply in the last recession but never came back down. It’s kept growing, although at a slower rate.

AAAAaaaaannnnndddddd......a graph:

Friday, May 18, 2018


We have become a tender culture. We can be so upset.
So I am embarrassed to say that I was recently really offended by a T-shirt. I guess "offended" is too passive. I was mad.

In 2011, “We are the 99 per cent” became a unifying slogan of the Occupy Wall Street movement. In 2013, the U.S. President Barack Obama described income inequality as the “defining challenge of our time”.
A year later, Pope Francis called for a “legitimate redistribution of economic benefits by the state,” while leftwing economist Thomas Piketty tried to supply the movement for greater income equality with intellectual ammunition in his book, Capital in the Twenty-First Century.

Recently The New York Times ran an article entitled Happy Birthday, Karl Marx. You Were Right!.

According to Jason Barker, an associate professor of philosophy at Kyung Hee University in South Korea and author of the novel Marx Returns, “educated liberal opinion is today more or less unanimous in its agreement that Marx’s basic thesis – that capitalism is driven by a deeply divisive class struggle in which the ruling-class minority appropriates the surplus labour of the working-class majority as profit – is correct”.

One must remember there is an implication here. Some may not want to be altruistic. Some might want to keep his farm or his car or his ship. And the NYT and the academics can glibly talk about Marx without getting into the specifics. But the specifics are that those who have, must surrender what the others want. Period. And there are only a few ways such a surrender, such a redistribution, can occur; it can occur with permission or without it. And without it means by force. And everybody seems to think this is just fine.

Well, maybe not everybody.

The Harvard University psychologist Steven Pinker, for example, has examined income inequality at considerable length in his recent book, Enlightenment Now: The Case for Reason, Science, Humanism, and Progress. Pinker questioned many of the rationales for treating income inequality as the “defining challenge of our time” and concluded that “income inequality is not a fundamental component of well-being”.
And new and extensive studies have revealed that there is actually no causation between income inequality and unhappiness.

The market economy is not a zero-sum game, where someone’s gain must come at someone else’s expense. The growth of Western economies have certainly shown the diffusely creative and generative power of wealth.
“The rich get richer and the poor get poorer” is a synopsis of the socialist critique of the market system, implying the perceived inevitability of what Marx called the Law of Increasing Poverty. It is also a myth unsupported by empirical evidence.
But freedom and its attendant Capitalism has some problems. You are free to err; your investment or your farm may fail.
“Capitalism without failure is like religion without sin,” the American economist Alan H. Meltzer once put it. “It doesn’t work.”
So freedom, and capitalism, have risks.

Which brings me to my evil t-shirt. I was in Whole Foods and saw a guy in a t-shirt that said, "The Only Good War Is A Class War." He was no child; he was old enough to know better. Advocating class war, a tenet of Marxism, is similar to advocating Nazism or slavery on a t-shirt. Only it's worse; "class war" is overtly homicidal. It does not advocate conflict, it advocates murder and extermination. The property class in Marxism has not had better luck or better accents; the property class is a phase in evolution--like the wolf, an evil, predatory phase that needs to be destroyed. And extirpated. The group needs to be wiped out and its members torn out by their roots and burnt as a holocaust to history. Deracinated. The Marxist are not exaggerating. They did it wherever they could, including the children, infants and fetuses of the enemy class.
The idea is that a person, because of his job, or his education or his parents is your mortal enemy. Enemy. And should die. Die. Reloading over the struggling bodies of the dying Romanov teenagers was not an aberration, it was policy.

There is a risk in open-mindedness. Tolerance can become indifference. But no one should be indifferent to something like that.

Thursday, May 17, 2018

A Capital Idea

In Capital, Piketty complains that the "r" (return) of inherited money is greater than growth, "g". That’s how we will end up with a rentier society.
Piketty insists that, since r exceeds g, the return to capital exceeds economic growth,  wealth of any kind will outperform work. Thus, according to the French economist, the rich will just keep on getting richer, and we’ll be left with an economy in which plutocrats are surrounded by us unsuccessful boobs, wandering around between Mad Max and a Star Wars bar scene.  Further, he goes on to say that the rich who inherit have access to much greater returns than the rest of us, making it a self-supporting spiral of economic misery.
This is great because there is justification in being angry at the rich.
It is interesting--but so is Lamarck.

The Sunday Times’s annual rich list, which was recently published, shows something different. Some 94 percent of the 1,000 people made the cut not by getting rich the old-fashioned way—by marrying or inheriting—but instead by making it. This correlates with the large sociological study in The Millionaire Next Door. It's a small sample and may not be indicative. But is does not agree with the Piketty theory, which has little hard support. It is doubtful that haziness of a theory will defeat it, though. Leaders and aspiring leaders always look for something, anything, to justify their power-concentrating, self-serving acts.

Leaders will always volunteer to set things right.
But--even if Piketty were correct-- the basic question goes unanswered: Can an order be imposed from above that will produce predictable results, however desirable? For example, how well has Iraq implemented the Madisonian blueprint that, in the American experience, is without doubt superior and worthwhile?