Andy Barenberg

I ended the previous post as such:

Once, back in the days long before Milton Freedman spoke of the freedom of the markets, conservatives understood that beneath every free trade on the market there was as its basis the coercive powers of the government.

Let me post the quotes I was thinking of. First Freedman:

“No external force, no coercion, no violation of freedom is necessary to produce cooperation among individuals all of whom can benefit. That is why, as Adam Smith put it, an individual who “intends only his own gain” is led by an invisible hand to promote an end which was no part of his intention.” - Milton and Rose Friedman, Free to Choose, 1980.

Of course Smith in reality realized an extensive system of coercion is necessary prior to the market:

Wherever there is great property, there is great inequality. For one very rich man, there must be five hundred poor, and the influence of the few supposes the indigence of the many. The affluence of the rich excites the indignation of the poor, who are often driven by want, and prompted by envy, to invade his possessions. It is only under the shelter of the civil magistrate that the owner of valuable property, which is acquired by the labour of many years, or perhaps of many generations, can sleep a single night in security. He is all the time surrounded by unknown enemies, whom, though he never provoked, he can never appease, and from the whose injustice he can be protected only by the powerful arm of the civil magistrate continually held up to chastise it. The acquisition of valuable and extensive property, therefore, necessarily requires the establishment of civil government.’ (WN V.i.b.2, pp 709-10)

I just had this email forwarded:

Thanks to the more than 25,000 e-mails CCAGW (Council for Citizens Against Government Waste) members like you sent to Capitol Hill, Senate Majority Leader Harry Reid last Friday pulled the Climate Security Act after falling a dozen votes short of the 60 needed to end debate and bring the bill up for a vote!

Introduced by Sens. Joe Lieberman (I-Conn.) and John Warner (R-Va.), the Climate Security Act was ”cap-and-trade” energy legislation that attempted to limit greenhouse gas emissions, principally carbon dioxide, and establish a trading system for emissions allowances.  In reality, the bill was nothing more than a hidden tax that would raise energy costs by $1.2 trillion by 2018 and would have created an army of new bureaucrats that eventually would have dictated nearly every aspect of commercial and indvidual energy use.

In rejecting the legislation, the Senate acknowledged this unacceptable expansion of government and said no to its higher costs and elite command-and-control structure that would kill prosperity.

Thank you again for your help in this very important government waste battle!  This truly is YOUR victory!

Sincerely,

Thomas A. Schatz
President

Since the days of Locke conservatives have argued that one of only two responsibility of governments is the establisment and protection of property rights. In opposing Christian Socialist arguement that the earths wealth is our common bounty conservatives have - correctly - noted that leaving control over resources as open to anyone who desires them will lead to a “tragedy of the commons”.  The “tragedy” refers to Garret Hardins famous anology of cattle ranchers who own the cattle but share the land as a commons.  Since each benifits from having an additional cow eating from the land, and none benefit from preserving the land for each others cows too many cows will be added to the land leading to a destruction of the commons.  Alternatively Hardin argued that if property right to the land was issued to someone - it doesn’t matter who- the landowner would maximize profit by limiting cattle on the land to that which is most efficient use of the land.  It doesn’t matter if the new land owner only places his own cows on the land; or rents out the right to use the land to others; what is important is that the landowner gains from maintaining the property and hence has incentive to use it efficently.

Now currently the atmosphere has a legal status like the commons of old; it is free for anyone to emit as much CO2 into it as they wish.  Like the conservatives have predicted we are seeing a tragedy of the commons - CO2 emissions have reached levels that to begin to give a sober analysis of the consequences is to get a label of fear monger.  At the theoretical level conservative philosophy should say that the answer should be the creation of a tradable rights to use the atmosphere for the dumping of CO2. That is what CO2 does.

Would it raise the cost of energy? Yes, of course; just like the property right that say I can’t take food out of your fridge raises the cost of food for me.

Would it require the establishment of a government bureaucracy to monitor and enforce the new property rights? Yes, of course; just like that property right that say I can’t take food from your fridge has an extensive bureaucracy behind it.

Once, back in the days long before Milton Freedman spoke of the freedom of the markets, conservatives understood that beneath every free trade on the market there was as its basis the coercive powers of the government.  How amusing it is each time they learn that anew.

Both Hillary and Obama have faced difficulties due race/gender, but the luckily atleast blatant racism is no longer consider acceptable on television; for sexism though:

From the Women’s Media Center

“African Voices on Structural Adjustment” Edited by Thandika Mkandawire and C.C. Soludo.

An excellent collection of articles critical of World Bank SAPs in Africa.

“Political Economy of Growth in Africa” By Ndulu et. al.

A more recent study from World Bank view (Ndulu was the chief economist of the Africa devision before moving to the Tanzanian Central Bank) largely based on a cross country regression.  The regression uses four way overly sweeping policy errors   (ie. regulatory based economic policies) and finds - surprise, surprise - that the errors caused significant economic slowdown.  It’s overly sweeping nature reallly limits its usefulness: for example; sure distorting prices against agricultural depressed growth, but what about distorting prices in favor of agricultural? Both would fall under the error distorting prices, but there is no disaggregation of different types of price distortions. The East Asian countries often kept prices of domestic agricultural goods at twice the world price - here we learn nothing of if that would work in Africa. But by lumping it together with the urban-biased policies that failed the book makes the World Bank market based reforms look like the only option.