Wednesday, October 01, 2014

Quotes of the day: On economics as prophylactic

“Economics is primarily useful, both to the student and to the
political leader, as a prophylactic against popular fallacies.”

- Henry Calvert Simons, The Simons’ Syllabus, ed. Gordon Tullock

“Not because he knows so much, but because he knows how much he would
have to know in order to interfere successfully, and because he knows that
he will never know all the relevant circumstances, it would seem that the
economist should refrain from recommending isolated acts of interference even
in conditions in which the theory tells him that they may sometimes be beneficial. …
    “It is no accident that in our subject the term ‘principles’ is so often used in the
titles of general treatises. Especially so far as economics policy is concerned,
principles are practically all that we have to contribute.  Principles are
particularly important however, when the one political aim which we
may take for granted is personal freedom.”
- F.A. Hayek, ‘The Economy, Science and Politics’

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Tuesday, September 30, 2014

Lowering Taxes Is the Only Decent Tax Reform

Tax reform being on the agenda this last election, this guest post by Laurence Vance suggests there is only one decent tax reform that should be considered:

The best tax is always the lightest.
— Jean-Baptiste Say

There cannot be a good tax nor a just one;
every tax rests its case on compulsion.

— Frank Chodorov

There can be no such thing as “fairness in taxation.” Taxation is
nothing but organised theft, and the concept of a “fair tax” is
therefore every bit as absurd as that of “fair theft.“

— Murray Rothbard

Since the very fact of taxation is an interference with the free
market, it is particularly incongruous and incorrect for
advocates of a free market to advocate uniformity of taxation.

— Murray Rothbard

The real issue is total spending by government, not tax reform.
— Ron Paul

When it comes to the subject of taxes, many conservatives, some libertarians [and supporters of virtually all political parties] just don’t get it.

The Tax Foundation, a “non-partisan research think tank, based in Washington, DC,” has six “principles of sound tax policy” that guides all of its research and “which should serve as touchstones for good tax policy everywhere”: simplicity, transparency, neutrality, stability, no retroactivity, broad bases and low rates. Good tax policy “promotes economic growth by focusing on raising revenue in the least distortive manner possible.”

The Tax Foundation recently charged education tax credits with violating “the principles of sound tax policy by greatly increasing the complexity and distortions in the tax code.” They should be eliminated, they said, “within a comprehensive reform package” for a number of reasons, among which is that “trading the elimination of education tax credits for lower marginal tax rates is good for economic growth.”

The Tax Foundation does a good job of answering the question of whether “the tax code is the proper tool to increase access to higher education and make college more affordable” (it isn’t), but the organisation’s proposal that the government should eliminate all education tax credits and use “the revenues to cut marginal tax rates across the board” is naïve.

The government simply can’t be trusted to not turn around and raise marginal tax rates the next time it “reforms” the tax code. And the fact that “trading education credits for lower tax rates” would “benefit the Treasury as well” means that the government would collect more money — which is always a bad thing.

How about proposing keeping the education credits and cutting marginal tax rates?

The Tax Foundation also recently weighed in on the subject of sales tax holidays. It is against them. Sales tax holidays “are periods of time when selected goods are exempted from state (and sometimes local) sales taxes.” Although “at first glance, sales tax holidays seem like great policy,” they “are based [says the Tax Foundation] on poor tax policy and distract policymakers and taxpayers from real, permanent, and economically beneficial tax reform,” “introduce unjustifiable government distortions into the economy without providing any significant boost to the economy,” “represent a real cost for businesses without providing substantial benefits,” are also an inefficient means of helping low-income consumers and an ineffective means of providing savings to consumers,” and “impose serious costs on consumers and businesses without providing offsetting benefits.” Although sales tax holidays may eliminate taxes for some period of time, they “are not real tax cuts.”

But even if, from an economic and political perspective, everything the Tax Foundation says about sales tax holidays is true, there is one thing they have dead wrong: Sales tax holidays are not just real tax cuts; because they eliminate sales taxes completely, they are the ultimate and ideal tax cut.

And then there is Dan Mitchell, formerly of the Heritage Foundation, now of the Cato Institute, who blogs at International Liberty. He is “a long-time proponent of the flat tax.” One reason Mitchell supports the flat tax is “other than a family-based allowance, it gets rid of all loopholes, deductions, credits, exemptions, exclusions, and preferences, meaning economic activity is taxed equally.” But because “a national sales tax (such as the Fair Tax) is like a flat tax but with a different collection point,” and “the two plans are different sides of the same coin” with no “loopholes,” even though he is “mostly known for being an advocate of the flat tax,” Mitchell has “no objection to speaking in favour of a national sales tax, testifying in favour of a national sales tax, or debating in favour of a national sales tax.”

But as I have said before, the flat tax is not flat and the Fair Tax is not fair.

Surprisingly, although Mitchell despises Obamacare, he believes “that there’s one small part of Obamacare that will have a positive impact”: the so-called Cadillac tax on expensive employer-provided health plans. The Cadillac tax:

  • Will slightly reduce the distortion in the tax code that encourages over-insurance and exacerbates the healthcare system’s pervasive third-party payer problem.
  • Is merely making workers more aware of costs that already exist.
  • Discourages over-insurance, and this is already leading to some positive changes in the marketplace.

Although I admire and recommend the work of the Tax Foundation and Dan Mitchell, and regularly visit their websites, for a more libertarian view of sound tax policy, I suggest that we turn to Frank Chodorov and Murray Rothbard.

From his essay “Taxation Is Robbery,” here is Chodorov on the morality of taxation:

The Encyclopaedia Britannica defines taxation as “that part of the revenues of a state which is obtained by the compulsory dues and charges upon its subjects.” That is about as concise and accurate as a definition can be; it leaves no room for argument as to what taxation is. In that statement of fact the word “compulsory” looms large, simply because of its ethical content. The quick reaction is to question the “right” of the State to this use of power. What sanction, in morals, does the State adduce for the taking of property? Is its exercise of sovereignty sufficient unto itself?
   
On this question of morality there are two positions, and never the twain will meet. Those who hold that political institutions stem from “the nature of man,” thus enjoying vicarious divinity, or those who pronounce the State the key­stone of social integrations, can find no quarrel with taxation per se; the State’s taking of property is justified by its being or its beneficial office. On the other hand, those who hold to the primacy of the individual, whose very existence is his claim to inalienable rights, lean to the position that in the compulsory collection of dues and charges the State is merely exercising power, without regard to morals.
   
Taxation for social services hints at an equitable trade. It suggests a quid pro quo, a relationship of justice. But, the essential condition of trade, that it be carried on willingly, is absent from taxation; its very use of compulsion removes taxation from the field of commerce and puts it squarely into the field of politics. Taxes cannot be compared to dues paid to a voluntary organisation for such services as one expects from membership, because the choice of withdrawal does not exist. In refusing to trade one may deny oneself a profit, but the only alternative to paying taxes is jail. The suggestion of equity in taxation is spurious. If we get any­thing for the taxes we pay it is not because we want it; it is forced on us.

And as Chodorov explains in his book The Income Tax: Root of All Evil (1954), the income tax means that the state says to its citizens:

Your earnings are not exclusively your own; we have a claim on them, and our claim precedes yours; we will allow you to keep some of it, because we recognise your need, not your right; but whatever we grant you for yourself is for us to decide.
   
The amount of your earnings that you may retain for yourself is determined by the needs of government, and you have nothing to say about it.

From chapter 22, “The Nature of the State,” in his The Ethics of Liberty, here is Rothbard on the nature of taxation:

All other persons and groups in society (except for acknowledged and sporadic criminals such as thieves and bank robbers) obtain their income voluntarily: either by selling goods and services to the consuming public, or by voluntary gift (e.g., membership in a club or association, bequest, or inheritance). Only the State obtains its revenue by coercion, by threatening dire penalties should the income not be forthcoming. That coercion is known as “taxation,” although in less regularized epochs it was often known as “tribute.” Taxation is theft, purely and simply even though it is theft on a grand and colossal scale which no acknowledged criminals could hope to match. It is a compulsory seizure of the property of the State’s inhabitants, or subjects….
   
Like the robber, the State demands money at the equivalent of gunpoint; if the taxpayer refuses to pay his assets are seized by force, and if he should resist such depredation, he will be arrested or shot if he should continue to resist.

The libertarian approach to tax deductions and credits differs strikingly from those on the left and the right who want to simplify the tax code by eliminating these things to ensure that every individual and corporation pays some uniform and arbitrary fair share. Since the federal government is unlikely to ever eliminate the income tax, proponents of a free society should work toward expanding tax deductions, tax credits, tax breaks, tax exemptions, tax exclusions, tax incentives, tax loopholes, tax preferences, tax avoidance schemes, and tax shelters and applying them to as many Americans as possible. These things are not subsidies that have to be “paid for.” They should only be eliminated because the income tax itself has been eliminated.

From chapter 2, “Ten Great Economic Myths,” in his Making Economic Sense, here is Rothbard on tax deductions and exemptions:

A deduction or exemption is only a “loophole” if you assume that the government owns 100% of everyone’s income and that allowing some of that income to remain untaxed constitutes an irritating “loophole.” Allowing someone to keep some of his own income is neither a loophole nor a subsidy. Lowering the overall tax by abolishing deductions for medical care, for interest payments, or for uninsured losses, is simply lowering the taxes of one set of people (those that have little interest to pay, or medical expenses, or uninsured losses) at the expense of raising them for those who have incurred such expenses.
   
There is furthermore neither any guarantee nor even likelihood that, once the exemptions and deductions are safely out of the way, the government would keep its tax rate at the lower level. Looking at the record of governments, past and present, there is every reason to assume that more of our money would be taken by the government as it raised the tax rate back up (at least) to the old level, with a consequently greater overall drain from the producers to the bureaucracy.

And from chapter 4, “Binary Intervention: Taxation,” in his Power and Market, here is Rothbard on tax exemptions and loopholes:

Many writers denounce tax exemptions and levy their fire at the tax-exempt, particularly those instrumental in obtaining the exemptions for themselves. These writers include those advocates of the free market who treat a tax exemption as a special privilege and attack it as equivalent to a subsidy and therefore inconsistent with the free market. Yet an exemption from taxation or any other burden is not equivalent to a subsidy. There is a key difference. In the latter case a man is receiving a special grant of privilege wrested from his fellowmen; in the former he is escaping a burden imposed on other men. Whereas the one is done at the expense of his fellowmen, the other is not. For in the former case, the grantee is participating in the acquisition of loot; in the latter, he escapes payment of tribute to the looters. To blame him for escaping is equivalent to blaming the slave for fleeing his master. It is clear that if a certain burden is unjust, blame should be levied, noton the man who escapes the burden, but on the man or men who impose it in the first place. If a tax is in fact unjust, and some are exempt from it, the hue and cry should not be to extend the tax to everyone, but on the contrary to extend the exemption to everyone. The exemption itself cannot be considered unjust unless the tax or other burden is first established as just.
   
In the literature on taxation there is much angry discussion about “loopholes,” the inference being that any income or area exempt from taxation must be brought quickly under its sway. Any failure to “plug loopholes” is treated as immoral.

From a libertarian perspective, the goal should be no coercive taxes whatsoever. To that end, any decrease in taxes or tax rates is a good thing and any increase is a bad thing; and any increase in tax deductions or credits is a good thing and any decrease is a bad thing.

No matter whom it benefits, no matter why the government does it, no matter who lobbied for it, no matter who supports or doesn’t support it, no matter how temporary it might be, and no matter how much complexity it adds to the tax code, any reduction in taxation, with a concomitant reduction in spending, is a very good thing indeed.


Photo of Laurence  M.  VanceLaurence M. Vance is a columnist and policy adviser for the Future of Freedom Foundation, an Associated Scholar of the Mises Institute, and the author of Social Insecurity, The War on Drugs is a War on Freedom. Author, publisher, lecturer, freelance writer, the editor of the Classic Reprints series, and the director of the Francis Wayland Institute, he holds degrees in history, theology, accounting, and economics.
This post has been republished from the Mises Daily.

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(Bonus) quotes of the day: On currency depreciation

“The so-called improved competitiveness resulting from currency
depreciation in fact amounts to economic impoverishment. The
"improved competitiveness" means that the citizens of a country are
now getting fewer real imports for a given amount of real exports.
While the country is getting rich in terms of foreign currency, it is
getting poor in terms of real wealth — i.e., in terms of the goods and
services required for maintaining people's lives and well-being.”
- Frank Shostak, ‘Will Currency Devaluation Fix the Eurozone?

“[F]lexible exchange rates preclude an efficient allocation of resources
on an international level, as they immediately hinder and distort real
flows of consumption and investment. Moreover, they make it inevitable t
hat the necessary real downward adjustments in costs take place…in a chaotic environment of competitive devaluations, credit expansion, and inflation…
    “I do not believe we shall regain a system of international stability without
returning to a system of fixed exchange rates, which imposes on the national
central banks the restraint essential for successfully resisting the pressure of the
advocates of inflation in their countries — usually including ministers of finance.”

- F.A. Hayek, quoted in ‘An Austrian Defense of the Euro’ by Jesus Huerta de Soto
-

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Quote of the Day: On free-range children

"Free and unsupervised play has lost ground, its place has
been taken by the play date, deliberately negotiated in advance
and the purposefully organised activities of contemporary
childhood: tee-ball and soccer camp, swim class and 5k
runs. More and more, parents feel obliged to steer their
children toward those activities that might have a future payoff…
    But as any cultivator of plants knows, to promote
one trait can cause others inadvertently to atrophy."
- Michael J. Lewis, ‘Children Who Never Play

[Hat tip Montessori Australia]

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Monday, September 29, 2014

‘Whispers of Peace,’ by Abiodun Olaku

 

Artist Michael Newberry, whose pieces you’ll see here often, says of Nigerian artist Abiodun Olaku,

There are very few, alive or dead, artists whose works I love. Abiodun Olaku is one of them. I was musing today what a mess contemporary art has made of understanding what is new and innovative in art. Most people would call Abiodun's work traditional because it is unpretentious and representational. The shame is in thinking it is old fashioned blocks people from seeing its innovations. Lol, we can't help it as we are naturally programed to close down and stare at highway accidents and roadkill.
    There is a lot in the painting Whispers of Peace, and it's pulled altogether so well that it's hard to separate elements -- but I would like share one thing, of many, that I love about it.
    The dusky light is mysterious, and it is an amazing foil to the light. It's as if everything has a light dusting magical powder.
    The tonal nuance is more subtle than the finest Vermeer. Just notice the tone of the embankments, it has hardly any range, neither dark nor light, yet each meter of it stretches forever until it disappears in the distance. I have never seen another artist execute nuance this well.

If you’re keen to pick it up, this painting is likely to feature in the May, 2015 'Africa Now' edition of Bonham’s Auction, in London.

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Quote of the day (a long one): On education

"The vast majority of today’s science teachers simply do not understand what it means to learn. They do not understand that there is a necessary order to learning, and that adhering strictly to this order is the only way to ensure that the student has a clear, independent grasp of the material.
    “Today’s teachers seem more concerned with enabling their students to parrot impressive-sounding words than they are with fostering their ability to think. That is why a high school chemistry teacher of Kira, one of my former students, said the following when he began a section on quantum theory: 'This material is far too complex for any of you to really understand—but don’t worry, we’ll only spend a few days on it.'
"Such 'teaching' is a betrayal of the purpose of education, which is to give children the essential knowledge and cognitive powers necessary to be independent, productive, happy adults.
    “In terms of content, to the extent that the hierarchy of knowledge is violated in students’ education, they learn nothing of the material they are being taught; they learn only to repeat what they are told.
    “In terms of method, to the extent that the principle is violated, students fail to learn what it really means to come to know something; this is replaced with the deadly lesson that knowledge of complex, abstract scientific issues is gained by parroting the words of an authority.
    "Students who have no true concept of scientific knowledge are ripe for pseudo-scientific propaganda. In today’s schools, the leading propagator of such propaganda is the environmentalist movement. For example, it is routine for seven-year-olds to be taught that catastrophic global warming is imminent, that it is caused by man, and that industry and Republicans are 'selfishly' leading us toward an apocalypse for their own short-term gain. In talking to these children and seeing them interviewed, what is most disturbing is the certainty they project in taking a position on as complex an issue as long-term climate change—when they have no knowledge of the principles of chemistry, physics, or meteorology.
    “Many parents understandably object to such indoctrination because of its anti-capitalist, pseudo-scientific content; the more fundamental objection to make, however, regards the anti-hierarchical method that it exhibits—a method that makes all learning, even of the truth, a form of indoctrination."
—Lisa VanDamme, “The Hierarchy of Knowledge: The Most Neglected Issue in Education,”
                                         OBJECTIVE STANDARD

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National 1938-2014 [updated]

David Farrar did two things this morning: first, he posted a carefully truncated graph that got people talking, showing what he claimed is evidence of Labour’s popular decline – with a trendline added in “to reinforce the obvious point” – and, second he didn’t post a similar graph showing the declining trend in support for National, his own party.

Lindsay Mitchell fixed the second omission. Below is her graph showing National’s long-term trend in support since 1938. She also added in a trendline “to reinforce the obvious point.” Like Labour’s, it too declines – in part due to MMP dividing up the vote between more parties than heretofore, and partly due to the slow rise of Helen Clark and the dramatic fall of Bill English in 2002:

So why did Farrar choose 1938 as a starting point rather than Labour’s actual starting point in 1919? Perhaps because that 1938 election delivered an all-time high result for Labour, allowing the remaining results to show the dramatic decline he desired.

It’s a little bit of a statistician’s simple sleight-of-hand that most of the commentariat has bought almost without demur.

If however we were to do the job his selective starting point obscures, to start instead with the post-war 1919 election instead (the first election in which the modern Labour Party was a force) we’d see a somewhat different “trend.”

image

I’ll let you draw your own long-term trend line, or medium-term cycle lines, if you think any of them them appropriate.

And I”ll add a link to what must be one of David’s favourite books:

How to Lie with Statistics.

UPDATE: If there is a political party with a genuinely discernible trend, perhaps it is this one …

image

Answers for which on a postcard, please.

How would you destroy $6m of gold?

Guest post by Terry Verhoeven

imageIn a marketing gimmick, the Bank of New Zealand has placed $6 million of shredded cash inside a model house and placed it on display in Aotea Square 

The idea is to illustrate how much money is being wasted by New Zealand homeowners in unnecessary interest payments, an amount that can supposedly be saved if all mortgage payers were to change to a BNZ Tailored Home Loan.

The first thing that people who are not concrete-bound in their thinking are going to conclude from the display is not how BNZ can save them money, but how well it demonstrates that fiat money has no real value backing it.

The NZ Mint should seize the opportunity to perform its own marketing stunt and place its own model house on display, but with four-thousand kilos (i.e., $6 million worth) of 'shredded' gold coins inside, placed next to BNZ's one with the shredded paper money, with their own big sign out front asking: "Where is the stored value in your hard-earned money"?

The difference might become obvious even to the most concrete-bound.

[Pic by Interest.Co.NZ]

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Thursday, September 25, 2014

The science is settled, says Leo

With stiff competition from an assortment of loony luminaries, Carbon Dioxide gives their Clown of the Year Award this year to man-child Leonardo di Caprio, a fellow who pretends for a living.

His performances in recent weeks have been exceptional, culminating in his claims that sea ice is disappearing, his hypocritical appearance at the so-called People’s Climate March ( losing his hearing when asked about his yachts, for example), and lecturing the UN on climate change (also without mentioning his four homes, private jets and renting the FIFTH biggest yacht in the world from an OIL billionaire).

Any better than that, and he’ll be taking away Al Gore’s Lifetime Clown Award.

Oh, and on that sea-ice thing: Global Sea Ice Extent Sep 22 2014 – Highest Since 1998. The red line shows 2014, up to Day 264 …

[Cartoon by Michael Ramirez. Hat tip On Liberty Street]

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Debating Drug Prohibition at the Oxford Union

Guest post here from the Mises Institute, interviewing Mark Thornton, Mises Institute Senior Fellow, who recently took part in Oxford University’s Oxford Union Debates.

Mises Institute: Why were you invited to debate at Oxford?

Mark Thornton: The Oxford Union can pretty much get whoever they want to debate, including presidents, prime ministers, Mother Theresa, the Dalai Lama, and even Julian Assange, so I was honoured that they invited me. I met several students in the Oxford Union and at Oxford University who were familiar with my work on the drug war and at the Mises Institute.
     Each side of the debate generally consists of a student presenter and three experts. The debate is similar in structure to the House of Commons and has been that way since 1823.

MI: What was your basic line of argumentation and how was it received? How did the other side justify the drug war?

Click here to read more ... >>

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Insanity is not what it was

Just for the record, since I’m officially sick of hearing that "The definition of insanity is doing the same thing over and over and expecting different results."

Not only is that not the definition of insanity, Einstein never said that.* And not only did he not say it, what’s wrong with doing the same thing over and over and expecting different results? Ever heard of metal fatigue? Or tipping points?

Anyway, there is a respectable definition of insanity that we can use over and over:

Insanity. n. mental illness of such a severe nature that a person cannot distinguish fantasy from reality, cannot conduct her/his affairs due to psychosis, or is subject to uncontrollable impulsive behaviour.

Which, when you think about, still applies to most politicians.

And the commentators thereof.

* “And neither did Benjamin Franklin. Salon has a good round-up of people using this quote in various political contexts, because politicians really love this quote. The Ultimate Quotable Einstein traces the quote to Rita Mae Brown's 1983 book Sudden Death, but it's almost certainly older than that…”

[Hat tip Psychology Today]

Wednesday, September 24, 2014

Herald Homes: Vela House by Organon Architecture

image

Nice to see one of my houses on the front page of the Herald Homes lift-out this morning. I never like it however when my clients move out, but 16 years after loving his renovation Kleme Vela is moving on to pastures wider than the Pt Chev site he’s been in since 1990.

That’s the sketch, above, I did for him back in 1996, from which the renovations started, making sure (as the Herald says) “the new part seamlessly matched the old.

It’s hard to believe [continues the Herald] that the architect-designed living room, with its wood-panelled window seat [below], traditional fireplace and pillars [pillars?], isn’t original.

It’s a testament to what can be done with clients who have an eye for detail.

You can read the Herald article here, sign up for the auction at Bayley’s here, and see some much better pics here at my site courtesy of ace photographer Melanie Tollemache.

image

Traffic cops and communists

Why the hysterical emotion from the left about their election loss, wonders Home Paddock this morning after windows were broken and Molotov cocktails left (but not lit) at a National Party office in Dunedin.

There was a ”huge amount of emotion” among those on the political Left after National’s sweeping election victory, ranging from ”demoralisation to anger to incredulity”, said University of Otago politics lecturer Dr Bryce Edwards.
    ”[The vandalism] shows a very exaggerated and extreme outcome of how many on the Left are feeling, but it doesn’t typify it.”

The emotion is everywhere.

Lefists across the commentariat are disembowelling themselves and each other in hyperbolic overreaction to an election win by a centrist, if not centre-left, government.  After two terms of pabulum, National will now start privatising, claims one. National will now start running the country for the wealthy at the expense of the people who actually do the work, says another. My favourite is a young Labour supporter and his girlfriend who say on Twitter they cried all weekend about the incoming government because now 250,000 children in poverty won’t be fed. "I keep going to the river to pray,” they say, “Cos I need something that can wash out the pain."

You might say that if children not being fed is their thing they might stay home instead and make some kids a few sandwiches, but that would only lead to accusations of being churlish.

I can understand the sackcloth and ashes about having your electoral arse handed you on a plate. But why the all frightened hyperbole about the new govt?

It’s not like the country just elected Basser al-Assad.

Here’s a clue from one lefty who does angry more than he does anything else.

Martyn Marin Bradbury’s dad was a traffic cop.* ‘So what?’ you might say. Everyone’s dad is something.

Well, I reckon it’s quite revealing. Here’s a hypothesis.

Click here to read more ... >>

Quote of the day: Bob Jones on Labour

“Most of all they should embrace the modern age and
recognise that social and economic salvation and
uplifting the underclass does not simplistically
lie in ever increasing taxes on the industrious
and thrifty and their transfer to the indolent.
There's nothing positive or progressive about that.”

- Bob Jones, ‘Cunliffe should man up and quit,’ NZ HERALD

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Town planners are great, say town planners

The New Zealand Planning Institute -- the trade union for the country’s town planners -- says don’t repeal, reform or even alter slightly the Resource Management Act – the source of employment for the country’s town planners.

Trade union boss Bryce Julyan said recent statistics collected by the Ministry for the Environment “debunked the myth that planners were a handbrake on development.”

Really?

Click here to read more ... >>

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‘New Bonnet,’ by Eastman Johnson

imageNew Bonnet, 1876, oil on cardboard, 527 x 686m, Metropolitan Museum of Art

A genre painter from Nantucket, Johnson had more tricks up his sleeve than you might think.

Composition, for example. Unusual for the time, the composition describes the relationship.  Divided in the middle by his tools, there is a straight line from the new bonnet (at the far edge of the picture) through the sustenance being prepared, through to the hands that provided both now being warmed over the fire.

[Pic from  The Athenaeum]

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Tuesday, September 23, 2014

ECONOMICS FOR REAL PEOPLE: Currency Internationalisation

276464_137539366339987_1226509_n

So what’s on this week at the Auckland Uni Economics Group you ask?  This week, customers, you’re in for a treat:

Hi everyone,

We are delighted to be joined this Thursday by Professor Tony Endres, very definitely one of the good guys.
    Tony is a Professor of Economics here at the University of Auckland, but don’t let that put you off. His research interests include the history of economic theory, Austrian economic economic theory and history, and international monetary relations.
    This Thursday evening, Tony will speak about “Currency Internationalisation” asking:
    What is currency internationalisation?
    Why does it matter?
    Why was the subject so controversial in the last half of the twentieth-century?
    And why has it been revived since the Global Financial Crisis?

The main schools of thought on the subject will be covered, why the subject has been so hotly contested will be explained.
    Tony is a lively and engaging speaker, and he welcomes difficult questions!
    So come along for what will be a very interesting presentation.

        Date: Thursday, 25 September
       
Time: 6pm-7pm
       
Location: Case Room Two, Level Zero, Owen G. Glenn Business School, Grafton Rd
                             (plenty of parking in the Business school basement, entrance of Grafton Rd)

All are welcome to attend. We look forward to seeing you there.

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‘I heart fossil fuels’ at the #People’sClimateMarch

image

And the only one there fanning a different fire? The courageous Alex Epstein from the Center for Industrial Progress, brandishing a copy of his new book The Moral Case for Fossil Fuels and a banner and T-shirt the same.

Why did he do it? Because he figured protestors should know they are marching against the lifeblood of civilisation.

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Election wrap

Every bullfrog and their leg rope has had their take on the election. So why not me?

Unusually, “None of the Above” didn’t win this election:

Pic by Nick Young

As my colleague Richard McGrath suggests, parliament should leave 28 places at the trough empty to reflect this voter disgust.

This was not because of low turnout that “None of the Above” polled so poorly.  (This was one of New Zealand's lowest turnouts ever.) It was because National did unusually well.  The first MMP election in which a party scored enough votes to rule on its own, and – virtually unheard of – a party lifting its vote for a third term in government.

It helped that its opposition was virtually unelectable. But National still had to beat the usual winner, None of the Above. And it did. Just.

Perhaps #DirtyPolitics helped? That what the electorate saw was not the muck but that it was directed National’s way, with Hager conflated as DotCon, and voters simply wanting to get behind “our guy.”

That might be a touch simplistic.

But perhaps there is a positive sign here.

Click here to read more ... >>

But what does a Colon stand for?

Conservative Party leader Colon Craig says he is “in politics for life,” undeterred by another expensive failure,

"I'm totally committed to politics. I've made that pretty clear," he told the Herald... "This is what I do now."
    Mr Craig said he was not only committed to running again in 2017, but also 2020 and beyond. "This is what I am going to be doing and working on for the rest of my life," he said.

For the rest of his life!

But what does he want to be a politician for? To advance an agenda? To promote his ideas? To get his policies in place? Apparently not:

He might reconsider his publicity strategy, which had included provocative statements on gay marriage and anti-smacking laws.  He said this controversial approach was required to get noticed but he was now more likely to focus on criticism of National's economic record.

So it’s not about what he stands for, is it.

Perhaps it’s the power, he’s after?

Monday, September 22, 2014

‘Young Merchants,’ by Henry Carey

The Young Merchants, 1842, oil on canvas, 1070x920mm,
The Carey Collection,
Pennsylvania Academy of Fine Arts

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The key is to look sane

Guest post by Suzuki Samurai

It's far easier to view NZ elections from afar: not quite so mind numbing -- not confronted with the constant media barrage, the hoardings, the endless chatter at the water cooler or pub.

My primary source of information has been this blog's analysis of the deep-meat; my other source being the endless shallow water of the NZ Herald. The Herald's obsession with the German elephant in the room isn't really surprising in that he makes great copy (to them) in an otherwise barren political landscape.

For them, he adds a Baron to the barren. As much as most folk were sick to their back teeth months ago having to see this goon everywhere they looked, what would the media have had in this election without him? What I'm left wondering is whether the media were just squeezing this for it's alleged juice, or trying to unsettle PM Key, or helping him out. Whether or not that was the plan and most likely not) the latter has been very effective.

So what of the rest of the cast in this pantomime?

Starting from the left:

The Greens showed that ageing hippies are still their mainstay. Despite their indoctrination from every teacher they’ve ever had, the youth vote only has a passing interest in dreadlocks, grow-your-own-bicycles, and drinking their own urine. Turns out, as they grow up, most want to enter the grown up world of capitalism 'cause it makes cool stuff.'   Even if they don’t yet have a grip on what capitalism is, most seem to know what to avoid.

The Inter-Maori-Lala Party: Perhaps an idea can be drawn from what I imagine it was like being member of one of their caucus meetings:

Click here to read more ... >>

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Saturday, September 20, 2014

Saturday Morning Ramble: No, No, No

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“There are going to be big changes, even with a NO vote.”
What next after the Scotland referendum? – Eamonn Butler, ADAM SMITH INSTITUTE
Scottish referendum: Alone, Scotland will would go back to being a failed state – Niall Ferguson, TELEGRAPH
The masses are far more rational than the unhinged political class – Brendan O’Neill, SPIKED
Celebrities react badly to the referendum result – SPECTATOR
Scottish Leader Quits – VODKA PUNDIT
Scotland and the irrational media – Alberto Mingardi, ECON LOG
Scotland the Brave – James Allan, QUADRANT

Most socialists will tell you that they became socialist out of concern for the poor. So if they learned that 600 million people have ben lifted out of poverty over the last 25 years, wouldn’t they be shouting that revelation, and the reason for it, from the rooftops?
Who Really Wants to Solve the Problem of Poverty?Stephen Hicks, EVERY JOE

An excellent way to brush up on the most colossal and destructive political and economic flop of all time.
The Politically Incorrect Guide to Socialism – Kevin Williamson, AMAZON

“The potential gains from planning liberalisation are clear: lower housing costs, a reduced cost of many goods and services, a better functioning labour market, and higher productivity and wages. The question is whether there is any appetite among our politicians to take on the vested interests opposed to reform.”
Planning liberalisation is the closest thing there is to an economic silver bullet – Richard Wellings, IEA BLOG

The Capitalist’s Guide to the Ideas Behind Ayn Rand’s Atlas Shrugged.
GREAT DEAL: Why Businessmen Need Philosophy for Under $6 On Amazon – DOLLARS AND CROSSES

There’s an easy solution you know.
Looming shortage of prime office space in the capital, says Colliers – INTEREST.CO.NZ

The world has one Colbert too many. Possibly more.
Colbert's legacy lingers on – Oliver Hartwich, NBR

Book Launch: “It takes a lot to really wreck either a city or a nation.”
The plan against the rebuild – Eric Crampton, SPEAKER

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“Which countries actually believe in free trade?, understand free trade?”
Why don’t we have more free trade? – Tyler Cowen, MARGINAL REVOLUTION

“The potential gains from planning liberalisation are clear: lower housing costs, a reduced cost of many goods and services, a better functioning labour market, and higher productivity and wages. The question is whether there is any appetite among our politicians to take on the vested interests opposed to reform.”

It’s stimulus season again. They hope.
Weak uptake for new eurozone stimulus program- HERALD
Our obsession with monetary stimulus will end in disaster – DETLEV SCHLICTER 
Keynes was a failure in Japan – No need to embrace him in Europe – DETLEV SCHLICTER 
As Germany loses battle for ECB, QE goes global – DETLEV SCHLICTER

After a sharp slowdown, stimulus is back on the agenda in China

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“The global warming movement is imploding.”
EU Dismantles Its Climate Commission Amid Economic Struggles – Michael Bastach, DAILY CALLER

“Misuse of climate models as false prophets is costly in lives as well as treasure. To condemn the poorest of India’s poor to continuing poverty is to condemn many to an untimely death. India Prime Minister Narendra Modi is right to have no more to do with such murderous nonsense. It is time to put an end to climate summits. Real-world evidence proves they are not needed.”
Stop the Scare! (GIGO climate models vs. human needs) – Willie Soon & Christopher Monckton, MASTER RESOURCE

“So how did we end up mistaking a wicked mess for a tame problem? The main problem has been putting the policy cart in front of the scientific horse.”
The Sound Of Settled Science – Judith Curry, SMALL DEAD ANIMALS

“Yesterday marked a not unimportant court deadline in the upcoming Mann vs Steyn trial of the century…”
The Lonesomest Mann in TownMark Steyn, STEYN ONLINE

“Anytime you hear the green corporate marketing buzzword "sustainable", you know you're likely being had. Sorry to break your hearts, hippies.”
Green energy more hype than benefit – Larry Bell, CLIMATE FACTS

“If a science has an adjective,
it probably isn’t a science.”

- Richard Feynman

“Tens of thousands of protesters will be swarming New York this Sunday to encourage the United Nations to call for drastic cuts for fossil fuels. They think they are doing the moral thing in encouraging the UN to oppose the use of coal, oil, and natural gas. In fact they’re supporting policies that would cut billions of lives short.”
Six Reasons Why the United Nations Should Not Intervene on Fossil Fuel Use (A Response to the Misguided People's Climate March) – Alex Epstein, FORBES

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"...there is a soon-to-be released and incredibly compelling book written by the Center for Industrial Progress’s Alex Epstein titled The Moral Case for Fossil Fuels. Its main premise is that both the short- and long-term benefits of using fossil fuels greatly outweigh the risks of any climate change that may occur as the result of the accompanying carbon dioxide emissions."
Is it “Moral” to Restrict Fossil Fuel Use to Mitigate Future Sea Level Rise? – Patrick Michaels & Chip Knappenberger, CATO AT LIBERTY

It would be a lot better if it really were warming

“It suited Western Leftists, during and after the War, to argue that Hitler had been uniquely evil, certainly wickeder than Stalin. It was thus necessary to forget the enthusiasm with which the two tyrants had collaborated.”
The greatest cultural victory of the Left has been to disregard the Nazi-Soviet Pact – Daniel Hannan, TELEGRAPH

“"If we want to work toward a free society, it is not enough to say that we have 'rights' or that aggression is 'bad' or that free markets are 'good.' Nor is it enough to explain why and how free markets work. If we want to advocate liberty successfully, we must understand and be able to explain where rights come from, why we have them, and how we know it. We must understand and be able to articulate what the concepts 'good' and 'bad' objectively mean—and how we know this. We must engage in philosophy."
Libertarianism vs. Radical Capitalism—Craig Biddle, OBJECTIVE STANDARD

“Multiculturalism is not really about choosing non-Western clothes if you like, or listening to World-beat music, or about rejecting racism. That is individualism. Multiculturalism is an anti-intellectual movement that denies truth to avoid facing facts, and rejects human rights and morality in the name of humanity.”
Multiculturalism Is a Failure: The Islamist's War with the Western Culture – Walter Williams, CAPITALISM MAGAZINE

"It is time for Americans to demand of themselves and of their fellow Americans that they first-handedly face the facts before their eyes, reject the dogmas of relativism and religion, realize that our enemies in this war are our enemies because they take religion seriously, and demand that our government demonstrate to our enemies that America the Beautiful is greater than Allah the Nonexistent."
Looking Back at the Post–9/11 Decade – Elan Journo, VOICES FOR REASON

“He declared undistinguishing and exterminating war, as a
part of his religion, against all the rest of mankind. The
essence of his doctrine was violence and lust. To exalt the
brutal over the spiritual part of human nature.”
- John Quincy Adams, 6th president of the United States

So, who’s feeding IS’s maw? [Click the pic for an interactive map.]

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Eugenics in the US: the guy who designed ObamaCare thinks people should die at 75 so they're not a burden to society.
Why I Hope to Die at 75 – Ezekiel Emanuel

“Out into the cool of the cyber dawn stroll the pretenders. NSA can't tell diff between criminal hacking & act of war?”
NSA Director Says Agency Is Still Trying To Figure Out Cyber Operations – SLASHDOT

“There is a troubling phenomenon I call "the anti-originality argument." The argument is that there is no such thing as genius or originality, because every new idea actually borrows from previously-established ideas…”
The "anti-originality" argument – Stuart Hayashi, CAPITALISTS FOR INTELECTUAL PROPERTY

Every man needs a project.

"We typically go through our days without devoting a thought to this this magnificent material (concrete) that helps make modern life possible. The next time you enjoy a modern building, drive down a street, or so much as stroll down a sidewalk, you might think for a moment of Joseph Aspdin (creator of Portland cement) and of the modern producers of concrete.” Unlike every politician you’ve ever met, their thought and work literally support your life.
Concrete: The Foundation of Modern LifeAri Armstrong, OBJECTIVE STANDARD

While you were looking at other things…
CERN closes in on antigravity answer – BBC NEWS

“It’s a wonder so many of us lived through childhood considering how little it seems our parents knew about safety.”
5 Things Our Parents Did That Would Get Them Arrested Today – LIBERTY CRIER

“Will Self's attacks on Orwell only expose his own alienation from and disdain for the public.”
Self, Orwell and the English language – Bruno Waterfield, SPIKED

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“Peter sees a big vagina. ‘That’s a big vagina,’ says Peter. ‘Big vaginas are feminist,’ says Mummy. Peter is scared.”
Peter and Jane Go to the Art Gallery – Miriam Elia IMGUR

“Four books that I learned from and that focus on the postmodern challenge in specific intellectual areas…”
Four recommended books on postmodernism – STEPHEN HICKS

Zapp: Why's it still blurry?!
”Kif: That's all the resolution we have. Making it bigger doesn't make it clearer.
”Zapp: It does on CSI: Miami.”
Then 'Enhance' Button – TV TROPES

The previously untold true story of David Bowie, Brian Eno, and Tony Visconti recording "Warszawa" from Low. Seriously. True story.

And the result…

How to get the most out of your orchestra…

Another method…

“Truly awful.”

[Hat tips Maria Montessori Education Foundation, Stephen Hicks, Bosch Fawstin, Auckland Philharmonia Orchestra, Stats Chat]

And finally …

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