h1

The State is not your friend (2)

December 7, 2016

This interesting article at The Economist comes via Paul B. Everyone knew that travelers’ luggage was being searched, but who knew there was an DEA-funded incentive program?

This stuff won’t stop until the legal theft we call civil asset forfeiture is outlawed and we put an end to the War on Drugs.

Transport employees in America were secretly paid by the government to search travellers’ bags

THERE are many reasons why you might have been stopped at an American transport hub and your bag searched by officials. You might have be chosen at random. Perhaps you matched a profile. Or you could have been flagged by an airline, railroad or security employee who was being secretly paid by the government as a confidential informant to uncover evidence of drug smuggling.

A committee of Congress heard remarkable testimony last week about a long-running programme by the Drug Enforcement Administration. For years, officials from the Department of Justice testified, the DEA has paid millions of dollars to a variety of confidential sources to provide tips on travellers who may be transporting drugs or large sums of money. Those sources include staff at airlines, Amtrak, parcel services and even the Transportation Safety Administration.

The testimony follows a report by the Justice Department that uncovered the DEA programme and detailed its many potential violations. According to that report, airline employees and other informers had an incentive to search more travellers’ bags, since they received payment whenever their actions resulted in DEA seizures of cash or contraband. The best-compensated of these appears to have been a parcel company employee who received more than $1m from the DEA over five years. One airline worker, meanwhile, received $617,676 from 2012 to 2015 for tips that led to confiscations. But the DEA itself profited much more from the programme. That well-paid informant got only about 12% of the amount the agency seized as a result of the his tips. […]

DEA delenda est

h1

Radioactive diamond "batteries"

December 4, 2016

This is an unexpected twist on an old problem based on research done at the University of Bristol (in the UK).

Via NewAtlas

Naturally I have to wonder how scalable this technology is. How much energy can be extracted from one of these diamond generators at a steady rate. Are we talking microwatt-hours, milliwatt-hours, watt-hours, or kilowatt-hours?

And, second, I have to wonder how many ‘eternal’ batteries we want out in the wild. How would you ever disable one of these if that were necessary?

h1

Crony-in-chief?

December 4, 2016

Peter Suderman writes an interesting column at Hit & Run about Trump, politics, and free markets.

Yes, We Should Worry About Donald Trump’s Business Conflicts of Interests—and His Whole Approach to the Interaction Between Government and Business

The president-elect was a crony capitalist businessman. Now he’s set to become a crony capitalist politician.

As a real estate developer, Donald Trump made and sought special deals designed to use the power of government to improve his personal bottom line.

The first building project he ever developed, the Grand Hyatt hotel in Manhattan, was completed using a multi-decade tax abatement obtained using his father’s connections. This was not a broad-based tax cut so much as a state-granted subsidy that granted Trump’s project the financial wherewithal to proceed. In 1994, Trump proposed that the city of Bridgeport, Connecticut, become a partner with him on a $350 million theme park project, allowing him to get access to land by declaring a number of businesses as condemned properties. Over the course of his career as a developer, he repeatedly pressured the government to use eminent domain to clear private property owners out of the way, including one instance in 1994 in which he requested that the government kick an Atlantic City widow out of her home in order to replace it with a limousine parking lot. While campaigning for president, he aggressively defended the use of eminent domain, calling it a “wonderful thing,” and describing it as necessary for construction projects that create jobs.

For Trump, this is not merely a business strategy. It amounts to a working theory of how government and the private sector should interact. And it is one that should worry anyone concerned about maintaining a fair and proper division between the state and the private sector. […]

He doesn’t believe that the government’s role is to set clear ground rules and let market competition work things out. […]

Remember all the well-deserved grief Obama took for Solyndra and Fisker?

Meet the new boss, same as the old boss…

h1

How crony capitalism works

December 2, 2016

Kevin Williamson has a good article about how Trump ‘saved’ jobs at a Carrier plant in Indiana. RTWT.

The Economic Stupidity of the Carrier Bailout

One particularly tough and indigestible nugget of talk-radio stupidity afflicting the guts of conservatism is the idea that there is some sort of fundamental difference between bribing a business with tax cuts and bribing it with a wheelbarrow full of cash. The Trump-Pence bailout of Carrier’s operations in Indiana provides an illustrative case. […]

Republicans might have had a little bit of a point in the question of general tax cuts: A tax cut and spending are different things, even if the budgetary effects are exactly the same.

But in the matter of industry-specific or firm-specific tax benefits of the sort extended to Carrier in Indiana, they do not have a leg to stand on. These are straight-up corporate welfare, ethically and fiscally indistinguishable from shipping containers full of $100 bills. […]

For Carrier’s accountant, any pecuniary benefit will do. So far as the bottom line is concerned, a $7 million tax credit is the same as a $7 million check or $7 million in Apple stock or $7 million in gold. It’s all +$7 million on the line where you want it. […]

This is a case of Frédéric Bastiat’s problem of the seen vs. the unseen. The benefits are easy to see, all those sympathetic workers in Indiana. The costs are born by sympathetic workers, too, around the country, and by their families and by their neighbors. But those are widely dispersed, so they are harder to see and do not hit with the same dramatic impact.

But the math is the math is the math. Trump and Pence are trying to sell you a free lunch, the same way the Keynesians and their magical spending multiplier do when they promise that government stimulus programs (Trump is pushing one of those, too) will somehow magically pay for themselves. […]

I suppose the good news for most of us is that the State of Indiana (and its taxpayers) will be the ones picking up the tab for this.

Bastiat’s That Which is Seen, and That Which is Not Seen.

h1

How a market works

December 2, 2016

This is an interesting story that I read on Dan Lewis’s Now I Know list. (Now I Know is worth a look, if you’re not already a subscriber.)

To set the scene: Herbert Dow, founder of Dow Chemical, came up with a new way to refine bromine in 1891. That was the good news; the bad news was that he got into a trade war with an international cartel when he tried to sell his bromine outside the U.S.

Here’s the bulk of Dan’s article, called The Bromine Gambit:

Before Dow came onto the bromine scene, a German government-backed cartel named the Bromkonvention had a monopoly on bromine. As Investopedia explains, the Bromkonvention “sold bromine at a fixed price of 49 cents per pound, but it would implement a predatory pricing strategy quickly, if challenged.” And Dow Chemical posed such a challenge.

Dow Chemical operated independently of the Bromkonvention, which didn’t make the Germans all that happy, but they were willing to coexist so long as Dow kept its bromine sales within the United States. And considering that Dow was selling bromine at 27 cents per pound — about 45% less than what the Bromkonvention priced it at in Europe — the Germans saw Dow as a real threat. So the Bromkonvention made a threat of their own: if Dow entered markets outside the United States, the Bromkonvention promised to use its huge supplies of bromine to force Dow out of business by selling it cheaply — below cost — in the States.

Dow called their bluff, selling bromine to England. And the Bromkonvention retaliated. The cartel began dumping bromine in America, offering it for sale at 15 cents per pound. Dow couldn’t compete, and it didn’t have any other products to make up for the shortfall. This put Dow’s business in jeopardy — in theory at least.

In practice? Something went wrong, at least from the perspective of the Bromkonvention. American demand for bromine went up, as expected, but by leaps and bounds — no matter how much bromine Bromkonvention sold there, it would sell out, and Dow was still able to find customers at its 27 cents/pound price point. Not only did Dow not go out of business, but it expanded. Dow began selling its bromine — still at 27 cents per pound — in Germany itself.

How was this possible? Instead of dropping its price to meet that set by the Bromkonvention, Dow became buyers, as Investors Business Daily (via the Indianapolis Recorder) explains: “[Herbert Henry Dow] had an agent secretly buy up hundreds of thousands of pounds of the cut-rate imported bromine.” And what do you do with that bromine? IBD continues: Dow would then “repackage [the cheap bromine] and export it back to Europe.”

The Bromkonvention, at first, wasn’t sure where the cheap European bromine was coming from; in that interim period, they also continued their price war against Dow and continued to lower the price in the U.S. (ultimately to 10 cents/pound). In the end, there wasn’t a price low enough to force Dow out of business, as Dow was well-enough capitalized to buy up the dumped bromine and arbitrage its way to success. (And besides, the Bromkonvention made it easier and easier by lowering the price.) A century plus later, Dow is still around; the Bromkonvention is long gone.

Dan writes that Dow Chemical had the capital reserves to buy up the "dumped" bromine. But I’ll guess that in this case it wouldn’t have been to hard to find speculators – or banks – willing to loan the money to buy the under-priced bromine.

h1

In that case, let the good times roll

December 1, 2016

Here’s a news item from New Zealand about a biology professor from the University of Arizona. (Mr. McPherson is a professor emeritus at Arizona.)

Humans ‘don’t have 10 years’ left thanks to climate change – scientist

There’s no point trying to fight climate change – we’ll all be dead in the next decade and there’s nothing we can do to stop it, a visiting scientist claims.

Guy McPherson, a biology professor at the University of Arizona, says the human destruction of our own habitat is leading towards the world’s sixth mass extinction.

Instead of fighting, he says we should just embrace it and live life while we can.

“It’s locked down, it’s been locked in for a long time – we’re in the midst of our sixth mass extinction,” he told Paul Henry on Thursday. […]

Where the hell is Julian Simon when we need him?

And check out Professor Curry’s talk that I mentioned recently.

h1

Was the election also a referendum on climate change?

November 27, 2016

A couple of days ago, I watched a video of Judith Curry talking about Climate Science and the Uncertainty Monster. Her presentation is long (and a little dry) but she brings up some interesting points.

One of the slides in Curry’s presentation was a map of state-by-state support for President Obama’s climate change programs. Here’s Curry’s map, captured from the video. (You can find a very similar map at ThinkProgress.)

curry-state-map

Look familiar? Here’s a map of Electoral College results (via 270toWin.com).

2016-election-results

I was struck by the correlation between the two maps, even though it’s not perfect.

Since the election, I’ve read any amount of commentary along the lines of "Trump’s victory means (fill in the blank)." The collection of opinions I’ve read reminds me of the elephant and the blind men. Everyone’s putting his own interpretation on the Trump elephant and frequently, I suspect, with little knowledge about Trump himself.

But I suppose you could add my interpretation here to that collection because what I’ve gathered from the people I know is that reaction to new Federal regulations under the Obama administration – climate change, among many others – was a factor in Trump’s win.

But back to the maps: It doesn’t surprise me that states whose governors & legislatures support active measures against climate change voted Democrat while those that don’t support those measures voted Republican. Before liberal readers begin buffing their halos as members of the Reality Party, though, it seems to me the Democrat support for action on climate change could have any number of explanations.

And that brings me to an article that John Tierney published in City Journal recently. I found Tierney’s article pretty interesting and you should RTWT. (My emphasis below.)

The Real War on Science
The Left has done far more than the Right to set back progress.

My liberal friends sometimes ask me why I don’t devote more of my science journalism to the sins of the Right. It’s fine to expose pseudoscience on the left, they say, but why aren’t you an equal-opportunity debunker? Why not write about conservatives’ threat to science?

My friends don’t like my answer: because there isn’t much to write about. Conservatives just don’t have that much impact on science. I know that sounds strange to Democrats who decry Republican creationists and call themselves the “party of science.” But I’ve done my homework. I’ve read the Left’s indictments, including Chris Mooney’s bestseller, The Republican War on Science. I finished it with the same question about this war that I had at the outset: Where are the casualties?

Where are the scientists who lost their jobs or their funding? What vital research has been corrupted or suppressed? What scientific debate has been silenced? Yes, the book reveals that Republican creationists exist, but they don’t affect the biologists or anthropologists studying evolution. Yes, George W. Bush refused federal funding for embryonic stem-cell research, but that hardly put a stop to it (and not much changed after Barack Obama reversed the policy). Mooney rails at scientists and politicians who oppose government policies favored by progressives like himself, but if you’re looking for serious damage to the enterprise of science, he offers only three examples. […]

The danger from the Left does not arise from stupidity or dishonesty; those failings are bipartisan. Some surveys show that Republicans, particularly libertarians, are more scientifically literate than Democrats, but there’s plenty of ignorance all around. […]

The first threat is confirmation bias, the well-documented tendency of people to seek out and accept information that confirms their beliefs and prejudices. In a classic study of peer review, 75 psychologists were asked to referee a paper about the mental health of left-wing student activists. Some referees saw a version of the paper showing that the student activists’ mental health was above normal; others saw different data, showing it to be below normal. Sure enough, the more liberal referees were more likely to recommend publishing the paper favorable to the left-wing activists. When the conclusion went the other way, they quickly found problems with its methodology. […]

And that brings us to the second great threat from the Left: its long tradition of mixing science and politics. To conservatives, the fundamental problem with the Left is what Friedrich Hayek called the fatal conceit: the delusion that experts are wise enough to redesign society. Conservatives distrust central planners, preferring to rely on traditional institutions that protect individuals’ “natural rights” against the power of the state. Leftists have much more confidence in experts and the state. Engels argued for “scientific socialism,” a redesign of society supposedly based on the scientific method. […]

(H.T. Jeff G)


Update 11/28/16: Here’s a more recent, post-election, column by Tierney. (My emphasis again.)

Trump and Science

What will a Trump administration mean for scientific research and technology?

The good news is that the next president doesn’t seem all that interested in science
, judging from the little he said about it during the campaign. That makes a welcome contrast with Barack Obama, who cared far too much — in the wrong way. He politicized science to advance his agenda. His scientific appointees in the White House, the Centers for Disease Control, and the Food and Drug Administration were distinguished by their progressive ideology, not the quality of their research. They used junk science—or no science—to justify misbegotten crusades against dietary salt, trans fats, and electronic cigarettes. They cited phony statistics to spread myths about a gender pay gap and a rape crisis on college campuses. Ignoring mainstream climate scientists, they blamed droughts and storms on global warming and then tried to silence critics who pointed out their mistakes. […]

Trump has vowed to ignore the Paris international climate agreement that committed the U.S. to reduce greenhouse emissions. That prospect appalls environmentalists but cheers those of us who consider the agreement an enormously expensive way to achieve very little. Trump’s position poses a financial threat to wind-power producers and other green-energy companies that rely on federal subsidies to survive. […]

%d bloggers like this: