If you invested $100 in 1965 at Social Security’s rate of return, today you would have $254.91. But if you invested that $100 in the market, today, even with the current down market, you would have $4,135.92.
However, we see a shift in power from markets to government as adverse nonetheless. Individual political leaders have less knowledge than is aggregated by markets. They face perverse incentives. And they pervert the incentives of others. Witness today's economy, in which everyone is asking not how they can create wealth but how they can get their share of a bailout.
More of this, please:Radiology has long been at the forefront of telemedicine, and now it is paving the way into another area of medicine...auctions! Enter Telerays radiology auction service, where batches of studies are auctioned off to the radiologist with the lowest bid. That doesn't sound very reassuring until you read through the company's reassuring credentialing process.
The radiologists are recruited from across the US in what appears to be a win-win proposition. For physicians, the Telerays system allows for as much or as little work, when and where they want, while simplifying billing arrangements. For hospitals, it adds access to radiologists, including sub-specialists (that may not be available in a smaller center) while potentially allowing for cost savings as well.
The worst thing you can say about libertarians is that they are intellectually immature, frozen in the worldview many of them absorbed from reading Ayn Rand novels in high school. Like other ideologues, libertarians react to the world's failing to conform to their model by asking where the world went wrong. Their heroic view of capitalism makes it difficult for them to accept that markets can be irrational, misunderstand risk, and misallocate resources or that financial systems without vigorous government oversight and the capacity for pragmatic intervention constitute a recipe for disaster. They are bankrupt, and this time, there will be no bailout.
Radley Balko: As I mentioned this morning, what gets me is this notion that libertarian ideas have been tried, and failed. That’s not the case at all. This administration has denounced libertarians at every turn. Its ideas come largely from the moral right and from the neconservatives, two groups wholly at odds with libertarianism.
Brink Lindsey: In firing this broadside, Weisberg poses as the pragmatic, empirically minded anti-ideologue. In fact, he is engaging in the lowest and most intellectually trivial form of ideological hack work.
Will Wilkinson: I think Weisberg rightly sees that control over the popular narrative about the causes of the financial collapse could have a big effect on public opinion. And Democrats are about to win the White House together with a robust Congressional majority. So here’s the main chance! The long-awaited dream! The desperate desire! The rightful claim of establishment liberals to the commanding heights is imminent! Now is the time! The sense of entitlement is about to meet title! And the GOP is in utter disarray, having long ago lost any semblance of a coherent philosophy of government. The field is almost clear. Only the utopian punter, holding a tattered copy of Atlas Shrugged, guards the goal line. The embittered professors and graying editors-in-chief cannot bear to wait another season. They will wake to their triumphant dawn. The cry goes up: “Smear the libertarian queer!” And never mind the rules. Bring it, Weisberg.
Jesse Walker: When you don't believe in the heroic corporate chieftain, it should be equally hard to put your faith in that alternative fantasy, the heroic regulator: neutral and public-spirited, always attuned to market failure, constantly prepared to right the ship of commerce. Instead we favor a decentralized system of checks and balances, of which the most important are the checks imposed by an open, competitive marketplace. Not because it's heroic, but because it can ruthlessly cut a would-be hero down to size.
Matt Welch: There is no space in Weisberg's conception of "libertarians" for people like, for instance, me: Not remotely a utopian, not "of the right," never read an Ayn Rand novel, spent high school playing sports instead of reading political philosophy, don't want to do history over (except for Game 5 of the 1986 ALCS), and don't pine for some presumably awful world where everyone shares my political views. (And, I might add, unlike Weisberg, I don't want to convert my political views into increased state power over fellow citizens who don't happen to agree with me.) No, I just think that, all things being equal, capitalism is vastly superior to socialism, government is by definition inefficient, and would be much better off focused on essential tasks, rather than, say, nationalizing hundred-billion-dollar chunks of the mortgage industry, or trying to guarantee that asset prices never depreciate. In my world, at least, not all regulation is automatically evil, just ripe for being gamed by the very interests being regulated, and so better when pruned back.
We'll never know how this newly liberated financial sector might have performed on a playing field designed by Adam Smith. That's because government interventions of all kinds, from the defense budget to farm supports, shaped the business environment. No subsidy would prove more fateful than the massive federal commitment to residential real estate -- from the mortgage interest tax deduction to Fannie Mae and Freddie Mac to the Federal Reserve's low interest rates under Mr. Greenspan. Unregulated derivatives known as credit-default swaps did accentuate the boom in mortgage-based investments, by allowing investors to transfer risk rather than setting aside cash reserves. But government helped make mortgages a purportedly sure thing in the first place. Home prices seemed to stand on a solid floor built by Washington.That sounds about right.
The chief question [regarding the current economic situation] is to what extent are today's problems caused by market forces, and to what extent by government interference with these forces.
What we are seeing now is the Freddie/Fannie model applied to the entire financial sector. You need a government guarantee in order to be a player. Once government-guaranteed firms are on a firm footing, the equivalent of "affordable housing goals" is sure to follow. That is, government will be bossing capital around to an even larger extent than before.
So if you love liberty and fear those who would engineer our well-being rather than let it emerge from our free choices, if you love liberty and fear those who would use good intentions as an excuse for plunder, don't worry. We'll have our day down the road. Keep reading and writing and thinking. And don't yell. Above all, smile and hold firm to your principles. They will be remembered and valued when the pendulum swings the other way. It's just a matter of time.
This post on speedometers by Tom Vanderbilt got me thinking:Even more troubling is the speedometer’s dumbness. The device gives a simple reading that lacks context. It tells speed, but it doesn’t convey other useful information. How does the car’s speed compare to the posted limit? How much time is saved by driving faster, and how does it compare to the added fatality risk of a crash (which rises exponentially at higher speeds)?
Following a meeting in Quebec City, Canada’s prime minister, Stephen Harper, and President Nicolas Sarkozy of France, who is the president of the European Union as well, are expected to sign an agreement for preliminary negotiations meant to create a trade pact between Canada and Europe that would be even more sweeping than the North American Free Trade Agreement.
If adopted it would minimize barriers in services, include sales to government, open up the air travel market and allow skilled Canadians and Europeans to work across borders without visas.
Obama's sinophobia could qualify him for a contributing editor slot at The Weekly Standard...
We should encourage the immigration of prime-age individuals. Beginning in 2007, net immigration fell to half of its level over the previous five years. Increasing immigration would increase the demand for housing and raise home prices. And note that the benefit would be immediate. Home prices -- and the value of subprime obligations -- would rise in anticipation of a higher population base. The U.S. particularly needs highly skilled workers. These workers not only would purchase homes, but would generate higher living standards for all Americans.
Some analysts have voiced concerns that this might not be the best strategic move; here's the reply, an instant classic:
Edward Barnes, JetBlue's chief financial officer, says the airline isn't worried. "You can't underestimate the brand," he said.You can't underestimate the brand. It raises an obvious question: What brand?
Mark goes on to clearly illustrate how JetBlue's service has deterioriated, and I agree with him that, with the attitude of its CFO, it's only a matter of time before the brand's image begins suffering serious damage. Maintaining a positive brand image (by creating a positive user experience) seems to require constant vigilance lest suffer a regression to the mean at the hands of business arrogance.
Image from here.
George Mason University economist and author Russell Roberts, who blogs at the always interesting Cafe Hayek, sat down with reason.tv to talk about the nation's shakey economy and the government's bailout plan.
Via Boing Boing and the Putting People First comes the story of some interesting research by Dutch psychologist Christof van Nimwegen.In "The Paradox of the guided user: assistance can be counter- effective," van Nimwegen asked two groups to perform the same tasks. The first was allowed use a computer; the second group only got a pen and pencil. The second group executed all tasks faster and performed substantially better. In addition, their solutions to complicated problems were more creative.
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Van Nimwegen says much software turns us into passive beings, subjected to the whims of computers, randomly clicking on icons and menu options. In the long run, this hinders our creativity and memory, he says.
NUTRITION PRIZE. Massimiliano Zampini of the University of Trento, Italy and Charles Spence of Oxford University, UK, for electronically modifying the sound of a potato chip to make the person chewing the chip believe it to be crisper and fresher than it really is.
The internet is a buzz with rumors on the latest “viral” video of Dan Aykroyd showing us his new Crystal Head Vodka in a gorgeous glass skull...Apparently it is made by Diamond Estates Wines & Spirits Ltd, out of Newfoundland water triple crystal filtered through herkimer diamonds (aka double-terminated quartz crystals)! Really the story is just great though, and the video and bottle make the experience priceless...
Midway Airport is poised to become the first large privately run hub airport in the country, officials said Tuesday, after an investment group bid $2.52 billion to win rights to a long-term lease, The New York Times’s Susan Saulny writes.
The deal with Midway Investment and Development Company, requires final approval from the Federal Aviation Administration and the Chicago City Council, which is set to vote Oct. 8.
Almost all commercial airports in the United States are owned and operated by local or state governments, and Midway is no exception. But Midway is eligible for leasing because the city applied to the F.A.A. to take part in an experimental program begun about 12 years ago to explore privatization as a means to generate capital for improvements.
Congress has allowed the agency to permit up to five airports to take part in the program, and if the Midway deal is approved, it will be the first.
It's about time America caught up to Europe in this regard. In case you're wondering, here's the list of top 10 airports worldwide. They're all in Asia, Europe, and Africa, and some of the airports are operated by governments while others are operated by private companies. There are currently no US airports (all of which are run by some governmental entity) in the top 10. Maybe Midway's new privatization can change that?
Image from here.
