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Terry Bennett
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Hindsight is 20/20. The Cuban missile crisis was a perfectly valid justification, and we should have razed Cuba and occupied it - not Bay of Pigs style, but Iraq 1991 style. (What were the Russians going to do - try to fight a war on the other side of the world against a superpower in our own back yard, without an ally or staging base within 5000 miles? Nonsense.) Instead we've been dignified / cowardly and we've put up with the antics of this odious, annoying little man for my whole lifetime. If there is any remote justification at all for Jim's assertion that I owe the Cubans money, it might be in the fact that we could have stopped Castro from inflicting the ensuing misery on the people of Cuba. However, by that standard, we owe a lot of money to a lot of people. I don't buy it, this consensus appointment as world policeman. In fact, we were extremely generous to any Cuban able to make the 90 miles to Key West, not only taking them in but giving them a share in our own sovereignty. In raw numbers, Castro had a clear majority at first, especially after the upper class left. Wealth disparity, the wendigo of this site, can drive discontent in the unproductive class, and lead to forcible theft from the productive. Obama proved you can promise to take from the rich and give to the poor and get more than 50% of even U.S. voters to back you. That doesn't make it moral. I would thus argue that the Cuban people in effect voted for Castro, however foolishly, and they can get their reparations from where the sun don't shine. I'm not an insurer of their bad decisions. Plenty of leaders rise popularly into power and then decide they don't want to leave, from Ferdinand Marcos to Charles Taylor. Not my problem. As for the embargo, I don't think it matters a hill of beans either way. I suppose some Americans would like access to the cigars, but we have a wider policy that when leaders of small ineffectual countries treat their people badly, we stand up and call them on it, and the embargo remains consistent with that pretense.
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Senior to all of these concerns is freedom, which necessarily includes freedom to engage in questionable behavior (and I speak as a non-participant). The original grounds on which the right to use marijuana was taken away were dubious at best (or should I say doobie-ous?). I do not see where there is anything approaching a compelling state interest to justify putting this limit on our liberty and pursuit of happiness. Even worse, the regime itself has created a whole class of social problems that would not exist had our grandfathers not taken issue with the substance in the 1930's. I have been amazed at the resistance to even medical legalization, considering we let doctors dispense things like morphine. Now it does seem like the dam has broken, and the millions of people who already use it can now keep doing what they're doing, minus the stress. What I would like to see is a continued demand for individual responsibility. I have always thought the opium den was a great idea, a place where you can safely go and take an action that will render you unable to control yourself, without risking hurt to anyone else - sort of like a bar where they make you sleep it off before you can leave. Every state has forceful drunk driving laws, a big neon sign telling people, "We don't want you to do this!" Still, every week in court I see lots of DUI's, including lots of repeat offenders. Obviously, the penalties are not enough to dissuade these people from putting my life at risk. I would be fine with legalizing marijuana and other drugs, if the legislature would simultaneously amend the statutes to the effect that a person who drives a car while under the influence of alcohol or drugs, in any amount, has committed an attempted murder, with a mandatory minimum 15-year sentence. If there is actually a fatality, it should be first degree murder - the ingestion was pre-meditated. Back in the 60's, the flower children used to say, "Do whatever you want to do, be whatever you want to be, just as long as you don't hurt anybody." As moral codes go, it's not at all bad.
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One of the most peculiar myths underpinning the liberal agenda is deliberate conflation of the concepts of skill and talent. Proponents rail, "We need to train our workforce to lower unemployment!" This presumes that the only difference between a person with a job and a person without a job is a specific, objective, teachable skill set. The people saying this are not the people doing the hiring, so maybe they don't have a clue - or maybe they know better and lie. Many people don't get hired because they are obviously stupid, or obviously non-conformist. If they obtain a learned skill set, they still show up for an interview as a stupid and/or non-conformist person with a learned skill set. Thanks once again to Judge Posner for giving this implicit discounting of talent the stiff punch in the nose and curt dismissal it warrants. However, as I noted in response to Dr. Becker's post, it certainly appears to me that there is value in a college degree, even for an individual of marginal IQ, because employers in our time have elected to rely so heavily, even blindly, on this qualification. A degree is a ticket to the dance, because the owner of the dance hall says so. Whether you can dance or not is a separate question, to be answered later when the music starts. As for what to do about it, I do agree that there is great efficiency to be gained by increased targeting of education to real world jobs. As an example, one of the jobs that cannot be outsourced is the configuring of desktop computers, local area networks, and other tech hardware in the workplace. An individual can take a several-month course and learn how to do this specific work, take a test / get a certification (such as Microsoft's "A+"), and can then productively go to work in an office maintaining tech infrastructure. The problem is that the certification, however valid, only documents the skill set, and not the "show up for work" part of the employer inquiry. Employers choose to continue leaning on their recently discovered shortcut, and post the job requirements as "bachelor's degree PLUS tech certification". So, we're right back where we started. One thing employers could consider doing is setting their hiring baseline as "bachelor's degree or honorable military discharge". A military tour documents the same thing as the college degree - those guys definitely know how to show up for work! I agree with Matt (not Da) regarding the perverse incentives of Dr. Becker's low wage / low repayment suggestion.
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College is the new high school, today's baseline of achievement, and this change has been market driven. Employers have imputed value to a college education by implementing policies such as, "We won't hire you to sweep floors unless you have a bachelor's degree." College is an obstacle course, and a degree is proof of an individual's wherewithal to navigate it - to get up and show up for four years and meet a goal. Whether he learned anything is of little consequence. It's just one more bureaucratic requirement, like a vaccination. A rule is substitute for thinking, and through this rule HR departments are relieved of the task of looking for diamonds in the mud - and there no doubt are some very talented people lacking degrees who could contribute if given the chance, but the transaction cost of finding them is probably prohibitive, and so employers have opted for this shortcut en masse in recent years. It also means you can get by with less talented HR people who no longer need to have an eye for talent but merely need to check paperwork. Government is one of the biggest proponents of this approach, which further objectifies candidate search and shields against claims of discrimination. This is also why there may be a certain amount of skill to be found in the government workforce, but notoriously little talent - it is not rewarded, and so tends to go elsewhere. Colleges meanwhile have reaped the windfall of this systematic attempt to exclude the losers from the workplace, as they have morphed from providers of a luxury into providers of a necessary product, and they thus can and do charge more, in response to market conditions. Colleges have also overbuilt, and some of them have taken it on the chin, notably law schools, as demand fell during the fiscal meltdown. I think the issue is thus more aptly framed not as the value of having a college degree (as distinct from a "college education", which is a diaphanous hypothetical), but rather as the cost of not having a college degree.
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The question posed is whether we are ungovernable. Obviously we are still getting governed. There are tiny pockets of lawlessness, and some regulations get flaunted for a time, but there is enough enforcement to compel at least some measure of compliance from most people. E.g., a speed limit of 65 doesn't keep everybody at 65, but it does make almost everybody think twice about going 100. We are not, however, governed with anything approaching the efficiency available via current technology. We could be governed much more effectively and much less expensively, but it would require modernization of our thinking. There are two obstacles to this - one is that the current force of civil servants actually doing the work don't have the tech chops to make it happen, and the second is that deep down people don't really want the government to be too good at what it does, because they don't really like what it does. Maybe in a generation we'll have replaced the old guard of bureaucrats with tech-comfortable individuals, but it remains to be seen whether their attitudes will change as they age, and suspicion of government will eclipse any interest they have in improving efficiency.
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John D. Rockefeller started dirt poor and amassed the largest fortune in American history. The single reason this feat is unlikely to ever be repeated is that he did it back when there was very little in the way of government meddling to prevent his success. Bill Gates climbed perhaps from the bottom of the top 20% to the absolute top - still impressive, but not nearly as unthinkable. There are people in this country who have decided to exercise their inalienable rights to life, liberty, and the pursuit of happiness by trying to make a lot of money. Some of them, it turns out, also have a lot of talent in that arena. Somebody who is good at something and dedicates his or her life to working at it is likely to have outsize success in whatever he or she happens to be pursuing. The result is, we have some very very rich people. As the collective wealth of the country has been increasing in recent decades, most of the increase has fallen into the hands of these people. Stated another way, if you add up everything that individual Americans produce and the rewards they receive therefor, the bottom 99% produce about as much today as they did 30 years ago. (Maybe they produce more goods, but they produce about the same VALUE.) The top 1% are the ones who have increased their reward because they are the ones who give a crap about having even more money and have made it their mission to acquire same, by producing more value and servicing demand in new and better ways. The lazy communists would suggest that nobody should be able to buy a ride to the space shuttle unless everybody can. Constraining our best performers does nothing to help the poor - it just makes the non-performers, such as those who make whole careers out of complaining about it, feel better to vilify those who have roundly outperformed them. The top 1% didn't win by cheating; rather they followed the rules scrupulously: doing the necessary work to gain entry to top schools, earning degrees in the right fields, taking jobs in the right industries at the right firms, performing well, moving up, maybe starting new companies to enact their visionary ideas, etc. Their story is irrelevant to the question at hand. Too many discussions of the failures of the poor are nothing more than thinly disguised sour grapes upon the successes of the rich. No matter at what level you start, achieving (or maintaining) tier 1 success requires consistently doing things right, over a whole career. If you're a pothead or a womanizer or you can't spell or add two-digit numbers in your head, you probably do not have what it takes to succeed at that level. They aren't shoveling coal, but these are extremely focused and hard-working people. Consider New Jersey's Governor, who did a lot of things right to rise as he has, and now suddenly will be undone by one mistake - regardless of whether it turns out that mistake was ordering a political payback, or having the poor character-judging skills to hire someone who would order a political payback. The way to improve the lot of poor people is to put a floor under us and not a ceiling over us. Perhaps there is some social value in fostering mobility from the 0-20 bracket to the 20-40 and maybe even to the 40-60 bracket, but once people are average they can decide for themselves if they want to do the work to rise even higher on their own, so they too can be despised by those who once claimed to want to help them.
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Thomas, 1) I don't particularly care if we do it; I'm just saying it's quite feasible to defeat gerrymandering in this way if is a sufficient problem. For that matter, it is even feasible now to disband Congress and put every bill to the voters directly. 2) I think political paralysis is exactly what the Founders were going for. I'm observing it, but as a moderate I'm not sure we're "suffering" from it. I suspect either side would be capable of inflicting an even more unpleasant tyranny given full reign.
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The U.S. is not a perfect melting pot. There are lots of lumps in the ore. People tend to cluster with others with whom they identify, whether by race, religion, culture, wealth, political disposition, or even affinity for a sports team - and everybody knows where the boundaries are. Thus, if we were to simply superimpose a grid of equal squares upon the map, we'd tend to get some heavily Democratic and some heavily Republican districts anyway. The sin of the gerrymander is that it's dirty pool: sometimes an attempt to unite a group of people, and sometimes an attempt to dilute them, but always a diversion of the fair course of events. What seems to have gone unnoticed is that in 2014 A.D. we have computers, which the Founders did not, and as I have written elsewhere, there are lots of ways to achieve more accurate representation with what is now rudimentary information technology. For instance, let's send the top two vote-getters in each district to Washington. Each Representative will carry a number of votes equal to how many votes he or she got back home. A typical House vote of the future, instead of tallying 290-to-245, might tally 86 million-to-48 million, much more true to the Founding vision of a house of "representatives", now that we have the means to achieve it. We can go a step further, and have voters rank candidates instead of just picking one. Of the two who win, whichever one gets ranked higher on a given individual's ballot gets the strength of that vote. Thus, everybody is represented by somebody they esteem more highly than the other guy from their district. District size and district boundaries both become irrelevant, and everybody is represented, even if your candidate doesn't win. Suppose every district sends one R and one D, each carrying the exact weight of the numbers of D's and R's in their district. (This would also encourage 100% voter participation, because even if your district is a landslide, your vote still counts.) If your district has a million voters, maybe the Democrat gets 550,000 and the Republican gets 450,000. When they get to Washington, that's how many votes they each cast. Another district of 200,000 may send 120,000 R votes and 80,000 D votes to Washington. Under the current system, those 450,000 R's and 80,000 D's are unrepresented, but in the new system they'd be counted with perfect granularity. It no longer even requires the districts to be of equal size. The dream of one voter one vote is realized. There are plenty of variations of this scheme, and plenty of other benefits. One appealing ramification is that if every district has two representatives, the competition for your allegiance is palpable all the time, and Representatives are likely to be more responsive to the sentiments of the folks back home. If your guy loses the election, you aren't left out of the process for the next two years. You can get access via the also-ran / also-won. In fact, third-party participation is likely to increase. It may be difficult for a third party to win, but it's much easier to come in second, and get a seat at the big table. Of course, never gonna happen, but it's not a can't; it's a won't.
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I remember standing on the shore at Messina in 1981 and looking over to mainland Italy, and asking my local contact why there was no bridge. He said the mafia ran the ferry. A few connected ferry operators benefited, and tens of thousands of residents on both sides were burdened, many to the point that they'd avoid the trip whenever possible. If the government wants to step in and regulate product quality or features, as they have now done with health insurance, maybe they can beat back the Chinese import machine. Meanwhile, millions of Wal-Mart customers vote every day that Its products are good enough to get the job done. Should 300 million people pay higher prices for clothes so a few thousand textile workers can luxuriate in their less than competitive production level? I'm suspicious.
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Gertrud, That's quite a different topic. Again, my outlook is net positive, but your optimism is bedazzling. I don't know what percentage of the population will be unskilled in 30 years, but I suspect it will be higher rather than lower than today, or at best the same. First, I expect the skill poverty line to be continually redefined upward. There has always been a segment of the population whose eyes glaze over when confronted with arithmetic or technology, and I think that will persist. Lots of kids today think they want a career designing games because they like playing games, but when they get into the actual sausage factory of computer science they quickly lose interest or find themselves unsuited. Second, I don't think we're going to change human nature, nor are we going to confront it. There are people who find public assistance sufficient, and have no further incentive to be productive. I expect we'll keep providing the same level of benefits, or higher. We're making progress - what was the literacy rate in Dickens' London? Maybe advances in infant nutrition will make almost everybody capable of counting in binary, but I still expect there to be a persistent segment - maybe not 47%, but a significant segment - whom society will need to pull along.
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Gertrud, if there are any pieces written for trombone and cello, I will take up the cello just for the privilege of playing a duet with you. In fact I do share your optimism, just not for quite the same reason. I think the discussion here is suffering from a disconnect of perspectives, i.e., one person looks at a snapshot of the world 10 years from now and another looks 30 years out, and of course they don't agree on what they see because they are seeing two different worlds. (E.g., your parents may not want robotic daycare, but your grandchildren, many of whom were moving a mouse before they could talk, are likely to be quite comfortable with it. Also, by the time your grandchildren need it, robots are likely to be pretty good.) When COBOL was invented and computers started turning up in the large firms that could afford them back in the late 1950's, the forecast was that many jobs would be eliminated. It was wrong - at the time. The nature of the work changed promptly, but as bookkeepers were laid off, programmers were hired. It took several decades, but by now the prediction has come true. If we had to do all the work manually today that is done by the horde of ubiquitous machines, including typing every report that is printed out of a PC or viewed on-screen, it would take millions upon millions of extra people. (The truth is, most of it just wouldn't be cost-effective to produce at all and would not get done.) The norm today is that you still need a person, but that's person's PC is a multiplier, enabling the person to get a lot more done. Right now it's not cost-effective to invent and deploy crop-picking robots because a farmer can hire a small army of Mexicans by the bushel, but the day will come. Our aging demographic is already pulling low-skill labor to geriatric services, and that arena is going to see more technology in the near future. Suppose a company owns nursing homes and needs 1 nurse's aide per 5 residents (on every shift). If they can automate some parts of the work and get down to 1 per 10 or 20 residents, that frees up a lot of money. A hundred years ago, a lot of jobs were thoroughly unpleasant and back-breaking. Look at the first car factories compared to today. There is less labor overall, but the more striking trend is that there is less drudgery in the labor that remains. I believe this upward march will continue, and people will find more benign work over time, thanks to machines. Where the employment itself will come in the future is a different question, and I believe we don't know yet - but I have every confidence that it will come, in ways just as unforeseen by us as our current economy was unforeseen by our forefathers. Communism and capitalism both occur in nature, but communism does not scale well. A family is a communist collective. A father works and feeds his wife and children without regard for account. Once you expand out beyond a family, or a clan, or a tribe, to dealings with other humans with whom a love connection is not presumptive, and once you get past clubbing each other over the head and taking each other's property, capitalism is what arises - trade, and just compensation. Communism falls apart as soon as collective production drops below collective consumption and supply fails (when, as Margaret Thatcher said, you run out of other people's money). Capitalism persists as long as demand exists. My vision of the future is that people will still want stuff, and they will pay to get it, and there will be competition to supply it cheaply, and there will be too many unskilled people competing which will drive the price of unskilled labor very low, and there will be a class of people who are eclipsed from the economy because they just don't have the wherewithal to produce as much as they consume, and we'll need to subsidize them, and we will. (This is also my vision of the present.)
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In a duel of imaginations, is it more imaginative to imagine tasks that can't be automated, or to imagine even more fantastic machines that can in fact automate those tasks? Gertrud's posts are usually quite insightful, but the existence of the Wii and Khan academy tend to argue against her position above. As robots get better and outperform humans, consumers will shift in their preference. Maybe it can never be 100%, but Judge Posner's point is well taken: there are magnitudes of new automation on the near horizon, and large numbers of jobs facing elimination thereby (though at least some offsetting number of other jobs will be created in the process). The "rewards of labor", per the post of B Wilds, are distributed naturally, and I do not see any justification for artificially and systemically interfering with that. Just eyeballing it, I expect the cheapest way to deal with the economic problem is to pay welfare subsidies to those who can't produce enough to pay for their consumption. As for CEO pay, anybody who wants to see them paid less is free to accomplish that, without resort to government. Simply buy a majority of the stock, outvote all the apparently foolish shareholders who want to pay THEIR executives so much, have the company offer lesser salaries to executives, and reap the extra profit yourself as your $40,000-per-year CEO leads the company to equal success. After all, anybody can manage a large company. Our tech landscape and daily life will look significantly different in 25 years, if only because of the continued maturing of the innovations that occurred 25 years ago. Just about anything can be automated to a greater extent than currently, as the building blocks get cheaper and it becomes more cost-effective to do so. I expect we'll see game-changing advances in medicine, robotics, and plenty of other areas, and even a significant re-on-shoring of manufacturing as Jii Jii mentioned (I saw a 3-D printer in Staples this week for a mere $1,250). The employment picture will continue to be bleak for those who choose to remain unskilled, probably even bleaker than at present. Maybe we'll move toward a 25- or 30-hour work week, to spread less work across more workers. Not so many decades ago, work weeks were much longer, and maybe that trend will continue. I expect that the U.S. will still be a land of great, even boundless opportunity for those who respond appropriately to market demands. For those who ignore that message, whether out of mere stupidity or a principled and obstinate insistence that it should be otherwise,...well, don't worry, I'm sure we'll still have some kind of welfare in place.
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Neilehat, The contaminant, if I must digress, was water. I find your re-imagining of my narrative implausible. I do not think a company would pay a chemist to test for contamination and jettison several tons of material, several times, just to hide from him the fact that in the course of his assigned duties he has detected a secret ingredient above his pay grade. They fired him because he made a phone call. I continue to assert that the anecdote stands for my premise, that large companies value structure over talent, to the point that structure must be enforced even when it is obviously inefficient, even when it affirmatively penalizes efficiency - bringing us back to the topic of bureaucracy and away from the non sequitur of the vagaries of the chemical industry. I take it you are a proponent of the belief that structure is indeed important enough in large organizations to warrant such a vigilant defense, and over the years I've talked to a few CEO's who agree with you. It's a mindset, and no doubt there is some validity in it - many large corporations make money. Whether they would make more or less money by allowing talent to override structure is an experiment waiting to be performed.
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Neilehat, I didn't mean to imply that my friend had anything to do with the explosion. I just thought it was a fitting irony that what seemed at the time like a turn of bad luck ended up revealing itself to be a turn of good luck. His superiors obviously agree with you, that the bureaucracy must be preserved, and individual brains must be suppressed, no matter how talented they are. That's their choice - they outranked him. That was my point, that large organizations run on structure, not talent. There have been attempts to let talent shine through via various management schemes at some companies, e.g., Volvo's one-time practice of assigning a team to build one car at a time, but as a rule once organizations reach a certain size they cease to be able to scale up individual talent. If anybody ever figures out how to do it, there's a pot of gold waiting.
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What measure of efficiency is being proposed? For a private, for-profit enterprise, we could look at profit per investment dollar, the ratio of revenue to expenses, etc. For a government or non-profit, the presumed goal is wealth redistribution, so we could look at what percentage of money in actually gets given to someone else vs. how much gets spent on administration. In IT, we use "bureaucracy" as a pejorative. My favorite working definition is "data that is not tied to a decision." I pay cash at the dentist; he does not need to know my SS#, or where I work, in order to service my teeth. This waste of time and productivity is repeated billions of times over, every day, because the cost of exercising intelligence is considered higher than the cost of inflicting a uniform process on everyone, even if it is wasteful. Part of the cost of this intelligence lies in its scarcity. It is easier to train someone in a repetitive task than to turn a dubious intellect loose on your customers. Small organizations run on talent; large organizations run on structure. One of my friends was a chemist for a conglomerate. Over the course of several weeks, they received rail cars of raw material which tested as contaminated. He told his boss; the stuff kept coming in bad. So one day, he picked up the phone and called his counterpart at the supplier directly. In 20 minutes they had figured out the problem, saving both companies millions - and he promptly got fired for violating the chain of command. (Then a few months later the whole facility blew sky high, killing several of his former co-workers.) The government in particular has an obligation to rain on all alike, and so thinking is discouraged because it might be perceived as unfairness. We on the outside find government frustrating to deal with because it is often obvious that just a small dose of intelligence would solve a problem, and there is none allowed. Rules are a substitute for intelligence. When you are confronted with a problem, you can think creatively about how to solve it, or you can follow a rule, without thinking. Rules generally embody some measure of intelligence, but they inevitably fail to incorporate sufficient thinking to address the full breadth of problems that can potentially arise. We are admonished not to reinvent the wheel, but in fact the wheel has been reinvented, thousands of times, because new problems constantly require new and better wheels. Rules unchallenged become calcified into idols. Every so often, it is crucial for one of the intelligent among us to step up and remind us, e.g., that the Sabbath was made for man.
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Happy New Year. Jack, I find your passion somehow laudable, but I am unmoved by either the slight logic offered nor your suggestion that were I more educated / intelligent / diligent in my thinking on the subject, I would be obliged to agree with you (speaking of "hack" arguments). "Entitlement" is not a meaningless word - you will notice that I defined it in my previous post. If CEO's are overpaid - and no doubt plenty of them are - it is up to the corporate shareholders whose dividends are thus diminished to vote to pay them less. I find people who vote with their wallets more credible than mere sidewalk opinion; the only gun to shareholders’ heads is their own desire for profit. It’s a victimless crime, and a non sequitur. Your larger point seems to be that our system is designed to favor some constituencies unfairly, to the unfair disadvantage of other constituencies. That may be true. You are welcome to your opinions as to who is in fact favored and who if any should be favored, and here your all-over-the-map outpouring of our system's litany of sins makes the outlines of a point. I don't disagree: the system has many significant flaws, which may be the result of legislative incompetence or something even more deplorable. Back to my original point, I found it curious in reading the posts and comments that everyone talks about the expected outcomes of this or that scheme of redistribution, as if it is a foregone conclusion that we have a right to effect it. Speaking of pretty good books some people ought to read, Judge Posner can attest that I have in fact read his source text, Economic Analysis of Law, word-by-word and cover-to-cover. Whether I have understood it is a separate question, but it seems to me that one of the most revolutionary implications of the "Law and Economics" school of thought, indeed a large part of its elegance, is that the notion of a morality among men is subsumed into economic theory, i.e., if you are not injuring another economically, you are not acting immorally. (I remain unconvinced and unconverted, but I certainly grant that this is a very useful way to look at issues - and one of the reasons I try to read this blog.) I continue to think my question is valid. On what grounds is it suggested that I am obligated to produce more than I consume so others can consume more than they produce? I've heard the shotgun blast about farm price supports, medical savings accounts, economic conditions in 1929, economic oligarchy, and so forth, nothing I haven't heard before, but I don't see where any of that touches on my question. At best it is an implication, and a weak one, and necessarily an aspersion upon me and the supposed economic crimes I have committed against those currently not succeeding in the market. It is this suggestion I reject. Further, I may not be connecting the disparate dots as might have been intended, but it sounds to me like Jack would have society re-engineered to place constraints on my economic freedom, just so other people won't feel so bad about their own low output. I for one think that my "life, liberty, and the pursuit of happiness" trumps someone else's tendency toward sloth and depression. Eugene Debs on his pinkest day never uttered an offense so putrid as BHO's, "You didn't build that." There is a presumption on the left that if you aren't complaining about your lot, you must have cheated to get enough to satisfy yourself - and THAT is their moral justification for taking from me, and the root of my umbrage. It is the tyranny of the majority of sore losers, and nothing more.
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I have nothing to resent but resentment itself - and that is precisely what I do resent: the premise that I have done something less than honorable in successfully earning my bread. I've never bribed a politician. I didn't inherit land. I worked and paid the full tuition asked of me in college and law school. My public grammar school was the poorest in my state. Today some of my classmates are successful, and some are poor. I have never been less than humanly kind to any of them, and I reject the accusation that I caused their current circumstance. Capitalism is not something we have consciously created; rather, it is simply what is revealed when we agree as a society that we will not physically violate each other and take each other's substance by force. Each man, thus relieved of the constant specter of being clubbed by a stronger man, can set about sustaining himself and his family, either by tending his own food supply or by trading with others. We have added prudent constraints to the system over the ages, proscribing fraud and such, but underneath, this is just the natural order of how peaceful men behave toward each other. Enter "entitlement", which means you are entitled to take from my wallet. Why? Good question...I have yet to hear a coherent answer. I believe the true answer flows from my character, not yours - which means it's not an entitlement. Whether out of compassion or practicality (as mentioned by Mr. Redkal above), I do not begrudge anyone the stock of my larder, but I'll have none of the unfounded pride nor the lame rationalizations of one whose choices have left his production outpaced by his consumption. Accept my gift, but keep your insult.
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Pardon my intrusion upon this morality-free zone. I'm still trying to parse the heading of this post, but it seems to me that a more fundamental question is begged here. We are talking about reaching into one man's pocket and taking out money to give to another man. Call me old-fashioned, but I think there should be a highly compelling reason before we do that. A beneficiary who is failing to subsist is, in general, highly compelling to me. A beneficiary who wants to "go shopping" is not. Since consequences are the preferred topic, let's talk consequences. If redistribution is meted out extravagantly or indiscriminately (I believe the economic term of art is "willy-nilly"), the recipients learn a new vocabulary word: "entitlement". This is not yet an economic consequence, but it lays the foundation for the greatest possible economic consequence: the mass corruption of Weltanschauungen, and the allowance of a world in which producers are labeled as evil and deserving of penalty. The inevitable consequence of that change in thinking is on display in our time in the form of failed and failing socialist states world-wide. The human engines meanwhile resent the yoke of the less diligent, and strive to circumvent it, as so poignantly described by Mr. Kirby above. I sympathize. At this time in my life I do not want any employees. I could be making more money and redistributing it directly, but I am unwilling to subject myself to the accompanying volumes of regulatory nonsense, which I'm sure would eventually trip me up and erase whatever profits thus gained. My potential reward has been diminished to the point that I rationally substitute leisure time for productive activity (as is obvious in this moment). I am willing to work a little harder, since I am able, to supplement the substance of those who strive and fall short, so that all may subsist with basic food, basic shelter, basic health care, and basic education (by which I mean reading, arithmetic, health, and civics). I will pay my share toward collective endeavor - military, NASA, highways, etc. In the end however, I was raised to believe that this is a free country, and I have seen with my own eyes what is available to any individual who wishes to pursue it. As for anyone who thinks he is "entitled" to the fruits of my "evil" labor, I will go to my grave resenting you far more than you are capable of resenting me.
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Mao was once asked about the prospects for Sino-Soviet war. He explained that on Day One the Chinese would surrender one million troops. On Day Two, they would surrender another million. Within 30 days, the USSR would surrender. The country needed to lose population. They hardly needed to resort to forced abortion - or its slightly less refined cousin, infanticide - to do it, as substantial compliance would have been achieved if Mao had simply framed it as a cultural imperative. He could have included it in the little red book, and gotten the job done without another word, especially since as Dr. Becker points out, modern realities were about to push the rate down anyway. At death, a tiger leaves its skin and a man leaves his name. So say the ancient sages of China. A male heir is thus highly prized, even today. Per Jim's comment, I delight in the unintended consequences China and India have inflicted upon themselves. Amnio clinics have come to dot Indian cities like gun shops here. Eventually however, supply and demand rear their magnificent heads, and suddenly the female dirt under an Asian man's shoes is an item of great value. High time if you ask me, for centuries of arrogant chauvinism to reap its comeuppance.
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As to comments one and three above, I'm sure Jim's facts are accurate and the policy produced a racially disparate result, but it is a stretch to assert that the motivation behind the policy was racist. As a group, blacks live shorter lives on average than whites, but the best performers of both races are equal, living slightly past 100. This proves that the disparity is not genetic, but cultural. The black numbers are driven down by gang warfare, poor diet (which may be partly due to lack of food money, along with uninformed choices), and less diligence toward health care (again, partly due to lack of money and partly due to lack of information and/or will). I invite citizens of color to be a thorn in the side of the WASP establishment, by behaving differently and thus living longer.
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The primary problem we face is cultural. We have positioned the government as an enabler. Social Security and Medicare are set up as contracts between the government and individuals. You pay into the plan, and you get a return - in fact a ridiculously generous return out of all proportion to your contribution. These programs should have been acknowledged from the start as taxes to fund welfare, with means tested payouts, but the socialists whose initials are so well known to us refused to degrade the self-esteem of their constituents in this way, preferring to prop up this national illusion that nobody really falls short and everyone is "entitled". A new client intimated to me this week that she had nothing in her name - no car, no house, no bank account - even though she was obviously comfortable. When I asked if perhaps she might be concerned with avoiding creditors, she bristled at the perceived aspersion. Eventually she volunteered that she wanted to be sure Medicaid didn't rob her of her wealth at the end of her life. I'm sure she wouldn't dream of buying a product or service and not paying for it, but she doesn't see her strategy as dishonest in the least. It's what the government has taught us to do. There is some basic arithmetic at work here. If you are going to consume some number of dollars of goods and services over your lifetime, then you ought to figure on producing at least that much (plus a little more to cover your charity toward those who fall a bit short, charitably collected by our IRS). That's why we have even money in the first place: it's a means of accountability. Under communism, there's no need for money - everybody is entitled to take what they need, whether their production warrants it or not. (Good luck with that.) If you're 90 and you go in a nursing home and you've got $500k saved up, then you can quite well afford to pay your own way and if your kids want to preserve their inheritance they can take care of you themselves. It used to be a point of pride that we paid our bills. In a lyric from about 100 years ago, the St. James Infirmary Blues, a dying man requests, "Put a twenty-dollar gold piece on my watch chain, so my friends will know I died standing pat." Nowadays, people think why should I rob my own children when I can rob everybody's children? We need first to re-establish the opinion that each of us should pay our way, and then to expose this ridiculous notion that we ARE paying our way.
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Maybe there's another way to slice this. We're all familiar with the concept of dumping, the practice of selling a product for less than it costs to produce. Let's suppose it takes my $10/hour to "produce" a laborer, keep him fed and fit for work, etc., and he sells himself on the open market for $6. He's dumping labor, selling it at a price with which an honest laborer trying to support a family cannot compete. The minimum wage can thus be thought of as a restriction on the employee's anti-competitive behavior, not the employer's. Building on that line of reasoning, there are people who don't cost $10/hour to sustain themselves because their sustenance is partially or wholly provided by their families. This is an oft-stated argument against the minimum wage - more than 50% of those who receive it are under age 25. Low-wage labor can be of individual and social value to those selling it, apart from consideration of the benefits to those buying it. How many college graduates had a first job flipping burgers or waitressing in a shore town for the summer? As the advocates rightly say, you can't raise a family on $7.25 an hour. As the detractors rightly say, most people earning minimum wage aren't trying to raise a family; they are trying to make a little pocket money, save for school, get some experience, contribute a little bit to help their parents, and maybe develop the discipline of getting up in the morning which will serve them in good stead in subsequent employment of higher responsibility and commensurate compensation. Some people even temporarily take jobs with no pay at all - internships - to obtain this benefit. So, the suddenly obvious fix is to exempt people under 25 from the minimum wage law, and almost everybody should be happy. Of course this might entice employers to terminate workers approaching age 25, but most of these workers will self-terminate anyway, and look for something better once they finish college or mature to the point that they realize they want and need to be more productive and successful. Furthermore, if the rules are known going in, we will be encouraging a structure wherein workers will know they need to progress, i.e., to have a career instead of just a job. In time, most such unskilled work may be done by new workers, as it should be, and older workers with experience will be goaded to move into at least slightly more skilled positions warranting higher pay. I thus think any practical skewing effect will be minimal and manageable, and may even be beneficial.
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If the minimum wage is $7.25, a worker employed at that rate is competing on two fronts: (a) can the employer get more than $7.25 in production from the worker, and (b) can the employer get anybody for that price whose production will be greater. If the minimum wage goes to $9, a worker whose production value is $8 is no longer a feasible investment for an employer. However, in most jobs production value is such a nebulous calculation that employers don't even pretend they can pinpoint it, so they'll probably keep most of their unskilled people anyway on the theory that they are sort of necessary and there will still be an overall profit. I.e., there will be minimal disruption and loss of jobs. However, if there is a big jump in the minimum wage to say $15, it becomes a little more obvious that even given the benefit of the gray area, these employees do not warrant the outlay. Second, and far more impactful, front (b) from above kicks in - suddenly a guy whose output is $8 is competing with people whose output is more than the $15 in wages they would legitimately command in the absence of government interference. The effect of such a law, as Professor Becker correctly forecasts, will be to greatly increase the number of workers tied for last place and calcify the chronically unemployable class, sending them the message that if your natural output doesn't exceed $15 an hour, don't even bother trying to participate in the market. (It will also force prices to rise.) If it is society's problem that people need their earning power supplemented in order to subsist (and to that extent I agree that it is), then it is appropriate for society to provide that supplement, as we do. If we force employers to pay $15, they will hire the best person available for $15 instead of the best person available for $7.25, and society will end up entirely supporting the bottom segment instead of merely subsidizing them. Designers of government policies have been trying to corner the haves into paying for the have nots for decades if not centuries, and they always fail. People who spend their days trying to earn money are, as a class, far more knowledgeable about money than people who spend their days running governments. Governments cannot outfox them, and there is not the collective political will to sink to openly taking their wealth from them, as much as it would suit the current President and his ilk. Unless the plan allows money to flow to the people whose lives are spent seeking money, those people will adjust their behavior and the plan will fall short under the weight of its own unintended consequences.
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The minimum wage, to the extent that it exceeds the market wage, is a tax on those who buy labor. Apart from the noted theoretical disincentive upon the purchase of labor, is it fair to tax that behavior? An employer who pays less than a living wage is getting a resource for less than it costs to sustain that resource; on the other hand if the market price is interfered with, the cost to the employer may be higher than the value of the resource. If it costs $10 an hour to feed, clothe, and house a person, and he or she generates $8 in output and is paid $6, is the state subsidizing the employer or is the employer subsidizing the state? The supposed horror of meritocratic capitalism is that if you give people freedom, some of them will exercise that freedom by pursuing, and often acquiring, great wealth. Income inequality is not a problem. The fact that some people are poor is a problem, but the fact that others are rich is not. If everyone were middle class, more people could afford Microsoft's products and Bill Gates would be even richer than he is. One person's efforts to create wealth do not somehow subtract from the wealth of someone who is or is not working to create other wealth. The fundamental problem is none other than supply and demand. Lots of people want to acquire the American dream, and have nothing with which to buy it. They offer up their strong backs and weak minds in the market, in competition with the rest of the teeming horde, and there is far more supply than demand, driving the price of unskilled labor down, a lot. I fully agree with Judge Posner that the practical effect of the 20% increase he proposes will be absorbed with some grousing and little other consequence. We can afford it. New Jersey has just voted to enshrine automatic increases in the minimum wage into our constitution. It sticks in my craw, but I have no plans to move. I just wish we'd call it what it is.
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As for the Winship study, I would expect a random but Gaussian distribution (not unlike IQ). Very few individuals are going to have the wherewithal to jump from the bottom all the way to the top, certainly not 20%. What you have/achieve/acquire/accomplish in your life is a function of two variables: (1) what you are given, and (2) what you work for. You may have brains, wealth, access to education, and other benefits without having to lift a finger, and you can improve on that initial position by your efforts. Those born into the 0-20 bracket are given the least, and have to work the hardest to compensate if they want to move up. How far they move up is largely a function of effort, and part of their plight is that the gift of an exemplar of the work ethic may be what they have missed the most. For 99% of people, the second factor is far more determinative than the first. Just as archers know that their craft is better facilitated by a cheap bow and high-quality arrows than vice versa, a person of average intelligence who works hard will almost always outdistance a gifted, lazy person (such as I). Gifted-and-driven is an unbeatable combination; those people will always do fine, and are not part of the topic. That leaves those who start so low on the ladder that it's an accomplishment just to climb above the poverty level in one generation. If 40% of the bottom fifth are still there a generation later, that means that 60% - more than half - climbed out, and I find that a fantastic statement of achievement and a testament to the obvious possibility of mobility within our societal structure. It also means downward mobility is a real possibility, as it should be. We know where a chunk of the bottom fifth came from - they were born there. Where did the rest come from? Some perhaps immigrated, but most fell, and that is as encouraging a sign as the rise of others, for it speaks to the meritocratic fairness of this life we live in America. There are no goldon boys. Everyone is subject to the rules, eventually. Maybe there is more than a lifetime's worth of achievement in the differential between out top 20% and bottom 20%; it will be a rare individual indeed who can leap that entire span in a single bound. I don't see that as a problem at all. It simply means very great rewards, far beyond mere daily bread, are available to those who care to apply themselves seeking same. Of the 40% who can't even jump from 0-20 to 20-40, they include substance abusers, mental patients, and immigrants with zero language skills and zero interest in learning English because they can function just fine in the underground economies of their little Havanas and little Beijings. Not everybody even cares to jump up. Some are blissfully unaware of the higher 80%, or specifically unattracted to it. I thus do not think the 40% is a problematic figure at all. If nobody stayed in 0-20, I would suspect a communist distortion in the system. I'm in favor of a floor, or to quote Joe Biden quoting Noel Kinnock, "a platform on which to stand". I just don't think it is important or even appropriate to make that platform particularly high. Some children would prefer to be left behind, and I don't judge their choices.
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