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Samizdata, derived from Samizdat /n. - a system of clandestine publication of banned literature in the USSR [Russ.,= self-publishing house]
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There is an interesting debate going on at the Econlog blog about whether there is anything like a “meritocracy” in the market. (My short answer: it is a mixture of luck and merit, but I am not sure about the ratio between the two). Rather than me weigh in, I just wanted to point to what I consider to be Bryan Caplan’s insightful comments. I also liked the comments in the associated thread by a character with the name tag of “MernaMoose”.
It may not always be the case that the hardest working folk make the biggest bucks, but it generally operates that if people think it does, then the system as a whole generates a bigger pie in which many of those who have worked hard to maximise their talents do well. After all, fatalism (“why should I bother since it is all down to chance?”) tends to correlate, from what I can see, with a less prosperous society in general. Unfortunately, there will always be the hard cases where the supposedly worthless celebrity earns gazillions while the hard-grafting nurse gets paid a lot less. (Although in my experience, some of these celebs have worked incredibly hard to get where they are). But in a society based on voluntary exchange and where no central authority gets the potentially horrendous power to decide who has made the most use of their talents (assuming such talents can be known in advance), that situation is inevitable. Being philosophical about such things, such as watching a trust-fund brat sailing through life while someone else has to slog away for a relatively small income, is hard, I know.
I have started reading the book, Crashproof 2.0 by Peter Schiff, and I thought I would register some early impressions.
He is a guy who was once mocked for daring to suggest, only a few years ago, that the buildup of debt in the US and parts of the West, and its reliance on what amounts to “vendor financing” from Asia, was bound to end in tears. It did. “Vendor financing”, by the way, relates to the practice of a firm that offers temporary loans to the consumers of its own products. This, more or less, says Mr Schiff, is what happened in the past decade or so: Western consumers bought cheap products from China; Western manufacturers went bust or offshored production to Asia; China used the foreign earnings from its exports to buy up Western debt, enabling even more Western consumer spending, fuelling even more Chinese exports……until the whole process when up in smoke. (This process was aided by an artificially weak Chinese exchange rate, not to mention the recklessly loose monetary policy of the Fed.) So far, so good: Schiff makes a lot of sense in debunking all of this.
But then there is a rather rum argument. Schiff says that somehow, this process was bad because as a result of the low-cost production from China and other parts of the world, US manufacturing jobs were replaced by allegedly lower-paying, crappier service sector jobs. (It is simply assumed that non-manufacturing jobs are worse than manufacturing ones). This sounds a bit like the sort of attack on globalisation I have heard made by such economic illiterates such as Lou Dobbs of CNN. I was a bit surprised that an Austrian-leaning writer such as Schiff should be making it. If the service sector can generate wealth for those who work in it, what is the problem? If, in a proper free market without the distortions of fiat money etc, certain manufacturing jobs were to be done by low-cost nations and other jobs by us, how is this a cause for Apocalyptic treatises?
Another query I have is this: if the Chinese/whoever are earning real income by selling us stuff, and then use that real income to lend us money that is used to fund investment in things that will create wealth in the future, again, how is this a problem? Sure, if that Chinese money is simply fuelling consumer spending and encouraging feckless spending and low savings – which is what did actually happen, I can see the issue. But lending money for productive purposes is hardly an evil. In the 19th Century, for example, the UK, with its wealth generated in the Industrial Revolution, was a net investor into countries such as the US, Canada and Argentina. I guess the trick is to make sure that the money lent for productive purposes is money derived from genuine savings, not funny money.
Maybe Mr Schiff will answer these points later in the book.
“Had McQueen’s life been recorded in a measured and appropriate way, it would have retained some dignity. As it is, we’ve had to consider the silhouette of trousers as though it ranks with the irrigation of Sudan or a cure for cancer. And that just makes him look a complete prat.”
George Pitcher, writing about the fashion industry in the light of the death of 40-year-old designer Alexander McQueen. Much of what Mr Pitcher writes in this piece also applies, in my view, to parts of the architecture and “modern” art establishment. However, at least the fashion industry operates mostly in a free(ish) market. If we don’t like its products, then we don’t have to buy them. When a tax-funded body pays for some freakish statue, for example, it is not quite the same thing.
Well, for yours truly, along with fellow rugby fans such as Antoine Clarke and Brian Micklethwait of this parish, some of our weekend plans have had to be slotted around watching, or trying to watch, the rugby matches in the Six Nations tournament. For the uninitiated, the teams are Ireland, England, Scotland, Wales, Italy and France. I watched the games on Saturday – I did not see today’s England-Italy match as I was driving around the Kent coast – but on the strength of yesterday’s matches alone, I am risking the prediction that this tournament could be one of the finest of recent times, or at least one of the most engrossing.
As a person with a bit of Scottish inheritance, I was rooting for the Scots on Saturday, and I thought they had pretty much clinched it until, in the last 10 or so minutes of the game, the Welsh, aided by some Scottish injuries, errors and possibly some lapses of concentration, staged an incredible comeback to win the match. As for the French, they comprehensively beat the Irish in Paris by a margin that makes one wonder how the Irish managed to win the previous tournament, although I imagine that the Irish will play, or try to play, with a bit more composure in the next match. But the French look a class apart from the rest – their pack was awesome.
One small detail pleased me yesterday, in that the Scottish team seems to have reverted to wearing a dark-blue strip that bears some relationship to the colours of the country. As I noticed several years ago, the Scottish recently had a strip that looked very similar to that of the New Zealand one, and very confusing that was.
Anyway, bring on next weekend!
“In short, sterling is in the toilet, our pensions have been slaughtered, cash savings yield almost nothing, the country is up to its neck in unprecedented debt, the banking system is awash with funny money, our gold reserves were sold off at rock-bottom prices, and Britain’s dole queue is considerably longer than before Crash Gordon began cooking the books. Apart from that, it’s not too bad.”
Jeff Randall.
Even now, after thinking through all the various words written about the plodding disaster of a man that Brown is, it is shocking to contemplate the damage he has done and continues to do, as he heads towards oblivion.
“Climategate is like the finest single malt whisky – 30-years matured, complex and multi-layered, distilled to a fiery concentration, and every drop of the cask to be savoured in small, delicious, damn-the-prohibitionist sips.”
– From regular Samizdata commenter, Pa Annoyed, writing about this recent post of Brian Micklethwait.
Pure genius.
By the way, here is an old post I did about a superb spoof on 1970s education programmes, which convey a similar sort of feel to some of those old Cold War public information items.
Tory MP Douglas Carswell, who is one of the relatively few good guys in that party, in my view, has this blog post about a recent proposal on how to make the banking system more robust, as made by the “Austrian”-leaning organisation, the Cobden Centre. I am not entirely sure about the use of the word “democratise” here in relation to banking; however, I guess this is how Mr Carswell is trying to popularise the basic idea of making banking more solid.
Truth be told, if your average citizen really reflected on what a controlled fiction fractional reserve banking really is, his or her hair would turn white in seconds.
Thanks to my old Libertarian Alliance mate, Tim Evans, for the pointer.
“Churchill, who was prone to the black dog of depression, went to bed on the night of the 5th of June 1944 with a heavy heart. Gloomily he told his wife, Clementine, that by the time they awoke in the morning many tens of thousands of young men he had sent across the Channel might lie dead on the beaches of Normandy. In Alanbrooke’s diaries (he was the finest of the WWII diarists) it is clear how heavily he felt the weight of responsibility throughout his time as a commander in France in 1940, and subsequently as CIGS. Yet neither Alanbrooke nor Churchill felt the need to go in front of the cameras and explain how troubled they were by all the pressure. Even long afterwards it wouldn’t have occurred to either for a split second that this would be a good idea or remotely appropriate.”
– Iain Martin, commenting on the recent performance of Mr Blair’s former spinmeister on the TV. He makes a good point, I think.
Toyota is recalling thousands of motor vehicles around the world to deal with certain problems, such as possible brake failures. The story was the lead item on the BBC TV news today, not surprisingly, given the large number of people who now drive Toyota cars. On one level, this issue is being billed as a terrible embarrassment for the Japanese company, but to an extent I find the comprehensive recall of the cars to be a pretty good example, in fact, of how private businesses with a huge brand-name investment have to act when their products have a problem. Can you imagine, say, a government department doing such a massive “recall” of a failed policy? With private business, the penalties for failure are bankruptcy. For government, the consequence of a mess is often more of the same, only with more lumps of taxpayers’ money. To put it more technically, there is little in the way of a negative feedback loop when governments are involved.
As an aside, and yes, I know this may seem a bit mean-spirited, but I cannot help reflect that the problems of the Prius cars add to what has been a terrible time for the Green/AGW alarmists. The Prius is very much the car that guilt-ridden, Greenie types like to drive. As the snows continue to fall, who wants to drive one of those machines right now? And in any event, they are just pig-ugly. Time to fire up the Aston Martin, Carruthers.
Scanning the news headlines at lunchtime today, I read through the Wall Street Journal and saw this item, in relation to the expenses scandal of British Members of Parliament:
I thought the headline was interesting, in that the WSJ – still an overwhelmingly US-centred publication, covering world affairs through the prism of certain American assumptions, likes to refer to MPs as “lawmakers”. To be pedantic, it is true that they do continue to make some laws and pass many others, but given that their legislative functions have been largely subsumed within the structure of a EU superstate, maybe the term “lawmaker” somewhat flatters the true status of these characters, who are more akin to members of a local council.
Just a thought.
“When I hear the word “holistic” I reach for my BAR and don’t worry about the safety.”
– Regular Samizdata commenter NickM, over at his CountingCats redoubt. He’s talking about Prince Charles. Of course, if Charles wants to revert to an age of Divine Right, witchburnings, absence of notions of individual rights, logic, science and so forth, then maybe he should remove himself to a place more congenial to his outlook.
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Who Are We? The Samizdata people are a bunch of sinister and heavily armed globalist illuminati who seek to infect the entire world with the values of personal liberty and several property. Amongst our many crimes is a sense of humour and the intermittent use of British spelling.
We are also a varied group made up of social individualists, classical liberals, whigs, libertarians, extropians, futurists, ‘Porcupines’, Karl Popper fetishists, recovering neo-conservatives, crazed Ayn Rand worshipers, over-caffeinated Virginia Postrel devotees, witty Frédéric Bastiat wannabes, cypherpunks, minarchists, kritarchists and wild-eyed anarcho-capitalists from Britain, North America, Australia and Europe.
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