We are developing the social individualist meta-context for the future. From the very serious to the extremely frivolous... lets see what is on the mind of the Samizdata people.

Samizdata, derived from Samizdat /n. - a system of clandestine publication of banned literature in the USSR [Russ.,= self-publishing house]

Names can be complicated

budw

There is, in this world, something called the Budweiser trademark dispute. The giant American brewery Anheuser-Busch produces a beer named Budweiser, an industrial mass produced lager that is not greatly revered by beer connoisseurs but which sells in large quantities, and a brewery called Budweiser Budvar Brewery in the Czech city of České Budějovice (Budweis in German) produces another beer called Budweiser, which is considered an excellent beer by most beer lovers. The two breweries have been fighting in courts throughout the world with respect who has the right to the name Budweiser ever since the end of Communism in Czechoslovakia. In some countries the Americans have won and the Czechs have had to find a different name, and in others the Czechs have won and the Americans have had to find a different name. In Britain the courts have made the eminently sensible ruling that both brewers can use the name and drinkers are smart enough to be able to tell the difference, but I don’t believe this has happened anywhere else.

Beer lovers are often sympathetic to the claims of Budvar, because the beer is better and because it actually come from Budweis, and this is therefore the “Original Budweiser”.

This is not really true, however. Anheuser-Busch started brewing the American Budweiser in 1876, due to the fact that the beers of Budweis were famous, including amongst German Americans. However, the Budvar brewery did not exist at that point. This brewery was not founded until 1895. At some point after that, they also started using the name Budweiser, possibly because the name had been given further fame by Anheuser-Busch. At least to some extent, the Czechs at Budvar may have started using the name because of the use of it by Anheuser-Busch, and not the other way round. Budvar was founded by ethnic Czechs, and the only reason they would have had for using a German name was that the German name had already been made famous by other brewers.

However, what of those earlier beers from Budweis, responsible for Anheuser-Busch starting to use the name? Well, there is another, much older, brewery in Budweis / Budějovický Budvar. This brewery, known as Budweiser Bürgerbräu until 1945, made beer in Budweis under the Budweiser name at least as early as 1802. It is almost certainly this company’s beers that Anheuser-Busch was copying when they started using the name “Budweiser”. This brewery was run by ethnic Germans from its founding until 1945, after which it was taken over by ethnic Czechs and de-germanised. The brewery is now called Budějovický měšťanský pivovar, which is a precise Czech translation of its original name. When de-germanisation took place, the brewery ceased using German words and names, including “Budweiser” (it regained some interest in using them post-1989). However, this brewery has by far the strongest claim that it produces the beer that is the original Budweiser.

That said, the trademark battles between the other two, larger companies have been so ferocious that Budějovický měšťanský pivovar has stayed clear of them, despite apparently having a stronger claim to the name than either of them. The brewery is quite a substantial one, and produces a significant quantity of (excellent) beer. It sells the beer under a variety of names including Crystal, Samson, B.B. Bürgerbräu, Boheme 1795, and more. It only uses the word “Budweiser” in places where trademark law is weak.

This is why I took the above photo, in Tbilisi in Georgia last month. It was certainly not the first time I had consumed beer from the brewery that actually gave us Budweiser, but it was the first time I had ever seen beers from that brewery actually using the word. It is not the most prominent word on the label, perhaps, but it is still prominently there.

Clear evidence that things are about to get much worse in the €uro zone…

If you doubted that the €uropocalyse was at hand…

French President Francois Hollande has declared an end to the eurozone debt crisis, which has gripped the region for the past four years.

… well everything is going to be okay after all then! Thank goodness for that!

Has the NSA created a market opening for non-US internet businesses?

The flood of revelations about the sheer scale of NSA information theft… direct server access without an individual court order whenever the NSA wants something from Microsoft, Google, Yahoo, Facebook, Skype*, PalTalk, YouTube, AOL and Apple… has made me wonder if savvy non-US based business might not be able to market their services as explicitly non-US.

Just imagine the possible tag lines:

“Don’t worry, the NSA does not have easy assess to your data as we are not a US based or owned company”

…or tapping into a bit of anti-Americanism never hurt the bottom line…

“We are not located in the ‘Land of the Free, Home of the Brave’, so your data cannot be browsed at will by unaccountable NSA spies!”

… which is not to say such services cannot be marketed to Americans…

“Non-US nationals across the world are not protected by the US constitution, come to think of it, neither are Americans in America, so your data is safer with us as we are a NON-US owned and NON-US based company!”

The creative possibilities are endless and anyone who cannot leverage this into internet gold is not trying hard enough! Capitalism for the win!

 

 

*= Skype, originally a Luxembourg based company, was purchased by eBay in 2005 and then Microsoft in 2011.

Eat Less Meat

The British government wants to “eradicate undernutrition globally”. It has a department for it. This can not be good. There is also a committee of MPs who have released a report.

There is an argument in the report that since the population is expected, by Benny Dembitzer as far as I can tell, to increase to 9.3 billion people by 2050, and since consumption of meat is increasing, that there is going to be a general food shortage. Meat is singled out for being an inefficient use of resources. From the report:

Simply urging the Western world to stop consuming meat is neither feasible nor desirable. Moreover, nor is it necessary: meat production based on pasture-fed systems (e.g. pasture-fed cattle), as opposed to the mass production of grain-fed livestock, is markedly less problematic.(69) The Food Ethics Council therefore suggests a ‘less but better’ approach, with meat promoted as a occasional product rather than an everyday staple.(70)

Note that the Food Ethics Council is funded mostly by the Joseph Rowntree and Esmee Fairbairn charitable trusts. Even private organisations can be wrong.

So why is pasture livestock “less problematic” than grain-fed? Note 69 points to question 62, part of a series of testimonials which seem to make up most of the evidence used to make the report. I’ll highlight the most fun bits.

Q62 Fiona O’Donnell [committee member]: Finally, as carnivores, can we keep consuming meat in the way that we are? It is probably a rhetorical question.

Tim Lang [Professor of Food Policy, City University, London]: Is the “we” here? Do you mean us?

Fiona O’Donnell: Yes.

Tim Lang: The rich world, no. Let me be very hard, and I will speak now as a public health man. The case or reducing meat consumption in the West from our astronomic levels is overwhelming; it is a public health gain if you reduce it. The report that I led and that Oxford University and others fed into, on food security and sustainability and on sustainable diets, showed that there is a win-win for the environment and for public health if you reduce our meat consumption. It is not meat qua meat; it is processed meat. The evidence there is getting stronger and stronger.

Camilla Toulmin [Director, International Institute for Environment and Development]: It is also intensive livestock production.

Tim Lang: Exactly. You will get agreement from us. In our world, the three of us and the previous panel, we are worried about this assumption that 50% of grain or 40% of grain to the world must be diverted down the throats of animals to then give us meat. There are cases when that can be useful, depending on the climate. To factor in a meat engine, which is like a juggernaut driving our definition of what a good food system is, is crazy. It is a crazy use of resources, it is crazy economics and it is crazy public health.

Andrew Dorward [Professor of Development Economics, School of Oriental and African Studies]: Can I just add two things to that? Firstly, I would broaden it to livestock production. For example, butter is not very good for us either and eating too much cheese makes for the same sorts of problems. In terms of livestock production, it is basically the consumption of grains in intensive systems that is bad. Where you have more extensive systems, where you have pastoral systems and where you have more extensive upland systems in the UK, it is a different argument. For the intensive grain systems, the health and the environment, the food security and the water demand arguments are really overwhelming.

It is mostly incoherent ranting. Are they arguing for less intensive farming of animals to solve the problem of too much meat consumption, or something else? I’ll see how far I can get by assuming that this is about using resources in the most efficient way.

It seems to me that if people are hungry they will start to bid up the price of grain and stop buying meat anyway and that the problem will solve itself. I am not sure why pasture livestock is preferable. I suspect it is even less efficient than grain livestock, assuming all land is equal. It may be that grain for humans is always more efficient than grain for animals, however since there is land that is not suitable for grain that might as well, in that case, be used for livestock. There is also a hint here that grain production needs more water. But all this is a non-problem in a free market. In a free market the land is always used in the most efficient way and whatever shortages of grain or water come about will move the prices and hence the demand automatically.

This seems to be a big problem with the concept of “sustainability”. If you think that current levels of meat production are unsustainable, then if you are right they will not be sustained. If you are right, it doesn’t matter what anyone does. Coming up with innovative policies to reduce the consumption of meat seems to be a bit pointless unless what you really want is to reduce the consumption of meat even if you are wrong about its sustainability, or you are concerned about being blamed by the voters for its un-sustainability. I rather think that it is sustainable and we will end up eating less meat anyway to please these sustainability “experts”.

If some fundamental resource shortage does increase the price of food, an interesting question is at what point does food become so expensive that it takes more than one person’s labour to produce enough food for one person? I expect with 9 billion people (some of them rather more clever than the assembled committee members and witnesses at making food production more efficient) we are still a way off mass malnutrition caused by resource shortages. At some point hydroponics and 3D farming become cost effective.

Still, the rest of the conversation is a fascinating insight into the minds of the elite:

Q63 Fiona O’Donnell: Do you think the market price will choke off demand for meat? There is only so much horse meat you can put into a burger.

Tim Lang: You are back to a mass psychological problem. Meat has, historically, been associated with progress and feast days. The problem is that feast days are every day. Wearing different hats, let us just move to horse-burger land. Look at what is exposed there. You have got a culture that is now centred around plentiful meat and meat as the centre of the plate. These are deeply rooted—in different ways in different countries—cultural goals.

Camilla Toulmin: You are right that meat is too cheap. Meat production does not, in fact, cover the full costs of production. Until it does that, we are going to see too much of it around.

Q64 Fiona O’Donnell: We would almost be heading towards a vegan diet then for a lot of people, especially poorer people, in order to be healthier. Are we doing enough work to look at how we then should have a nutritious balance and how we produce it?

Tim Lang: The short answer is: no. I referred very early on to this issue of sustainable diets. There is a bubbling debate. I could spend my whole week, like Camilla, in the air going to meetings—they are cropping up everywhere. Last week I was in a one-day meeting, though I was only there for half a day, where experts from all over the country were brought in. I will quote, without naming, a leading nutritionist, who said, “Look, veganism can deliver a sustainable diet and can deliver a healthier diet, but the issue is culture and choice.” Without a shadow of a doubt, the ubiquity and cheapness of meat and meat products, as a goal for progress for Western agriculture, let alone developing world agriculture, is one we have to seriously question now for reasons of climate change, emissions, ecosystems and local reasons. Many of us in this debate referred to the Steinfeld et al./FAO’s Livestock’s Long Shadow report. This month, the new version of that report is going to come out, so I strongly recommend the committee has a look at that. I am not allowed to say what is in it.

Do these people listen to themselves? Meat is cheap and ubiquitous therefore we need to eat less of it. Climate change!

Andrew Dorward: This is something we all personally need to take very seriously, because it starts with us, not with telling policymakers what to do.

Fiona O’Donnell: I will take that away, if nothing else, from today.

Camilla Toulmin: In 20 years’ time we will look back at it in the same way as we now look back at smoking as it was 20 years ago.

Do not underestimate the power of these people. They may seem like idiots and professors talking nonsense among themselves but look what they have done with smoking. In 1999 I had to change seats on an aeroplane because there was too much smoke. Now people are cast out of society for lighting up at the far end of the empty railway platform. And it started like this.

Lots of conversations like that, then the report, now the news articles. Say the headlines: “Families should only eat meat as an occasional treat because the surge in global demand is unsustainable, according to a committee of MPs.” They are making the idea seem normal.

The committee also urged the Government to redouble its efforts to slash the amount of discarded produce – estimated to be around 30% globally… The committee wants ministers to set producers and retailers targets for food waste reduction, with sanctions imposed when they are not met.

The thing about food waste is that there is no such thing. There is a rational economic decision to choose excess food production to optimise for something else instead. In my house I sometimes buy or cook more food than I need because the computing resources needed to calculate exactly the correct amount are more expensive than the food that is thrown away. Everyone else is making similar choices. If the government invents innovative new policies to reduce “waste” X they necessarily make Y more expensive and thereby allocate resources less efficiently than before.

If existing policies are found to cause market distortions that cause food to be thrown away that would not be absent the policy, then these should of course be abandoned. But this should be applied generally to all policies that distort markets.

And it called on the UK to look at whether nations should stockpile food to protect themselves from price spikes.

Don’t we have market solutions to this already? Speculators?

They also warned that some biofuels are driving up prices and making them more volatile and, in some cases, could be even more damaging to the environment than fossil fuels.

Good thinking. Don’t stop there. Let me help you along. What do biofuel targets have in common with food waste targets and meat production targets?

The above is a lesson in how the ideas of certain classes of people – academics; politicians; journalists; social scientists – become law. These are the early stages, but something is afoot.

Samizdata quote of the day

You are not supposed to take money away from the competent people and give it to the incompetent so that the incompetent can compete with the competent people with their own money. That’s not the way capitalism is supposed to work.

– Jim Rogers tells Zero Hedge what he thinks of bank bailouts. (Thanks to Adam Gilhespy for spotting this.)

Thoughts about optimism and pessimism for the End of the World Club

The End of the World Club (there seem to be quite a few – can’t find a link to the one I mean) is a bunch of Austrianist-inclined people who meet at London’s Institute of Economic Affairs every few weeks to talk about the state of the world, and than afterwards maybe drink and/or dine locally, to try to cheer themselves up again.

Simon Rose, the guy who runs the End of the World Club, has asked me to kick off the discussion on the evening of May 28th. The following is a hastily typed summary of what I have in mind to suggest that we all talk about. I emphasise the “hasty” bit. Under comment pressure I will surely want to modify or even abandon quite a few bits of what follows. My number one purpose here is not to be unchallengeably right about everything, although you never know your luck; my number one purpose is to provoke thought and talk, by looking at the world from a slightly different angle to the usual angles. It began as a mere email to Simon Rose, but as you can see, it got a bit out of hand. My email to Rose will now be the link to this.

Since it’s the “End of the World” Club, I thought it might make sense to think about optimism and pessimism. Is that title (“End of the World”) for real? Or is it playfully ironic? How optimistic or pessimistic are we End-of-the-Worlders about the near future, and the longer term future? How optimistic or pessimistic about the near and longer term future are our statist adversaries? How much difference does that make to anything?

In recent decades, it has been the Austrian School who have been most rationally and persuasively pessimistic about the short run (by which I mean the next few years and the next, say, couple of decades). And it has been the politically middle-of-the-road statists who have been most unthinkingly optimistic, first, that no sort of economic catastrophe was coming, and now, when they try to be as optimistic as they can about the catastrophe (that has happened despite their earlier unthinking optimism) not getting any worse. Austrianists, in contrast, regard the present turmoil as proof that they were and remain right about everything, and that their pessimism, now, about the short term (and actually not that short term) future will accordingly also be entirely justified. Austrianists are mostly pessimists now. (Think Detlev Schlichter.) But they are optimistic about their own thought processes, in which they have absolute confidence.

But when it comes to the bigger picture, it is the broader free marketeer tendency who are now the optimists.

Socialists used to be optimistic, about how their socialism would make humanity materially better off. They were only pessimistic in the sense that they feared that they might never be allowed to do socialism. But about half way through the twentieth century, socialists stopped saying that they would do affluence better than capitalism was doing it, because the claim that capitalism wasn’t doing affluence was becoming absurd. Instead they turned against affluence.

They became economic pessimists about their own policies, in other words. But they stuck with their policies and turned their backs on the idea of mass affluence being a good thing. The Green Movement, which is what socialism has mutated into, is a huge surrender on the economic policy front, and an attempt to engage with the world on a quite different front. Socialists have surrendered the happy future. You have to listen a bit carefully to hear this. It took the form of a huge change of subject, from making the future happier, to making it more virtuous and poverty-stricken. They used to like affluence. Now they trash it. (Have a listen, for instance, to this excellent Jeffrey Tucker talk.) They used to be leading us towards an imaginary heaven on earth. Now they claim merely to be saving us from an equally imaginary hell on earth (and thereby are actually trying to create a real one). I am optimistic that this imagined hell on earth is also now on the way to being abandoned (see, e.g., this blog posting by Pointman). (What will be their next Big Tyranny Excuse?)

Meanwhile, classical liberals (as opposed to the illiberal liberals of our own time) note how free market ideas have raised humanity from abject poverty to a standard of living that was formerly unimaginable even for kings and emperors. Some free marketeers are rationally optimistic (to echo Matt Ridley‘s recent book title) that life will continue to get better, despite everything the statists and socialists now try to throw at it. Other free marketeers are now supremely optimistic that free market policies will work superbly, provided those policies are followed. Think J. P. Floru (an earlier speaker to the End of the World Club – very eloquent, very confident, I was there). Conditional optimism, you might call this. This is the same optimism that the socialists had a hundred years ago or so. It is very potent. The future will be wonderful, but only if you join our cause and help us save this wonderful future from being trashed by our malevolent, idiotic adversaries.

In the first half of the twentieth century free marketeers were much more tentative and intellectually timid. They often agreed that material progress would only happen if big government (with or even without big business) made the running, but argued for freedom anyway, as something that should be sentimentally preserved despite its economic cost. No wonder they did so badly.

But free marketeers are now the optimists. In the long run this means we will win. Discuss. See also: optimism (even irrational optimism) as a technique for success, individually and collectively. See also: pessimism (even (especially?) rational pessimism) as a recipe for failure, individual and collective.

That is pretty much it, and is surely more than enough to keep us talking for however long is required. Email me (you surely know how by now) if the End of the World Club is of interest, and I’ll pass it on.

Robert Charles Wilson

In my ongoing quest to read science fiction with sensible politics and economics, I thought I would give Robert Charles Wilson a try and am reading his novel Spin, which is very enjoyable so far. On his web site he has published some talks he has given, including this:

Total up the man-hours necessary to bring even a cheap conventional color TV into your home, and the result, I suggest, would be absolutely staggering. And that work in turn rests on an absolutely colossal body of prior knowledge, all of it generated piece-by-piece and preserved and transmitted over generations.

This reminded me of the famous pencil essay. He is writing about all the things that went into making a TV advert for a car:

So even something as inherently humble as an automobile commercial stands as striking evidence that we, as a species, have an absolute genius for collaboration. Even without conscious intent — and after all, of all the billions of people necessary to produce that ad, only a handful of them actually wanted it to exist — we can still create something in which our collective ingenuity is embedded and embodied.

Of course, he doesn’t mention what mechanism makes this collaboration possible, but we all know what it is.

Not the quote of the day…

Not the official QOTD, but pretty great anyway:

“If prices are information, then subsidies are censorship.”

– Russ Nelson

The economics of bad science

A typical reaction to global warming skepticism is to point to all the institutions that endorse global warming and argue that this would require a grand conspiracy if global warming were false.

I argue that all that is needed is for incentives to align in a certain direction. The awarding of grants, the publication of papers and the media attention all point in one direction and there is positive feedback between them.

As reported in the New York Times, Diederik Stapel literally made up results of psychological experiments that were never done. It is not necessary to go quite that far.

Fraud like Stapel’s — brazen and careless in hindsight — might represent a lesser threat to the integrity of science than the massaging of data and selective reporting of experiments. The young professor who backed the two student whistle-blowers told me that tweaking results — like stopping data collection once the results confirm a hypothesis — is a common practice. “I could certainly see that if you do it in more subtle ways, it’s more difficult to detect,” Ap Dijksterhuis, one of the Netherlands’ best known psychologists, told me.

Journals and reviewers can play a part:

If Stapel was solely to blame for making stuff up, the report stated, his peers, journal editors and reviewers of the field’s top journals were to blame for letting him get away with it. The committees identified several practices as “sloppy science” — misuse of statistics, ignoring of data that do not conform to a desired hypothesis and the pursuit of a compelling story no matter how scientifically unsupported it may be.

The adjective “sloppy” seems charitable. Several psychologists I spoke to admitted that each of these more common practices was as deliberate as any of Stapel’s wholesale fabrications. Each was a choice made by the scientist every time he or she came to a fork in the road of experimental research — one way pointing to the truth, however dull and unsatisfying, and the other beckoning the researcher toward a rosier and more notable result that could be patently false or only partly true. What may be most troubling about the research culture the committees describe in their report are the plentiful opportunities and incentives for fraud. “The cookie jar was on the table without a lid” is how Stapel put it to me once. Those who suspect a colleague of fraud may be inclined to keep mum because of the potential costs of whistle-blowing.

So there are incentives to take an easy path of painting a simple, neat picture because it is more persuasive and saleable.

Stapel did not deny that his deceit was driven by ambition. But it was more complicated than that, he told me. He insisted that he loved social psychology but had been frustrated by the messiness of experimental data, which rarely led to clear conclusions. His lifelong obsession with elegance and order, he said, led him to concoct sexy results that journals found attractive. “It was a quest for aesthetics, for beauty — instead of the truth,” he said.

What the public didn’t realize, he said, was that academic science, too, was becoming a business. “There are scarce resources, you need grants, you need money, there is competition,” he said. “Normal people go to the edge to get that money. Science is of course about discovery, about digging to discover the truth. But it is also communication, persuasion, marketing. I am a salesman.

It is not just money; the rewards are the respect and admiration of one’s peers. In my talk on open source software on Friday I mentioned that this is one of the reasons individuals give away their source code or donate their time to open source projects. It feels good to make something that others find impressive.

I am lucky enough to work in software. There, the most aesthetically pleasing solution is usually the best one. And software can not easily be faked; it becomes apparent very quickly if it does not work. I can imagine software that appears to do what it claims to do without actually doing it, such as an encryption program that leaks your secrets. Open source software has largely solved this problem. In fact, science could learn a lot from open source software.

H/T Watts Up With That?

Nigel Farage tactfully comments on the euro and the EU

[youtube http://www.youtube.com/watch?v=UZap5n3zGZ8&w=560&h=315]

A slight discrepancy in the numbers

Sometimes, a straight, even dryly-written news-wire report can tell you about the vastly different interpretations of certain issues out there. This Bloomberg report about the world of “offshore money” is a classic case in point. The whole article is worth reading, but this caught my eye:

“According to Tax Justice Network, a U.K.-based organization that campaigns for transparency in the financial system, wealthy individuals were hiding as much as $32 trillion offshore at the end of 2010. Fewer than 100,000 people own $9.8 trillion of offshore assets, according to research compiled by former McKinsey & Co. economist James Henry.”

That is one hell of a contrast. You have the TJN’s $32 trillion, or $9.8 trillion. Take your pick.

Suppose TJN is correct. $32 trillion is a lot of money. And I ask myself how on earth a leftist campaign group such as the Tax Justice Network comes up with that figure. According to Wikipedia’s page on the size of the global economy, the latest available figure for the value of total GDP, based on the 20 richest countries, is $18.8 trillion. So maybe there is a “long tail” of money from smaller economies, but even so, it is a bit of a stretch to arrive at $32 trillion, and then to assume that this money is all parked, or routed via, offshore centres. And even if some of this huge amount of money does pass via offshore centres (such as Bermuda, Caymans, Jersey, Delaware, Zurich, Geneva, and er, cough, London) it does not stay there, but is invested in various places. (What would be the the point of just stashing money in a nice Caribbean island rather than putting it to work?)

I have come to the conclusion that while some of the concerns about offshore wealth might be justified if we are worried about finances of criminals and the like, some of the amounts being bandied about are so vast that the credibility of the attacks is seriously compromised. And I remain convinced that much of the current furore about the offshore world is based on a desire by some policymakers to stamp out tax competition and create a sort of global fiscal cartel.

Whitehouse bomb tweet hoax causes markets to… fall?

I looked at my screen this morning and saw this…

BILLIONS was temporarily wiped off the US stock market last night after hackers broke into the Twitter account of the Associated Press and announced that two bombs had exploded at the White House, injuring Barack Obama

Sayeth the news article and my immediate thought is… why?

If the White House… hell, let us think big… and indeed all of Washington DC was fortuitously tragically blasted into a huge smoking crater by an unexpected meteorite, killing every politician, government functionary and policy wonk who works there, surely that would be a economic windfall that should add billions to the US stock market, at a stroke removing a significant portion of the most active members of the parasite class from the world’s largest economy.

Just sayin’