Archive for Finance and money

Explaining the Pope

Gene M. Van Son explains why Francis is not the Left’s Pope.

In fact everything Pope Francis has said regarding marriage, family, divorce, contraception, homosexuality, women’s ordination — and economics — has been perfectly in line with traditional Catholic teaching. And while he is all for helping the poor and is against greed and crony capitalism, he does not support liberation theology, and he is not a socialist or a communist.

The issues have nuance and it is easy to suffer misperceptions if words are used in more of an ideologic manner without appropriate care. For instance:

Regarding economics, in a January interview in the Italian journal La Stampa, Francis — yet again — clarified his views on capitalism, saying, “When money, instead of man, is at the center of the system, when money becomes an idol, men and women are reduced to simple instruments of a social and economic system.” He added that “We need ethics in the economy, and we also need ethics in politics.”

The problem here is that capitalism, as Professor Walter Williams explains, is an economic system based on service to individuals. The very core of the economic system is that man, not money, is at the center of the system. Yes, capital is needed in order to provide the entrepreneur the resources to provide a service or product but, unless that service or product does not serve individuals who make choices one a a time, the capital will not yield any return. You can clarify views on capitalism all you want but unless you make it clear that fundamental basis of the system and its primary reason for its contributions to humanity is service to people and not money gamemanship, one will remain misunderstood.

A capitalist who makes money his idol looses focus on his market. When that happens, the capitalist looses his money as well as his market. He forgets that his business success in based on providing people with something they want or need and that wealth, both financial and otherwise, comes from that service to humans. Confusing the need for funds with the use of those funds is a propaganda tactic often used to malign capitalism. One needs to be careful with how one uses words and associates them with other concepts and it is this area that the Pope has created sufficient worry for articles trying to clarify his point of view.

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Trying to figure out what is bothersome

Jazz Shaw finally found it. Something about the Hastert case didn’t feel right but couldn’t pin it down until Connor Friedersdorf at the Atlantic provided the proper analogy. So evading government scrutiny is a crime. Why?.

Let’s toss in one more hypothetical from Friedersdorf just to drive the point home.

What if the government installed surveillance cameras on various streets in a municipality and then made it a crime to walk along a route that skirted those cameras?

That’s it in a nutshell.

This is behind why the extension of the PATRIOT Act caused so much rancor. The telephone records data mining effort is like the surveillance cameras and it bothers people that there is no way to get out of sight, to take another route, to avoid getting hassled for trying to avoid governmental snooping. The abuse of prosecutorial discretion in going after political enemies is a realized fear and the Hastert case is looking to be another example in such efforts. 

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Let the free market work

Terry Anderson and Donald Leal take onClimate Policy: Adaptation, Not Mitigation (Part I, Theory). They take a look at the tragedy of the commons and how many complex problems can find practical solutions in a dynamic environment driven by free market principles.

Rather than simply throwing up our hands in despair with respect to what appear to be intractable problems of establishing property rights and encouraging markets in regard to global climate, we turn to a major theme of free-market environmentalism—dynamic markets provide the best hope for human interaction with dynamic environments.

The key here is that of using a dynamic system to respond to a dynamic problem. This is not about using static (i.e. governmental regulation and mandate) to fix a ‘real soon now’ problem that may never occur. 

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Always wanting more: education edition

John Hinderaker thinks the President is clueless when it comes to some of his recent remarks on education. It’s not only the President but also those seeking more money for education in Baltimore as a cure for race riots and in Nevada where they think business needs to cough up more, too. The problem is that the numbers indicate that more money isn’t an effective solution. Hinderaker also addresses the continuing complaint that this or that government program is “cut” and therefore suffering intolerably.

Government cuts? What government cuts? Let’s take education, the most important item on Obama’s list. I think pretty much everyone knows that there has been no decline in spending on education; on the contrary. Spending on education has constantly climbed, without any corresponding improvement in quality.

The United States spends considerably more per pupil than the average OECD country, more in fact than any country except Switzerland and Norway

So where is the “disinvestment?” Where is the “anti-government ideology?” Obama’s comments represent rank ignorance; either that or cynical demagoguery. In truth, the cure for poverty is well known: graduate from high school, get a job–any job–and get married. But the real solution doesn’t fit the left’s agenda.

Pouring more money on a fire is an easy thing to do. It burns nicely, too. The question that has to be faced later is where that money comes from and what happens when the fire goes out. In government, the fire often leaves a smoldering heap of sludge that needs constant attention to keep from igniting other fires – as it has in Baltimore. 

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Minimum wage and all the usual ‘arguments’ behavior

Mark Perry brings in his comments about Don Boudreaux on the ‘manifest idiocy’ of Robert Reich’s minimum wage video. It is a case study on the nature of debate on many of today’s hot button issues.

In a series of posts, George Mason economist Don Boudreaux has done a great public service by conducting a systematic, step-by-step takedown of Reich’s economic asininity, because in Don’s words, “Nearly every sentence out of Reich’s mouth in the video is flawed.” Demonstrating his total “economic bad-assery” in regard to regularly dismantling every aspect of economic nitwitery about the minimum wage, here’s a summary of Don’s takedowns of Reich’s “manifestly idiotic” video:

First to note. Of course, you might think that with the focus on Robert Reich that it was an ad hominem rant. The thing to note, though, is that the commentary is not about the person but rather his behavior, what Reich actually said. It is the assertions and debate points that are ridiculed and not the person.

Add the minimum wage fantasies to a long list supported by a lack of touch with reality and reason.

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The Malthusians “land is a fixed resource” argument

The real estate broker says that land is a good investment because they don’t make any more of it. That suits the Malthusians just fine as those folks are always raising the alarm about how humanity is going to run out of something Real Soon Now with disastrous consequences for mankind. The economist tells a different tale. Don Boudreaux responded to the concept and describes why Supply Is Not Exclusively, or Even Mainly, A Physical Phenomenon.

While I agree that efforts to create land out of water-covered areas won’t yield much extra land, I disagree that land is fixed in supply. It is not fixed, at least not economically.

The economic supply of land, like that of any other resources you can name, is not a physical phenomenon. As long as people are free and inspired to innovate – and as long as input and output prices are free to adjust to changes in supply and demand – the economic supplies of even the most ‘fixed’ and ‘nonrenewable’ resources will expand.

The examples used to illustrate how the utilization of land is not fixed include skyscrapers, refrigeration, and computers. If your value of land is only as nature will have it, then there is indeed a problem. But if you value land for its ability to provide housing, food, and preserves, then the imagination an ingenuity of humans provides endless horizons.

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Earth hour: get people off it for betterment?

Mark Perry explains why Earth Hour celebrates ignorance, poverty, and backwardness citing Canadian economist Ross McKitrick.

“Abundant, cheap electricity has been the greatest source of human liberation in the 20th century. Every material social advance in the 20th century depended on the proliferation of inexpensive and reliable electricity.”

“The whole mentality around Earth Hour demonizes electricity. I cannot do that, instead I celebrate it and all that it has provided for humanity. Earth Hour celebrates ignorance, poverty and backwardness. By repudiating the greatest engine of liberation it becomes an hour devoted to anti-humanism. It encourages the sanctimonious gesture of turning off trivial appliances for a trivial amount of time, in deference to some ill-defined abstraction called “the Earth,” all the while hypocritically retaining the real benefits of continuous, reliable electricity.”

Why? What is it that drives those who are able to put their own energy needs into the background to want to deprive others of the freedom and liberty it can bring?

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Public servants or public masters?

James Rust says Barack Goes Berserk on Climate ‘Deniers’ (gold stars for fed alarmists?) but the real story is that so many government employees have forsaken their primary duty and become a political arm.

“Organizing For Action (OFA) is a non-profit and community organizing project formed after President Obama’s 2012 re-election to promote his agenda. On March 5, 2015, OFA sent out a letter under President Obama’s signature reporting certain elected officials were climate change deniers with the following statement:

“You’re part of an important team with OFA, with a mission of holding climate change deniers’ feet to the fire.“

“Recent actions of intimidating letters sent to university presidents by Congressman Raul Gripalva February 24 and letters sent February 25 to 100 pro-energy organizations by Senators Markey, Boxer, and Whitehouse protesting alleged conflicts of interest due to compensation received by those who question carbon dioxide from fossil fuels causes catastrophic climate change.”

“Using the Freedom of Information Act, attorney Chris Horner uncovered a March 3, 2009 internal EPA memo to Richard Windsor (EPA Administrator Lisa Jackson’s cover-up name) that recommended a different approach be used to generate public support for EPA’s policies. ”

“Another example is shown by activities of the Department of Interior’s U. S. Geological Survey (USGS).”

“On February 10, 2015, the Department of Agriculture issued a press release “USDA Announces Funding for Renewable Energy and Energy Efficiency Projects” which described the availability of $280 million from the 2014 Farm Bill for their Rural Energy for Americans Program (REAP)”

So many agencies with so many governmental employees: you’d think there would be some pushback on the effort to force an ideological fantasy on the public. So far, it seems, it’s just crickets chirping.

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For the greater good

There was a letter sent to several universities inquiring about research funding from several members of the minority party in Congress. That created a backlash that has resulted in a number of FOIA requests to provide insight into the “Climate Empire.” Paul Driessen describes how The Climate Empire Gets Nasty (‘crony science’ for funding, power).

“As the pressure for debate and reform mounts, the Climate Empire insists that its actions serve “the greater good” – preventing catastrophic climate changes. But aside from the absence of evidence clearly linking fossil fuel emissions to significant climate events (or even to phenomena that are simply different in frequency or intensity to what mankind and planet have endured since time immemorial), there are two insurmountable problems with this alarmist tautology.

“The “Greater Good”?

“First, it requires depriving billions of people of reliable, affordable energy today – to prevent hypothetical crises decades from now. And that means causing thousands of deaths each winter in Britain and Europe in households where families cannot afford proper heat – and millions of deaths annually in Third World countries, from lung, intestinal and other diseases that modern energy and living standards would prevent.

“Should the Climate Empire have such life-or-death powers? And who has the moral or legal authority to grant it such powers? Perhaps there was a reincarnation of Moses’ burning bush?”

“a recent analysis by economists William Butos and Thomas McQuade on how “Big Players” can distort climate research and other scientific endeavors” provided topics for a more fruitful discussion than the efforts of the Congressmen.

“Will the lies and other outrages ever stop? Probably not anytime soon. But those of us who believe in the scientific method, evidence instead of models and proclamations, and modern living standards for all who want them must not cease our efforts.

For as Rabbi Tarfon said five centuries ago, “You are not obligated to complete the task, but neither are you free to abandon it.””

Much as Ferguson is revealing the outcome of catering to thugs and criminals due to race by senior government officials, The Mann court case and the assault on Professor Soon are revealing the tactics and that result in changes such as responsible researchers avoiding climate research altogether. The costs, as the economists note, are horrific. To those on the left, those who worship Marx and communism in any form, those costs are of no concern because it is all for the greater good.

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The ‘Free Internet’ movement: Looking for governmental solutions

Ryan Radia says Don’t Extend the Dead Hand of the FCC to the Internet — “Entrusting the FCC with broad and ambiguous regulatory powers was, and remains, a grave mistake“.

“On February 26, the Federal Communications Commission (FCC) will vote on a proposal to regulate companies that provide Internet access as public utilities.”

“Why the sudden march to regulate? In 2008 and again in 2010, the FCC tried to impose somewhat less onerous rules on Internet providers, but both times, a federal court found that the agency exceeded its authority. Rather than admit defeat and move on, the FCC took a third stab at rulemaking in 2014—this time proposing more modest rules that hewed to the court’s rulings. But last summer, the White House began making its own plans for the Internet, as if it were a “parallel version of the FCC itself.”

“The rallying cry behind the FCC’s impending rules can be summed up in two words: net neutrality. According to this superficially benign concept, coined by the left-leaning law professor Tim Wu, Internet providers should be barred from discriminating against applications, services, content, or devices without an extremely good reason. Over time, net neutrality has morphed into the broader notion that Internet providers shouldn’t even be allowed to accept payment from content companies such as Netflix or Amazon for priority traffic handling.”

“Why the drive to handicap Internet providers’ business models? Because, the argument goes, infrastructure is special—so much so that it deserves comprehensive federal oversight. Internet service providers are supposedly all-powerful gatekeepers with the incentive and ability to pick winners and losers online.”

As a general rule, the government is a last resort for solving society’s problems. Advocating governmental involvement when you can’t really define a problem should raise many questions. Creating conspiracies and imagined collusion in order to assert monopoly is not a good basis for action. The record of the government in regards to telecommunications regulation was only adequate when there actually was a monopoly and technology needed a gateway. The heyday of that for telephones was forty years ago. Twenty years ago, technologies provided a means around the established infrastructure. But we still have taxes from a hundred years ago, taxes that hit the small and less capitalized persons and businesses the hardest. Getting government to let go is even more difficult that getting it involved in the first place. That is the threat with this effort to implement socialist theology on the I’net.

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Nobody so blind as he who won’t see

Someone defined insanity as doing the same thing over and over expecting different results. That seems to be a chosen mode of operation in some political corners these days. For an example, see ‘Hidden in Plain Sight': A Q&A with Peter Wallison on the 2008 financial crisis and why it might happen again

“Legislation can only be effective if it is drawn up by a Congress that understands the nature of the problem it is supposed to solve. Dodd-Frank was based on the false idea that the 2008 financial crisis was caused by insufficient regulation of the private sector. This narrative supported what the 2010 Democratic Congress wanted to accomplish—the imposition of much greater regulation on the US financial system—but did not come close to identifying or addressing the government policies that were the actual cause of the crisis. Indeed, by absolving the government from any role in the crisis, the supporters of Dodd-Frank left the government free to do the same thing again—something that is occurring right before our eyes. The president’s proposal last week to reduce the FHA’s insurance premiums, and the FHFA’s ruling that Fannie Mae and Freddie should accept 3% down payments on mortgages, are only the most recent examples that we are on our way to repeating a very sad history.”

“The key question is whether the American people have learned that it was the government’s housing policies, and not the risk-taking and greed of the private sector, that caused the 2008 financial crisis. With that understood, we can have a genuine national debate on whether the US should continue a government role in the housing finance system. At the moment, the signs are not good.”

It does sound so nice – for everyone to be able to own their own home. The problem occurs when it is decided that the government is the agent to be used to accomplish this idea. Then, when the results of that effort hit home, the ‘sounds nice’ crowd get into rationalizations that choose an ‘evil capitalist’ to explain the failure. That continues to downward spiral of solving the wrong problem, creating more problems, and spending ever more resources on solutions to the wrong problems.

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A recipe for American decline

Brian Wise says Blocking Uber’s innovation is not the American way

“Saving Uber isn’t just about one company, but giving all innovative products that aim to respond to market demand a fair chance to thrive without unjust government interference. At a time when an explosion of technology is changing the marketplace virtually every day, we either innovate or we fall victim to a debilitating self-restraint that means less productivity and a lower quality of life for everyone.”

The trade licensing issue fits in here as well. Nevada is especially pernicious in its assault on small business in the many license requirements for low skill vocational activities. These are supposedly to ‘protect the public’ but that was in a day before you could easily check up on companies and individuals regarding their service capabilities and customer satisfaction.

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Another ‘big lie” – bank bailout

It’s Hinderaker on the occupiers and their complaints about Wall Street and the bailout of big banks:

“For years, my friends in the banking industry told me that the federal government was forcing them to make bad loans. Mortgages were not the only such bad loans, but while they were the largest, they were also the least problematic from the banks’ standpoint, since the taxpayers, through Fannie Mae and Freddy Mac, stood ready to buy them and assume the risk. The financial collapse of 2008 and the recession that followed were caused primarily by liberal policies enforced by the federal government that went back to the Carter administration.”

“”In what sense were banks “bailed out”? They weren’t “given” anything. Large banks were forced to take liquidity loans by the lender of last resort to prevent a bank run while the equity holders got mercilessly hammered in the market. Most “bankers” had huge amounts of their bonuses and net worth in options or in equity in the bank, respectively, which also became nearly worthless. Hundreds of thousands of “bankers” lost their jobs and will never work in finance again, most likely. This is a “bailout”?””

“”The bank liquidity programs were nothing like the bailout of GM or Chrysler, which were actually given money directly and indirectly, through special tax legislation creating a loophole worth about $45 billion in foregone taxes, most of which will never be recovered. And it was done in an irregular.””

“Of course, if the Democrats want to base their 2016 campaign on anti-bank populism, they will have to deal with the fact that the financial industry contributed more money to Barack Obama’s campaigns than any industry has contributed to any candidate in the nation’s history. Why might that be? The Democratic Party is, and has been for a long time, the party of Wall Street. The congruence between the Obama administration’s policies and Goldman Sachs’s interests is almost perfect.”

It’s where the money is and that means it is a rich target for political hacks who haven’t considered the morality of their ideology. The lack of intellectual integrity is a necessity in order to maintain the pretense, to believe the lie. That never turns out well.

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Uber and the taxi wars of the 60’s continue

You may have heard of Uber. It is a modern take on taxi service that is encountering resistance from the established business model. The Las Vegas Review Journal describes a bit of the history of this struggle: Taxi wars’ of ’60s predate today’s stand-off with Uber.

“Taxi regulations are overseen by the Nevada Taxicab Authority, which was established in 1969 after more than a decade of confrontations among cabdrivers that casino executives feared were getting so violent that they would discourage tourists from coming to Las Vegas.”

“Many of the “taxi wars” battles were waged between union drivers represented by the Teamsters Local 881 and nonunion drivers for companies such as Checker Cab”

“Over the years, statutes were modified and the five-member Nevada Taxicab Authority remains in place and only regulates taxis in Clark County. Cabs that operate in other counties are administered by the Nevada Transportation Authority, which also regulates buses, limousines, towing and moving van companies.”

“The authority board’s top objective is to best serve the riding public. But state statutes have other criteria that the public has been quick to criticize as anticompetitive and protectionist.”

Of course, the usual pattern: Union violence stimulates anti-competitive regulation that is promoted under the banner of public safety and order in commerce. What has changed? 

personal accountability via capitalist incentives.

The taxi companies primary service, that of dispatch, now no longer needs to be centralized as an app on the cell phone can do most of the work. Instead of having to depend upon the reputation of the taxi company, potential riders can now investigate the reputation of a particular driver. The scene is changing and it will take time to determine the implications and work them out to acceptable solutions. Once again, it is those playing by the old rules up against those who want to make new rules. Let’s hope it doesn’t repeat the violence from past taxi-wars.

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Innovation escaping

Dr. Kanav Kahol left Arizona to get back to India in order to develop his idea for medical testing.

“There, he and a team of researchers produced the Swasthya Slate, or “Health Tablet.” The machine, built from sensors and an Android tablet, measures vitals like blood pressure and glucose levels and tests for conditions like HIV and pulse oximetry. Medical labs certified that it was as accurate as pre-existing technologies, and the Indian government has underwritten successful pilot projects using the device in the field. Where it was introduced, the device worked wonders. For example, a complicated antenatal testing process that previously took 14 days can be performed in 45 minutes using the new machine.”

India Welcomes a Medical Innovation Rejected by America tells the story. Too many obstacles here doesn’t help anyone.

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Here we go again: re inflating the housing bubble

“Is the Obama administration actively trying to create the conditions for another housing collapse? What everyone who follows the housing market knows full well is this: The major reason for the millions of home foreclosures during the meltdown was the policy of low down payments on home loans.

“One study by researchers at the University of Texas in Dallas looked at some 30 million mortgages issued before the bubble burst and found that “[t]he evidence strongly suggests that the single most important factor is whether the homeowner has negative equity in a house” — i.e., whether they paid a high or low down payment. This study found the down payment was a much stronger prediction of whether a loan would end up in default than the credit score of the borrower.”

Stephen Moore describes how The feds are pushing the same lax rules that triggered the crash.

“As the housing bubble kept inflating from 2001 to 2006, aspiring homeowners could walk into a bank or a branch of Countrywide Financial and walk out with home loans with as low as 2.5 percent or 3 percent down payment (including closing costs, which also could be financed through the loan). The Wall Street Journal, Investor’s Business Daily and other free marketeers warned of the insane risk that taxpayers were underwriting on almost $1 trillion in mortgages. They were shouted down as alarmists.”

“None of these lessons from the last crisis have taken hold in Washington. The best and the brightest in President Obama’s camp want to roll the dice again and lower, not raise, down payments and ease the credit rules at banks. When sensible people protest this insanity, critics call us fear mongers. That, too, is what the housing lobby said on the eve of the previous housing crisis.”

Try, try, again. Hope for different results this time. Never stop to think about why the fantasy might not be reality and why trying to make it so is a sure path towards disaster (again).

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Forty years after and Vietnam learns capitalism

It took forty years after being abandoned to the communists but Vietnam has discovered what capitalism can bring. The mindset there is a comparison and contrast to that in the U.S. as Glenn Harlan Reynolds explains in How we ‘won’ in Vietnam, but are losing at home.

But the Vietnamese advantage may boil down to this: Free markets are new there, whereas America has had them for a long time. Scientist Thomas Ray once said that every successful system accumulates parasites, and the free market in America has been successful for a very long time. Established businesses get tied down with regulations that keep out new innovations — like Michigan’s GM-backed anti-Tesla law that bars car makers from selling directly to the public — while politicians line up to line their pockets with taxes and fees and campaign contributions.

The question is what it will take to get the U.S. back on track. That is what worries.

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Racist mindset

Patricia L. Dickson is accused of being too logical. An example is her explanation that Poverty In The Black Community Is The Result of Culture Not Racism

A black female friend and I once discussed how our historically unemployed (lazy) relatives often claimed that we were rich simply because we had things that they did not. I said to her that surely they understood that we worked for everything that we have. Her response to me was that they did not understand how we acquired what we had. I told her that it was illogical for someone not to correlate money or possessions with work, and I refused to believe it. Well, a short time later, my friend’s comments proved true.

Until the black community looks inward to solve its problems, nothing will change. Many problems in the black community are the result of a self-imposed inferiority complex. That is why it infuriates me so much to hear race baiters telling poor blacks that they are victims. The victim mindset causes complacency and impotence of action in an individual. One reason that the black community has regressed instead of progressed is due to the victim mindset that has caused cognitive blindness and mental paralysis. Blacks cannot continue to blame society for how blacks Americans are perceived. The black community must examine its culture and its effect on the lives of the individuals in the black community.

Looking inward is always a good start for discovering a source of problems as it is where you can find those things over which you have the most control

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aspirational vs envious

It’s New York measured against Hong Kong. Richard W. Rahn – Hong Kong, an aspirational society to emulate – “The currency of Hong Kong is effort, rather than envy”

Why is Hong Kong succeeding while New York City is receding? They are both world-class cities with about the same per-capita income and great natural harbors.

Hong Kong, like Singapore, South Korea, Chile and Switzerland are aspirational societies, rather than societies consumed with envy, like France. Work, saving and investment are not punished in aspirational societies, and there tend to be less social conflict and a higher level of civility. The United States used to be an aspirational society, but has increasingly become an envious society.

The leaders of China understand that aspirational societies work and those based on envy do not — but an aspirational society requires both economic freedom and individual liberty. Those who seek to control the lives of others, whether they are in Beijing, Paris or Washington, fear aspirational societies and thus, seek to regulate them — out of existence.

Envy, hate, and greed – it isn’t capitalism but rather the take from those who have to give to those who appear to need (or those who are friends of those in power). Powerful emotions overwhelm the ability to learn from history or from reality.

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Moralizing markets

There is a struggle some have about the wealth created by modern capitalist markets. Kevin Brown hits this in his column Capitalism and the Common Good — How to gear the free market so that people floursh.

As people of faith, we need not deify or demonize the market. Instead, I propose we focus on ensuring that the market’s consequences create the least possible damage and the greatest common good for our neighbors near and far. The market may be one gift from God, but he’s given us a greater gift in the church. Together, we can watch out for the most vulnerable members of society lest they slip through the cracks of our global marketplace.

The biggest problem is that he confuses causation with correlation and neglects the inherent moral issue centered on the temptation of man. From “The Coltan Conundrum” to child labor laws, he confuses the sources of evil. He shows an awareness of this:

Stanford ethicist Debra Satz says that in Adam Smith’s classical economic vision, markets flourish when they are grounded in property rights, with appropriate government regulation and social conventions. In other words, well-functioning markets do not so much produce these attributes; they need to be grounded in them. Thus Christians can be actively involved in shaping the regulatory environment and the moral and ethical social conventions that allow for healthier markets.

The ideology is the false assumption that corrupts thoughts and lends bias. It is one that delves into motivations rather than actual behavior.

The market is regularly tempted to think of humans less as persons and more as “factors of production.”

The economist occasionally surfaces in this mudstorm:

UK political philosopher Jonathan Wolff says that for an economic system to survive, it need not be optimal, just superior, to other systems. It doesn’t have to be perfect. It just has to be the best available option in an imperfect world. As an economist and a Christian, this strikes me as a helpful vantage point in moving the market debate forward.

At the practical level, most critics of the market system advocate some form of a planned economy, … this only introduces new problems. In planned economies, we do not see the same level of innovation or effectiveness … Planned economies also hinder the supply and demand forces that ultimately provide consumers with the best prices. … We must also note that a paternalistic environment usually discourages human creativity, initiative, and industry. And these are all ways in which we bear the image of God. There is a spiritual cost to a planned economy.

While Brown wails on at length about “collateral damage” he seems to forget how the market brings this into personal consumer decisions (along with context and other issues). In marketing, this aspect of the transactions is known as the brand. People will pay a lot to get what they want from a vendor who has an image they endorse. You can see this in the assault on WalMart (and others) regarding merchandise made in China, for instance. The key here is that a market system is not simple. It is composed of many transactions and each one has many factors that involve personal choices. As the first quote above signifies, the issue with markets, the angst and moralizing, isn’t really about the market system but rather about individuals and the choices they each make every day and for every purchase.

That is the fundamental problem. Instead of looking at ourselves, we are looking for a scapegoat. Ragging on that scapegoat isn’t going to solve anything as long as each of us as individual humans do not take possession of our faults and failures

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