Free Markets, Free People

Thomas Sowell


Quote of the Day: Political vernacular edition

Thomas Sowell, as he has so aptly and wonderfully done for decades, distills down some of the silliness that happens with the language of politics.  He pens a short political glossary  for those who need it.  You can’t tell what a politician is saying without it.

Fairness:

One of the most versatile terms in the political vocabulary is "fairness." It has been used over a vast range of issues, from "fair trade" laws to the Fair Labor Standards Act. And recently we have heard that the rich don’t pay their "fair share" of taxes.

Some of us may want to see a definition of what is "fair." But a concrete definition would destroy the versatility of the word, which is what makes it so useful politically.

If you said, for example, that 46.7 percent of their income — or any other number — is the "fair share" of their income that the rich should have to pay in taxes, then once they paid that amount, there would be no basis for politicians to come back to them for more — and "more" is what "fair share" means in practice.

Life in general has never been even close to fair, so the pretense that the government can make it fair is a valuable and inexhaustible asset to politicians who want to expand government.

Dead on right and yes it is indeed a word that has become an “inexhaustible asset” to politicians of a certain ilk.

Racism:

"Racism" is another term we can expect to hear a lot this election year, especially if the public opinion polls are going against President Barack Obama.

Former big-time TV journalist Sam Donaldson and current fledgling CNN host Don Lemon have already proclaimed racism to be the reason for criticisms of Obama, and we can expect more and more other talking heads to say the same thing as the election campaign goes on. The word "racism" is like ketchup. It can be put on practically anything — and demanding evidence makes you a "racist."

On the positive side, sort of, “compassion”:

A more positive term that is likely to be heard a lot, during election years especially, is "compassion." But what does it mean concretely? More often than not, in practice it means a willingness to spend the taxpayers’ money in ways that will increase the spender’s chances of getting reelected.

If you are skeptical — or, worse yet, critical — of this practice, then you qualify for a different political label: "mean-spirited." A related political label is "greedy."

In the political language of today, people who want to keep what they have earned are said to be "greedy," while those who wish to take their earnings from them and give it to others (who will vote for them in return) show "compassion."

Make sure to read the rest.

Suffice it to say, Sowell nails it.  Of course there are many other words and phrases that can be included as well. Language is malleable as our politicians prove every day.  That’s why so many people listen and then point to Orwell’s “1984” after many political speeches today.

~McQ

Twitter: @McQandO


Why aren’t Democrats running on their record?

Seriously? If, as the President touted in LA the other day, they’ve passed the most progressive agenda in decades, why in the world aren’t they trumpeting it to the hills?

Instead, as a headline notes in the POLITICO, “White House searches for villain”.  Apparently they’ve finally figured out that they’ve worn the “blame Bush” card out. However, instead of a strategy to remind the public what Congressional Democrats have done in this session of Congress, they’re looking for a bad guy on the other side to vilify instead.

You could write it off to their usual penchant for the politics of personal destruction and blame-shifting.  But it’s hard to blame Republicans for “obstruction” when you had majorities in both houses of Congress that nullified the GOP’s ability to do that.

So what’s up with them ignoring their own record?

Perhaps, as Thomas Sowell points out, it is how they accomplished that record and what that means that they’d rather play down instead of play up:

‘We the people" are the central concern of the Constitution, as well as its opening words, since it is a Constitution for a self-governing nation. But "we the people" are treated as an obstacle to circumvent by the current administration.

One way of circumventing the people is to rush legislation through Congress so fast that no one knows what is buried in it. Did you know that the so-called health care reform bill contained a provision creating a tax on people who buy and sell gold coins?

You might debate whether that tax is a good or a bad idea. But the whole point of burying it in legislation about medical insurance is to make sure "we the people" don’t even know about it, much less have a chance to debate it, before it becomes law.

The health care bill is the most prevalent example of what Sowell is talking about.  So intent were they on passing what liberal Democrats considered one of their most cherished ideological dreams they pulled out all the stops, invented procedures on the fly and essentially rammed this legislation through without even them knowing what all was in it. 

Debate?  There was none.  None. They wouldn’t allow it. And certainly none about what was in the bill and would become law of the land.  So we continue to find little nuggets of crap in the law as we wade through it.  Gold taxes for instance.

But his larger point is the important one here.  It is  what has spawned the Tea Parties and the anger throughout the nation that is now boiling over.  “We the People” – that would be anyone outside of DC – are simply tired of being ignored and having things imposed upon us by out of touch politicians.  And we’re certainly tired of seeing legislation passed as this Congress has done.

Another way we have our freedoms and liberties imposed upon is also been used by this and other Congresses:

Yet another ploy is to pass laws worded in vague generalities, leaving it up to the federal bureaucracies to issue specific regulations based on those laws. "We the people" can’t vote on bureaucrats. And, since it takes time for all the bureaucratic rules to be formulated and then put into practice, we won’t know what either the rules or their effects are prior to this fall’s elections when we vote for (or against) those who passed these clever laws.

Consider the EPA’s attempt to regulate greenhouse gasses by fiat.  If Congress can’t pass a law to regulate them because of popular opposition, well they’ll just reinterpret existing law to their benefit and try to do it anyway.

If you wonder why people think government is out of control, those are two good examples. 

Is it any wonder people see politics today as agenda driven for the benefit of the parties instead of the people?  Is it any wonder that people are feeling more and more like serfs and less like equal citizens?

Not since the Norman conquerors of England published their laws in French, for an English-speaking nation, centuries ago, has there been such contempt for the people’s right to know what laws were being imposed on them.

Until this government is drastically pared back to some basic functions, this is going to continue and get worse.  It is in many areas in which it has no business and it is consuming more and more of our GDP doing things it has no business doing.  If we’re not already bankrupt, runaway government is doing its level best to do so.

There’s a reason the Democrats are searching for a bad guy instead of running on their record.  They can sense something’s wrong, but they really can’t – for whatever reason – put their finger on it. Well, my guess is they can cloak the next villain in Nazi SS regalia and call him the worst thing since Adolph Hitler and it won’t matter a whit in November.

This has got to stop and “the people” have figured it out.  In November, methinks, they’re going to help the politicians figure it out as well.

~McQ

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The Lure Of Price Controls

It is a dream all central planners have – the ability to change the laws of economics to the extent that the planner can decide on what a “fair price” might be and market dynamics will adjust themselves to the price and all will be unicorns and rainbows.

Of course we know from our experience with that application in various areas that the market doesn’t adjust to price and it is never unicorns and rainbows when price controls are applied. In fact price controls consistently spawn pretty predictable market reactions and, depending on how vast the price controls are, have the ability to bring down whole economies, or at least put them into a shambles. The latest price control paradise is Zimbabwe where a wheelbarrow full of Zimbabwean currency may be enough to buy an egg in the morning but not in the afternoon.

I bring this up because there’s a growing call for lawmakers to consider price controls for health care insurance, as demonstrated yesterday in the LA Times.

In the drive to bring health coverage to almost every American, lawmakers have largely rejected restrictions on how much insurers can charge, sparking fears that consumers will continue to face the skyrocketing premium increases of recent years.

The legislators’ reluctance to control premium costs comes despite the fact that they intend to require virtually all Americans to get health insurance, an unprecedented mandate — long sought by insurance companies — that would mark the first time the federal government has compelled consumers to buy a single industry’s product, effectively creating a captive market.

Nancy Pelosi has articulated the price control “dream” for health insurance – “a cap on what you pay and no limit on what you get back” if I recall correctly. Of course what she doesn’t say is not even Medicare does that and it has about 43 trillion in unfunded liabilities at this point. But understand that at the bottom of Pelosi’s statement is the reality of imposing price controls – you can’t have a “cap” on what you pay without them.

Thomas Sowell touches on the real intent that sort of Pelosi-talk:

Liberals especially tend to think up all sorts of good things we want — a “living wage,” “affordable housing,” “universal health care,” and an ever-expanding wish-list of things that everyone should receive as “rights” — with little or no awareness of the economic repercussions of turning that wish list into laws.

He then provides a little primer about price control:

Prices are perhaps the most misunderstood thing in economics. Whenever prices are “too high” — whether these are prices of medicines or of gasoline or all sorts of other things — many people think the answer is for the government to force those prices down.

[...]

Prices are not just arbitrary numbers plucked out of the air or numbers dependent on whether sellers are “greedy” or not. In the competition of the marketplace, prices are signals that convey underlying realities about relative scarcities and relative costs of production.

Those underlying realities are not changed in the slightest by price controls. You might as well try to deal with someone’s fever by putting the thermometer in cold water to lower the reading.

What most who believe they can thwart the laws of economics and use price controls never seem to understand is that economic law requires the price mechanism in order to properly allocate goods. Without it, some other mechanism must take its place. Those are usually found in forms of evasion. One evasion is deterioration of quality. The old saw “you get what you pay for” is never more true than under price controls. The time allocated to a doctor visit might get shorter and shorter in order for the doctor to see enough patients to meet his and his practice’s financial needs. That could also mean he can’t afford the newest equipment or diagnostic tools. Consider what price controls would mean to a pharmaceutical company and its incentive to create new and better drugs.  Or a medical implements company, etc.

Another evasion may be alternate markets – you pay a physician a yearly fee and don’t use the price controlled system in place – that has already begun in anticipation of this.  Doctor’s networks are springing up all over the country. Of course with a mandatory insurance requirement, you’d still have to pay into the price controlled system. But that sort of evasion takes doctors out of the price controlled market and creates another shortage with which that market has to contend.

And, of course, there’s queuing. If the price imposed is low, the tendency for those paying is to use it more frequently. There’s no penalty for doing so. That leads to a shortage (in the case of medicine, doctors still only have 24 hours in a day and can still see only a finite number of patients during that time) of available appointments and thus it extends the time before you can see a physician.

Some would call these “unintended consequences” of price controls. But they’re certainly not unknown consequences. They’re consequences on display all over the world in systems which do, in fact, impose such price controls.

Sowell concludes:

Costs don’t go away because you refuse to pay them, any more than gravity goes away if you refuse to acknowledge it. You usually pay more in different ways, through taxes as well as prices, and by deterioration in quality when political processes replace economic process.

But the lure of the free lunch goes on.

With the same disastrous results it has always had.  Yet our would-be central planners seem obvious to the fact.  That’s one reason government debt is at the horrendous level it is today and headed for even higher levels.

~McQ

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