Monday, July 27, 2015

Should Missouri Raise Its Minimum Wage?


Should Missouri Raise The Minimum Wage? from Missouri Viewpoints on Vimeo.

My bit starts at about the 15:30 part. There's so much ill-informed nonsense in the pro- camp, which is on display in the first half of the video, as well as in a radio debate I participated in last year. There are intellectually sound arguments to be made, but they aren't being made. Instead we get flat-eathers who believe that the law of demand can be repealed just because a bunch of progressive no-nothings can feel good about themselves. Also see this earlier post, with my letter to the editor.

Saturday, January 24, 2015

Good policy, properly argued, can win

Scott Walker, Republican governor of Wisconsin, has been touted by some as presidential timber. Back in November, Rich Cromwell argued that Walker is what the country needs in 2016. The argument included this assessment of Walker's electoral chances:
Does Walker sizzle? Not exactly. Is he a particularly charismatic speaker? No, he isn’t. But does he sit upon a throne made of the skulls of his enemies? Yes, yes he does.
The line has stuck in my head ever since, and reminds me that there is more to successful governing than shallow phrases, a fiction-filled origin story, and class and race warfare. Instead, it's possible for good policies, if properly argued and presented, to defeat divisiveness, lies, and hate.

Sunday, January 11, 2015

Have some dignity St. Louis

Kevin Horrigan has an excellent rundown of the history of the St. Louis Saps, the collective of regional residents who are being asked yet again to lay down millions of dollars at the altar of the NFL. The article is behind some sort of paywall, but be sure to read it if you can. It includes this 1988 quote about the NFL from then-mayor Vincent Schoemehl following the departure of the football Cardinals:
The fact of the matter is, these are not reputable people, and I don't think it's becoming of a city to extend themselves to postures that allow them to kiss the backsides of such people.

St. Louis resigned to losing the Rams

Tim Logan, formerly of the Post-Dispatch, wrote an interesting article for the LA Times describing the mood in St. Louis about the Rams: In St. Louis, Rams fans seem resigned to losing football team.

Yours truly was quoted in the article:
The Rams do bring value to the St. Louis region, said Howard Wall, an economics professor at Lindenwood University in suburban St. Charles. But in a cash-strapped state with many needs — from roads to schools to the aftermath of this summer's unrest in Ferguson — shelling out for a football team doesn't seem so essential. 
With such pressing priorities, Wall said, many are asking: "Should we spend a half-billion dollars on a football stadium for a billionaire?"
Also see my post from yesterday on the economics of publicly financing of stadiums.

Saturday, January 10, 2015

Rams' stadium plan is corporate welfare at its worst

I was going to write a post about the how study after study shows that the economic impact of pouring public money into sports stadiums is effectively zero.  I was also going to describe how whatever economic benefit there is from having an NFL team was in the amenity value, not the economic development effect. It turns out that I don't have to write that post because Dave Nicklaus has already written an excellent piece making those arguments. Read the whole thing, but here's his conclusion:
St. Louis is being asked to pay dearly for the prestige of remaining an NFL city, so I think Peacock described his stadium plan accurately when he called it a “crown jewel.” A jewel can sparkle and make its owner feel good, but it’s hardly a productive use of half a billion dollars.
I'll add two things for now:
  1. We will no doubt be hearing from those who support the stadium plan that the economic impact of the project will easily exceed the investment. We'll even be given a number for economic effects that is in excess of double the amount of public funding. This study will come from economic consultants, not from independent economists. The study will sound convincing but will be complete bunk. Here is something I wrote recently that provides a list of the deceptions to look for when hearing about the supposed economic impact of the stadium plan.
  2. We've already been hearing how the plan doesn't involve any new taxes, which is true, but irrelevant. In Missouri, tax increases require a popular vote, and this proposal would go down in flames if it were put to the voters of the state. So instead, the state government would rely on the refinancing of existing bonds from the stadium we're still paying off, and on tax credits. Tax credits are functionally equivalent to a bag of cash from taxpayers. If I have a $100 tax credit, my tax bill is lowered by $100. If I don't owe taxes, I can wait until a year in which I do, or I can sell my credit to someone else at a price very close to its face value. So, the tax credits in the stadium plan are nothing short of a cash giveaway that reduces the amount that is available for the state to spend on other things. Thus, either the state will have to raise taxes to make up for the tax credits, or some possibly worthwhile government spending will not be done because the state decided instead to give away hundreds of millions of dollars to a billionaire NFL owner.

Friday, January 9, 2015

No, the minimum wage is NOT good for businesses

The Post-Dispatch had an op-ed the other day arguing that the minimum wage is actually good for business. The author of the op-ed, Chris Sommers, is a successful businessman in St. Louis who I debated with on this issue a few months back. You can listen to the debate here.

The crux of his argument then and now is that he raised the wages in his businesses, which worked out for him, so the Federal government should force every business in the United States to do the same. There were two good letters published today that tore apart this logic (here and here).
It's pretty tiring having to keep arguing against such a demonstrably horrible policy, but I submitted this letter to the editor anyway:
In his op-ed arguing for an increase in the Federal minimum wage (Boost business by raising the minimum wage), Chris Sommers thinks that he has hit upon a magic formula by which increases in the minimum wage do not decrease employment but, instead, are actually good for businesses. He dismisses the reams of empirical evidence to the contrary with the story that his own restaurant chains benefited when they unilaterally raised their internal minimum wage. 
In a nutshell, his argument has four parts:
  1. Because his businesses benefited from voluntarily increasing the wages it paid, every one of the millions of businesses in the United States would benefit by increasing their wages. 
  2. The owners and managers of these millions of businesses spread across millions of square miles are too ignorant to know how to run their own businesses. 
  3. Because of (1) and (2), the Federal government should step in and force a uniform minimum wage for every business of any size in every industry no matter where it is located. 
  4. The result is higher wages with no effect on the number of people employed.  
You can accept this fanciful logic if you like, but I would like to offer an alternative, which is backed up by actual empirical evidence.
  1. Wages tend to be related to the productivity of workers. 
  2. If a law forces a business to pay a wage that is not justified by the productivity of some of the firm’s workers, the firm will not continue to employ those workers. 
  3. The minimum wage leads to job loss and poverty for the lowest-skilled workers, who might never gain the experience they need to get a job that pays above the minimum wage.

Sunday, June 1, 2014

The road to pathetic weeniness

Elementary School Field Day Notice: ‘The competitive urge to win will be kept to a minimum’
The purpose of the day is for our school to get together for an enjoyable two hours of activities and provide an opportunity for students, teachers and parents to interact cooperatively. Since we believe that all of our children are winners, the need for athletic ability and the competitive “urge to win” will be kept to a minimum. The real reward will be the enjoyment and good feelings of participation.
HT: Jonah Goldberg

Saturday, May 31, 2014

Mor(e)on the VA as a socialist success story

Ezra Klein has never impressed me in the least, so this statement of his from 2009 is not surprising:
If you ordered America’s different health systems worst-functioning to best, it would look like this: individual insurance market, employer-based insurance market, Medicare, Veterans Health Administration.
HT: Instapundit

Inequality obsession can kill

Megan McArdle has an interesting article (Would You Pay $84,000 for a New Liver?) that can be read as "A drug company develops a drug that saves money and lives.  But, because the company was motivated by profit and not solely by caring, the company is actually evil and should be forced to sell the at a loss." The story is partly about ignorance of the difference between average and marginal costs, and partly about whether those who do good should make money because of it.

Wednesday, May 28, 2014

Tyranny by bureaucrat

Forget all those silly notions about democracy and laws being passed by Congress and signed by the President.  The current administration continues to simply use its bureaucrats to punish legal activity it doesn't like.

The lesson from the VA scandal

Thomas Lifson spells out the lessons from the performance of VA hospitals, as described by a doctor in today's Wall Street Journal:
It is important that Americans understand the fundamental point about the incompatibility of monopolistic medical bureaucracies and high quality medical care. It is not a matter of incompetent management and employees (though such no doubt exist). The problem will not be solved by adding dedicated leaders and staff; they also no doubt exist in the VA health care system. 
People who can’t be fired and who know that no matter what they do their organization will continue to exist inevitably become self-serving. This is the moral hazard of government funded bureaucracies. 
The solution to the health care problems of veterans and all Americans lies in the competitive discipline of market forces. As Obamacare implodes, we must keep the example of the VA system in mind. And as we figure out how to get care to the veterans who have earned it, we must embrace market forces.
See my earlier post for a similar sentiment.

Tuesday, May 27, 2014

Nooooooooooo!

(F)inding high quality whiskies could get a lot more difficult in the future. 
So, what’s a whiskey drinker to do? Well, not drinking whiskey clearly isn’t a viable option. So, as Esquire suggests, we also recommend you “buy as much as you can afford today.” 
The end is near (sort of), so stock up on high quality whiskey – the good stuff – while you still can!
Well, my kids will just have to do without braces for another year while I deal with this crisis.

Saturday, May 24, 2014

The VA scandal is simply par for the course

I agree with the first and third parts of something Paul Krugman said in 2011 about the VA health system:
And yes, this is “socialized medicine”... But it works — and suggests what it will take to solve the troubles of U.S. health care more broadly.
It is socialized medicine, it doesn't work, and it does suggest what it will take to fix U.S. health care more broadly.

Having lived in the UK for five years and faced the socialist awfulness that is its National Health Service, the recent scandals regarding VA hospitals are very familiar.  Scandals of this sort are an extremely common occurrence in the UK.  Here's a rundown from the BBC of the scandals from 2013 alone:
  • February - The Francis Inquiry into the Stafford Hospital scandal said patients were "betrayed" by a system that put corporate self-interest first. A total of 290 recommendations proposed changes from top to bottom. The government responded by commissioning four new reviews into mortality rates, healthcare assistants, patient safety and complaints.
  • July - A review by NHS medical director Prof Sir Bruce Keogh into the 14 trusts with the highest mortality rates uncovered a host of problems not previously picked up by the official regulator. It led to 11 being placed in special measures.
  • July - The Cavendish Review into healthcare assistants called for mandatory training for the workforce, saying some were being allowed to work after simply watching a DVD.
  • August - A review carried out by Prof Don Berwick, a former adviser to US President Barack Obama, called for patient safety to become a "top priority" in the NHS.
  • October - A review led by Labour MP Ann Clywd into complaints said the NHS has a culture of "delay and denial".
  • November - In response to the Francis Inquiry - and the subsequent reviews - ministers published a blueprint for a "profound transformation", including the introduction of safe staffing levels and new standards for healthcare assistants.

This plaza has something for the whole family

There's also a Chinese restaurant, and I'm thinking that the empty former Blockbuster would make a good tattoo megastore, and the empty Kmart is ideal for a casino/bowling alley.

Saturday, May 10, 2014

The fruits of the minimum wage

In case you were under the illusion that the minimum wage doesn't affect the employment of low-skilled workers (i.e., if you are an economic illiterate), you should know that McDonald's knows better:

McDonald's hires 7,000 touch-screen cashiers

Sunday, April 27, 2014

How are markets responding to global warming?

John Tammy at Forbes has an interesting take on global warming: Rather than listen to the overly emotional arguments from both sides, look at how people with actual skin in the game are responding. That is, if people with money on the line aren't bailing on coastal property, then maybe the coasts will be around for a while longer.

Are Global Warming Alarmists Shane Smith And Bill Maher Moving To Texas?

Global Warming's True Believers Are Screaming At The Proverbial Scoreboard

More on American oligarchs

Oligarchy in the Twenty-First Century: Think rich conservatives rule the world? Think again.

Sunday, April 20, 2014

Perhaps the plutocrats ARE in charge

If one were so inclined, it would be pretty easy to connect some dots and come up with a story about how a couple of billionaires have bought themselves a president who is willing to risk natural and human disasters in return for campaign cash:

Billionaire Dem environmental activist Tom Steyer vows “efforts to defeat Keystone will continue”

Warren Buffett Cashes In on Railroad Tank Cars

Accidents Surge as Oil Industry Takes the Train

Obama administration delays decision on Keystone XL pipeline again

Wednesday, April 9, 2014

The real issues surrounding the gender wage gap

As indicated in my post from yesterday, the notion that the "gender wage gap" is a measure of workplace discrimination is absolute nonsense.  Most of the gap is the result of women's choices about balancing career, family, etc., and not discrimination in pay.  As I mentioned briefly in that post, by being so obviously innumerate, those who claim otherwise are probably harming their own cause. That is, by using this trumped-up measure, they are making it too easy to avoid the actual issues.  Here are two issues off the top of my head:

1. Are women's choices about career, family, etc. made freely, or is it discrimination that leads them to not even try to succeed in male-dominated professions or to work as many hours as men do? My own experience and observations indicate that the most important determinant of women's choices is that they are the ones who God has decided will bear children. One might point out that women didn't choose this state of affairs, but one must admit there is little that government can do to change it. But I think the question of discrimination affecting women's choices is a real issue. Even if women's choices are mostly a product of biology, some of them are not. Megan McArdle has a nice discussion of this issue.

2. After adjusting the gender wage gap for women's choices, the gap almost--but not quite--disappears. Most research is able to explain all but 2 to 5 percent of the gap, but fails to note that a gap of that size is perfectly consistent with there being a great deal of wage discrimination. For example, a 2 percent gap can occur if one-quarter of all working women are being paid 8 percent less than the otherwise identical man doing the exact same job; or if one in ten women are being paid 20 percent less. Wage discrimination on either of these scales should be worth looking into. The focus on the easily debunked gap of 23 cents on the dollar means that more-accurate measures of discrimination are ignored too easily. But maybe those who choose innumeracy do so because they want to force the idea that all women are discriminated against all the time.

If you like your phony numbers, you can keep them. Period.

RAND study: By our estimate, 3.9 million people signed up for ObamaCare, not 7.1 million like the White House says

Tuesday, April 8, 2014

The President didn't mean that HE discriminates, only that we do

Apparently the ridiculously idiotic use of the gender wage gap to measure discrimination applies only to everyone else, but not to the White House.  Among White House staffers, women make only 88 percent of what men make.  But the president's spokesman says that if you account for other factors the gap disappears, so it's unfair to use the gap to indicate discrimination. If only he'd had the decency and honesty to make these corrections for everyone else.

Update: When the White House loses CNN, you know they're in trouble.  Who next? MSNBC?

When economists sell their soul, II

Anyone with half a brain knows that President Obama's claim that the so-called gender wage gap shows the extent of sex discrimination in the workplace is complete bull. Every year this number is trotted out, and every year it has to be redebunked. It is a very tiresome exercise. The claim is so ridiculously stupid and so easily debunked that it probably sets back the cause of eliminating actual workplace discrimination because the discussion centers on the idiocy of the number.

Apparently, even one of the president's personal economists couldn't bring herself to stick to the script. Betsey Stevenson is a member of the president's Council of Economic Advisers and a very accomplished professional economist. Now, any economist who is able to talk about the wage gap as a measure of discrimination is either a ridiculously bad economist or a soulless shill. Stephenson is not the former and she is having a tough time becoming the latter.  

After spouting the nonsense about the gender wage gap at a news conference she was asked a simple question about whether or not is actually shows what she had just claimed it to show. Being a good economist who is having troubling selling her soul, she immediately crumbled from the party line.  She tried to save it, but her brain was not letting her soul be sold for so little.  I can't really give her kudos for this, so I'll just give her a single kudo.

Update: I think I will take back the kudo. Stevenson's performance was just too pathetic and she ended up sticking to her original lie.

Update: Go here for further points about the gender wage gap.

Wednesday, March 12, 2014

President Obama: Tea party anarchist

At least according to Senate Majority Leader Harry Reid, President Obama is a tea party anarchist for denying the fact that Obamacare is the law of the land. Here is Reid in September of last year:
We’re not going to bow to tea party anarchists who deny the mere fact that Obamacare is the law. We will not bow to tea party anarchists who refuse to accept that the Supreme Court ruled that Obamacare is constitutional,” Reid said in a blistering opening speech. “The simple fact remains: Obamacare is the law of the land and will remain the law of the land as long as Barack Obama is president of the United States and as long as I’m Senate majority leader.
Now we have yet another in a long line of unilateral changes made to Obamacare by the president himself:
ObamaCare's implementers continue to roam the battlefield and shoot their own wounded, and the latest casualty is the core of the Affordable Care Act—the individual mandate. To wit, last week the Administration quietly excused millions of people from the requirement to purchase health insurance or else pay a tax penalty.
At least the president is becoming aware that all of this tea party anarchism of his is somewhat embarrassing. This latest change was hidden in a technical bulletin and received none of the notice that accompanied the other major changes.