New Orleans, Part Two - The Line

I thought I would share some of the pictures I took while I was in New Orleans earlier this month. Sorry for the poor quality, but I forgot my digital camera and had to buy some disposable cameras and have the pictures burned to a CD.

Throughout the city there is dark line that marks a lot of the buildings and structures. That line, of course, is where the water stood for several days if not weeks. The picture below is looking north on Tulane Avenue outside of my uncle's restaurant (about a mile from downtown). You can see the line wrapping around the white building. You can't make it out in this picture but that line goes all the way down the street.

This next one is at the same place but turned around (facing south). My uncle's restaurant is the white building in the middle. You can definitely see the line starting on the right side of the picture go right down the street.

It is pretty incredible considering that this spot is about 4.5 miles from Lake Pontchartrain. The river is closer but, of course, the river wasn't a problem.

The next two are of a strip mall about half a mile from the lake. My wife and I used to live near here and this is where we would "make groceries" (grocery shopping to the non-New Orleanian). Here you can see the line going around the entire mall.

And finally, here are a couple of houses that are near the infamous 17th Street Canal levee breach.


More to come.
Part One

The games people played

As you can see in the side bar I am currently reading Barbara Tuchman's A Distant Mirror: The Calamitous 14th Century. It is a really good read, although a bit difficult at times because there is so much information. I thought I'd share some of the more interesting bits as I came across them. Here is something that really stood out as a bit strange:

In village games, players with hands tied behind them competed to kill a cat nailed to a post by battering it to death with their heads, at the risk of cheeks ripped open or eyes scratched out by the frantic animal's claws. Trumpets enhanced the excitement. Or a pig enclosed in a wide pen was chased by men with clubs to the laughter of spectators as he ran squealing from the blows until beaten lifeless. Accustomed in their own lives to physical hardship and injury, medieval men and women were not necessarily repelled by the spectacle of pain, but rather enjoyed it. The citizens of Mons bought a condemned criminal from a neighboring town so that they should have the pleasure of seeing him quartered. It may be that the untender medieval infancy produced adults who valued others no more than they had been valued in their own formative years.

Wow! And people think Grand Theft Auto is morally degrading!

That last part about the "untender medieval infancy" refers to something mentioned previously in the book about how children were of little concern to medieval society. I'll talk about that some other time.

Re: More wage bunkum

The News & Observer had a letter to the editor today referencing this article of mine. The writer agreed with my point about the need for increased production and used it to justify replacing the income tax with a consumption tax. His basic point being that such a tax will "enhance economic growth." While I am glad he used my argument to justify the need for economic growth, I don't agree with him that a consumption tax will accomplish that goal.

There are economic reasons why a consumption tax will end up being a tax on incomes, thereby negating some of the benefits that the letter writer claims. But the bigger problem I see with his proposal is that it is, as he claims, revenue-neutral. Why would we want it to be revenue-neutral? Why would we want the government to continue to confiscate so much from the private economy?

The issue that we should be addressing is not the type of taxation, but the level of taxation. The more the government takes out of the private economy the more economic growth is hindered, and changing to a "revenue-neutral" consumption tax would do nothing to solve this problem. The government would continue to consume economic resources that would be better left in private hands.

Calling the consumption tax the "Fair Tax" is silly because it would end up not being fair. We are still dealing with politicians who would do their level best to make sure certain products and certain constituents would be exempt from the tax. I can see the debate in Congress now over taxing two ply toilet paper higher than single ply because the rich use more plies.

If I had to choose between a progressive income tax with a small limited government and a consumption tax with the current behemoth, I would choose the former.

Yoda origami

Not that I am into origami, but I may have to try this.

Update: "Do or do not. There is no try." My ass!

Bad medicine

This article is another example of why we don't want a socialized healthcare system in this country. Many advocates of such a system point to Canada and Great Britain as models for us to follow, but they consistently ignore the serious problems those systems face. Long waits and rationing are fundamental aspects of any socialized system, be it limited to healthcare or imposed on an entire economy.

I know, I know, the system in America has serious problems as well. But those who claim that our system is deficient because of its reliance on the free-market ignore (a) the massive amount of regulation that is imposed on the healthcare industry, and (b) the distorting effects of Medicare and Medicaid.

More wage bunkum

I sent the following to the Raleigh News & Observer:

In "Paycheck parity" you praise the N.C. General Assembly for raising the state's minimum wage, stating that "struggling workers will benefit from the money." This is a very simplistic view of a more complex economic reality.

The redistribution of little green pieces of paper will do nothing, in the long run, to increase the standard of living of the people you intend to help. Only by increasing the production of goods and services can real wealth be created for the masses, and raising the minimum wage, all things being equal, does nothing to achieve this goal. As the economist Henry Hazlitt said, "The best wage rates for labor are not the highest wage rates, but the wage rates that permit full production, full employment and the largest sustained payrolls."

The price of security

When defending the Bush administration's NSA domestic spying program many Conservatives state that the security of the country is at stake, and that we must make certain sacrifices in this time of war. I ran across this quote from Wilhelm Röpke that I thought was apropos

The desire for security, while in itself natural and legitimate, can become an obsession which ultimately must be paid for by the loss of freedom and human dignity—whether people realize it or not. In the end, it is clear that whoever is prepared to pay this price is left neither with freedom and dignity nor with security, for there can be no security without freedom and protection from arbitrary power. Surely, every single one of us must then realize that security is one of those things which recede further and further away the more unrestrainedly and violently we desire it.

New Orleans, Part One

Last week I was down in New Orleans visiting family for the first time since hurricane Katrina hit the area. It was definitely a mess, but I saw a lot of people cleaning up and rebuilding. I will share some stories and pictures later this week, but I wanted to address a question I was asked regarding my political philosophy.

A friend asked me whether or not my political beliefs were challenged after seeing the utter devastation and the obvious need of those who lost everything. Now, if it isn't obvious already, I am a staunch libertarian (bordering on anarcho-capitalist), and believe that government has no business providing charity of any kind. I think Grover Cleveland's words say it best

I can find no warrant for such an appropriation [federal aid to drought-stricken Texas farmers] in the Constitution, and I do not believe that the power and duty of the General Government ought to be extended to the relief of individual suffering which is in no manner properly related to the public service or benefit...The friendliness and charity of our countrymen can always be relied upon to relieve their fellow-citizens in misfortune...Federal aid in such cases encourages the expectation of paternal care on the part of the government and weakens the sturdiness of our national character, while it prevents the indulgence among our people of that kindly sentiment and conduct which strengthen the bond of a common brotherhood.

No politician today would have the nerve to say such a thing. Instead, we get a gaggle of rogues who stumble over themselves in a race to place blame on each other and to siphon funds from the public trough.

So, have my beliefs been challenged? In a word, no. In fact, the question is predicated on, what I consider to be, a false assumption: that only government can provide solutions to such problems. (The person who asked me this question is a libertarian himself, so I don't think this is what he believes. I have, however, been asked similar questions by non-libertarians).

Read this story about how $1.4 billion dollars was wasted on fraudulent charges and tell me that government is the most efficient provider of relief funds. This isn't some anomaly either - we constantly hear about fraud in programs like Medicaid, Social Security, Defense Department appropriations, etc. Why would we think that allowing the government to provide billions in disaster relief would be run any better?

We also have to look at the moral hazard that occurs when government becomes the primary supplier of charity. In the passage above, Grover Cleveland talks about the "expectation of paternal care" that is encouraged when Federal aid is so easily dispersed. We should want to "strengthen the bond of a common brotherhood" with the application of private, personal charity, not sit back and assume that some monolithic entity will know what is best for the vast numbers who have lost everything.

Visiting New Orleans has done nothing to change my philosophy. In fact, after listening to personal stories and watching the local news, I am more convinced that the heavy, bumbling hand of government is the bane of civilized society.

Minimum wage bunkum

Yesterday, the News & Observer had an article praising the North Carolina Legislature for passing an increase in the minimum wage. At one point they say "a raise might enable some of those workers to buy more goods and services themselves, thus stimulating the economy for everyone." Typical of the N&O they fail to see the total effect of this policy.

Increasing the minimum wage, all things being equal, does nothing to increase the supply of goods and services. So, the increased consumption which they consider a benefit will actually have the effect of increasing demand for the current supply of goods and services, thereby putting an upward pressure on prices. In the end those people who the policy intends to help will have higher nominal wages, but their real wages will be the same or lower.

We should be looking to increase real wages by increasing the supply of goods and services, which will put downward pressure on prices. Raising costs for producers will do nothing to achieve this goal.

Enron and deregulation (or the lack thereof)

Here is a very good article from Spiked on the recent trial of the Enron executives Kenneth Lay and Jeffrey Skilling. Most notably is this quote

"Enron might have made free-market noises, but as its forays into international expansion – backed by the Clinton administration – show, it sought state help whenever it could get it. And in California, Enron took advantage of the electricity market precisely because it was still significantly regulated and had anomalies it could exploit."

This is a key point because many people believe that Enron is the posterchild for deregulation. The fact is that recent waves of deregulation have actually been cases of re-regulation - changing the regulatory framework, not abolishing it.

The article does a good job dispelling other myths, as well.