Quotation of the Day…
1 hour ago
Back in my teaching days, many years ago, one of the things I liked to ask the class to consider was this: Imagine a government agency with only two tasks: (1) building statues of Benedict Arnold and (2) providing life-saving medications to children. If this agency's budget were cut, what would it do?
The answer, of course, is that it would cut back on the medications for children. Why? Because that would be what was most likely to get the budget cuts restored. If they cut back on building statues of Benedict Arnold, people might ask why they were building statues of Benedict Arnold in the first place.
There’s an author Bob Lupton, who really nails it when he says that when he gave something the first time, there was gratitude; and when he gave something a second time to that same community, there was anticipation; the third time, there was expectation; the fourth time, there was entitlement; and the fifth time, there was dependency. That is what we’ve all experienced when we’ve wanted to do good. Something changes the more we just give hand-out after hand-out. Something that is designed to be a help actually causes harm.Read the whole thing.
Oakley concludes by noting that "during the twentieth century, tens of millions [of] individuals were killed under despotic regimes that rose to power through appeals to altruism." An understanding that altruism can produce great evil as well as good is crucial to the defense of human freedom and dignity.When something bad happens, people often assume that someone with evil motives--especially greed--is the cause. The notion of pathological altruism is an alternative explanation. Bad results can come from what appear to be good motives--altruism. And people with suspect motives, such as greed or lust for power, often are very good at finding ways to exploit the altruism of others to further their own goals.
Mr. Yang's father would die within three days. Yet it would take years before Mr. Yang learned that what happened to his father was not an isolated incident. He was one of the 36 million Chinese who succumbed to famine between 1958 and 1962.
It would take years more for him to realize that the source of all the suffering was not nature: There were no major droughts or floods in China in the famine years. Rather, the cause was man, and one man in particular: Mao Zedong, the Great Helmsman, whose visage still stares down on Beijing's Tiananmen Square from atop the gates of the Forbidden City.
It also needs a certain number of people who understand the full truth about the Maoist system so that the party will never repeat its mistakes, even as it keeps the cult of Mao alive in order to preserve its political legitimacy. That's especially true today as China is being swept by a wave of Maoist nostalgia among people who, Mr. Yang says, "abstract Mao as this symbol of social justice," and then use that abstraction to criticize the current regime.
Calvin Coolidge became president on the unexpected death of Warren Harding in 1923 and won re-election in 1924. He declined to run in 1928 despite pressure from his party. As president he cut taxes, spending, and government debt, leaving government smaller than when he took office. The low ranking professional historians give him reflects their bias for activist presidents. In this view the prosperity during his administration was accidental, not a result of his efforts to curtail government. Shlaes disagrees, arguing that by reducing the role of government, Coolidge encouraged private-sector expansion. She describes how his determination to cut spending overcame opposition from those wanting to spend more on veteran's bonuses, farm subsidies, defense, aid to flood victims, and an ambitious dam building program proposed by Commerce Secretary Herbert Hoover. Coolidge emerges as a determined man respected and popular not because he followed public opinion but because he did what he thought was the right thing to do. That determination and principle combined with luck and a group of dedicated supporters carried him from state legislature to governor of Massachusetts to the vice presidency. Highly recommended, all audiences.
If there is one common theme to the vast range of crises we consider in this book, it is that excessive debt accumulation, whether it be by the government, banks, corporations, or consumers, often poses greater systemic risks than it seems during a boom. xxv
Although private debt certainly plays a key role in many crises, government debt is far more often the underlying problem across the wide range of financial crises we examine. xxxiii
Severe financial crises rarely occur in isolation. Rather than being the trigger of recession, they are more often an amplification mechanism: a reversal of fortunes in output growth leads to a string of defaults on bank loans, forcing a pullback on other bank lending, which leads to further output falls and repayment problems, and so on. 145
[I]nflation has long been the weapon of choice in sovereign defaults of domestic debt and, where possible, on international debt. 175
"The most insidious effect of the Social Security and Medicare regimes is that they actually shift economic incentives away from having children," Jonathan V. Last, a writer for the conservative Weekly Standard, says in his book, "What to Expect When No One's Expecting: America's Coming Demographic Disaster ."
Here's a counter-argument: These programs reassure parents bearing the considerable expense of raising children that they won't be destitute if they can't save enough for their old age.Ms Harrop has a strange notion of how incentives work: If you have children, you get state-funded retirement payments. If you do not have children, you get state-funded retirement payments. Therefore state-funded retirement payments encourage you to have children.
"But what Sunstein and Thaler say is that it's just easier to trick people than it is to change their incentives.... [M]y toolkit used to contain only incentives, but now tricks are in there, too."Behavioral economics and the psychologists who inspired it may have introduced ways of tricking people into intellectual discourse but it is doubtful that they are discovering anything that has not been practiced by hucksters for generations. Their analysis of weaknesses in the ways people choose can be used in two ways.
Steven D Levitt, from an interview in Simon W, Bowmaker, The Art and Practice of Economics Research: Lessons from Leading Minds (Edward Elgar, 2012 ISBN: 978 1849808460) p. 237
"But, without trade, they couldn't survive in the long run."And
In the final phase, it was young people of child-bearing age in particular who saw no future for themselves on the island. The excavators found hardly any skeletons of young women on a cemetery from the late period.
"The situation was presumably similar to the way it is today, when young Greeks and Spaniards are leaving their countries to seek greener pastures in areas that are more promising economically," Lynnerup says. "It's always the young and the strong who go, leaving the old behind."