Addendum: in yesterday’s post “Send in the Clowns…” I neglected to credit John Stossel, as the source for Bryan Caplan’s ideas about the irrational voter. Stossel sums it up this way:
Caplan stresses that most voters see no reason to do otherwise because they don’t bear the consequences of their choices. This irrationality does not carry over into their personal lives because there they bear the brunt of their own decisions. But when irrationality is free, notes Caplan, people will indulge their biases.
Caplan divides them into four categories: antimarket bias, antiforeign bias, make-work bias and pessimistic bias. Antimarket bias describes people feeling that trade and profit are zero-sum games, that one person’s gain is another person’s loss [I call this ‘scarcity thinking — D]. They haven’t learned that free exchange is win-win and that in a free market, profit comes from cost-cutting innovation. Antiforeign bias, perhaps a vestige of primitive man, consists of distrusting “them” even though our prosperity increases according to how global the division of labor is. Foreigners don’t want to invade us; they want to sell us useful things. Make-work bias is the belief that what makes us rich is jobs, rather than goods, and so anything that eliminates jobs is bad. If that were really true, we could prosper by outlawing all inventions created after 1920. Think of all the jobs that would create! Finally, pessimistic bias is the view that any economic problem is proof of general decline. Lots of people actually think we’re poorer than our grandparents were!
As a result of these biases, people often support price controls, foreign-trade barriers and laws against job “outsourcing,” and oppose immigration. Most economists are eager to demonstrate that these policies are bad for society, but most people aren’t interested in evidence. They’re interested in what confirms their worldview and makes them feel good. So they often vote for protectionists, anti-immigration advocates and other opponents of the free market. [emphasis added]
Does this sound like the Democrat Party? I have come to think of them as the lolparty. Not only are they amusing, but they are “tagged for your convenience.”
[teh fun endz heer]
4 comments:
Hmmm. Steyn has a piece from his "American Songbook" feature this week about what song...? Why "Send in the clowns".
I think my head is starting to hurt.
I may have a problem with Stossel on this, since I am not clear on what he means:
"Antiforeign bias, perhaps a vestige of primitive man, consists of distrusting “them” even though our prosperity increases according to how global the division of labor is. Foreigners don’t want to invade us; they want to sell us useful things."
Does this assume that such foreigners will remain in their home countries, or does the term "foreigners include those who immigrate to our country?
If it is the former, I agree with Stossel, excluding the exceptions of 1) Chinese toothpaste and other foreign produced goods that are a health hazard, including farm produce and animal products that are carrying dangerous living creatures or bacteria 2.) Strategic resources (oil) used to that either fund jihad, the spread of Islam, or to support dictatorial regimes such as Chavez's or Putin's.
If it is the later, that is, immigrants and the free flow of labour across borders- then I disagree, and feel that Stossel himself is irrational. Apparently, if this is the case, then Stossel believes that the breath of human actions can be described as traits of Homo Econimicus, whose culture, religion, and ideologies are non-issues and are not motivating factors. Terrorism is not born from Economic repression, but by ideology and religion. They do "want to invade us." Even the economic migrants from Latin America should be seen as a danger, since many have no intention of assimilating into our body politic or our culture. Many don't "want to sell us useful things", they want to vote themselves benefits, receive healthcare, and in other words, leach off of what we have built.
On a different note, what is good for business does not necessarily mean that it is good for the US. Growing the pie has worked before the advent of offshoring, Caribbean tax-shelters and multi national corporations.
Large, world-spanning companies do not have loyalty to us, or to any nation states, only to their shareholders, and their aims are to only make a profit.
There are many positive results from successful small- or medium-sized businesses, but when the company is multinational, the positive trickle down results of success MAY flow out of but not into the West. Case in point may be the Saudis buying into our media companies, therefore putting a damper on our media from investigating issues that put Islam in a bad light.
"Foreigners don’t want to invade us; they want to sell us useful things."
The statement above is patently false. Some foreigners are invading the living hell out of us.
I would define anti-foreign Bias as being a 'principle' to be against foreigners in the market - even when it is not in our best interest. Smith noted that countries that did not trade freely hit a 'maximum' in resources/goods trade internally, which eventually brought economic growth to a standstill.
Its definitely true that there are some situations where we want to favor our own country's production, but there are also situations where that shoots us in the foot.
Was chatting with some folks last night, and someone mentioned - outsource code, things like e-lance, who supports the code for bugs? Who owns the intellectual property?
A serious problem for us here has always been that our dollar goes further in these exotic locales than it does here. Therefore, with the internet foreign coders can take advantage of their low cost of living to sell their services for lower rates.
On the one hand, we don't want to lose our computer science/coding production of our country, but on the other hand we don't want to insulate our own industry until the point at which the measures are unsustainable - and when they are released (such as tariffs) it will cause a crash in the industry.
Jobs are only associated with wealth insofar as they are involved in producing something of value. Make-work usually is the idea that you can 'create wealth' by giving people jobs that really don't produce anything.
That is, a society will not be wealthy where a lot is produced by only a few people and nobody else has the money to purchase it, nor will a society be wealthy where everyone is employed at doing basically nothing at all.
My position is that it's not completely wrong that jobs can create wealth, protecting our market can help us, but only in a limited sense. They can't be principles.
Also, the zero-sum logic only works in very limited contexts. If two people are being interviewed for a VP position, it is a zero sum game for them. But the general rule is that 'VP' positions can be created as well, so while one guy may lose immediately by not getting hired, more VP positions come along, or the man himself might create his own business.
But all of this relies on an expansion of population, producible things, and accessible resources. That is, growth. Without the growth no manner of fancy economic voodoo will help you.
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