Thursday, September 19, 2002

Life Imitates Pilger, Part I

Last week I noted a John Pilger piece in which he compares George W. Bush with Hitler.

Today the Melbourne Age reports that German Justice Minister Herta Daeubler-Gmelin has just made the very same comparison.

Maybe Daeubler-Gmelin is a big Pilger fan. Or, given the German government's current foreign policy response (as detailed in this piece [link requires email information] in today's Wall Street Journal), maybe the entire German cabinet has been "Pilgerized".

Wednesday, September 18, 2002

Senator Hillary "You Know" Rodham Clinton

In her book The Final Days, Barbara Olson (deceased wife of current US Solicitor General Theodore Olson), details the abuses of power by the Clinton White House in the last days of that administration.

Olson also notes the proclivity of Hillary Clinton to deliberately and constantly use the phrase "you know" in an attempt to connect with listeners. As in: "you know, my husband is the victim of a vast right-wing conspiracy".

For a very recent example, see the transcript of this interview with Tim Russert of NBC's Meet the Press from Sunday, 16 September 2002.

I count Senator Clinton using the phrase "you know" 35 times in the course of this interview.

I grew up in North Queensland, and as a consequence I occasionally throw in a few "you knows" here and there.

But I don't think I'm as bad as Hillary, you know?

Misleading Headline Alert, I

This story in the Sydney Morning Herald notes that the "richest 20 per cent have an average wealth portfolio of $772,000, compared with $18,000 for the poorest 20 per cent."

The headline? Rich get 40 times Richer, which implies that this phenomenon is a recent one and that it never used to be the case. But the story actually fails to provide a single shred of evidence regarding the movement of individuals within and between wealth deciles over time, or on the overall growth in wealth over time (I haven't read the NATSEM report, so I don't know whether the report covered this or not).

So the only conclusion that we can draw from the Herald story is that, at this point in time, there are some people who have more wealth than others. I can also infer that those same people also pay way more in taxes than others. Did we really need to a report from NATSEM to tell us that?

Tuesday, September 17, 2002

Has Already Solved the ABC's Dilemma?

In this transcript, Stephen McDonell of the ABC's Four Corners program asks:

"If the question is whether Lebanese Australians have a crime problem or are unfairly being blamed for crime, the answer is that both seem true. And, if that's the case, the real question is -- what are we going to do about it?

It seems that may have already supplied a possible solution to the ABC's dilemma - hand over criminal investigations to the ACLU:

"Instead of un-Constitutionally targeting specific groups, our investigation will expand the pool of interviews by more fairly including people of every ethnicity, every religion, every gender, and every sexual persuasion," said ACLU Executive Director Anthony D. Romero. "Right now, we are interviewing Caucasian farmers in Iowa, legally blind Wal-Mart employees in California, and gay Latino package store customers in Floridato see if they had contact with, or were involved with, those from the Middle East who carried out these attacks."

"For some reason, we haven't learned a thing so far," Romero conceded. "But I should note that we have yet to speak to Chinese-American loggers in the Northwest."

Using the new approach, the ACLU estimated the investigation will cost $2 trillion and take 750 years to complete.

My guess is that the ACLU is probably already busy enough. The Human Rights and Equal Opportunity Commission, on the other hand, does seem to be seriously underworked. Their most recent and proudest accomplishment has been internet censorship.

I'll welcome Peter Martin to the blogosphere by immediately attacking him. He comments on a piece by Ross Gittins , which addresses a recent paper in the Journal of Economic Literature on happiness research.

Martin concludes that:

Taken all together - the implications are that redistribution of income is a very good idea, positional goods should probably be banned (in aggregate they make people unhappy by raising expectations) jobs matter, and that democracy matters in its own right, regardless of where it leads us.

I've read the JEL paper very carefully, and I don't see how you can reasonably conclude from it that (i) "redistribution of income is a very good idea"; (ii)"positional goods should be banned"; or (iii) "democracy matters in its own right, regardless of where it leads us."

Here's why:

(i) Trading in markets can undo a lot of the redistribution that a government might try to achieve, because it is simply impossible to redistribute things like talent, brainpower, genes etc. So the net result of many policies which attempt to redistribute income is just to lower income for everyone. And the JEL paper shows unambiguously that, for a given point in time, people on lower incomes are unhappy:

As a robust and general result, it has been found that richer people, on average, report higher subjective wellbeing. The relationship between income and happiness, both in simple regressions and when a large number of other factors are controlled for in multiple regressions, proves to be statistically (normally highly) significant. In this sense, “income does buy happiness.”

(ii) In practice, many redistributive programs work by redistributing income from poor to rich (eg education subsidies, middle class welfare, corporate welfare, etc). So if your conclusion is true, it also implies that should be willing to abolish - or undertake substantial reform of - a large number of government programs that are currently in place.

(iii) To logically conclude that "redistribution of income is a very good idea" you would need to show that the actual redistributive tools that are available, and the policies that politicians actually put in place make everyone happier. There is no direct evidence in the JEL paper to suggest that these policies actually achieve this goal; in fact, my guess is that the opposite is true. And even if it was true - if there were redistributions that made everyone happier, why don't people simply make these redistributions themselves?

(iv) The JEL paper also concludes that economic freedom is correlated with happiness. Economic freedom is negatively correlated with the size and extent of governmental redistributive programs. The paper also notes that institutional features like the rule of law and governmental accountability are associated with subjective well-being. Again, these institutional arrangements are negatively correlated with the extent of income redistribution.

(v) If positional goods really don't make people happier, then surely that is extremely valuable information which could conceivably prevent people wasting money on these goods - if only they knew that this was the case. So why not simply tell people that positional goods don't increase happiness, and let people decide for themselves whether to purchase these goods, rather than implement a knee-jerk ban? And what happens to the workers who produce positional goods? If we ban positional goods and they become unemployed, haven't we then increased their unhappiness?

(vi) The JEL paper reports that other things being equal, democracy is associated with happiness. It does not say that irrespective of anything else, democracy is associated with happiness. So your conclusion that "democracy also matters in its own right, regardless of where it leads us" is simply the wrong conclusion to draw from the paper. Of course, it is also wrong for a host of other reasons, but I'll leave those for another post.

(vii) I think there is a potentially a big problem with using "average life satisfaction" as a measure in regressions. The reason is that this measure, like all such measures, is susceptible to the problems raised by Kenneth Arrow and others in the field of social choice. More on this in a later post.

Great Moments in Canberra Doorstop Interviews, Part I


Your Taxes at Work, Part II

Check out the transcript from ABC's Lateline program last night, where ALP backbencher Harry Quick provides this eloquent piece of policy analysis and advice on what is currently the most important issue in Australian national security and foreign policy:

HARRY QUICK, LABOR BACKBENCHER: The American attitude to the whole thing really sucks.

George Bush, I think, is just a bit of, well, a crazy guy at the moment and he just wants to justify getting in there and having a real ding-dong go.

And I just think we're all being caught up in this 9/11 hype and I think it's ridiculous.

I think we should stay right out of it.

According to his parliamentary biography, Mr Quick is also the Opposition Whip in the House of Representatives. If I have done my calculations correctly, this means that taxpayers are funding his salary to the tune of well over $100,000 per year (base salary, plus Opposition Whip allowance).

And the best policy advice this guy can come up with is: "the American attitude to the whole thing really sucks."

Monday, September 16, 2002

Alcoholic Milk - Stronger than Beer!

Buy yours before it is banned.

What will UN Inspectors be Looking For? Part II

It looks like the UN might also have to search for, and bring to justice, Al Qaeda terrorists in Iraq. Here is a fascinating must read column in the New Yorker on the Iraq/Al-Qaeda link and Saddam's weapons programs:

The Kurdish intelligence officials I spoke to were careful not to oversell their case; they said that they have no proof that Ansar al-Islam was ever involved in international terrorism or that Saddam's agents were involved in the attacks on the World Trade Center and the Pentagon. But they do have proof, they said, that Ansar al-Islam is shielding Al Qaeda members, and that it is doing so with the approval of Saddam's agents.

I wonder if the Kiwis will be up to the task?

What will UN Inspectors be Looking For? Part I
Iraq has announced it will let in UN inspectors. lists some of the materials (in addition to nuclear weapons) that the inspectors will be looking for:


WHAT IT IS: The most toxic of chemical weapons, VX is a sticky, colorless liquid that evaporates slowly into a colorless, odorless gas.

WHAT IT DOES: VX interferes with the body's nerve impulses, causing convulsions and paralysis of the lungs and blood vessels. Victims essentially choke to death. A dose of 10 milligrams on the skin is enough to kill.

WHAT IRAQ HAD: Iraq acknowledged making 3.9 tons of VX, which it said it destroyed. U.N. inspectors estimated Iraq had the means to make more than 200 tons of VX and never found definitive proof Iraq had destroyed its supply.


WHAT IT IS: A nerve agent like VX, sarin is a liquid that evaporates quickly.

WHAT IT DOES: Like VX, sarin causes convulsions, paralysis and asphyxiation. The Aum Shinrikyo cult used sarin in attacks on in the Tokyo subway system in 1995 that killed 12 people.

WHAT IRAQ HAD: Iraq first told U.N. inspectors it had made 812 tons of sarin, then said it had made 790 tons. Iraq also produced binary weapons: bombs carrying two separate chemicals that when combined in an explosion, produce sarin. Iraq acknowledged making thousands of rockets, artillery shells and bombs containing sarin and used the chemical during its war with Iran in the 1980s and is believed to have used it against Kurdish Iraqi civilians.


WHAT IT IS: A colorless liquid at room temperature, mustard agent evaporates into a gas that may be odorless or smell like mustard or rotten onions.

WHAT IT DOES: Mustard agent begins dissolving tissues on contact, causing skin injuries similar to burns, as well as damage to lungs and eyes. Mustard agent usually is not fatal but can cause blindness, lung problems and other injuries that can be painful for decades. It was first used in World War I.

WHAT IRAQ HAD: Iraq gave two figures of how much mustard gas it produced: 3,080 tons and 2,850 tons. Iraq acknowledged extensive use of mustard gas against Iran during the Iran-Iraq war in the 1980s. Iraq told the U.N. it misplaced 550 mustard-filled artillery shells after the 1991 Gulf War.


WHAT IT IS: Bacillus anthracis, a hardy bacteria that causes illness in livestock and humans.

WHAT IT DOES: There are three types of anthrax infection: skin lesions, gastrointestinal infection and lung, or inhalation, anthrax. The deadliest -- and the one weapons are designed to produce -- is inhalation anthrax, which starts with flu-like symptoms but escalates to fill the lungs with fluid, causing death. Just a few tiny anthrax spores are enough to cause a deadly infection in some vulnerable people. The anthrax attacks last year showed that antibiotics, if given early, can eliminate the infection, and the U.S. military has a program to vaccinate its soldiers against the disease.

WHAT IRAQ HAD: Iraq acknowledged making 2,200 gallons of anthrax spores -- enough to kill millions if delivered effectively -- but U.N. inspectors determined Iraq could have made at least three times that much. As many as 16 missile warheads filled with anthrax are missing. Iraq also was working in the 1990s to produce a deadlier dry, powdered form of anthrax, inspectors say. That powder could be sprayed from aircraft, put into missile warheads or given to terrorists, inspectors say.


WHAT IT IS: A poison produced by the Clostridium Botulinum bacteria, botulinum toxin is one of the deadliest substances known.

WHAT IT DOES: In small doses, such as those in food contaminated with the bacteria, it can cause stomach cramps, diarrhea, blurry vision and muscle weakness which can advance to paralysis and death. If the toxin is applied in pure form -- especially if it is inhaled -- the paralysis and death can be very rapid. About 70 billionths of a gram is enough to kill if inhaled.

WHAT IRAQ HAD: Iraq acknowledged making nearly 5,300 gallons of botulinum toxin, most of which was put into missile warheads and other munitions. At least five missile warheads filled with botulinim toxin are missing.


WHAT IT IS: A poison produced by the Aspergillus flavus fungus and related fungi that grow on grain.

WHAT IT DOES: Aflatoxin is a potent carcinogen that causes liver cancer. In large doses it can cause abdominal pain, swelling of the lungs and brain, convulsions, coma and death.

WHAT IRAQ HAD: Iraq acknowledged making more than 520 gallons of aflatoxin and putting it into missile warheads and bombs. At least four aflatoxin-filled missile warheads are missing.

Shameless Self-Promotion, Part I

Some good news last week. I won first prize in the Hayek Essay Contest, held biannually by the Mont Pelerin Society and made possible by a grant from the Aequus Institute. I will be attending the Mont Pelerin Society Meetings later this year.

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