Thursday, November 28, 2002

International Buy Know Nothing Day
The Sydney Morning Herald reports on the latest piece of idiocy to grip "consumer activists" - stop consuming:

Must have. Hot new look. Improved formula. Great new flavour. Latest styling. New shade. Buy one, get one free. The message is relentless: buy more stuff. It's hard to resist, with advertising slapped on everything from food-court tabletops to railway ticket barriers to the sky.

Few show any desire to resist. According to the Australian Bureau of Statistics, households spend an average of nearly $100 a day on goods and services. Some of it is unavoidable: food, shelter, utilities ... that cute beaded handbag for the Christmas do. Plenty though, is totally avoidable, especially at Christmas: candles, candle holders, wine glasses, those do-hickeys that click onto the glasses so guests don't pick up the wrong one.

What do you do if you want to get off the consumer merry-go-round? Could you get off, even for 24 hours? What would it be like to spend a day without spending?

But wait, today there is a way. It's International Buy Nothing Day, a brave attempt to wean people off so they can stop and think about what they buy and why, and if they can do without - or with less - for a day ... or even longer.

Since the first Buy Nothing Day in 1993, supporters say it has blossomed, with 30 countries celebrating consumer awareness and simpler living.

Sure, you morons - don't buy anything today. Just buy twice as much tomorrow. Or instead, just send your money to me - and I'll spend it for you. You'll feel better, because you won't be engaging in evil consumption, and I'll feel better, because...I'll be enagaging in evil consumption.

A Pareto improvement if ever there was one.

Commanding Heights: I Get Results

A few months ago I blogged on the television series Commanding Heights, which is based on a book on globalization originally written by Daniel Yergin and Joseph Stanislaw, and which was recently screened by PBS in the United States.

I wrote to the ABC and SBS to try to get them to run it, and now that has paid off. The SBS has decided to screen the six part series, starting this Sunday at 8.35pm. Don't miss it.

Wednesday, November 27, 2002

Dry: In Defence of Economic Freedom

John Hyde's Dry: In Defence of Economic Freedom (recently published by the Institute of Public Affairs) has just arrived on my desk. If the Introduction is anything to go by, this should be an excellent book:

Federal politicians who had once led the charge for economic freedom and generously supported a reforming Labor Government have reverted towards, but not yet to the habits of, the Fraser years.

Our changed fortunes did not come about by chance and it is clear that the gains could all too easily be squandered.

This is an account of how attitudes and public policies were changed in Australia. It recounts the journey of an ideal concerning the proper conduct of public policy—its travails, considerable successes and partial setback—during the last quarter of the twentieth century. Many people played parts in the drama. The unfolding story tells what an ill-defined but, nevertheless, identifiable group, which I call ‘the Dries’, believed, learned, did and failed to do. It shows that argument, properly used in a liberal democratic society, can bring about changes by legitimate, peaceable means, and that ‘the good fight’ is worth the effort.

Happy Holidays: Giving Thanks for Private Property Rights
November 28th is Thanksgiving Day. According to Holidays on the Net:

In 1621, after a hard and devastating first year in the New World the Pilgrim's fall harvest was very successful and plentiful. There was corn, fruits, vegetables, along with fish which was packed in salt, and meat that was smoke cured over fires. They found they had enough food to put away for the winter.

The Pilgrims had beaten the odds. They built homes in the wilderness, they raised enough crops to keep them alive during the long coming winter, and they were at peace with their Indian neighbors. Their Governor, William Bradford, proclaimed a day of thanksgiving that was to be shared by all the colonists and the neighboring Native American Indians.

According to journalist Tom Bethell, however, the real story of the Pilgrims is one of the success of private property rights. In his book, The Noblest Triumph: Property and Prosperity through the Ages, Bethell details how, under communal land stewardship, the Pilgrim community was afflicted by an "unwillingness to work, by confusion and discontent, by a loss of mutual respect, and by a prevailing sense of slavery and injustice":


The Mayflower arrived at Cape Cod in November 1620 with 101 people on board. About half of them died within the first few months, probably of scurvy, pneumonia, or malnutrition. It is not easy for us to grasp the hardships that the first settlers in this country experienced, even in New England, where the native American Indians were relatively friendly.

By the spring of 1623, the population of Plymouth can have been no larger than 150. But the colony was still barely able to feed itself, and little cargo was returning for the investors in England. On one occasion newcomers found that there was no bread at all, only fish or a piece of lobster and water. “So they began to think how they might raise as much corn as they could, and obtain a better crop than they had done, that they might not still thus languish in misery,” Bradford wrote in his key passage on property.

Having tried what Bradford called the “common course and condition”—the communal stewardship of the land demanded of them by their investors—Bradford reports that the community was afflicted by an unwillingness to work, by confusion and discontent, by a loss of mutual respect, and by a prevailing sense of slavery and injustice. And this among “godly and sober men.” In short, the experiment was a failure that was endangering the health of the colony.

Historian George Langdon argues that the condition of early Plymouth was not “communism” but “an extreme form of exploitative capitalism in which all the fruits of men’s labor were shipped across the seas.” In this he echoes Samuel Eliot Morison, who claims that “it was not communism . . . but a very degrading and onerous slavery to the English capitalists that was somewhat softened.” Notice that this does not agree with the dissension that Bradford reports, however. It was between the colonists themselves that the conflicts arose, not between the colonists and the investors in London. Morison and Langdon conflate two separate problems. On the one hand, it is true that the colonists did feel “exploited” by the investors because they were eventually expected to surrender to them an undue portion of the wealth they were trying to create. It is as though they felt that they were being “taxed” too highly by their investors—at a 50 percent rate, in fact.

But there was another problem, separate from the “tax” burden. Bradford’s comments make it clear that common ownership demoralized the community far more than the tax. It was not Pilgrims laboring for investors that caused so much distress but Pilgrims laboring for other Pilgrims. Common property gave rise to internecine conflicts that were much more serious than the transatlantic ones. The industrious (in Plymouth) were forced to subsidize the slackers (in Plymouth). The strong “had no more in division of victuals and clothes” than the weak. The older men felt it disrespectful to be “equalized in labours” with the younger men.

This suggests that a form of communism was practiced at Plymouth in 1621 and 1622. No doubt this equalization of tasks was thought (at first) the only fair way to solve the problem of who should do what work in a community where there was to be no individual property: If everyone were to end up with an equal share of the property at the end of seven years, everyone should presumably do the same work throughout those seven years. The problem that inevitably arose was the formidable one of policing this division of labor: How to deal with those who did not pull their weight?

The Pilgrims had encountered the free-rider problem. Under the arrangement of communal property one might reasonably suspect that any additional effort might merely substitute for the lack of industry of others. And these “others” might well be able-bodied, too, but content to take advantage of the communal ownership by contributing less than their fair share. As we shall see, it is difficult to solve this problem without dividing property into individual or family-sized units. And this was the course of action that William Bradford wisely took.


Bradford’s history of the colony records the decision:

At length, after much debate of things, the Governor (with the advice of the chiefest amongst them) gave way that they should set corn every man for his own particular, and in that regard trust to themselves; in all other things to go in the general way as before. And so assigned to every family a parcel of land, according to the proportion of their number.

So the land they worked was converted into private property, which brought “very good success.” The colonists immediately became responsible for their own actions (and those of their immediate families), not for the actions of the whole community. Bradford also suggests in his history that more than land was privatized.

UPDATE: James Robbins at the National Review Online also writes today on a similar theme, urging readers to give thanks for "the choices of freedom over rule, property over collectivization, the liberty of the individual human spirit over the dictates of the enlightened few."

Food Industry and Sugar Growers Oppose Sugar Package
In today's Australian, Dick Wells, chief executive of the Australian Food and Grocery Council writes:

The federal Government intends to place a tax on sugar in Australia to fund a restructuring package for Queensland's sugar industry.

In its attempts to defend this policy faux pas, federal ministers have made numerous remarkable claims. They have claimed the tax is not a tax but a levy, that it will be uncomplicated, that it won't affect employment, that it won't affect consumers. It is as if the sugar tax is a magic pudding, generating $120 million out of thin air.

Let's be clear about this. The "sugar levy" is a 6 per cent input tax on sugar. It defies the Government's own guidelines on what a primary industry levy should look like and bears no resemblance to the 62 now operating. These were all requested or backed by those paying the levy to deliver key services back into their primary industry – mostly research and development, marketing or disease management.


In a bizarre paradox, a sugar tax may actually hurt most those it is supposed to help. If food manufacturers move plants overseas, the raw sugar industry will be forced to sell its product to more distant and potentially less profitable markets.

If the sugar industry in north Queensland needs assistance, this should be done without damaging specific sectors of the Australian economy. To suggest the assistance package is in jeopardy if the Senate refuses to pass it brings into question the Government's commitment in the first place.

A sugar tax is a 1950s solution. It is bad policy and should not be made law.

Meanwhile, the mighty Townsville Bulletin reports that growers are unhappy about the tax as well:

More than 2000 angry sugarcane growers took to the streets of Townsville yesterday in protest at their industry's treatment at the hands of the State and Federal governments.

Their message was loud and clear: Peter Beattie, Tom Barton, John Anderson, Warren Truss, Peter Lindsay and Ian Macdonald and a swag of other mainstream political suits were "out". This season the only politician who is "in" is the cowboy hat and Wrangler jeans-wearing Member for Kennedy, Bob Katter.

Former politicians Ted Lindsay, once the federal Labor member for Herbert, and Max Menzel, once the state National Party member for Mulgrave, are also "in". Both marched at the front yesterday and both spoke in support of growers at the rally in Anzac Park.

The growers have rejected the Federal Government's $150 million rescue package for the industry and have dismissed the much-vaunted Hildebrand Report as being written for the benefit of millers and manufacturers at the expense of growers.

My favourite part of this story is:

Cane harvester salesman and rally architect Bill Micola shouted that "without the sugar industry, half of Townsville will die".

Since Townsville is already half-dead, I guess that means that without the sugar industry it will be 100 per cent dead.

The story also shows that old politicians, unlike General Douglas MacArthur, never even fade away:

Ted Lindsay urged growers not to abandon the fight and said Canberra was "sneaky".

For those of you who are unfamiliar with North Queensland politics (which, I am guessing, is just about everyone) Ted "Eamonn the Demon" Lindsay was the ALP member for Herbert (the Townsville electorate) during the Hawke-Keating years (1983-1996). Prior to the 2001 election, Herbert was one of the most marginal electorates in Australia (You can check the AEC here - the 1998 election result was ALP: 49.90% Lib: 50.10% - a difference of only 150 votes).

Lindsay should know about "sneakiness" in Canberra with regard to the sugar industry, because in 1991, when he was the sitting member, import tariffs were reduced from $115 to $ 75 per tonne, and in 1995 the tariff was abolished completely.

(Note: The Townsville Bulletin's story fails to mention that growers were lobbying for a 25 per cent tax instead of the Howard Government's "sneaky" 6 per cent)

Complex Rules for a Simple World
The Wall Street Journal's Pete du Pont writes on a recent "tax reform" proposal by Michael J. Graetz, a professor at Yale Law School.

He proposes a complex tax increase disguised as breathtaking tax reform.

As a Wall Street Journal editorial pointed out last week, the 5% of taxpayers with incomes of $128,000 or more currently pay 56% of all income taxes, up from 42% 15 years ago. Prof. Graetz's first reform is to accelerate this trend by having the top 10% ($100,000 and up) pay 100% of the income tax and eliminate it for everyone else. Then impose a 14% national sales tax for everyone, but since that is not a break-even plan for the government, he would raise capital gains and estate taxes as well. The total Graetz reform would increase the overall tax burden by an average of $30 billion each year over the next decade.

The national sales tax would be a value added tax, or VAT. It is a consumption, as opposed to an income tax, paid by the companies that produce goods as they move through the production process. In the end the consumer pays the total in the form of a higher price for the goods.

Eliminating the personal income tax for families making less than $100,000, would relieve 90% of taxpayers from paying any income taxes or even filing a return. That sounds simple, but it quickly becomes complex. Since everyone would be paying 14% more for goods--and probably some services--and since the Earned Income Tax Credit (EITC) that gives money back to low-income families would vanish with the income tax, the poor would suffer a double whammy. Prof. Graetz would solve that by eliminating various purchases from the 14% VAT--health care and education, for example--and providing low-income workers with "tax offsets through the payroll tax withholding system," a reduction in the taxes that fund Social Security retirement benefits.

In case you are wondering about Australia, according to official data from the Australian Taxation Office, in 1995-96 the top 30 per cent of all income earners paid 66.3 per cent of total income tax revenue.

And, if you're worried about "equity" in the tax system, then you'll be pleasantly surprised, because, by 1999-2000, the top 30 per cent of all income earners paid 68.2 per cent of all income tax revenue, with the top 5 per cent of all income earners paying nearly 27 per cent of all income tax revenue.

Here is the full distribution for 1999-2000:

Cumulative      Taxable Income        Proportion of
                              Percentile                                                Total Income Tax Revenue Paid

5                Income < $8 970        0.2
10               $8 970 – $11 589        0.4
15               $11 589 – $13 869        0.6
20               $13 869 – $16 071        0.9
25               $16 071 – $18 351        1.2
30               $18 351 – $20 534        1.4
35               $20 534 – $22 667        1.8
40               $22 667 – $24 884        2.3
45               $24 884 – $27 055        2.7
50               $27 055 – $29 304        3.1
55               $29 304 – $31 635        3.6
60               $31 635 – $34 137        4.1
65               $34 137 – $36 808        4.5
70               $36 808 – $39 570        5.1
75               $39 570 – $43 049        5.8
80               $43 049 – $47 225        6.7
85               $47 225 – $51 968        7.8
90               $51 968 – $59 676        9.3
95               $59 676 – $75 919        11.9
100               Income > $75 919        26.8

Tuesday, November 26, 2002

Material Girl Fighting for Private Property Rights reports:

Tony Blair is about to get an angry letter from Mr. and Mrs. Ritchie.

Mrs. Ritchie, better known as Madonna, is teed off over plans to place a public right-of-way through her and her husband's lavish estate.

Apparently, some U.K. environmental land access laws allow for "areas of mountain, moorland, heath and downland" to be granted to the public.

Guy Ritchie's mom, Shireen Ritchie, told the Daily Express that Madonna and her director spouse "feel the legislation has put them and their two young children in a potentially dangerous situation."

So is Madonna the Ayn Rand of the 21st century? Stay tuned for more details.

Federal Court Outlaws Free Speech

Yesterday AAP reported (sorry, no link available) that the Federal Court ruled that Liberal Senator Ross Lightfoot broke the law when he called Aborigines in their native state the most primitive people on earth:

Justice Christopher Carr said the West Australian Senator had breached the Racial Discrimination Act with his comments to a journalist in May 1997. He ordered Senator Lightfoot to pay costs of up to $10,000.

Perth woman Hannah McGlade had taken civil action in the Federal Court, seeking an order that Senator Lightfoot admit his comments vilified Aborigines, that he pay her costs and that he make a donation to the Aboriginal Advancement Council (AAC).

Justice Carr granted Ms McGlade's request for a declaration that Senator Lightfoot's comments vilified Aborigines.
``I think that it would be fit to grant the declaration sought,'' he said. ``It is a useful and appropriate way of recording publicly the unlawfulness of the making by the respondent of comments which received considerable publicity and were reasonably likely to offend and insult,'' Justice Carr said.
He also ordered Senator Lightfoot to pay most of Ms McGlade's costs.

However Justice Carr rejected Ms McGlade's request that the Senator be ordered to make a donation to the AAC. ``I take into account also the fact that the order that the respondent pay the applicant's costs will result in a payment by him of several thousand dollars, possibly in the order of about $10,000,'' Justice Carr said.

Today's decision came five years after Ms McGlade first complained about Senator Lightfoot's remarks to an Australian Financial Review journalist that:``Aboriginal people in their native state are the most primitive people on earth.''

The Senator also said: ``If you want to pick some aspects of Aboriginal culture which are valid in the 21st century, that aren't abhorrent, that don't have some terrible sexual and killing practice in them, I would be happy to listen to those.''

Senator Lightfoot later refused to apologise.

In evidence, Ms McGlade told Justice Carr that the comments brought back memories of childhood racial taunts. ``As a child I learnt the shamefulness that the dominant white Australian culture places on Aborigines,'' she said in an affidavit. ``I learnt that it was bad and degrading to be an Aborigine. ``I was one of them, an Aborigine, boong, nigger.''

Outside the court today, Ms McGlade said she was pleased with the outcome. ``Well, it has been a significant thing for me to take this legal action over five years and to have obstacles placed in my way, it was very difficult,'' she told ABC radio. ``But this is a new area of law. This is the first case under the Racial Discrimination Act that has really looked at the position of Aboriginal people and upheld a decision that there has been a contravention. ``I think that is very significant and I think that the law can only develop further from here.''

Ms McGlade's lawyer, Caroline Tan, said: ``This matter wasn't about money - this was about proving ... that you cannot go about behaving in this way.'' Comment was being sought from Senator Lightfoot, who was not present for the judgement.

Thanks to Duncan Macfarlane for this piece. Update: John Ray over at Dissecting Leftism has a link to this story in the Age.

Monday, November 25, 2002

Creative Destruction: How Globalization is Changing the World's Cultures

From the Boston Globe (thanks to Glenn Reynolds for the link):

Tyler Cowen's new book, ''Creative Destruction: How Globalization is Changing the World's Cultures'' (Princeton), once again salutes the marriage of fine arts and free markets. Globalization, he argues, may indeed make one culture more like another; but it also makes the world as a whole more beautiful. It increases the degree of choice that individuals can enjoy within any given culture - and we should all be grateful for that. ''A typical American yuppie,'' he enthuses, ''drinks French wine, listens to Beethoven on a Japanese audio system, [and] uses the Internet to buy Persian textiles from a dealer in London....'' Besides, cultural blending can promote artistic creativity through the introduction of new technologies: Consider the popular postwar music of Zaire, which drew upon the electric guitar, as well as upon Cuban and American music styles heard on phonographs and radios.

In person, Cowen resembles a thinner, darker-haired version of comedian Chris Farley, with a plummy voice that borders on the aristocratic.

Trust me: I have met Tyler Cowen, and Chris Farley he ain't. But I'll let my readers be the judge. See if you can spot any differences:

Chris Farley


Tyler Cowen

Sunday, November 24, 2002

(Potentially!) Over 1 Billion Served
I have just checked here, and apparently this blogspot is accessible in China.

Thanks to Aaron Oakley for the link.

Great Barrier Reef Not in Danger: Scientist
If you had watched monitored the ABC Radio's AM program on Saturday, you would have heard this interview with Professor Bob Carter, of the Marine Geophysical Lab of James Cook University:

BOB CARTER: It's certainly true the public is being fed or being provided with an interpreted version of the facts and the interpreted version is obviously, or I wouldn't be talking to you today, that the Great Barrier Reef is being damaged. I can only repeat that the published scientific evidence - there is no published scientific evidence for damage to the Great Barrier Reef, in terms of water quality or sediment.

IAN TOWNSEND: You're saying there's only a few scientists qualified to give a good opinion of the real state of the reef, but there are so many bodies involved in it. It's a fairly big employer isn't it of monitoring the reef, the Great Barrier Reef Marine Park Authority, the CRCs, AIMS - I mean there's a lot of people employed in those bodies. What are they doing?

BOB CARTER: Most of them are doing research in a programmatic sense and they're responding to the directions of their boards. And the overwhelming emphasis of those boards these days is not science for sake of understanding, it's science for the sake of making money. That is a significant problem.

Because Professor Carter has also recently spoken at the Institute for Public Affairs in Melbourne, you can expect an ad hominum attack any day now.

Also, it appears that a larger, far more insidious right-wing conspiracy may be at work here: in the late 1980s, I attended high school - and was good friends with - Professor Carter's son!

Simon Says
In today's Australian, Simon Crean asks:

Why are our taxes the highest they've ever been?

Well, Simon, the answer is simple - you and your party opposed the Coalition's proposed income tax cuts when the GST was introduced.

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