Thursday , July 20 2017

Potpourri

Summary:
==> Gene Epstein liked the most recent Contra Krugman, but pointed out that I missed this even more ironic–vis-a-vis his current stance–Krugman column (detailing the flaws of French regulations on labor) from 1997. An excerpt: To an Anglo-Saxon economist, France’s current problems do not seem particularly mysterious. Jobs in France are like apartments in New York City: Those who provide them are subject to detailed regulation by a government that is very solicitous of their occupants. A French employer must pay his workers well and provide generous benefits, and it is almost as hard to fire those workers as it is to evict a New York tenant. New York’s pro-tenant policies have produced very good deals for some people, but they have also made it very hard for

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==> Gene Epstein liked the most recent Contra Krugman, but pointed out that I missed this even more ironic–vis-a-vis his current stance–Krugman column (detailing the flaws of French regulations on labor) from 1997. An excerpt:

To an Anglo-Saxon economist, France’s current problems do not seem particularly mysterious. Jobs in France are like apartments in New York City: Those who provide them are subject to detailed regulation by a government that is very solicitous of their occupants. A French employer must pay his workers well and provide generous benefits, and it is almost as hard to fire those workers as it is to evict a New York tenant. New York’s pro-tenant policies have produced very good deals for some people, but they have also made it very hard for newcomers to find a place to live. France’s policies have produced nice work if you can get it. But many people, especially the young, can’t get it. And, given the generosity of unemployment benefits, many don’t even try.

France’s problem is unemployment (currently almost 13 percent). Nothing else is even remotely as important. And whatever a unified market and a common currency may or may not achieve, they will do almost nothing to create jobs.

Think of it this way: Imagine that several cities, all suffering housing shortages because of rent control, agree to make it easier for landlords in one city to own buildings in another. This is not a bad idea. It might even slightly increase the supply of apartments. But it is not going to get at the heart of the problem. Yet all the grand schemes for European integration amount to no more than that.

==> I liked that one so much, Gene then reminded me of this 1997 Krugman column praising cheap labor and globalization (which I had read before). Here’s a good excerpt:

The occasion was an op-ed piece I had written for the New York Times, in which I had pointed out that while wages and working conditions in the new export industries of the Third World are appalling, they are a big improvement over the “previous, less visible rural poverty.” I guess I should have expected that this comment would generate letters along the lines of, “Well, if you lose your comfortable position as an American professor you can always find another job–as long as you are 12 years old and willing to work for 40 cents an hour.”

Such moral outrage is common among the opponents of globalization–of the transfer of technology and capital from high-wage to low-wage countries and the resulting growth of labor-intensive Third World exports. These critics take it as a given that anyone with a good word for this process is naive or corrupt and, in either case, a de facto agent of global capital in its oppression of workers here and abroad.

But matters are not that simple, and the moral lines are not that clear. In fact, let me make a counter-accusation: The lofty moral tone of the opponents of globalization is possible only because they have chosen not to think their position through. While fat-cat capitalists might benefit from globalization, the biggest beneficiaries are, yes, Third World workers.

I am being dead serious, when Krugman post-2007 (or so) casts derision on orthodox economists and how they conveniently assume away the heart-wrenching problems faced by the disadvantaged, he is usually describing the way he himself treated a topic either in his pop stuff from the 1990s or in the latest edition of his textbook. The only thing I’m not certain about is if he is consciously or subconsciously doing that.

==> You know how the Marvel universe features a plot line where the US government after World War II brought in a bunch of Nazi scientists in weapons development? (Dr. Strangelove fits this too.) Well that was real; the CIA even says so, and you know they tell the truth.

Robert Murphy
Robert Patrick Murphy (born 23 May 1976) is an American economist, consultant and author. He is an economist with the Institute for Energy Research (IER) specializing in climate change and a research fellow with the Independent Institute, He was a senior fellow in business and economic studies at the Pacific Research Institute, and he is an associated scholar at the Ludwig von Mises Institute. In addition to economic subjects, Murphy writes about, and has presented an online video class in, anarcho-capitalism on the Mises Institute website. Murphy also has written in support of Intelligent Design theory and expressed skepticism of biological evolution.

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