The Economist's Cookbook

Recipes For A More Free Society

  • "The curious task of economics is to demonstrate to men how little they know about what they imagine they can design."

    - F.A. Hayek

The Real Reason Prohibition Ended

Posted by The_Chef On 9:41 AM 0 comments

Here is a fascinating article from the Pittsburgh Tribune-Review by Don Boudreaux (Chair of the Econ Dept at GMU).

But all in all can anyone claim to be truly surprised by the idea that the true reason that liquor was re-legalized was because congress wanted the tax revenue.

So ... the question then arises: What will happen to the "drug" issue in this country if Congress decides that it needs another source of income for its various forms of extortion, coercion, and "redistribution".

Now there's an idea ... fund social security through legal drug sales in the US. Oh God ... I shouldn't say that, I'm waiting for that awful program to die a horrible, bloody death.

Supreme Court Dabbles in Econ?!

Posted by The_Chef On 9:32 AM 1 comments

This from the Washington Post:
"The U.S. Supreme Court yesterday overturned a nearly century-old ruling that prohibited manufacturers from dictating the minimum prices retailers must charge for their goods, saying such agreements could spark competition rather than stifle it.
The 5 to 4 opinion, delivered by Justice Anthony M. Kennedy, found that minimum-pricing requirements by manufacturers do not constitute an automatic violation of the Sherman Antitrust Act. Instead, the agreements must be judged on a case-by-case basis according to a "rule of reason" to determine whether they interfere with market competition."

I have several problems with this.

Since when has our legal structure ever used such a thing as reason? I mean when you really get down to it the only way a true monopoly can exist is if it is legitimized and protected by the Federal Government. In a market where entrance into and out of the market is it entirely possible for an entrepreneur to knock a so-called Monopoly down a notch and in the process capture a portion of market share.

the fact that there happens to be one business that seems to dominate a given market at this time in NO way makes it a monopoly. In fact, if you look at many of the so-called (I say so-called because I honestly believe that "monopoly" is just a modern anti-capitalist buzzword) "monopolies" do not ACT like the microeconomic models tell us they should. Strange how they act like firms in a competitive market...

But here are the other issues and these both bother me a lot!
1.) What is wrong with allowing producers of a good to contract with a seller and say 'You buy this from us and you don't sell it below a price we set'? First off no self respecting retail store will go for it. They need those sale prices to clear out inventory. You see it all the time when you walk into a clothing store. Now some carriers of VERY expensive luxury goods might just go for this, but I wouldn't expect to see the price of Hanes T-Shirts skyrocket.
2.)This quote astounded me:
"Justice Stephen G. Breyer filed a dissenting opinion with Justices John Paul Stevens, David H. Souter and Ruth Bader Ginsburg, arguing that little has changed in the U.S. economy to warrant overruling a decision that has held up since 1911."(emphasis mine)

WHAT IN THE HELL!?! Are they really this dumb? Is 4/9 of the ruling court of our land legally retarded? The Economy hasn't changed? Or is just that it hasn't changed enough for the sainted wearers of black robes to decide that we are fit for government to cease regulating our lives and businesses?

I apologize for the three week break in posting.

It's truly amazing how people in the "civilized" West can be so blind, or so foolish in what they believe. We have, in the West, luxuries that many other people have never experienced. One such luxury is time. The ridiculous things that we in the West can take our time to support or rally to, are amazing.

I am referring specifically to the environmental movement in the West and Especially in the US. This movement has done more to harm people in the name of "preserving the earth", than anyone ever thought possible. I make this post on the heels of the anniversary of the release of the book Silent Spring by Rachel Carson. This is one book that spawned the beginnings of the environmental movement, and has cost millions of people their lives.

The book relates to the use of DDT in America and some of the adverse effects of its overuse. I use the term overuse, because even though water is the stuff of life YOU CAN STILL DROWN IN IT! DDT can cause bird shells to thin, if you spray it around like candy, but you don't need that much of it.

As a result the environmental lobby have hindered the use of DDT in Africa, an area overrun with Malaria. Roughly 300 million Africans contract Malaria a year .... that's almost the population of the US. More than 1 million of them will die each year.

I suppose it's okay to pile up the corpses, as long as we're saving the earth.