Fertile Material
12 July 2008
News Editor, New York Post
Dear Editor:
Jesse Jackson is now being scolded - justifiably - for expressly wishing to cut off Barack Obama's balls ("Jesse should look out for his own 'package,'"July 11). But come on: no one is surprised that the rhyming reverend envies persons whose political skills are more potent than his own. More importantly, Rev. Jackson's testy swipe at Sen. Obama is hardly his most objectionable verbal emission. That distinction goes, I suggest, to Rev. Jackson's 1988 protest jingle at Stanford University - to wit: "Hey Hey, Ho Ho. Western Civ Has Got to Go."
With that little jewel, Rev. Jackson expressed his wish to castrate the human mind from much of the finest and most seminal learning available to it.
Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University
Fairfax, VA 22030
Ya Gotta Have Faith!
12 July 2008
Editor, Washington Post
1150 15th St., NW
Washington, DC 20071
Dear Editor:
Amity Shlaes says that "Campaign Econ" - populist babble meant to win votes for politicians - has little in common with "Real Econ" ("Phil Gramm Is Right," July 12). She's absolutely correct. Expecting sensible discussions of the likes of taxes and trade from a campaigning politician is as futile as expecting scientifically sound discussions of the likes of obstetrics and gastroenterology from a backwoods faith-healer.
Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University
Fairfax, VA 22030
Free Trade and Income 'Inequality'
11 July 2008
Editor, Washington Post
1150 15th St., NW
Washington, DC 20071
Dear Editor:
E.J. Dionne uncritically quotes Rep. Barney Frank's assertion that freer trade makes incomes more unequal: "Free trade has increased wealth, but it's been monopolized by a very small number of people" ("Capitalism's Reality Check," July 11). Rep. Frank and Mr. Dionne ought to study recent research by the University of Chicago's Christian Broda and John Romalis. These scholars find that official measures of income distribution - which do show increasing inequality in recent years - greatly overstate inequality because they fail to account for the differential impacts of trade and big-box retailing on the purchasing power of the poor relative to that of the rich.
Data from 1994 through 2005 show that trade with China along with the retailing efficiencies of Wal-Mart have lowered the prices of the goods that poor people buy much more than they've lowered the prices of the goods that rich people buy. The result is that, as Prof. Broda reports on his blog, "real inequality in America, if you measure it correctly, has been roughly unchanged."*
Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University
* http://www.voxeu.org/index.php?q=node/1353 (A link to Broda’s and Romalis’s paper is available in this blog-post.)
His Ideology
10 July 2008
Editor, Washington Post
1150 15th St., NW
Washington, DC 20071
Dear Editor:
Your front-page headline today proclaims "Obama's Ideology Proving Difficult to Pinpoint." I disagree. Sen. Obama's ideology is blazingly obvious: do and say whatever it takes to win and maintain power.
Of course, his gluttony for power and his having the arrogance to exercise it do nothing to distinguish Sen. Obama from 99 percent of his fellow politicians.
Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University
Fairfax, VA 22030
Antiantitrust
10 July 2008
Editor, The Wall Street Journal
200 Liberty Street
New York, NY 10281
To the Editor:
Edwin Rockefeller accurately describes antitrust proceedings as "the debris of past political demagoguery" (Letters, July 10). Research shows that the 1890 Sherman Act was not sparked by fears of high, monopoly prices: real prices charged by the so-called 'trusts' fell steadily during the decade leading up to the passage of that statute.* Instead, that first national antitrust statute is the bastard child of hostility to the LOW prices charged by the innovative entrepreneurs who pioneered the use new technologies that, for the first time, enabled individual firms to serve a transcontinental market.
Populist hostility to the efficiency of firms such as Standard Oil filled Congressional debate over the Sherman Act. Congressman William Mason (R-IL), for example, thundered on June 20, 1890, that "Trusts have made products cheaper, have reduced prices; but if the price of oil, for instance, were reduced to one cent a barrel, it would not right the wrong done to the people of this country by the 'trusts' which have destroyed legitimate competition and driven honest men from legitimate business enterprises."
Sincerely,
Donald J. Boudreaux
Chairman, Department f Economics
George Mason University
* Thomas J. DiLorenzo, "The Origins of Antitrust: An Interest-Group Perspective," International Review of Law and Economics (June 1985).
Earning vs. Getting
9 July 2008
News Editor, WTOP Radio
Dear Sir or Madam:
Several callers today asserted that Uncle Sam should tax rich Americans more heavily and give the proceeds to poor Americans. One of these callers justified this "redistribution" as being a means of "instilling pride and self-respect" in persons who receive such handouts. Baloney. Pride and self-respect come only from admirable accomplishments. Spending other people's money is neither admirable nor an accomplishment.
Someone whose pride and self-respect are enhanced by receiving welfare is akin to someone whose pride and self-respect are enhanced by buying a fake college diploma. Both cases feature pitiable persons who mistake rewards received for admirable accomplishments as being the admirable accomplishments themselves.
Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University
Fairfax, VA 22030
Thomas Hazlett on Censorship
Prompted by my letter on free speech (in the preceding post), my colleague Tom Hazlett -- of both GMU Econ and GMU Law, and former Chief Economist of the FCC -- sent me the following important history.
Don
........
Don,
Your newspaper example is not theoretical. In radio, the FCC did -- under licensing rules -- eliminate editorializing by stations. In order to = keep their economic assets intact (i.e., make money), stations complied. The government enforced silence. This was during the New Deal when regulators presumed that conservative station owners would editorialize against them.
Post World War II the regulators formally initiated a new regime, the Fairness Doctrine, that forced the stations to cover controversial issues. But the FCC continued to evaluate whether such issues were presented from 'balanced perspectives.' This created a tax on controversy. Lots of silence ensued from that, too.
All of this de facto censorship was enabled because, in 1943, the Supreme Court decided that the First Amendment did not fully protect broadcast speech. The case was decided on erroneous 'technical' assertions, but still stands. The Fox Broadcasting case (FCC v. Fox Television Stations (Dockett No. 07-582)), is coming up before to Court this Fall. The Court will decide whether that decision is still good law and so whether the FCC can regulate broadcast speech, as in the indecency case being reviewed. Leftish groups like Free Press, which claim to champions a free press, are supporting the FCC's pro-censorship role in amici.
TWH
