And What About the Makers of Parts Used to Make Auto Parts?
25 March 2009
Editor, The Wall Street Journal
200 Liberty Street
New York, NY 10281
To the Editor:
Paul Ingrassia asks many relevant questions about the planned government bailout of auto-parts producers ("Now for the Car-Parts Bailout," March 25). But he fails to ask the most obvious one - namely, if Uncle Sam’s bailout of the Detroit automakers works as advertised to keep these companies going, why do their parts suppliers need a bailout?
One of the selling points back in December for the auto-maker bailout is that it would help to keep afloat the many parts suppliers throughout the country. Was that a lie? Or perhaps the auto-maker bailout isn’t really expected to work as advertised? Either way, the case for bailing out parts makers is a sham.
Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University
Rev. Obama
24 March 2009
Editor, Baltimore Sun
Dear Editor:
Barack Obama's op-ed reads like a bad sermon ("A time for global action," March 24). For persons already baptized into the cult for which Mr. Obama proselytizes, all that he says seems true and glorious. But because Mr. Obama merely strings together assertions while supporting not a single one with argument or evidence, nothing that he says is convincing to us skeptics of Mr. Obama's faith in heavy-handed government regulation.
In addition, at least one of Mr. Obama's proclamations reeks of duplicity. I speak of his call for the peoples of the world to "embrace a collective commitment to encourage open trade and investment, while resisting the protectionism." Remember, these are the words of the same man who only last year, while campaigning for votes, infamously criticized the North American Free Trade Agreement and called for it to be amended in ways that would have made America more closed to trade and investment.
The Rev. Jimmy Swaggart was hung out to dry for his hypocrisy. Why doesn't the same fate await the Rev. Obama?
Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University
Is Obama a Socialist? Mencken Answers
23 March 2009
Editor, San Francisco Sentinel.com
Dear Editor:
Barack Obama is probably not lying when he denies being a socialist ("Resistance grows to Obama's bigger government," March 22). But how he labels himself is less important than how he acts - and his actions seem designed to make self-proclaimed socialists all warm and fuzzy inside while simultaneously scaring the bejezus out of those of us who understand and appreciate the workings of free markets.
What H.L. Mencken said about the labor leader John L. Lewis applies nicely to Mr. Obama:
"Lewis says that he is not a Communist, and there is no reason to doubt him.... But all the same he joins in some of their fundamental assumptions, just as he joins in those of the New Deal sorcerers. Especially does he join in the assumption of both outfits that the nation would be vastly benefited if its present scheme of government could be radically overhauled, and the safeguards now thrown about property eliminated, and all power and prerogative handed over to men of vision, sworn to serve and save the lowly."*
Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University
* H.L. Mencken, On Politics: A Carnival of Buncombe (Baltimore: Johns Hopkins University Press, 1996 [1956]), pp. 325-326.
Protectionism Isn't Free
18 March 2009
Editor, The New York Times
620 Eighth Avenue
New York, NY 10018
To the Editor:
Sen. Sherrod Brown snarls at the notion that protectionist policies reduce freedom (Letters, March 18). Let's see. If I want to buy a pair of pants from China, armed agents from U.S. Customs stop me from doing so unless I fork over to them a fee that Mr. Brown and his colleagues on Capitol Hill determine I should pay for the privilege of engaging in this voluntary transaction.
If I resist and try to buy my pants without paying the fee demanded by Uncle Sam's armed goons, I will be imprisoned. If I resist too adamantly, I will be shot dead.
For Mr. Brown to deny that protectionism infringes people's freedom is disgraceful Orwellian newspeak.
Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University
On Immigration
17 March 2009
Editor, The Wall Street Journal
200 Liberty Street
New York, NY 10281
To the Editor:
Successful politicians Bernie Sanders and Chuck Grassley assert that the productivity of America's economy is not reduced by restricting businesses' ability to hire immigrants (Letters, March 17). In contrast, successful entrepreneur Jeremy Chester explains that his business thrived largely because he was able to hire immigrants.
Two different opinions from two different sources. Which source do you reckon is most credible?
Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University
A Mad System
17 March 2009
Editor, The Wall Street Journal
200 Liberty Street
New York, NY 10281
To the Editor:
Peter Wallison masterfully exposes the pitfalls in Rep. Barney Frank's proposal to create a "systemic risk regulator" ("Congress Is the Real Systemic Risk," March 17). But it's worth emphasizing that we already have an excellent regulator of systemic risks: the market. Because participation in any aspect of the market is voluntary, each individual - risking only his or her own assets - chooses how, and how much, to participate. The competition, personal responsibility, and inherent decentralization characteristic of the market keep systemic risks small.
Large systemic risks are created only when competition is replaced by monopoly power, when decentralization is supplanted by centralized decision-making, and when personal responsibility gives way to socialized 'sharing' of costs and benefits. Government is the one institution capable of achieving this troika of troublesomeness. Monopoly control over the money supply is only the most devious of the many ways that government dangerously intrudes itself systemically, and with no competition, into market transactions.
Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University
Rules are Better than Rulers
16 March 2009
Mr. Rick Sanchez, Host, CNN NewsRoom
Dear Mr. Sanchez:
Re your interview today with economics students at Georgia State University: when a young man said that he is skeptical of government regulation and that he values individual liberty, you derisively accused him of believing that the economy would work well "without any rules."
The smug assurance of your accusation reveals your gross misunderstanding of the case for free markets. That case is NOT that rules are unnecessary. Rather, it's that rules written by politicians and enforced by bureaucrats generally work much less well than do rules that emerge decentrally - rules that evolve from the voluntary interactions and successes and mistakes of individuals each pursuing his or her own goals without being herded by a central authority - rules that are enforced by competition and by the exercise of personal responsibility and that, when sufficiently important, become formalized in case law declared by courts.
The distinction between what you think of as rules and the kinds of rules that permeate successful market economies is perhaps subtle. But it's also real and important. You should try to grasp it.
Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University
Fantasy
16 March 2009
Editor, Baltimore Sun
Dear Editor:
Opposing merit pay for teachers, retired teacher Jim Apgar claims that he and his colleagues were motivated only by their students' needs and that "no amount of money would have improved my performance" (Letters, March 16).
Wow! Taking Mr. Apgar at his word implies that no reduction in the amount of money he was paid would have worsened his performance. Indeed, his claim suggests that he would have continued to teach - and teach well - even if his employer had stopped paying him altogether.
If Mr. Apgar is both truthful and representative of teachers, cash-strapped school districts can stop worrying and simply slash teachers' pay dramatically.
Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University
Taleb on Roubini
15 March 2009
Editor, Washington Post
Dear Editor:
In your "Conversation With Nassim Nicholas Taleb" (March 15), Mr. Taleb rightly warns against taking seriously any specific macroeconomic predictions made by economists. But I'm surprised that Mr. Taleb identifies Nouriel Roubini as an exception to this rule - as an economist who "got it right" when it came to predicting today's economic downturn.
Roubini has predicted economic Armageddon for years now, so he did not accurately predict the timing of this downturn unless you regard incessantly screaming "we're doomed" to be an accurate prediction. And he got important details wrong. For example, as recently as 2005 Roubini warned that the "hard landing" would occur because foreign holders of dollar-denominated assets would start to diversify out of these assets, leading (in his words) "to a sharp fall in the value of the U.S. dollar [and] significantly higher U.S. long-term interest rates."* None of these things has happened.
Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University
* http://online.wsj.com/public/article/0,,SB111202112287190860,00.html
Sage Wisdom
14 March 2009
Editor, New York Post
Dear Editor:
Representatives Pelosi's and Waters's recent spasms of hypocrisy would not have surprised the greatest journalist in American history, H.L. Mencken. Recalling his first personal contacts with homo politicus, Mencken confessed that he "had never suspected, up to then, that frauds so bold and shameless could flourish in a society presumably Christian, and under the eye of a putatively watchful God."*
Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University
Fairfax, VA 22030
* H.L. Mencken, Heathen Days (Baltimore: The Johns Hopkins University Press, 1996 [1941]), p. 279.
