Wednesday, December 24, 2003

The Singularity 

Part I and Part II

Monday, December 22, 2003

The Heckscher-Ohlin (Factor Proportions) Model 

Reading about The Heckscher-Ohlin (Factor Proportions) Model

The implication is that free trade benefits the abundant resource and harms the scarce resource in participating countries. Thus, if the US and Mexico trade, Mexican workers and US capitalists gain, while Mexican capitalists and US labor lose (relative to each other, of course; in practice both will gain in absolute terms).

Now, looking at Mexico it's easy to see that creating millions of jobs for poor Mexicans is clearly worth lowering the wealth of a few rich Mexican families. So the globalists should be throwing Molotovs to encourage free trade.

On the other hand, it's a bit more controversial in the US. The truth is that, relative to Mexico, the US is a very wealthy country and we don't need to worry about our capitalists or workers. That is, 10 million illegals tell us there are too many jobs in this country anyway, and personally I'm willing to trade 10,000 union jobs for 1,000,000 Mexicans lifted out of absolute povery. The union guy will find another job easily, whereas the Mexican's next-best-offer may be prostitution or criminal. That's why I'm pro-free trade.

Having said that, you can mitigate the effects; I don't believe capitalists ever need to be helped (buyer beware), and Mexican labor was helped. So that leaves US labor. Perhaps they could be given a lump sum payment if they're laid off, something to help them through the search for new work. And if the new job pays less... Well that's life. When people get raises they think they deserve it, and when they get pay cuts they damn well deserve it too. So they can go back to school and become teachers or nurses (both of which there are shortages, by the way).

Commercial Welfare 

Article by Walter WIlliams detailing the Commerce and General Welfare clauses, which I rail on and on about. A good backgrounder.

Liberalism vs. Individual Rights 

Great article about the hypocrisy of "Liberal" ideology. Details sidespread slavery in Africa, and outlines some of the more authoritarian positions of Liberals. In Britain the term Liberal means libertarian, and the corrupted US usage is often translated as "socialist".

Historical point; Adam Smith is a classical liberal, FDR was a "progressive". The progressives believed in forcing people to change in order to create a more perfect society (as defined by progressive elites). The progressives became so disliked that they stole the name "Liberal". We true liberals should take the word back and beat these socialists back into the spider holes from which they emerged.

How the Democrats Lost Power 

Interesting article detailing the Dems' fall from power. The Dems owned government from 1932 to 1994, and their legacy is big government (the New Deal and Great Society, the income tax, Social Secutity, Medicare, Welfare, powerful unions), civil rights (CRA, attempted ERA, myriad laws about women, minorities, handicapped, elderly), and regulation (too massive to list; every day our gov't passes hundreds of new regulations (!)), and a liberal court (4 or 6 of 9 depending on your point of view on O'Conner & Kennedy).

So what will stay and what will go? Assuming the GOP has some guiding principles (a recent study by U Chicago's Steven Levitt found 1/3 of policy at the Senate level is ideology; the other 2/3 are voter opinion & special interests), then big gov't and regulation seem most threatened. The court will over time be changed to reinterpret the commerce & general welfare Constitutional clauses, which should lead to smaller gov't and less federal regulation.

On civil rights, many of the achievements have consensus support and unlikely to be reversed. Most prominent would be the CRA; there is now clearly a national consensus on equal rights. So while the extremes (affirmative action, too-broad definition of discrimination) may go, the foundations will remain.

Social issues is trickier. My hope is that questions such as abortion or gay marriage will be returned to the states, but I am fearful that the Christians may demand their pound of flesh for getting the GOP to where it is.

So I think we'll see, over the next 2 decades, dramatic reversals on the size and authority of government, enshrining of civil rights, and either a return of social policymaking to the states or a retrenchment of social freedoms. That retrenchment is where Libertarian Republicans need to keep a close eye on their representatives.

Um... 50 year forecasts? 

CBO puts out new 50 year economic forecasts. Let's see, some of the scenarios predict we can balance the budget in 50 years... This is silly. Who in 1945 could have predicted, say, Gorbachev, the internet or Bush's dividend tax change? Who pays these economists and should they get real jobs?

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