Category Archives: Political Commentary

Political Commentary

Oh, That’s All He Meant

Apparently Senator Durbin’s ever-changing story was that he wasn’t comparing the Bush administration overall to the Khmer Rouge, or Nazi Germany. No, he was only commenting on their interrogation techniques.

Well, here is an example of “interrogation” at S-21 in Cambodia:

The regime of S21 was harsh beyond belief. Amongst the cruellest of guards were the 12-16 year old warders. Without a strongly ingrained morality and given positions of total power over their captives, their actions became bestial. Prisoners were regularly questioned and tortured with a variety of techniques, from fingernails being pulled out to electrification and suffocation. Important political prisoners were kept in their own 2 1/2 foot by 6 foot cell, feet shackled to an 2 foot iron bar. As horrible as this sounds it was infinitely preferable to the treatment of the bulk of S21

Political Commentary

Oh, That’s All He Meant

Apparently Senator Durbin’s ever-changing story was that he wasn’t comparing the Bush administration overall to the Khmer Rouge, or Nazi Germany. No, he was only commenting on their interrogation techniques.

Well, here is an example of “interrogation” at S-21 in Cambodia:

The regime of S21 was harsh beyond belief. Amongst the cruellest of guards were the 12-16 year old warders. Without a strongly ingrained morality and given positions of total power over their captives, their actions became bestial. Prisoners were regularly questioned and tortured with a variety of techniques, from fingernails being pulled out to electrification and suffocation. Important political prisoners were kept in their own 2 1/2 foot by 6 foot cell, feet shackled to an 2 foot iron bar. As horrible as this sounds it was infinitely preferable to the treatment of the bulk of S21

Political Commentary

“History’s Has-Been”

Robert Samuelson says that Europe is going out of business.

A few countries (Britain, Ireland, the Netherlands) have acted, and there are differences between Eastern and Western Europe. But in general Europe is immobilized by its problems. This is the classic dilemma of democracy: Too many people benefit from the status quo to change it; but the status quo isn’t sustainable. Even modest efforts in France and Germany to curb social benefits have triggered backlashes. Many Europeans — maybe most — live in a state of delusion. Believing things should continue as before, they see almost any change as menacing. In reality, the new E.U. constitution wasn’t radical; neither adoption nor rejection would much alter everyday life. But it symbolized change and thereby became a lightning rod for many sources of discontent (over immigration in Holland, poor economic growth in France).

With the recent drop in the Euro, they may in fact be about to have a going-out-of-business sale.

Political Commentary

“History’s Has-Been”

Robert Samuelson says that Europe is going out of business.

A few countries (Britain, Ireland, the Netherlands) have acted, and there are differences between Eastern and Western Europe. But in general Europe is immobilized by its problems. This is the classic dilemma of democracy: Too many people benefit from the status quo to change it; but the status quo isn’t sustainable. Even modest efforts in France and Germany to curb social benefits have triggered backlashes. Many Europeans — maybe most — live in a state of delusion. Believing things should continue as before, they see almost any change as menacing. In reality, the new E.U. constitution wasn’t radical; neither adoption nor rejection would much alter everyday life. But it symbolized change and thereby became a lightning rod for many sources of discontent (over immigration in Holland, poor economic growth in France).

With the recent drop in the Euro, they may in fact be about to have a going-out-of-business sale.

Political Commentary

“History’s Has-Been”

Robert Samuelson says that Europe is going out of business.

A few countries (Britain, Ireland, the Netherlands) have acted, and there are differences between Eastern and Western Europe. But in general Europe is immobilized by its problems. This is the classic dilemma of democracy: Too many people benefit from the status quo to change it; but the status quo isn’t sustainable. Even modest efforts in France and Germany to curb social benefits have triggered backlashes. Many Europeans — maybe most — live in a state of delusion. Believing things should continue as before, they see almost any change as menacing. In reality, the new E.U. constitution wasn’t radical; neither adoption nor rejection would much alter everyday life. But it symbolized change and thereby became a lightning rod for many sources of discontent (over immigration in Holland, poor economic growth in France).

With the recent drop in the Euro, they may in fact be about to have a going-out-of-business sale.

Political Commentary

A Sideshow?

Roger Cohen asks if Europe matters any more:

At a recent meeting here of the Council for the United States and Italy, a group that brings together influential folk from both sides of the Atlantic, America’s often withering view of Europe was as clear as the light on the lagoon.

That view may be summarized as follows: a Continent reluctant to spend on defense, offering only “postmodernist” armies useful enough as peacekeepers but next to useless as warriors, given to earnest blah-blah about the pre-eminence of international law, inhabited by a declining and evermore aged citizenry living in overregulated economies that have not shown significant growth for at least five years.

Contrast that image with another offered at the meeting: that of an India growing at over 7 percent a year, inhabited by more than 500 million people under the age of 25, busy buying hundreds of advanced aircraft, convinced that armies are still created to fight, churning out English-speaking high-tech graduates by the million each year, and persuaded by Islamic terrorism that its strategic goals and America’s are often identical or at least complementary.

So, which of these parts of the world is more worthy of the attention of the United States? Which is a compelling affair: the intensifying and fast-changing relationship with India, or the largely stagnant alliance with Europe that served above all a cold-war strategic challenge now overcome?

Economics, Political Commentary

Don’t Quota Me

Chinese apparel have been slapped with a quota. Quotas are worse than tariffs, but first here’s a little background.

The rash of China bashing is well-timed to keep the Chinese buying dollars according to Yuan Answers? (WSJ, 6/10, subscription required). A triangular trade where US sends dollars and st0ck and title deeds overseas to the rich savers of the world and imports lots of stuff in one way shipping containers from China is not a bad thing. In fact, it can be sustained indefinitely with the US capital st0ck continuing to grow. It is a testament to how our laws are not quite as bad as everyone else’s.

In economics we talk about how tariffs and quotas both imply a “deadweight social loss”. When prices are artificially raised via a tariff, the customer prices rise and the supplier prices fall. The quantity sold also falls. It is this last part that is the first component of deadweight loss. By reducing the quantity sold, profitable trades without the tariff become unprofitable because they are not profitable enough to beat the “spread” between the supplier and customer prices induced by the tariff. All this is Economics 101.

A quota has an additional element beyond this kind of loss. In a quota, the supply price rises too. That means that any supplier who can produce at the new higher price will try to fulfill their quota. Thus suppliers who would have cut back production under a tariff will continue to produce to fulfill their quota. Everyone is cut back pro-rata (or according to some formula, e.g., 7.5% more than last year even if growth would otherwise be 500%) and not according to who is the most efficient. Coase might say that quota shares could be traded, but this entails higher transactions expense than the decentralized trade that occurs with a competitive market price.

The additional inefficiency is happily born by international suppliers who receive a major benefit when a quota is imposed–higher prices. So the quota is a collusive bargain between the Government, the domestic suppliers and the foreign suppliers to raise prices on the consumers at the cost to the economy of two kinds of deadweight social loss. Diffuse harm, concentrated benefit. Can one file a class action law suit against an industry association that lobbies for selfish policy?

Economics, Political Commentary

Don’t Quota Me

Chinese apparel have been slapped with a quota. Quotas are worse than tariffs, but first here’s a little background.

The rash of China bashing is well-timed to keep the Chinese buying dollars according to Yuan Answers? (WSJ, 6/10, subscription required). A triangular trade where US sends dollars and st0ck and title deeds overseas to the rich savers of the world and imports lots of stuff in one way shipping containers from China is not a bad thing. In fact, it can be sustained indefinitely with the US capital st0ck continuing to grow. It is a testament to how our laws are not quite as bad as everyone else’s.

In economics we talk about how tariffs and quotas both imply a “deadweight social loss”. When prices are artificially raised via a tariff, the customer prices rise and the supplier prices fall. The quantity sold also falls. It is this last part that is the first component of deadweight loss. By reducing the quantity sold, profitable trades without the tariff become unprofitable because they are not profitable enough to beat the “spread” between the supplier and customer prices induced by the tariff. All this is Economics 101.

A quota has an additional element beyond this kind of loss. In a quota, the supply price rises too. That means that any supplier who can produce at the new higher price will try to fulfill their quota. Thus suppliers who would have cut back production under a tariff will continue to produce to fulfill their quota. Everyone is cut back pro-rata (or according to some formula, e.g., 7.5% more than last year even if growth would otherwise be 500%) and not according to who is the most efficient. Coase might say that quota shares could be traded, but this entails higher transactions expense than the decentralized trade that occurs with a competitive market price.

The additional inefficiency is happily born by international suppliers who receive a major benefit when a quota is imposed–higher prices. So the quota is a collusive bargain between the Government, the domestic suppliers and the foreign suppliers to raise prices on the consumers at the cost to the economy of two kinds of deadweight social loss. Diffuse harm, concentrated benefit. Can one file a class action law suit against an industry association that lobbies for selfish policy?

Economics, Political Commentary

Don’t Quota Me

Chinese apparel have been slapped with a quota. Quotas are worse than tariffs, but first here’s a little background.

The rash of China bashing is well-timed to keep the Chinese buying dollars according to Yuan Answers? (WSJ, 6/10, subscription required). A triangular trade where US sends dollars and st0ck and title deeds overseas to the rich savers of the world and imports lots of stuff in one way shipping containers from China is not a bad thing. In fact, it can be sustained indefinitely with the US capital st0ck continuing to grow. It is a testament to how our laws are not quite as bad as everyone else’s.

In economics we talk about how tariffs and quotas both imply a “deadweight social loss”. When prices are artificially raised via a tariff, the customer prices rise and the supplier prices fall. The quantity sold also falls. It is this last part that is the first component of deadweight loss. By reducing the quantity sold, profitable trades without the tariff become unprofitable because they are not profitable enough to beat the “spread” between the supplier and customer prices induced by the tariff. All this is Economics 101.

A quota has an additional element beyond this kind of loss. In a quota, the supply price rises too. That means that any supplier who can produce at the new higher price will try to fulfill their quota. Thus suppliers who would have cut back production under a tariff will continue to produce to fulfill their quota. Everyone is cut back pro-rata (or according to some formula, e.g., 7.5% more than last year even if growth would otherwise be 500%) and not according to who is the most efficient. Coase might say that quota shares could be traded, but this entails higher transactions expense than the decentralized trade that occurs with a competitive market price.

The additional inefficiency is happily born by international suppliers who receive a major benefit when a quota is imposed–higher prices. So the quota is a collusive bargain between the Government, the domestic suppliers and the foreign suppliers to raise prices on the consumers at the cost to the economy of two kinds of deadweight social loss. Diffuse harm, concentrated benefit. Can one file a class action law suit against an industry association that lobbies for selfish policy?

Political Commentary

Tipping Point

Now that the French and Dutch have rejected the monstrosity that was the EU constitution, the Poles are now expressing their true feelings about it as well:

“The French and Dutch ‘nos’ encouraged people to openly say they were against the treaty but didn’t dare to admit it until now,” said Mikolaj Czesnik, a sociologist at the Polish Academy of Science.

Before voters in the two founder-member states of the EU rejected the constitution, followed closely by a British decision to put its referendum on the treaty on hold, it was “considered politically incorrect in Poland to reject the treaty,” Czesnik said.

“Some people also feared that a Polish ‘nie’ would lead to accusations that Poland was reponsible for the demise of European integration. Those people felt relieved” by the negative votes, Czesnik said.

It’s hard to imagine anyone wanting to ratify this thing now, at least in a popular referendum, with the possible exception of the Belgians.