Minimum Wage or Minimum Insanity?

The minimum wage is in the news again as a putatively respectable policy option among some on the alternative right, in particular for Donald Trump, who recently said he’d be willing to consider the idea. It is an odd thing for him to have said, given his emphasis on the necessity of reducing immigration from the Third World.

Is the prevailing wage for entry level jobs too low to live on? That’s a way of saying that there is an oversupply of labor. So, don’t raise the minimum cost of labor; that will subsidize the oversupply, increasing and exacerbating it while reducing demand for US workers (and increasing demand for robots and Chinese workers). Instead, remove the artificial factors that generate the oversupply to begin with.

Immigration of millions of unskilled workers reduces the price of labor. So for that matter does the entry of women into the workforce. Men used to be able to earn a wage sufficient to support a wife and children. It stands to reason that if you double the supply of labor by adding to it almost all women, you will cut the prevailing wages for most jobs – not perhaps by half, but to such a degree that it will thenceforth take almost two workers to earn the income that had once taken only one.

On the demand side, the regulatory and labor environment in the US is so completely whacked, irrational, cumbersome, and costly that it is better, easier, and cheaper, all things considered, for a manufacturer to produce in China than here. So the jobs are going to China. To the far side of the planet, where they speak a different and unrelated language, use a completely alien and wildly inefficient form of writing, and are culturally comfortable with fraud and corruption and cheating and adulteration – with harming their customers.

This is nuts.

All these massive distortions in the labor market that crush wages happened as a result of stupid government policies. The solution is not to add another layer of policy to correct them, but to delete the problematic policies, root and branch – and, where necessary (not very often) replace them with something rational – so that the labor market can right itself naturally in such a way that the minimum wages anywhere being offered ad libitum suffice for a family to live dignantly thereon.

This is simply done:

  1. Enforce immigration laws and deport aliens. Crack down hard, relentlessly and sensationally on a few thousand cases pour encourager les autres, and most aliens will depart under their own recognizance, post haste. No wall will be needed. A single Spartan concentration camp in the Mojave for processing deportees will do. Reduces labor supply.
  2. Replace all taxes on Americans (by all their governments) with simple flat consumption taxes (that are cheap and easy to collect at point of retail sale). Reduces cost of living and doing business, thus the price of the living wage.
  3. Impose an optimal tariff on all foreign goods. Set to maximize the revenues it generates, it would far exceed ((all annual American taxes on GDP)/annual GDP)(retail price of goods imported). Increases domestic labor demand.
  4. Impose an optimal annual tonlieu on all foreign workers. Set to maximize the revenues it generates, it would far exceed average annual American labor compensation (because much of what immigrants want from America – and would pay to obtain – is, not money per se, but … life in America). Reduces alien labor supplied.
  5. Rip up most of the regulations that hamstring industry – that hamstring *life.* Let the plaintiff’s bar have the whip hand when it comes to regulating malfeasance and malpractice. Focuses (immensely profitable, motivated, and skillful) enforcement activity on true malfeasors for real torts; eases compliance burdens on ethical businesses; reduces cost of living and doing business (for the ethical), thus the price of the living wage.
  6. Allow employers to discriminate in every way among employees as they see fit. They do this anyway, because they must; we might as well make it legal, and cheap. Employers prefer and will pay more for long term employees (who have support at home and are unlikely to quit on account of babies) who are fluent , literate, numerate, ethical, hard-working, cooperative, trainable, and intelligent. Improves motivation, quality and compensation of labor force; reduces cost of doing business; increases efficiency; as a sequela, reduces cost of living, thus the price of the living wage.
  7. Eliminate the cost of the immense regulatory burden of employment – discouraging outsourcing to robots at the margin (i.e., where such outsourcing makes little or no true economic sense). Reduces cost of doing business, and, as a sequela, of living, thus also the price of the living wage.
  8. Pay (much reduced and simplified) cash welfare benefits only to fathers married to and living with the mothers of minor children they have begotten or legally adopted. Improves family formation, reduces divorce, reduces welfare costs, etc.; too many ancillary benefits to count.

If these things were done, women and (a fortiori, and much more quickly) aliens would leave the labor supply at the margin, wages would rise, family life would quickly begin to cobble itself together again, and the social dereliction, moral bewilderment and personal ruin caused by bastardy, irreligion and promiscuity would begin to abate.

The margins we are talking about here are actually quite thick. We are talking deciles. And the compounding effects would be substantial. The fewer the workers, the greater the wages; the greater the wages, the easier it is for a family to live on one income, and the greater the number of families who decide to try it. Pretty soon, fashions change; then, customs; then, morals.

None of this is complex or difficult, either to understand or to implement. Mostly it would involve doing far less than we are already doing. Mostly it would involve simply stopping doing what we have started doing only since about 1960. It would be easy. We still have the Federal Code circa 1960. It could be made the whole of the Federal law again, by a single Congressional vote. Four more acts of Congress – to establish the tax, tariff, tonlieu and welfare policies set forth above – and it would mostly be done.

If we did all of it, and the entry level wage was still too low to live on, then it might make sense to think about some sort of minimum wage.

106 thoughts on “Minimum Wage or Minimum Insanity?

  1. While I would like to see the rise of sustainable local economies and much less mass immigration I do not think the kind of Hamiltonian capitalism expounded here would really help society even if one were to implement just a few of the policy provisions you outline above. The “creative destruction” of the market can only be corralled so much. If Trump gets in and somehow inaugurates a new policy of protectionism, I fear that the response will be a serious push for great automation. I recall a while back seeing some Nrx “techno-commercialists” snickering about McDonald’s workers striking for better wages and how they would soon be replaced by robots. What is going to happen when the large numbers of people who can only work at such jobs are replaced by machines? What happens when automation begins to even replace the jobs that make up what’s left of our manufacturing sector?

    • These are all important and troubling questions. The answers cannot be quite known, for the shape of things to come is obscure. We can however be fairly sure that our present policies are suppressing wages *and* increasing costs of production and of living *and* motivating increased capital investment in automation and outsourcing to China that, at the margin, and absent artificial distortions of market signals, are unprofitable (and are therefore diseconomic). If they were deleted, workers would do better.

      In the long run, though, there are no safe harbors. Creative destruction is another term for history; for evolution. It can’t be stopped. Some evil, however – some purely destructive destruction – can be avoided, or prevented, or at the very least not encouraged and subsidized, as at present.

      • Yes, and it must be recognized that the problem is also self correcting to an extent. Taking it to an absurd conclusion to make a point, if all jobs are replaced by robots and no one has a job, no one will have money to pay for the goods produced by robots, so no company will produce goods. Now of course this is absurd, but the general trend stands. Technological innovation has always led to “job loss” but a free economy has been the only producer of real improvement in the lives of the majority of people and technological innovation can’t be so destructive that it becomes unprofitable.

        “Free” being defined as any society’s rules on market exchange from before 1913 combined with a more or less just and effective legal system. That may not be the libertarian definition of free but there’s a reason there was no word for libertarian in 1913. Once man is free past a certain point he doesn’t really care about actual anarchism, but I digress.

    • I guess they will have to learn how to fix the machines that took their jobs – and charge ten times as much for fixing them than it would have cost to pay the human to do the job in the first place.

    • Was hoping to see you (Itascripta) comment here, though your disagreements weren’t as sharp as I’d hoped or expected. Where the rest of the anti-capitalist trads at?

      These suggested policies would spell disaster and the merciless abuse of wage earners. Not to mention they are at striking odds with, um, all of Catholic Social Teaching. Let’s just look at the first two

      1) Enforce immigration laws and deport aliens. Crack down hard, relentlessly and sensationally on a few thousand cases pour encourager les autres, and most aliens will depart under their own recognizance, post haste. No wall will be needed. A single Spartan concentration camp in the Mojave for processing deportees will do. Reduces labor supply.

      A single “Spartan concentration camp”? I’ll remember this next time the author thinks of criticizing the brutality of communist regimes. This is a profoundly anti-Christian position. Compare with Pius XII’s Exsul Familia

      https://en.wikipedia.org/wiki/Exsul_Familia

      2) Replace all taxes on Americans (by all their governments) with simple flat consumption taxes (that are cheap and easy to collect at point of retail sale). Reduces cost of living and doing business, thus the price of the living wage.

      The Religious Right cheered when Ben Carson combined their two favorite things – a faulty interpretation of Scripture with free market nonsense by proposing a flat tithe tax. A flat “consumption tax” seems even more disastrous.

      Though I think all capitalism is “crony capitalism”, I cannot imagine a way this policy wouldn’t lead to the kind of “crony capitalism” even a Libertarian can acknowledge. A flat consumption tax? Buy! Buy! Buy! The already crushing pressure to spend unnecessarily and beyond one’s means would increase by orders of magnitude. The government would have an even greater vested interest in Americans’ mindless consumption. This policy would be especially dangerous (and I mean spiritually) to the poor who often lack the resources to resist the basest lures of a market economy.

      Marxist philosopher Slavoj Zizek rightly notes the ascetic tendency in historical Christianity is inimical to capitalism. How would a government that makes all its tax revenue from a flat consumption tax treat religious organizations that teach its adherents to live simply and ascetically? It’s bad enough when they won’t pay for contraception.

      • Thanks, Curio, for a provocative (thus useful) comment. I’m afraid you’ve got the economics of the proposals quite backward.

        The already crushing pressure to spend unnecessarily and beyond one’s means would increase by orders of magnitude [under a flat consumption tax].

        It’s just the opposite. You get *less* of what you tax, not more. Google “excise tax wiki” or “sin tax wiki.” A consumption tax would introduce crushing pressure *against* marginal consumption.

        I cannot imagine a way this policy wouldn’t lead to the kind of “crony capitalism” even a Libertarian can acknowledge.

        Why? You’ll have to explain why an explicit flat consumption tax would generate more cronyism than we have at present.

        There is always an oligarchy – *always.* There are, i.e., *always* cronies. To think that we might somehow be able to get rid of oligarchs is a puerile fantasy. Best then to be up front about it, as with an aristocracy, and so to arrange things that success as an aristocrat depends upon effective service of the general welfare.

        The government would have an even greater vested interest in Americans’ mindless consumption.

        Again, why? If the government was sane – admittedly, a stretch in this day and age – it would know that a consumption tax – and no taxes on income or property – would lead quite straightforwardly to increased labor, increased net take home pay, increased savings, increased capital formation, increased investment in plant and equipment, increased labor productivity, higher wages, and … increased consumption, thus (over the long run) increased tax revenues. All of which is just a long way of saying, increased prosperity.

        This policy would be especially dangerous (and I mean spiritually) to the poor who often lack the resources to resist the basest lures of a market economy.

        On the contrary; you’ve got this exactly backward. A consumption tax would increase the immediate cost of consumption. It would therefore *help* those with high time preference make more prudent decisions, at the margin – which is where almost all decisions are made, in a wealthy society like ours.

        Marxist philosopher Slavoj Zizek rightly notes the ascetic tendency in historical Christianity is inimical to capitalism.

        He’s a *Marxist.* Of *course* he thinks of Christianity in worldly materialistic terms. But that’s a gigantic – and thoroughly tendentious – misprision. Christians, of all people, should not fall into such a ridiculous error.

        Christianity is orthogonal to this world. The ascetic tendency in Christianity, indeed Christianity per se, is inimical to *worldliness,* but it is not inimical to the world as such. It is not money that is the roof of all evil, but the *love* of money. Christianity does not hate the goods of embodied life, but the worship thereof. Check out The Rich Man’s Salvation by Saint Clement of Alexandria for a searching exploration of this topic. You might also want to review Divini Redemptoris for the Catholic position on Mr. Zizek’s Marxism.

        How would a government that makes all its tax revenue from a flat consumption tax treat religious organizations that teach adherents to live simply and ascetically?

        Pretty well. I didn’t propose any such thing (I think governments should generate the lion’s share of their revenues from tariffs, tolls and tonlieux, as was the case up through circa 1913), but … pretty well.

        How well are governments today treating ascetic organizations such as the Little Sisters of the Poor?

        Historically, devout Christians have been among the most successful entrepreneurs, merchants, and traders. Purging his heart of the love of money opens a man’s eyes to what is really important and true; and this makes him a more canny, shrewd, sagacious, ethical, honest, trustworthy, prudent businessman. Devout Christians are the most prized counterparties, because they are reliably honest and true to their word, and do not seek unfair advantage, but rather the true good of their fellows. They feel duty bound to ascertain, and then do, the right thing. That’s how the ascetic abstemious Puritan Yankee trader got his reputation for fair shrewd dealing. Ditto for the Cluniac.

        An economy prospers most, not when it seeks to maximize accounting profit (because that’s focusing on the wrong metric), but when its agents reliably seek the true good. And the good is just what a devout Christian is apt to do, by his best lights. As an extra bonus, and as might have been expected in a cosmos built by a good God, doing the true good generally results in the highest overall accounting profit, mutatis mutandis – and, ergo, in the highest tax base for the sovereign. Everyone benefits most when everyone is trying to do the right thing. This is not just an aphorism, but a truth of game theory. It is mathematically true; it is built into the fabric of this and all possible worlds.

        A single “Spartan concentration camp”? I’ll remember this next time the author thinks of criticizing the brutality of communist regimes.

        Sparta was not a gulag. But nor was it Guantanamo. It was a perfectly livable place; just not luxurious.

        I’m not talking about Auschwitz here, but just a bare bones facility without a lot of creature comforts. No torture, but nor then TV or AC, either. Just a minimal camp, sufficient to the maintenance of life and limb but no more, where deportees are quickly processed and sent on their way back home on school buses.

        This is a profoundly anti-Christian position. Compare with Pius XII’s Exsul Familia.

        There is in Exsul Familia no hint of a suggestion that governments should abolish their borders – should, that is to say, abolish themselves – and by the power of the state succor all who seek entry to what had theretofore been their national territory, but was thereafter not. On the contrary, we find this:

        Our planet, with all its extent of oceans and seas and lakes, with mountains and plains covered with eternal snows and ice, with great deserts and traceless lands, is not, at the same time, without habitable regions and living spaces now abandoned to wild natural vegetation and well suited to be cultivated by man to satisfy his needs and civil activities: and more than once, it is inevitable that some families migrating from one spot to another should go elsewhere in search of a new home-land.

        Then – according to the teaching of Rerum Novarum – the right of the family to a living space is recognized. When this happens, migration attains its natural scope as experience often shows. We mean, the more favorable distribution of men on the earth’s surface suitable to colonies of agricultural workers; that surface which God created and prepared for the use of all.

        If the two parties, those who agree to leave their native land and those who agree to admit the newcomers, remain anxious to eliminate as far as possible all obstacles to the birth and growth of real confidence between the country of emigration and that of immigration, all those affected by such transference of people and places will profit by the transaction.

        The families will receive a plot of ground which will be native for them in the true sense of the ward; the thickly inhabited countries will be relieved and their people will acquire new friends in foreign countries; and the States which receive the emigrants will acquire industrious citizens. In this way, the nations which give and those which receive will both contribute to the increased welfare of man and the progress of human culture.

        Two conditions of just immigration set forth in this passage are noteworthy. First, the land accepting the immigrants must have “habitable regions and living spaces now abandoned to wild natural vegetation and well suited to be cultivated by man to satisfy his needs and civil activities.” Second, both the immigrants and the citizens of the nation that receives them must, “… remain anxious to eliminate as far as possible all obstacles to the birth and growth of real confidence between the country of emigration and that of immigration.” If these conditions are met, then, “… all those affected by such transference of people and places will profit by the transaction.”

        With respect to the current wave of immigration to Western lands, it is evident that neither of these conditions are met.

        We hear further from Exsul Familia:

        Since land everywhere offers the possibility of supporting a large number of people, the sovereignty of the State, although it must be respected, cannot be exaggerated to the point that access to this land is, for inadequate or unjustified reasons, denied to needy and decent people from other nations, provided of course, that the public wealth, considered very carefully, does not forbid this.

        I have emphasized the pertinent parts. They pertain, of course, to the very question addressed in the post. Does the addition of millions of illegal aliens to the labor supply of the United States hurt the wages of the poorest Americans? The question answers itself. Does it hurt the wages of the middle class? Again, yes. Does it hurt the elites? No.

        Almost all of Exsul Familia is devoted to a rehearsal of the noble works of the Church in succor of immigrants and refugees, or to the internal policies of the Church respecting the movement across national borders of her officers and employees (as priests, missionaries, choirmasters, and so forth) in support of her lay children who would otherwise be without spiritual support.

        This is all most apt and fitting. It is the Church who should in all lands be the palmary source of succor and support for the poor and needy, not the State. The Church must look to the poor especially. The State on the other hand must look to the general welfare. Their proper duties differ.

      • Kristor, your reply to Curio is excellent, and spot on in my estimation.

        One thing I would point out further (and this goes to your question of whether government is sane, or no; and do correct if you think me wrong) is that conversion of our tax system in the US to your suggested flat consumption tax structure, will likely never occur (and certainly not in our lifetimes, but I acknowledge that’s beside the point, so I digress) because the government *is sane* in this respect at least, thus understands that such a conversion would give people too much control over their own destinies. The totalitarian nature of government can never permit this, even at the cost of less prosperity, thus less tax revenues.

        I know quite a few people who are starry-eyed optimists concerning the future implimentation of a flat consumption tax, and the above is always my caution. Bruce C. has it right, I believe, when he says in effect there is a method to the government’s madness.

      • Dr. Charlton is indeed exactly correct: there is always a reason why the government does insane things; the insanity is reasonable from someone’s perspective. Someone’s demonic perspective.

        Although the mask does slip from time to time, our masters do not want us to think of them as our masters. They want us to believe there is no oligarchy. This makes it easier for them to game the system in their favor, because the oligarchy operates sub rosa. The corruption of evil ramifies and elaborates in the darkness of dishonesty.

        Again, it would be far better if we were honest about things and recognized a formal aristocracy. They could then pursue their own interests publicly and without shame, and no one would think it odd or unjust. This would at least expose their stratagems to more sunlight and discussion that is about what is actually going on, rather than the Narrative about what is going on. This in turn would have the general long term effect of improving their stratagems – which is to say, of improving the service of public policy to the general welfare, ergo of the wallets of the aristocracy.

        The best way to do well is to do good; this too is an iron truth. The sagacious aristocrat is magnanimous. The sub rosa oligarch – who is essentially a gangster, a Mafioso – not so much.

      • I can’t disagree with any of that. I’m reminded of the debates in Congress over consideration of the 17th Amendment (which it’s been awhile since I read, so if my facts are a bit off, well …), wherein the progressives/liberals/demagogues argued explicitly that their purpose was to abolish the last remaining vestige of aristocracy in America. My recollection is that the other side denied the existence of such an aristocracy in the first place. How pathetic!

      • Know what’s really spooky? Dollars to doughnuts, almost all of the hidden oligarchy beavering away at the roots of our culture honestly believe they are on the side of the angels. They don’t think of themselves as an oligarchy, but rather at most only “the elite.” They are hiding in plain sight, even from themselves.

  2. Kristor, if only the invading alien fleet would assign you to be the humble but diligent Vizier-in-America for the Lord Commander Denebolator of the Leonine Interstellar Empire! Imagine what rational amelioration you could bring about in our sickened regime — backed, of course, by a militant but benevolent extraterrestrial force whose leadership just wants a competent selected group of natives to clean up the place (they’re alien neocons, I’m afraid).

    Scenario: MSNBC refuses to comply with the Lawson Media Directive #43 (to follow standard American English grammatical usage @ 1960). Star Cruiser Epsilon Leonis targets 30 Rockefeller Plaza and vaporizes all mixed polyethylene-paper products in the building (with their weirdly versatile and selective alien technology). Rachel Maddow’s entire staff erupts in wailing and gnashing of teeth as the resulting collective Starbucks mess soils their offices. Epsilon Leonis sends a communiqué to 30 Rock to inform that human flesh will be the next material targeted — in five minutes. Phil Griffin immediately calls humble but diligent Vizier-in-America Kristor’s secretary, begging forgiveness and promising to do better in the future.

    Of course, this is all silly and fantastic. Obviously, Lawson Media Directive #5 will have suppressed MSNBC altogether. Maddow? Won’t she be working on a dairy farm somewhere in Wisconsin? Don’t be sad; she’ll be far happier and more fulfilled.

  3. My understanding is that increasing minimum wage increases unemployment (especially of favoured miniroties) increasing their dependence on state handouts and locking them into permanently supporting voting for Leftism (of democrat or Conservative varieties).

    Increasing dependence is the master plan.

    So increasing the minimum wage achieves its purpose.

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  5. I’m not sure what a “wildly inefficient form of writing” has to do with your argument, but as an Asianist who reads Chinese fluently, I would like to take the opportunity to attest that Chinese characters possess an aesthetic and intellectual appeal that is difficult for those unfamiliar with them to appreciate. (It’s also worth pointing out that literacy–not to mention numeracy–is stronger in Japan, Taiwan, and among young Chinese mainlanders than among Americans, in spite of the “efficiency” of our writing system.)

    • I did not mean to pick on the Chinese, whose culture (and ideograms) I admire. I meant only to emphasize the rather enormous logistical difficulties an American manufacturer faces in setting up production in China – not least, the difficulty for a Westerner of the Chinese language, compared with, say, Italian or Spanish.

    • I, too, am literate in a character-based system (Japanese), and less so in others (written Chinese, written Cantonese, Classical Chinese). Chinese characters are grossly inefficient.

      Children learning alphabets master the basics and can read around age six. Children learning Chinese characters are still learning characters in high school, and might not reach full literacy until college or thereabouts.

      As the Thinking Housewife has shown in her numerous “model minority” posts, Asians cheat and lie about all kinds of things. As it so happens, literacy is one of those things, too. While I can’t speak to how literacy is defined or reported in China (or elsewhere in the Sinosphere), in Japan, school attendace is equated to literacy. Since the former is at about 99%, therefore, the latter is as well. Anyone with half a brain can see that this is a false equation, yet we read reports of high literacy in Asia with awe.

      Reports of character-based literacy are a Potemkin village, with many at the lower end of academic achievement having only a minimal functional literacy that gets them through most daily tasks, without an adequate command of the written language to be able to read a newspaper.

      Having said all that, Chinese characters are about as unreformable as English spelling is. Revising either would cut everyone but specialists off from the huge body of writings in traditional orthography, which would alienate people from their own past even more than they already are.

  6. Sorry, I disagree.

    Rob Unz has written about the $12 minimum wage in 2014.

    http://www.higherwages.org/opinion/the-conservative-case-for-a-higher-minimum-wage/

    Bottom line, by paying workers below federal and state poverty limits, you shift the burden from employers to tax payers. Plenty of research Walmart games their wages so workers can max out “their just due” from the Gov’t teat. I shouldn’t be subsidizing Walmart but I am.

    Second, if you look at wages and government benefits, you find that many working poor have more precarious circumstances than the non-working poor. That is a bad incentive structure.

    Third, if you want to bring in immigrants to suppress wages, a high minimum wage prevents this from being effective. Granted, you need e-verify and you need toss employers employing illegals into federal prison, but I have a feeling that may be coming.

    As far as China, the low wage jobs that could go to China have gone. Automation is coming no matter what. However, it is the domestic jobs, like lawn mowing, maintenance, etc., and services jobs like retail that will be affected.

    Not to say I necessarily disagree with a lot of your alternatives, but raising the minimum wage is a lot more feasible than slapping a 40% tariff on goods and eliminating the EEOC, don’t you think?

  7. The problem with the “Classical Liberal” approach, if I may be so bold, is that a free market is not so different from a poker tournament (although everyone does not start out with the same number of chips). At some point, all the chips end up in the hands of a few players. Economically, this is probably okay, politically, it is a recipe for revolution. You see the problem most clearly in oil states, where oil is the primary basis of the economy. How many oil states are actually places you would want to live in?

    I have to confess I think the Prussians had sounder ideas about the economy than the people today touting neoclassical economics. I recommend looking at Peter Turchins’ book War, Peace and War, the Rise of Imperial Nations for better analysis.

    • Thanks, KD. You make a lot of different points.

      Bottom line, by paying workers below federal and state poverty limits, you shift the burden from employers to tax payers.

      Sure. It’s stupid. But as the post argues, the factors that push some wages below the poverty limits are mostly artifacts of stupid government policies. Delete the policies that suppress wages and increase the cost of living, and then let the labor market adjust to their absence. If wages are still too low, *then* consider a policy to address poverty. This need not be a minimum wage. It could be a negative income tax, or some other such scheme that allows the labor market to clear without government intervention to force this outcome or that, this price or that.

      Plenty of research [shows that] Wal-Mart games their wages so workers can max out “their just due” from the Government teat. I shouldn’t be subsidizing Wal-Mart but I am.

      It would be foolish not to adapt to a welfare system that can be gamed. That would be like paying more in income tax than you legally must, just because you didn’t feel like deducting your charitable contributions or something.

      One of the dangers inherent in designing policies is that they will tend to result in adaptations that tend to frustrate their objectives. You can’t avoid this danger, because a policy that does not deform behavior is utterly moot. Policies *intend* to deform behavior. But, ipso facto, most policies create new niches for social parasites, new ways of gaming the system of laws and regulations.

      If there’s a defect in the welfare system that generates problematic results, don’t compensate for the problematic results with some additional policy. Just fix the defect that generated them.

      Second, if you look at wages and government benefits, you find that many working poor have more precarious circumstances than the non-working poor. That is a bad incentive structure.

      Correct. The welfare system is perverse. It penalizes work *and* suppresses wages at the bottom of the pay scale. Like I said: if there is a defect in the welfare system, fix that defect. Don’t paper it over with a minimum wage.

      Third, if you want to bring in immigrants to suppress wages, a high minimum wage prevents this from being effective.

      A bit, sure. But it would also greatly increase the incentive to participate as a buyer in the already thriving black market for the labor of illegal aliens. Immigrants reduce wages by increasing the supply of workers. If you want to reduce immigration, focus your policy on reducing immigration.

      … raising the minimum wage is a lot more feasible than slapping a 40% tariff on goods and eliminating the EEOC, don’t you think?

      Oh, absolutely. I would bet all my assets that our leaders will continue their insane policies, and indeed double down on them by masking their effects through additional foolish policies. We are governed by cowardly fools.

      On the other hand, we may have reached an inflection point.

      Complex mendacious systems that don’t work very well can come crashing down overnight. It happened to the Warsaw Pact, not too long ago. Once people begin to admit that the emperor is naked, things can shift radically and quickly. With the current campaign of the Department of Education to force all public schools to allow boys and men into girl’s restrooms and locker rooms, we may have arrived at such a moment. We even seem to have on hand a boyo who feels no fear at noticing what he sees, and is richly rewarded for doing so.

      … At some point, all the chips end up in the hands of a few players. Economically, this is probably okay, politically, it is a recipe for revolution.

      There is always an oligarchy. Always. Whatever the system is, a few will win at working it, and they will end up with most of the wealth and power. Best then to be honest and explicit about this, as with aristocracy, and then set up the system so that the way to get or stay rich and powerful by it is to work it so as to generate the greatest popular prosperity. And the best way to do that is by rational policy, that everyone can see is rational, so that no one has cause to think or argue it unjust, and urgent of revolt.

      People don’t revolt against oligarchy as such. They revolt against oligarchs who are stupid, cruel, or foolish.

      Also this: whatever the economic system, it is nuts to address problems caused by defects of existing policy other than by fixing those defects of existing policy. If, e.g., immigration is causing problems, don’t add new programs to ameliorate those problems. That effectually subsidizes the immigration that is causing the problems, so that there ends up being even more of it. Instead, just eliminate the immigration that is causing the problems to begin with.

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  9. The corruption is so mind-boggling at the top that we should work hardest on fixing all of that before we mess with anything at the bottom. I suspect a lot of our economic problems would disappear if we weren’t being pillaged by the bankster “elite.”

  10. It doesn’t have to be an either-or thing. Combine minimum wage raise with immigration enforcement and tariffs. Deportation and tariffs offset the danger of a minimum wage hike causing unemployment.

    I’m not sure why removing the progressive income tax is in this list. I doubt Americans’ standard of living is really strongly affected by the cost of the IRS. I would hate to replace it with a consumption tax, which would fall disproportionately on those who can’t afford to invest or save. It’s the rich who are pushing sodomy on the rest of us. Make them suffer.

    • Indeed it does not need to be either or. But there is a proper order of operations: first fix the policies that exacerbate the problem, then – if there is still a problem when the system has adjusted to those changes – devise a policy to address the problem specifically. If we fail to follow it, we introduce noise to the system, because we won’t know the true dimensions of the problem we have noticed once its artificial factors have been removed.

      Removing income tax is on the list because taxing assets penalizes work: assets are stored work, and wages receivable are assets. You’d want to get rid of all other taxes on property, as well.

      Consumption is taxed because savings – i.e., capital formation in plant, equipment, research, and development – increase labor productivity, ergo wages. Since it is an effectual subsidy to savings, a consumption tax is particularly good for the poor over the long run.

      However they are collected, or from what sorts of persons, the cost of all the taxes paid by the private sector is in any case factored into the prices of consumables. We are all paying a consumption tax already, via higher prices on goods and services. But the signal of the implicit consumption tax is buried in the price of the goods or services we buy; and we are also paying lots of taxes on all sorts of assets. If *all* taxes were replaced with a flat consumption tax, the overall burden of taxes on the working poor would go *down,* if only because the costs of tax compliance and collection across the whole economy would plummet.

      One benefit of using *only* a consumption tax collected at the point of retail sale is that all consumers would be confronted at every turn with complete information about how much their governments were taking from them. Ouch! This full and accurate disclosure would feed back to policy makers, as popular pressure to keep the consumption tax as low as possible.

      Policy should be focused. If you want to prop up the poor, welfare is the way to do it. Benefit exactly the people you want to help, as directly and immediately as possible. If you want less sodomy, don’t tax this or that group of people, punish sodomy. Punish exactly the thing you want reduced, as directly and immediately as possible.

    • “[A consumption tax] would fall disproportionately on those who can’t afford to invest or save.”

      How so?

      • If rich people spend a quarter of their income and poor people spend all of their income, a flat consumption tax will be four times higher as a fraction of income for the poor person than the rich.

      • Josh, thanks. But I thought Bonald meant a consumption tax would disproportionately affect the “poor” (I’m not real sure what we mean by “the poor” in this context, since there are so many variables to take into consideration when making such a distinction. Same with the “rich” for that matter, but in any case…) in some new way in which our current tax scheme doesn’t already do. I “get” that the graduated (or “progressive”) income tax scheme is designed to protect the poor by way of lower tax brackets, and “refunds” that would probably be better termed “transfers of wealth,” and that “the poor,” which group includes a bunch of single working Moms, have in turn learned to game the system for all it’s worth in these regards. In other words, they’re being rewarded for divorcing their husbands and depriving their offspring of a father and stable home environment. This serves as an incentive to divorce, and beyond. Way beyond!

        I know I’ve ventured off into a tangent here, but when “the poor” are invoked to justify something as (clearly to my mind) unjust and crazy as the current income tax apparatus, which *encourages* all manner of bad behavior to game it, we have to go beyond “the poor” as such, and get into what kind of behavior we’re trying to protect. And to ask, “is this good, or bad, for individuals or society as a whole?” To my mind it is clearly the latter, and therefore must be replaced with something that isn’t inherently immoral/unjust/self-destructive and nuts.

    • Kristor, I agree with your reasoning on the income tax, but for my part it’s “on the list” because it’s highly invasive, therefore evil, and ought to be replaced with something *that isn’t*. Am I wrong?

    • Well, if the linked article is any indication, then Dr. North didn’t read the post carefully enough. The article he forwarded is about *manufacturing* jobs, and how they have been lost mostly to automation, rather than to foreign outsourcing. This is of course true. But it is not pertinent.

      The post is about demand for and supply of labor simpliciter. Ceteris paribus, *any* job delegated overseas is one less job available in the US.

      It is perhaps easy to overlook the fact that the post does not suggest that we ought to *prevent* the movement of jobs or goods across borders. It suggests only that tariffs and tonlieux should be set to maximize the revenue they generate for the Treasury. Doing business in the US is a good; it should not be free, or a commons will obviously ensue, which will then tend to be abused. Permission to do business in the US should be sold for the highest price that the market will bear.

      A free marketer should love this notion.

  11. Ending the income tax might be tough. But amending it so that the worker can deduct the market rate of his labor as an expense would be much simpler to do. And would, in essence achieve the same effect.

    • I think that in this particular season, as the nation grapples with the possibilities opened up by the current vast expansion of the Overton window, the first five items on the list have a snowball’s chance in Hell. They rather fit together as a package, parts of which are already under intense discussion.

      But you never know. Once you take a teeny tiny bit of a red pill, you start to think about a lot of things that had before seemed quite inconceivable: “Yeah: why the Hell not?” It can start a cascade of toppling intellectual walls, and a new world of possibilities can open up. I’ve been through this myself, and I’ve watched it happen first to the Warsaw Pact and then to the USSR. Fragile brittle complex systems have a way of falling apart and rearranging themselves all at once, given just the tiniest push (e.g., St. JPII returning to Poland).

      This is why we need to keep writing. To write is to plant seeds. We may not ourselves ever see them sprout. But, no seeds, no oaks.

      Plus the timing of the Administration with this business of opening public school girls’ locker rooms across the land to 45 year old guys who are willing to say that they feel like women couldn’t be more deliciously ironic. The Republicans are running a guy who is winning *because* he calls spades spades, and the Democrats come out with this absurd reduction of their policies. It’s like they’ve painted a big fat target on their foreheads and handed a gun to their adversaries, saying, “shoot me.” The idiocy of this move is all by itself enough to show that they are *radically stupid and incompetent,* and unfit to rule.

      So, again, you never know. Social phase changes happen. This could be one. When things deliquesce, all bets are off.

      • This is where your statement above “we are governed by cowardly fools” comes in. Our intrepid leaders know that anykind of reduction in taxes and regulatory burdens for businesses and corporations is almost automatically deemed a form of “corporate welfare” by the idiot masses, who’d just as soon cut their noses off to spite their face.

        That’s what years and years and years drilling *out of* people their independent, entrepreneurial spirit, and replacing it with the idea that all they should ever aspire to do is to “get a good job” does to them over the long haul. Meanwhile, there is not a government program (no, not one!) currently in existence that mustn’t continue to be fully funded and maintained from henceforth and forever, at all (and I do mean ALL) costs. We see this happen continually – once people get used to idea that they are entitled to this form or that of *other people* subsidizing their lifestyles, no amount of reasoning, nor hard data, will ever convince them otherwise.

        It always amazes me, as one example among dozens, that the average working class is so completely wedded to the notion that forced overtime pay is a good thing, *in spite of* the fact that, literally to the man, they all complain that when they work overtime, the great bulk of their additional pay is confiscated by the government. Intuitively they know this isn’t “right,” but good luck trying to convince them that the problem is government enforced overtime pay itself; that the government doesn’t mandate and enforce it because it has a conscience and “cares” about them. Same thing, of course, with minimum wage laws, etc., …

      • Accustom people to a good – welfare, bread, circuses, free internet, freeways – and they soon treat it as personal property, to which they have title. That’s why we call such goods “entitlements.”

        You can’t take property without due compensation, and expect anything other than war. This makes perfect sense. People set up their lives at great personal cost according to the rules established by the sovereign. Any change to the rules imposes on them a cost of commensurate adjustments.

        The solution is then to buy entitlements. This is what the British did when they wanted to end slavery in the Empire. Parliament simply bought all the slaves, then freed them. This was horribly expensive, but it was cheaper than our Civil War.

        Most entitlements could be bought with little or no impact on government budgets. Take retirement benefits under Social Security, for example. Buy rights to those benefits from a currently entitled citizen for their actuarial net present value at some suitable discount rate. Float a 30 year bond to finance the purchase. Then, pay interest for 30 years instead of paying benefits. You could even underwrite the deals, offering them only to beneficiaries in good health, who would otherwise collect benefits for a long time.

      • Karl Denninger has pointed out repeatedly that if you ended the monopolistic and collusive practices by all players in the medical industry (providers, insurers, drug companies) just using existing law health care prices could drop as much as 80%. Such a reduction in cost would make the problem of private health care insurance trivial to solve. Though with health care making up 18-20% of the overall US economy an 80% reduction would shrink the economy more than 15%. But along with common sense tax and regulatory reform the cost of doing business would fall dramatically and a boom could follow swiftly. Not to mention that the annual cost of Medicare and Medicaid on the federal budget would fall $600-800 billion ending the federal deficit problem permanently, all else equal (that is, exclusive of further budget cuts and the benefits of greater economic growth).

      • Bingo. More than half of the employees in the banking industry work on regulatory compliance. Res ipsa loquitur.

        … health care prices could drop as much as 80%. Such a reduction in cost would make the problem of private health care insurance trivial to solve. Though with health care making up 18-20% of the overall US economy an 80% reduction would shrink the economy more than 15%.

        But remember that cost savings on health care would not somehow vanish from the economy, thus shrinking it. They would simply be allocated to other sorts of things.

      • Sure, but perhaps not right away as many jobs go away and unemployment spikes for a short time (if allowed to happen without interference). Karl cites the 1920-21 correction as an example.

      • Sure. But that would come to pass only if the 80% cost savings was realized over the course of a few months. In reality it would take several years. There would be the same number of dislocations, but it wouldn’t be a pig in the python. It would usually be a couple hundred here, a couple thousand there.

        I remember when telecom was deregulating in the 80’s. Listening to the radio in the morning, it would be devastating. Morning after morning, it would be 70K layoffs here, 80K there. And through the 80’s this was spreading through other sectors of the economy as they were deregulated. One wondered where all those folks were going to find work. Yet they did, and the economy boomed.

      • Kristor, I once wrote a letter to the IRS, offering to sell back to them my Social Security benefits at a fraction of the amount I had already paid in at the time. With which proceeds, as I explained, I would *wisely* invest in my business, thus employing more people and creating more taxable wealth. Never heard back from them for some strange reason. Ha, ha. (At the time, I *really believed* I was the only person who’d ever thought of such a thing.)

        But, yes, your scheme makes perfect sense to me. I wouldn’t know how to work the logistics of it, but that’s what people like you are for. 🙂

  12. Pingback: Lightning Round – 2016/05/18 | Free Northerner

  13. You will still need to fix the money system. America was so much better off when we had a currency nominally backed by gold and silver. Better yet, a free market in money which would be commodity money. Abolish the Federal Reserve for starters. I had an uncle that worked a modest parts counter job at International Harvester and still had a home, a car, and raised a wife and child.

    • Free banking would be nice, and would have all sorts of good knock on effects. If we are dreaming, then reform of corporate liability (to pierce the corporate veil for officers and shareholders) and elimination of usury would be great, too. But each one of those is a huge ball of wax, much more difficult to explain than the list above.

  14. After I e-mailed my e-mail pen pal Dave Hines a link to Kristor’s post, he wrote:

    “It’s not at all unusual for persons who deal with personal finance have odd ideas of government economics. Some of the things Trump says, for example, make some sense in private business finance but don’t translate well to government policy.

    The misperception here is that the foreign company pays the tariff. That is not the case. The importer pays the tariff. He will not pay it unless he has a reasonable expectation that he can recoup it from the consumer. Thus the tax is paid by the consumer in the increased cost of goods.

    Some think this is fine, in that without the foreign competition the US company can thrive and Americans can work. Maybe, but it is also in a position to more easily raise its prices; it has been granted monopoly/hegemony power by the tariff.

    But doesn’t it save American jobs? Not really. Division of labor and specialization are hallmarks of economic progress. Those who produce goods or provide services more efficiently specialize in those fields. Each trades the products of his expertise for the products of others’ expertise, each benefiting by the exchange.

    The punitive tariff solution attempts to stunt this process, and to preserve a former status quo. It’s thought that this cuts only one way — it punishes the foreigners and helps the natives by letting us sell to them without them selling to us (or them paying a premium when they sell to us, or the consumer paying a premium to buy from them hence having disincentive to do so).

    That’s doesn’t work. If foreigners are to buy our products they must have something to sell to us. They can’t trade if they have nothing with which to trade. Some of this is disguised in the governmental system. Giving foreign aid to other countries gives them money to trade with; it also raises the cost of living for Americans, whose taxes pay for the aid. This makes Americans less competitive in the global market.

    The stated rationale, of course, is that those countries are so poor that it’s humanitarian to help them, and also that poverty makes them unstable so giving aid is for our own protection from violent and demented poor people.

    This is but a brief overview. The thrust is that punitive tariffs are a simplistic but counterproductive approach. The American taxpayer pays to make himself less competitive, then as a consumer pays to purportedly protect somebody else’s job. The jobs purportedly protected are within particular niches, not spread evenly across the labor force. What somebody gains somebody else loses.”

    • Thanks, Bill, for passing on Dave’s comments. They are inapt. He seems to have misconstrued my arguments. These were admittedly sparse; the post covered a lot of policy ground in a few bullet points. I’ll try to clarify by responding to his points.

      The misperception here is that the foreign company pays the tariff. That is not the case. The importer pays the tariff. He will not pay it unless he has a reasonable expectation that he can recoup it from the consumer. Thus the tax is paid by the consumer in the increased cost of goods.

      None of this is relevant, or tells one way or another. It doesn’t matter who cuts the check to pay Customs for the tariff. Obviously the consumer of imported goods ultimately suffers the cost of the tariff. This is true of the costs of any state policy. The consumer always pays. This fact therefore provides no guidance to the maker of policy.
      What matters is whether the consumption of the marginal unit of a given foreign good makes economic sense. If the tariff is set optimally – so as, i.e., to maximize state revenues from that levy – and if the consumer decides to go for it given the total retail price that results, then no problem: it makes sense.

      Some think this is fine, in that without the foreign competition the US company can thrive and Americans can work. Maybe, but it is also in a position to more easily raise its prices; it has been granted monopoly/hegemony power by the tariff.

      This is true only if the tariff is set substantially higher than the overall state burden on domestic agents. If it is set to compensate for that burden, then the playing field is leveled, at least as to accounting measures of costs.

      But doesn’t it save American jobs? Not really. Division of labor and specialization are hallmarks of economic progress. Those who produce goods or provide services more efficiently specialize in those fields. Each trades the products of his expertise for the products of others’ expertise, each benefiting by the exchange.

      Dave has apparently mistaken the point of the tariffs advocated in the original post. It is not to punish foreign goods, but rather to stop subsidizing them, as at present. Tariffs – and taxes and tonlieux – should all be set to maximize the NPV of sovereign revenues they generate. They should, in other words, be set to the price that the market will bear – that will clear the market. So long as these levies are rational – so long as everyone who consumes the good of participation in the market pays the same unit price for doing so – then competition between goods and their producers may proceed more rationally – i.e., free of noise introduced to price signals by state deformations of markets.
      NB that phrase, “free of noise.” It is what is properly meant by the term, “free market.”

      The punitive tariff solution attempts to stunt this process, and to preserve a former status quo.

      I don’t advocate punitive tariffs. I advocate optimal tariffs.
      An interesting wrinkle here is that optimality of state levies does not imply that tonlieux, tariffs and taxes should all be set to impose exactly the same state costs on foreign and domestic producers. Domestic producers suffer externalities not borne by foreigners, and which are extremely difficult to internalize. For example, domestic workers are obliged to sacrifice to defend the realm in time of war, or perhaps to live in intemperate climates or cope with rough terrain. They likewise suffer – and enjoy – all sorts of burdens of local customs, such as the eight hour day or the weekend. It would be quite difficult – quite costly – to tally up all those costs.
      What is more, foreign workers, too, suffer all sorts of unaccountable and countable costs.
      In practice, therefore, the simplest way to pay and to signal for such costs properly and accurately is just to keep increasing each sort of state levy independently until the marginal increase of each sort of levy generates no increase of revenues. That will be the sweet spot. The sweet spot is likely to be somewhat different for tariffs than for taxes and tonlieux imposed on subjects. It is likely to be somewhat higher.
      That sounds like a punitive tariff until we recall that economic rationality should lead all sovereigns to do the same thing: charge as much for access to their markets as the market for such access will bear. Ceteris paribus, this would have the effect that less attractive markets – less orderly, prosperous, lawful, and so forth – would charge lower tariffs than their more attractive brethren. Which only makes sense.

      The jobs purportedly protected are within particular niches, not spread evenly across the labor force. What somebody gains somebody else loses.

      This is true for every state policy whatever. It is true for a policy of zero tariffs, and it is true for total closure of the borders, and it is true for everything in between. Everything the state does helps and hurts some people more than others. How could it be otherwise?
      Thus again this objection is neither here nor there. It provides no guidance to the policy maker.
      What I’m after in any case is not industrial policy effected via punitive tariffs on certain sorts of goods or certain companies or foreign states, but a level tariff imposed equally upon all goods entering the realm.
      Hope that helps.

      • You’re welcome, Kristor. Thank you for answering Dave’s criticisms. I’ll tell him the you replied.

      • You missed my point entirely. Your original piece proposed lowering the cost of living. Good plan. Among other salutary effects it would make American labor more competitive globally. Yet in the midst of the pitch you propose raising the cost of living through tariffs. You counter the premise with which you started.

        You seek to “level” the costs of externalities upon businesses. Implicit is an expectation that government will do as you wish…well, just because. You remove the market impetus to make more rational decisions, enabling continuation of the irrational. The need to make the regulatory environment “so completely whacked, irrational, cumbersome, and costly” is dodged by imposing costs on consumers. If you were dictator maybe you could square that circle…MAYBE. But lacking such autocratic power it can’t be done.

        You attempt to bureaucratically put a price on everything, such as temperate/inclement climate, and adjust for such things through tariffs. As Hayek showed decades ago, this is a virtual impossibility. Immune from market forces by their monopoly on coercion, government officials’ sensitivity to price and value is chimerical. Their valuations can be only imaginary, having no reality check in the market.

        How much reality is there in “leveling” such factors as environment via tariffs? Does it make sense to make Inuit wine production competitive with Bordeaux wine? It doesn’t to me.

        You do propose “optimizing” tariffs for maximum revenue. This might possibly be seen as some market check. It also prioritizes government revenues over persons and families. This is not, to my mind, a commendable priority to promote. That pretty much leads to mercantilism, which regards the person/family as merely a cog in the government revenue machine.

      • Thanks, Mr. Hines, for your continued involvement with this topic.

        You missed my point entirely.

        On the contrary, I grasped your arguments instantly. The problem, again, is that they were simply inapposite to this discussion, as being not quite responsive to what I wrote. I’m afraid this is equally true of your latest sally. You are tilting at arguments I have not made.

        Your original piece proposed lowering the cost of living.

        Not quite. The proposals in it were aimed rather at approximating more closely to economic rationality. Some of them lowered the cost of living, others raised it. But improving economic rationality should mutatis mutandis have the overall effect of improving prosperity and the standard of living in one way, or another, or in several ways at once.

        You seek to “level” the costs of externalities upon businesses.

        No. I advocate a level tariff on all imported goods, whatever their type or origin. That’s quite a different thing.

        Implicit is an expectation that government will do as you wish … well, just because.

        How can policies of government be proposed other than as … proposals for government policy?

        You remove the market impetus to make more rational decisions, enabling continuation of the irrational.

        How? Level consumption taxes and tariffs would deform all prices equivalently, so that the pricing system could then compare the values of goods more accurately – and far less expensively – than it can at present, under the massive noise introduced by our bewildering array of taxes, tariffs and fees, each with its cumbrous accoutrement of cavils, exceptions, and qualifications. By their pettifogging variety and complexity, these all mask and confuse the information in prices about the values of goods, misguiding all economic decisions.

        The need to make the regulatory environment “so completely whacked, irrational, cumbersome, and costly” is dodged by imposing costs on consumers.

        I’m not sure how to make sense of this sentence. What “need”? I propose mostly eliminating our current regulatory environment. I don’t seek to impose costs on consumers, but to replace irrational noisy costs they currently bear with relatively rational, relatively noiseless costs.

        You attempt to bureaucratically put a price on everything, such as temperate/inclement climate, and adjust for such things through tariffs.

        Um, no. Just the opposite. I wrote:

        It would be quite difficult – quite costly – to tally up all those costs. … In practice, therefore, the simplest way to pay and to signal for such costs properly and accurately is just to keep increasing each sort of state levy independently until the marginal increase of each sort of levy generates no increase of revenues.

        I suggest with Hayek that it is impracticable to account for such things by some sort of formal tally.

        How much reality is there in “leveling” such factors as environment via tariffs?

        It seems to me that you are not reading carefully enough. I didn’t suggest leveling such factors as climate and terrain between producing nations. I suggested a level tariff on all imported goods, set as high as can be without reducing the revenue it generates. The highest price that importers are willing to pay to import should then cover the myriad costs and benefits – whether or not they are accountable, internalized, or tangible – of doing business in a country.

        Does it make sense to make Inuit wine production competitive with Bordeaux wine? It doesn’t to me.

        Me neither. I proposed no such thing. What I did propose is more aptly illustrated by comparing manufacture of transistors destined for the US market in China versus in, say, Ohio. While both are perfectly capable of building transistors, Ohio obviously has many substantial comparative advantages over China – legal, logistical, linguistic, and so forth – as, admittedly, China has some other comparative advantages over Ohio. How to ascertain and account for them all? I’m pretty sure it is not humanly possible to do so. A level tariff on all imported goods, that did not single out China, but that was set as high as the global market thinks access to the US market is worth, would seem however to do that job, without any cumbersome bureaucratic overhead.

        You do propose “optimizing” tariffs for maximum revenue. This might possibly be seen as some market check.

        That’s *exactly* what it is. Here at last you make contact with the arguments I have actually made.

        It also prioritizes government revenues over persons and families.

        No matter how you raise a dollar of revenue, the cost will fall on persons and families. Better then to raise revenues as efficiently as possible. That means focusing your policy aimed at raising revenue on … raising revenue. If you then find that persons and families need assistance of some sort, devise a policy to address that problem as precisely as can be.

        [Optimizing tariffs] pretty much leads to mercantilism, which regards the person/family as merely a cog in the government revenue machine.

        We *already have* a system that regards people and families as cogs. The system we now have has been deliberately sapping all the private organs of social order – including the person – for a hundred years. Such tinkering with tariffs as I propose will not change that – will not make it worse, or better. How in any case would a mercantilist system treat people and families as cogs? Families and persons did OK during the mercantilist period in the West.

  15. A number of your comments suggest to me that despite your protestations you have yet to grasp the thrust of my critique. To wit:

    “Some of them lowered the cost of living, others raised it.”

    Yet your original piece a repeated advocacy for your proposals is:
    “Reduces cost of living and doing business, thus the price of the living wage.”

    You touted the low cost of living that enabled a family to exist with one wage earner. To now say that raising the cost of living is part of your plan seems like a bit of bait and switch.

    “How can policies of government be proposed other than as … proposals for government policy?”

    Here is the illusion that those in power consider proposals solely on their merits to the common weal. Those are people, with their own desires, weaknesses, and misperceptions. If they are to do the right thing they must be motivated. Thus the following:
    “I’m not sure how to make sense of this sentence. What ‘need’?”

    If politicians and/or bureaucrats are able to dodge the ill effects of their actions, what need do they see to change them? We’ve seen it with Keynesian money creation gone wild, a.k.a. “quantitative easing”. Instead of solving problems the easy course it to merely subsidize the errors. You suggest evading the real economic effects of a “completely whacked, irrational, cumbersome, and costly” regulatory environment by taxing the American consumer, obviating the need to address the issue — at least until the ill effects of economic ignorance become too dire to evade any longer. At such a time the problems will have become too large and complex to effectively address.

    “I propose mostly eliminating our current regulatory environment. I don’t seek to impose costs on consumers, but to replace irrational noisy costs they currently bear with relatively rational, relatively noiseless costs.”

    Well, simplicity does have its benefits. However, perhaps all of history suggests that nothing would be replaced; instead, costs would only be added. Politicians would quickly discover that they can’t exist without extant extractions, in addition the tariff extractions. Indeed, the “noise” is a source of a Congressman’s power. He gets to insert earmarks into bills to benefit certain contributors. A tax advantage is easier to get through than an outright subsidy. This is why every tax reform effort, which happens periodically, immediately starts becoming byzantine again. Politicians are loath to surrender their power, and would resist surrendering this power.

    “It seems to me that you are not reading carefully enough. I didn’t suggest leveling such factors as climate and terrain between producing nations.”

    If so, what is the relevance of this?:
    “Domestic producers suffer externalities not borne by foreigners, and which are extremely difficult to internalize. For example, domestic workers are obliged to sacrifice to defend the realm in time of war, or perhaps to live in intemperate climates or cope with rough terrain.”

    If there were no suggestion to somehow compensate for such things, what was the relevance in mentioning them at all?

    “A level tariff on all imported goods … that was set as high as the global market thinks access to the US market is worth…”

    Here we see insistence that it is the “global market” that pays the tariff, not the American consumer. You say you understand that it’s the consumer who pays. Therefore you are advocating that the American citizen be taxed to the max: “as high as the global market thinks” he’s worth. Or else you have not internalized the truth that it’s the American consumer who pays the tariff.

    “We *already have* a system that regards people and families as cogs. The system we now have has been deliberately sapping all the private organs of social order – including the person – for a hundred years. Such tinkering with tariffs as I propose will not change that – will not make it worse, or better.”

    Indeed, this is the what we already have. Your original piece suggested, though, that your tinkering with tariffs would change that. Was this, as suggested earlier, a bait-and-switch?

    • You touted the low cost of living that enabled a family to exist with one wage earner. To now say that raising the cost of living is part of your plan seems like a bit of bait and switch.

      Items 1, 3, 4 and 6 of the list of proposals in the original post would all have the effect – as they say – of decreasing the supply of workers manufacturing goods in or for the US, whether within its borders or without. Ceteris paribus, they would tend to increase the price of domestic labor, which would in turn increase the cost of living.

      The other proposals on the list would tend to reduce the cost of living.

      Item 6 would tend both to increase wages *and* reduce the cost of living.

      The post was considering, not reducing the cost of living, but achieving a living market wage for the bottom end of the labor supply, thus obviating the need for a minimum wage. This can be achieved in two ways, which are not mutually exclusive: increase wages by reducing the supply of workers, or reduce the cost of living through economic rationalization (as of regulation, taxes, etc.).

      There was no bait and switch. You just didn’t read carefully enough.

      Here is the illusion that those in power consider proposals solely on their merits to the common weal. Those are people, with their own desires, weaknesses, and misperceptions. If they are to do the right thing they must be motivated.

      Politicians are wicked. Does this mean we may not evaluate and propose policy? If you had some good policy proposals, would you have to squelch any talk of them because the corrupt politicians would just ruin them in the implementation? If we can’t discuss the differences between good policy and bad, how will we know the differences?

      I have elsewhere discussed how to motivate the oligarchy to do the right thing. While related to the topic of this post, and to all other political topics, it is nonetheless different.

      You suggest evading the real economic effects of a “completely whacked, irrational, cumbersome, and costly” regulatory environment by taxing the American consumer, obviating the need to address the issue …

      I propose mostly eliminating our current regulatory environment. I don’t seek to impose costs on consumers, but to replace irrational noisy costs they currently bear with relatively rational, relatively noiseless costs.

      You say that I suggest evading the economic effects of our whacked policies, and then you go on immediately to quote my reiteration of proposal 5 on the list that we do the exact opposite – that, i.e., we eliminate almost all of our current regulatory environment precisely because it is so whacked. This saves me a bit of time in responding – all I have to do to shoot you down is quote you quoting my reiteration of the opposite of what you say that I say. But it leads me again to the suspicion that you just aren’t reading carefully enough, not just what I write, but what *you* write.

      … perhaps all of history suggests that nothing would be replaced; instead, costs would only be added. … Politicians are loath to surrender their power, and would resist surrendering this power.

      Yeah, no argument there. Yet this fact tells, not against good policy, which despite politicians we ought always to endeavor, but against policies founded upon such illusions or fantasies as that there is no oligarchy, or that the oligarchy might ever do other than what it apprehends to be in its own interests. Again, that’s a different department of politics. I have some ideas about how to shape policy in frank recognition of the incorrigible reality of oligarchy, so as to domesticate the oligarchs to the general welfare. But this post is not about that topic.

      If there were no suggestion to somehow compensate for [externalities not borne by foreigners, and which are extremely difficult to internalize], what was the relevance in mentioning them at all?

      Market perfection involves internalizing all externalities. This increases the precision of prices, because internalizing externalities ipso facto enables the pricing system to take some account of them. It increases the quantity of information integrated into prices. This makes all decisions influenced by prices more informed, thus more rationally apt to the actual state of affairs. And prosperity is a function of the rationality and aptitude of decisions, ergo of the acts that embody them.

      NB: the actual state of affairs to which our decisions must be rationally apt if we are to prosper includes the actual state of moral affairs – includes, i.e., the Natural Law.

      Here we see insistence that it is the “global market” that pays the tariff, not the American consumer. You say you understand that it’s the consumer who pays. Therefore you are advocating that the American citizen be taxed to the max: “as high as the global market thinks” he’s worth.

      Again, you are not reading carefully enough. I didn’t suggest that the global market pays anything. I have reiterated several times my agreement that the consumer will ultimately suffer the cost of taxes and tariffs, however they are levied. How many more times will I have to do that before you understand that I do indeed agree on that point?

      All taxes, tariffs and tonlieux are accounted for in the prices of goods that consumers of those goods pay. There, I’ve done it again. Clear enough?

      That said, I have said again and again, not that I think American citizens should be taxed “to the max,” but optimally.

      Your original piece suggested, though, that your tinkering with tariffs would change [the system that regards people and families as cogs]. Was this, as suggested earlier, a bait-and-switch?

      No, it is yet another instance of your not reading carefully enough. I never suggested that the policy proposals of the original post would engender a system that did not treat people and families as cogs. They would have all sorts of beneficial effects ancillary to achieving a living wage for the cogs at the bottom end of the labor supply, but not that one. To get a system that does not treat people as fungible cogs, we’ll need to go a bit deeper than tweaks to trade, tax and regulatory policy, terrific as they might be. We’ll need to get over and past *liberalism.*

      • A couple salient points came to mind.

        Kristor, you were quite specific as to what you considered “optimization”: slowly raising the tariff until it could glean no additional revenue. This is pretty synonymous to “taxing to the max”. It’s not a function of me not reading carefully enough; it’s a function of what you said. Perhaps you didn’t read carefully enough what you yourself wrote.

        What you said in the original post could be “simply done” cannot be simply done without a road map through the political morass. Without such a plan I can generally predict the outcome:

        A politician might enthusiastically support your plan. Then behind closed doors in committee he will compromise away the elimination of other taxes. After all, those entering government are predisposed to think that government is wiser and smarter than you are, and knows better how to spend your money. Eliminate a way to get the money out of your pocket and into the government’s? It has to be the first thing to go. Otherwise it stands zero chance of passing.

        The next thing compromised away would be the reduction of regulation. After all, some of the politician’s constituents regard the regulatory bureaucracy as a paycheck, better than they could get in the private sector. And some well-heeled campaign contributors consider the regulations an advantage over their competitors.

        Ultimately the only bit that may remain is “tax to the max” (or euphemistically, “optimize revenue”). Then you’re told, “Unfortunately we couldn’t get everything you wanted, but we got some of what you demanded. Now if you’ll support me in the next election…”

        It’s been played out time and time again. Yet you consider the road map irrelevant.

      • Kristor, you were quite specific as to what you considered “optimization”: slowly raising the tariff until it could glean no additional revenue. This is pretty synonymous to “taxing to the max”.

        No, it isn’t the same thing at all. There is no maximum tariff. You could set the tariff to 1,000%, or 1,000,000%. You wouldn’t get any imports at all if you did. Then your revenues from tariffs would be $0. That would mean you had set your tariff way too high.

        So to figure out the market clearing price of your good – in this case, the good of doing business in a nation, but the process works the same for sellers of widgets – you set your price just a bit higher than your cost of production, then raise it until revenues from sales stop increasing. Then, you back down a bit on your price, figuring that there’s a good chance you overshot the sweet spot of the Laffer Curve.

        That’s all this is, you know: the Laffer Curve, applied to tariffs instead of marginal income tax rates. It’s basic microeconomics.

        Enacting the proposals of the original post would indeed be simple, provided we had the political will to do it. You are right that, up till now, we have not had that will. No disagreement there. As I have already said in this thread to another commenter, we are led by cowardly fools.

        Yet as I have also said elsewhere in this thread, we seem to be in a bit of a political earthquake. All sorts of interesting things can happen when the earthen foundations of a society liquesce.

        Whether or not anything interesting does come out of this current political realignment, the fact that we are led by wicked men does not mean we ought not to discuss the characteristics of good policy. I mean, if all hope is lost, and nothing anyone can do will make the slightest jot of difference, then why are you wasting your time reading, thinking and writing about economics and politics?

      • Kristor, though you repeatedly claim to understand that it’s a fallacy, you continue to perpetrate the fraud that it’s some foreigner who pays for “the good of doing business in a nation”. No yet again! It’s the consumer. So what you seek to determine is how much a consumer will overpay for a widget. The overpayment, of course, goes to support government regulation and all.

        I don’t know why you keep wanting it both ways — that you know that it’s the consumer who always pays, yet insisting that it’s somebody abroad who pays for the good of doing business. This cognitive disconnect doesn’t give me much faith that you have truly considered your plan.

      • I don’t know how I can be more explicit in my insistence that I really do understand that the consumer ultimately suffers the cost of all expenses of production, distribution and sale. How on Earth could it be otherwise?

        Nevertheless it is the importer who, taking the impact of the tariff on his final unit sales and profits into account, makes the decision whether or not to import the marginal unit of a good. It is in his mental calculus that the tariff makes itself most prominently and consciously felt.

        There is no conflict between these two facts. Indeed, they are aspects of a single fact.

        If the tariff is set optimally, there is no overpayment by the consumer for imported goods. Rather, the consumer is presented with prices on foreign goods that take into account all the costs of production, distribution, and so forth.

        Among these are the value of access to the market in which consumers make their purchases.

        It takes considerable resources to maintain a market. Even the most efficient markets are not free of costs; and efficiency is itself a valuable good, for all market participants; as are the market rules and customs, the moral quality of its members, their prosperity and liquidity, and so forth. So it is that to participate a market we must pay entrance fees and transaction fees. It costs a lot of money to buy a seat on the NYSE; and every trade executed there earns the Exchange a few pennies, plus a few for the broker whose seat enabled him to bring the trade to the floor.

        So likewise for access to the US market. If we charge less for access thereto than is optimal – less, i.e., than it is worth – we *distort* that market. Prices thereon will not reflect the true value of participation therein, and will therefore be lower than they ought to be. There will be more decisions to consume at the margin than is optimal. Marginally less will go to savings & investment; capital formation, labor productivity and wages will all grow more slowly than they otherwise would have.

      • K: “Nevertheless it is the importer who, taking the impact of the tariff on his final unit sales and profits into account, makes the decision whether or not to import the marginal unit of a good. It is in his mental calculus that the tariff makes itself most prominently and consciously felt.”

        That is an absurd contention. To see why, let’s take an object lesson.

        You can buy legal marijuana in Colorado, and many do. It is heavily taxed; the state gains a windfall. But the state also complains that the black market still operates. People don’t want to pay the tax-inflated prices for pot, so they purchase illegally imported stuff.

        As always, the consumer is in control of what the market offers. Not the importer nor the tariff collector. It it the experience every time a planned economy is attempted. Black markets abound, evading the careful planning of people who think they can by fiat repeal natural economic law.

      • If there is a black market, the tax is set too high, and the sovereign is forgoing revenue.

        It is in [the] mental calculus [of the importer] that the tariff makes itself most prominently and consciously felt.”

        That is an absurd contention.

        Really? When was the last time you decided to order a container of T-shirts from China? It is *obvious* that demand on the part of consumers influences the quantity of goods supplied. But it is also obvious that no consumers (other than the importer himself) make the decision whether to import the marginal container of this or that. It is in the mind of the importer that information on the state of consumer demand, costs, taxes, tariffs, and so forth all come together in a decision to import the marginal container.

        Setting a tax or tariff at the optimal level and then letting the chips fall where they may is the *opposite* of a planned economy. Given your enthusiasm for natural economic law – which I share – I am surprised that you don’t see this.

      • Kristor wrote:

        “If there is a black market the tax is set too high, and the sovereign is forgoing revenue.”

        This is almost a “no true Scotsman” argument. It posits a switch that turns black markets off/on. That is never the case. With any nontrivial intervention in the market there will be black markets, or grey markets ready to turn black.

        There are people who work “under the table”, for cash. For many their income tax would be nothing, though some might be withheld until they go through the IRS reporting routine the following year. Payroll tax (Medicare etc.) would take a little bite. The extractions might be nearly trivial, yet some of these people will often prefer immediate gratification. This is pretty much a black market in labor.

        People cross state lines to avoid a state’s high tax on tobacco. They may buy cartons of cigarettes to sell to others. This may violate state law, though seldom enforced.

        There are people who buy alcohol or tobacco for underage friends. This constitutes a black or grey market. There are those who buy guns for others who otherwise could not legally obtain them. Despite state lotteries, illegal gambling still thrives. The odds of winning are slightly better, though payoffs are not as big.

        Any nontrivial tariff would surely engender a black or grey market. People do not all think alike, reacting en masse to what you consider to be the optimal tariff. There is no on/off switch in optimization.

      • With any nontrivial intervention in the market there will be black markets, or grey markets ready to turn black.

        This does not defeat the notion that if there is a black market, the sovereign has set the tariff too high, and is forgoing revenues. If the black market has captured a significant portion of the white, then the tariff is definitely too high. If not, not.

        There will always be cheats, to be sure. No doubt there are some who would want to operate on the black market even if the tariff were 0%. But this is true of every system. That there are always some cheats then is not an indictment of the system they cheat. What counts is the volume of cheating, and of corruption. If the tariff is set too high, or – importantly – if complying with it is difficult and complicated – then there will be lots more cheating and corruption. A marginal reduction in the tariff then should bring lots of agents back into the white market, and the tax base. Because why? Because operating in the black market imposes all sorts of other costs, including the risk of being murdered by the criminals who usually control such markets.

        Black markets are just competitors to the white market, that are owned by black sovereigns – gangsters. They charge their own sorts of fees, and impose their own set of constraints, rules, penalties, and so forth.

        You didn’t think that the government is the only one selling protection, did you?

        Put another way: if you set your tariff too high, then one of the things that will begin to reduce the revenues it generates is a decrease in legally compliant imports, but another will be a shift of imports from the white to the grey market, and from the grey to the black. Dial down the tariff and you’ll get more revenue as imports move back into the white market.

        But dial it down too far and revenues will start to drop again. Except in the vicinity of the sweet spot, the Laffer Curve slopes steeply.

      • People don’t want to pay the tax-inflated prices for pot, so they purchase illegally imported stuff . . . It it the experience every time a planned economy is attempted. Black markets abound, evading the careful planning of people who think they can by fiat repeal natural economic law.

        People steal pens from work; therefore, corporations owning property is a violation of natural economic law.

      • Kristor wrote:

        “If there is a black market the tax is set too high, and the sovereign is forgoing revenue.”

        That to me has always seemed to be pretty close to a self-evident truth. We see this happen constantly with, for example, the overtaxing in one place or another of such items as tobacco products. And almost always a black market develops in consequence.

        As to the loss of revenue to the sovereign caused by overtaxing an item or items, I know that one way in which the sovereign attempts to recover some of the lost revenue is via law enforcement, fines, confiscation and resale of property and so forth. None of this has ever made very much sense to me, but I wonder, when you boil it all down and when all is said and done, what *percentage of losses to the sovereign are actually recovered* by these means. My guess is barely enough to cover the cost of going after and prosecuting these people. That’s just my guess, but if it’s anywhere close to true, I have to believe recovery of lost revenues is not the primary goal in the first place. Then it occurs to me that overtaxation by the sovereign may be by sinister design and malice aforethought.

        But anyway, does anyone know whether my guess is right or not?

      • Your suspicions are well-founded, Terry. When I was a guide on the Colorado River, we once had five professional gamblers from Vegas on a trip through the Canyon. Really smart guys. I asked them once why prostitution was legal in some counties of Nevada, but not others. They laughed. “It’s illegal in all the counties that the Mob controls.”

        Jail time amounts to a tax of 100% of earnings that might otherwise have been generated during the period of incarceration. It sets the excise tax on criminal activities extremely high. This huge cost of doing business pushes the price of crime way up, by decreasing the quantity supplied. That Increases the price of crime, and that makes crime extremely profitable for those willing to keep supplying it. So the Mob *wants* it’s businesses to be illegal. It *wants* to sell into a black market.

        To keep their preferred markets black, the Mob pays off politicians.

        So, the sovereign is being paid in full. He is in fact enjoying huge economic rents on relatively little business activity.

        It’s just that the sovereign in such cases is not the ostensible ruler, but the hidden oligarchy behind him.

        There is always an oligarchy. The only question is whether it is open and honest, as with an aristocracy, or hidden, insisting that it does not exist, as in the USSR, the USA, and Las Vegas. It is the latter sort that does the really egregious mischief.

        See? It’s right there in the word: mis, ‘bad’ + chief.

      • Kristor, thank you. The appearance of the law must be upheld, especially when it’s being violated, right? 🙂

      • Mr. Hines, a better example of a black market in labor is the virtual takeover of the construction industry in my State and others by illegal immigrants.

        This is a matter of *the government*, not citizens subject to U.S. jurisdiction, “cheating” her own citizens. The government has set the tax too high against her own citizens by virtue of flooding construction and other industries with cheap illegal laborers, and it (the government) obviously has no will nor intention to rectify the situation.

        This set of circumstances has *driven* honest citizens into “cheating” if that is what you want to call it. I personally do not call it that; what I call it is a man doing what he feels he has to do in order to survive and given his situation *he did not create.* Besides, if a man does not owe income tax (as with your example above) when all is said and done, how is he “cheating” anyone by simply choosing not to file?

        I personally know of a few (a very few, but nevertheless) people who choose not to file *in spite of* the fact that they stand to receive a significant tax refund each and every year. They do this because they know the system is polluted and corrupt, and refuse to participate in it on that moral basis. If such people are “cheating” anyone, it is themselves and their own families. They may be participating in a black market of sorts, but there’s nothing immoral about it if that is what the policies of the sovereign have forced them to do, and/or if they reject the sovereign’s rotten carrots in return for their unquestioned obedience.

      • I made no moral judgment at all on black markets; I merely noted that they exist, and are not controlled by tariff on/off switches.

        A note on that: once in existence a black market will not merely disappear as Kristor insists that it will if the tariff is slightly lowered. Somebody has invested in mechanisms to get around the tariff; he will attempt various things to remain in business. And his customers will not have faith at all that the slightly lowered tariff won’t be raised again.

        But to answer your question: Someone working “under the table” is denying funds to SocSec, Medicare, etc. Since the government has only those resources it takes from somebody, somebody else must be taxed more to make up the shortfall. Whether you consider this to be moral, immoral, or amoral is on you. It’s economic fact.

      • … once in existence a black market will not merely disappear as Kristor insists that it will if the tariff is slightly lowered.

        I insisted no such thing. This notion of a digital on/off switch is profoundly unscientific (taking economics as a science); I did not introduce it to this discussion. I suggested only that if there is a black market, then transaction costs in the white market, being high enough to make crime attractive, are by definition too high; so that (not counting bribes) the sovereign is forgoing revenues he might have enjoyed if those costs were lower.

        It is of course true that there is stickiness in markets. No market is perfectly elastic, either as to supply or as to demand. And there are threshold costs associated with transitioning a distribution system from one market to another. This is all pretty obvious. It is also beside the point. The delta we are interested in is marginal, not absolute.

        If the tariff or tax are lowered, or regulation is relaxed a bit, then a few agents will opt for the white market who might otherwise have gone to the black. Lower the transaction costs a bit more, a few more agents will switch. The greater the volume and liquidity and economy on the white market, the more attractive it gets compared to the black. Pretty soon no one wants to buy black market product, because it isn’t reliably branded, isn’t subject to contract enforcement by the state (in case, e.g., of product defects), isn’t vulnerable to the plaintiff’s bar, isn’t subject to internal quality control, there’s no recourse to the manufacturer, etc.

        You’ll probably never eliminate the black market altogether, if only because people are so ornery (this being a feature rather than a bug; orneriness and waywardness are indications that at least a few men push always to find the limits and weaknesses of any social system; and that tends to make society more robust). But that’s OK. Marginal changes can have huge effects even when they are tiny.

        Economics in the real world operates at the margins, almost always. It is almost never all or nothing. For that, you need law, or war.

      • Dave Hines wrote:

        “Someone working “under the table” is denying funds to SocSec, Medicare etc.”

        Quite so. Tell that to the South American and Mexican migrants who have invaded this country; tell it to the multitudes of our fellow citizens who hire them; and tell it to the sovereign who, through its mucked up judicial system, has prevented us from doing anything about any of this. And as I said, holds out rotten carrots for us as a way to appease.

        I’m sorry, but to hell with that!

      • I see. So you’re telling me that you’re not much interested in discerning economic truth, but rather in lashing out at designated targets. You’d prefer coercive attempts even if they are not at all economically feasible and thus merely exacerbate problems instead of solving them. But at least the coercion might send them “to hell”.

        The system didn’t get messed up for no reason at all. It got messed up because politicians and voters operate under the influence of economic delusions.

        Regarding the sovereign preventing “us”* from doing anything about it: well, that’s one of the perqs of being the sovereign, isn’t it? He’s the one who gets to apply the coercion you say you want, but of course in a method of his own design.

        * I’m not at all confident in the fuzzy collectivism inherent in the nebulous “we/us”:
        http://www.renewamerica.com/columns/hines/130609

      • Oh, no, I’m paying attention, but so far Kristor has the better of the two arguments in my estimation.

        By “us” I mean States and local communities like my own who have made worthy attempts at solving the immigration crisis within our own jurisdictions, only to have them shot down by the federal judiciary, or rather gutted of their teeth, on frivolous 14th Amendment Equal Protection and Due Process grounds. But we all know by now that “federal law [automatically] trumps State law,” and “immigration is [exclusively] a federal issue.” Right? Right. Somehow William James comes to mind – absurd, repeat often enough. How’s it go again?

        Btw, I’m curious, what is “economically unfeasible” about solving the immigration crisis? I’m talking about solving it by attrition. What are you talking about?

      • Terry wrote: “Btw, I’m curious, what is ‘economically unfeasible’ about solving the immigration crisis?”

        Terry, there was a discussion about the effects of tariffs. Your “rebuttal” was something about who you wish to send “to hell”. There was no discussion of the economics of attrition. E.g., how much public money would you spend to obtain it? How much liberty would you sacrifice for it?

        Not examined either is how this attrition would dovetail with Kristor’s tariffs. Would a higher tariff, if it benefits American businesses, promote MORE illegal immigration? Would that not increase the cost of attaining attrition?

        No, no economic analysis was forthcoming only “to hell with ’em”. That was not at all a convincing economic argument.

      • To the extent that I understand economics, I’m an economic libertarian – a thoroughgoing free trader. If I understood economics sufficiently, I believe I’d be in the Austrian school.

        Any economic restriction – including tariffs – any restriction on the movement of labor, capital, and goods across political borders, has an adverse economic impact – on everyone. If the Japanese impose a tariff on us, then there is an adverse economic effect on both us and the Japanese. if we retaliate, then our retributive tariff adversely affects both us and the Japanese, economically.

        An adverse economic effect is not by definition good or bad – unlike murder, homosexual activity, theft, and rugby league. It’s simply an adverse economic effect.

        I don’t believe the federal government able to utilize tariffs competently (I, Pencil). I absolutely positively don’t trust the federal government to utilize tariffs honestly.

        H-1B limitations have an adverse economic impact. Immigration restrictions have an adverse economic impact. I certainly support Austerian immigration restriction, despite its adverse economic effect, because it is essential to preserve our culture.

      • Thanks, Roger, these are all excellent points.

        It is true that any tariff is going to have some adverse effects. But it is also true that a tariff of 0% is going to have some adverse effects. That there’s no such thing as a free lunch entails that you suffer a cost even if you don’t eat the lunch. You pay a cost no matter what you do. Cost is conserved (this follows straightforwardly from conservation of mass, momentum, charge, and so forth: value is conserved, and so is information (when entropy increases, information is not destroyed, but rather just masked: the overall information in the world can’t be reduced, only redistributed)).

        Devising policy then is a matter of choosing which schedule of costs and benefits make the most sense. For example, you and I both prefer the costs associated with Austerian immigration restriction, because we don’t like the cultural costs associated with unrestricted immigration. We see our culture as a valuable economic good – i.e., a valuable *moral* good -to be preserved at some reasonable ongoing cost, like any asset. I.e., we see access to our culture as a valuable good that ought not to be sold for less than it is worth.

        Access to markets is analogous. The opportunity to do business in a well-ordered, prosperous and honest market is incredibly valuable. Consider: would you rather try to set up a business in Somalia, or Canada? The question answers itself. Access to such fantastic markets as any of the Western nations ought not to be sold for less than it is worth.

        To sell something for less than it is worth is to create a commons, and to invite an exploitative run upon it, that must end by destroying it.

        I don’t believe the Feds are morally competent to administer tariffs properly. Ditto for taxes, and for all the other things they do. But then, the fact of the matter is that they are now already administering tariffs, taxes, and so forth. They are doing all of it very badly. The suggestion of the post is just that they do it better. Thus the title, which suggests that the proper alternative to a minimum wage (which likewise the Feds are not morally competent to administer) is a reduction in the insanity of current policy. Mostly this is accomplished by a reduction in policy, period full stop. The post is saying, in essence, “here’s how to be a bit more morally competent in the administration of the state.”

        Is it possible for the state to be administered more ethically and rationally than at present? If not, then thinking about political economy is bootless, sound and fury signifying nothing. If so, then it behooves us to think about what sort of policies would be more ethical and rational.

        Our leaders now are engaged in a long term project of farming us while avoiding the appearance that they are doing any such thing. Their oligarchy is disguised, subterfugitive, and so profoundly corrupt. It is essentially dishonest. It is also therefore extremely inefficient. We’d be a lot more prosperous, and so would they, if their oligarchy were honest and above board, and if everyone understood that the oligarchs were in business to maximize their revenues, and properly so. They could then talk amongst themselves frankly, asking, “how can we set things up so that the farms generate the most for us?” The answer: economic rationality.

        Without going into all that, the post cuts right to the sort of tax and tariff policies a rational and straightforwardly profit-seeking oligarchy would then tend to settle on: a flat consumption tax, a flat tariff (let’s throw in flat internal tonlieux), all set to optimize revenue.

        Optimizing a tariff is not hard. All you have to do is keep increasing the tariff marginally until revenues stop increasing. If revenues start to fall, reduce the tariff a bit until they stabilize. If they rise, inch tariffs up a bit until revenues level off.

        Notice that this turns customs into a negative feedback circuit, which has the virtuous knock on effect of damping swings in economic activity. In times of great prosperity, tariffs inch up, damping velocity of trade at the margin. In bad times, tariffs ease off, damping downturns in economic activity. This is accomplished, not because the Customs Bureau is trying to manage the economy the way the Fed now does using the price of money, but because it is simply trying to optimize its own yield from the tariffs. There’s no central planning involved, no command and control of economic activity. No need for the oligarchs to be smarter than the average bear.

      • Terry and Kristor, much thanks for your courtesy. Kristor in particular knows that I feel in over my head when I try contributing to these discussions, but I was hoping that at least some of my points were relevant.

        As a brief aside, I note that Kristor mentioned conservation of momentum. If you’re space crazy like me, then google an experimental propulsion system called the em drive (there’s a very similar system called the cannae drive, but for some reason almost all discussion is about the former). The em drive should violate Newton’s Third, but just maybe possibly perhaps it doesn’t. And if indeed it doesn’t, then we will have access to the solar system – like Buck Rogers – at least by the time of your grandchildren.

        Anyway.

        Kristor said, “(I)t is also true that a tariff of 0% is going to have some adverse effects.” I never would have thought so, but I guess I now see how that might be true. I’d be most interested to hear Mr. Hines weigh in, because I believe that I’m more on his side in this discussion.

        I think it’s terribly unfair that we make the poor contractor who hires illegals perform our police function for us. If we want the illegals gone, we should pay for keeping them out and kicking them out. Not to mention that our contractor can’t win. If he screens for illegals, besides bearing all the costs by himself, he has to pay the higher wages to legal workers, and so gets outcompeted by contractors who take their chances with illegals and hope not to get caught.

        Eisenhower sweeps, and those spartan temporary holding camps previously mentioned here, would resolve our illegal immigration disaster. As for Auschwitz, my father’s sister married an Auschwitz survivor, and I know the difference.

        I oppose consumption taxes, value added taxes, sales taxes, and so forth, because I think they mask the pain that we should be suffering, and much more importantly, the catastrophic damage that we are suffering. I think taxes should feel like they are being extracted through our noses. In Virginia, the car tax is hardly the worst one, but we complain about it the most, because we get the bill, and have to write out the check and send it. The only magic bullet that I think would collapse this whole ghastly socialist superstructure is to abolish withholding, and review everyone to pay right out of pocket.

        How I miss Larry, and View from the Right.

      • Roger: “Kristor said, ‘(I)t is also true that a tariff of 0% is going to have some adverse effects.’ I never would have thought so, but I guess I now see how that might be true.”

        I made the point in a previous comment that if tariffs are so great at so many things why not have tariffs on goods from across the street?

        I do understand Kristor’s point that there are costs for infrastructure in maintaining an attractive marketplace, e.g., reliable courts. But these guys tell us the courts are not at all reliable, so why pay more to shop in this particular market? At any rate, charging what the market will bear for access to one’s market neutralizes any advantages it may have. You end up not with a popular marketplace, but a commonplace one with no advantages over any others, only different advantages and disadvantages.

        I greatly appreciate you making the point that overt taxes are preferable to hidden ones, that disguising the costs leads many people to false perceptions. This is nowhere more egregious than with the inflation tax: “quantitative easing” and all. A surprising number of people are fooled into thinking that money creation is the same as resource creation.

      • Terry, I think that you, Dave, and Kristor are doing an admirable job. I’m following as best I can.

        In that TTH thread, I thought you were a good sport.

      • Roger, thanks again for your contributions here. I have three things to say:

        1. In the flat tax/tariff/tonlieu regime I propose, there would be no need for employers to police who was working for them. The tonlieu – the price of a visa, annually renewable – would mean that anyone with a current visa could legally work. Mr. Hines might respond to this suggestion, rightly, with the point that this could create a black market in fake visas. So it might! But then, the way to control crime is … to control crime. Fake visas are an enforcement problem. Simplest way to smoke out the fakers is a bounty for anyone who reports them.

        2. I can appreciate your argument that taxes ought to be painful. I have made it myself. What is not clear to me is whether a consumption tax would be less painful in practice than the hundreds of taxes we now pay, all of them utterly buried in the prices of goods so that we just can’t tell how great the tax burden is. The great benefit of a consumption tax is that it would appear right there on the receipt for every sale, right under the sales tax. It would be in your face, day in and day out, in a way that the income tax, say, is not (except in the month leading up to April 15).

        On the one hand, this could mean that you would get quickly inured to the consumption tax. On the other, it could mean that you could never quite forget it. But either way it would prompt you to save as much money on consumption expenditures as you could – a great benefit all around.

        3. I miss Larry too, and View from the Right.

      • I’m much more comfortable with lighter matters, like being a jerk to Terry because he’s protecting his daughter. But alas, for me the Laura Wood ship has sailed.

      • Actually, no, Mr. Hines. You misquoted me twice in the same reply. I did not say “to hell with *them*”, I said to hell with *that*. Big difference. To understand what “that” is in context, go back an re-read my comments in question. And by the way, it should actually read “to hell with all of that.” It isn’t *them* I wish to send to hell, but their crazy policies.

        Also, the discussion got into black markets. You spoke of virtual black markets in labor. I responded that (in my opinion) a better example of a black market in labor is the takeover of construction and other industries by illegal immigrants in certain states, and that this is caused by government policies. You wrote, in answer to my query about the morality of not filing income taxes by those who don’t owe them to begin with, that working “under the table” deprives S.S. and Medicare, etc., funding; that it has to be collected from *someone*, and working under the the table places an additional burden on those who work above it. My answer that followed was to stay on point about the “better example” of a black market in labor caused by illegal immigration and the unwillingness of the sovereign to do anything about it.

        How much am I willing to spend to force attrition on illegals? Throw some numbers at me and I’ll tell ya. But very likely a damn sight more than you are, with all due respect. For starters I’m willing to spend every last penny we’re currently spending in social benefits they receive, as well as what we’re spending to house and care for their criminal elements once we imprison them.

        How much liberty am I willing to give up? Well, I take it you are a libertarian. To you “liberty” probably means something very different than it does to someone like myself; my definition of “liberty” includes the exercise of self-government, self-restraint, responsibility. Whereas yours, probably not s’much. That is my guess, but do correct me if I am wrong. What sorts of “liberties” would I need to give up, to your mind, in forcing attrition on illegals?

        Otherwise (concerning illegal immigration) what Roger said.

      • I.m a libertarian, not a libertinarian. I recognize that freedom involves taking personal responsibility, which is why so many people don’t really like freedom.

        Roger indicated that he would be willing to take an economic hit to reduce illegal immigration. That’s a valid answer. He recognizes that there is a price; many don’t. Rather, they see the issue in simplistic terms. They often insist that merely stopping illegal immigration shall solve all problems.

        How can it be a “black market” if it is approved and supported by the sovereign? If you say “to hell with all of that” are you advocating revolution?

        You indicated earlier that you are more or less convinced of Kristor’s case for tariffs. If tariffs are beneficial, then why don’t we permit more of them? Why shouldn’t Ohio place a tariff on goods from other states, and have price discovery on the Ohio market? Heck, why not tariffs between Pittsburgh and Philly? How about intra-city: Compton and Hollywood? There are certainly disparities and externalities involved in that trade. Why wouldn’t these additional tariffs make us a great deal richer?

      • Roger, you and I are largely in the same boat when it comes to economic theory. I flatter myself, however, that I can at least speak fairly intelligently and fluently when it comes to how it all affects the average guy on the ground working under someone or other’s policies.

        In the case of our contractor(s), it always aggravates me that among Tea Party types, for example, the knee-jerk reaction to illegal immigrants invading certain of our industries is to *create more laws* to deal with it. I cannot tell you how many times I’ve been to their functions and have interjected into their conversations pronouncing that “we already have too many laws, and those pertinent to this topic *are not being enforced.*”

        Seriously, if we’re unwilling to enforce already existing laws against hiring illegal workers or whatever, what makes these people think we’re ever going to enforce the new ones? All it will result in is a bunch more laws on the books that will either go unenforced like their predecessors, and/or, new and broader licensing requirements that will most adversly affect honest contractors, but at the end of the day won’t solve a thing.

        Now, I can’t speak to every single area in the country, or even in my state for that matter. What I can speak to in the way of those contractors who have no real qualms with hiring illegal workers is that, as Kristor has pointed out several times in the thread, they are willing to take this chance for two primary reasons: (1) it pays big dividends to themselves, thus making it very appealing, and (2), they don’t fear “being caught” nearly as much as what you assume.

        The people “selling protection,” as Kristor so aptly put it, are such organizations as the Chambers of Commerce, the U.S. government through its judicial system as I mentioned above, and even federal, State and local law enforcement agencies.

        It is the honest contractor for whom hiring illegal workers is unconscionable, who is much more likely to get himself in a bind with the powers that be. The power behind the power, as it were. Kristor knows what I’m talking about. Not sure about Mr. Hines.

      • Terry, there is much her with which I agree. How will new laws help if old ones are not enforced? It’s a very old shell game: Politicians tell us. “If you only give me a little more power and surrender just a little more liberty, I’ll solve your problem.” When it’s not solved the plan is, “Just a little more power, and a little more sacrifice from you. I see the light at the end of the tunnel.” Rinse and repeat ad infinitum.

        You’re correct also about the protection racket. They call it “constituent services”. Of course, some constituents are more equal than others.

        But enforcement and attendant costs is not an holistic solution. We’ve seen it in the so-called “drug war” wherein billions in expenses hasn’t at all stemmed the tide of drugs. One must address the proper root causes.

        In the US that would be the welfare state. Everyone from the destitute to the richest CEO seeks handouts from the government. The latter tend to get more than the former due to their connections, but to a poor Mexican the chitlin’s left over after the .bigwigs make off with the tenderloins is still quite a feast. When the government pays immigrants to buy convenience stores, and to “dream”, what’s not to find attractive?

        The welfare state is essentially taxing us to give part of that money back to us, after extractions by the government middlemen. But voters don’t want to get rid of it because they don’t want to do without their own government cheese, whatever it may be.

      • Mr. Hines, how can it be a black market if the sovereign permits it? So you’re saying cheap illegal “under the table” laborers in construction and service industries *do not* constitute a black market in labor *because* the sovereign turns a blind eye (which is just another way of saying he’s “selling protection”) while upholding the appearance of the law? Hmm.

        By “revolution” I assume you mean more specifically “armed revolution.” No, I’m not in favor of armed revolution. Most of us who frequent this site count ourselves among peaceful counter-revolutionists. So when I say “to hell with all that,” most everyone who reads it knows what I mean. I mean among the regulars. Now you know.

      • Roger, you can be a jerk to me over here. Believe it or not I do realize that someone needs to be a jerk to me now and again to keep me well grounded and on point. Mr. Auster used to set me straight quite alot.

        As I recall, that discussion at TTH went bad because I had failed to divulge relevant information about the “suitor” and his friend that, at first, I thought not important enough to include. That was my mistake. And in hindsight it did come across as “bragging,” as I think it was you who pointed out. Oh well, live and learn.

      • Mr. Hines, …

        Okay, okay, I see more clearly now what you were getting at. The welfare state, of course!, one of my pet peeves. Thank you so much for clarifying!

        Okay, so we agree that more laws is *not* the solution. What, therefore *is* the solution, to your (much more than mine) expert economic opinion/perspective?

        I *really am* paying attention, btw. 🙂

      • One makes the American worker more competitive globally by lowering his cost without lowering his purchasing power. This is done by eliminating all nonessential government expenditures. Each program alone may take only a nickel, or a fraction of a cent, from each worker but in aggregate they add thousands to the cost of employing an American.

        It should be obvious that the consumer pays the taxes of everyone up and down the supply chain. Nobody can work only to pay taxes; each needs something left for food as well as other necessary and desired expenditures. Add taxation, and it must be added to the price of the worker’s product. The consumer therefore pays the taxes of the stock boy, the teamster who delivers the goods, the warehouse foreman, the factory line worker, the CEO…

        Many people think that enormous debt to support a warfare-welfare state is okay, since we’re “borrowing from our grandchildren”. No, we’re not. There is no time machine that can bring resources from the future to the present (at least I very much doubt that DARPA has created such a device). Anything consumed today must be available today. The borrowing by government merely penalizes the ordinary people in favor of preferred entities such as major corporations.

        Forget creating prosperity through government spending. It doesn’t work; though for a time it might appear to work, it merely exacerbates problems and pushes them into the future where they shall be worse for the procrastination in dealing with them. Top-down economic management is not one of the enumerated powers granted to the national government by the Constitution, and for good reason: It creates conflicts of interest to have government in charge of, for example, both impartial justice and profit/loss.

        If you’re to have any government at all some taxation will be necessary. A small tariff is not such a bad way of taxing. Excise taxes made up the other part of the original taxation plan of the Constitution: charges for government fees rendered.

        By reducing the overhead that must be paid to employ an American worker, and/or to buy his products you’ve gone a long way to solve the problem of competition from illegal aliens. The American already has advantages over the foreigner. He’s quite familiar with the language. He knows the culture, and probably the geography. Without the burden of government expenditures he’s pretty darn competitive.

      • Amen, amen. We *say* we don’t have a VAT, but we do indeed have one. We just call it the income tax.

        I would point out that Mr. Hines has here admirably fleshed out much of the fifth, sixth and seventh proposals in the original post.

      • Kristor, as to your last to Roger (I very much miss Larry Auster too, btw), this is a very common anecdote in the sense that most anyone has experienced, in one way or the other, the exact same thing, but nevertheless…

        Once upon a time (not so awfully long ago) I had a serious problem with one of our main vehicles. I’m not an automotive mechanic per se, but my father was very good at instilling in me the principle of “it’s always good to know how to work on your own vehicles when you’re in a bind.” I was in something of a bind, so I (rightly) diagnosed the problem myself. I then called one of the local parts dealers to get a price on the part I would need. They gave me the price and I went to pick up the part, cash in hand.

        When the tally was made at the cash register, the price was significantly higher than that quoted over the phone. When I protested, the attendant proclaimed that the telephone price had been correct, but that “after Uncle Sam added his part” we arrived at the much greater price. I paid the higher price after establishing that he had given me a wrong price over the phone, but used it as a teaching opportunity to instruct everyone present, of which there were … more than a dozen. To wit:

        The tax you added at the end of the sale is a *local* tax called a “sales tax.” The tax you attribute to “Uncle Sam” is already imcluded in the price of the item at the register *before* you hit the sales tax key. This tax amounts to a significant proportion of the cost of the item, again, *before* you added sales tax. I don’t know how you got this wrong over the phone, but it definitely was *not* by ignoring the 9% sales tax.

        I agree! If it’s there in our faces, we’re alot more apt to respond appropriately.

      • I’ll add a third “amen” to that post, Mr. Hines. The overhead expenses are killing us. Would that more people understood that!

    • The article you link gives the following definition:

      “Classical liberalism” is the term used to designate the ideology advocating private property, an unhampered market economy, the rule of law, constitutional guarantees of freedom of religion and of the press, and international peace based on free trade.

      That’ll do for a start. Most of those desiderata are acceptable to a reactionary, provided they are suitably qualified (e.g., you’d need to define “unhampered” carefully). But you run into trouble with freedom of religion (ergo freedom of speech), because its basis is skepticism, with the result that its inevitable eventual sequelae are moral nominalism and cultural dissolution, followed by a breakdown of authority, then political instability. I.e., war. That’s why it is a chimerical notion: there is *always* a state religion, and taxes are *always* going in part to support it. The only question is whether the state religion is true, thus good.

      There is in practice likewise also never freedom of speech. Some sentences, some ideas must be forbidden, or there will be no social constraint on behavior, thus no society. So that notion, too, is chimerical.

      • Thank you, Kristor. I don’t know what “unhampered market” means in that article when I remember that von Mises says that there’s no such thing as the free market. Christopher Ferrara writes, “Ludwig von Mises, the primary intellectual progenitor of Austro-libertarianism explain that the

        imaginary construction of a pure or unhampered market economy assumes that . . . the operation of the market is not obstructed by institutional factors. It assumes that the government . . . abstains from hindering its functioning , and protects it against encroachments on the part of other people . . . [that] the market is free; there is no interference of factors , foreign to the market, with prices, wage rates, and interest rates” (qtd. in Ferrara 12).

        Ferrara, Christopher A. “The Church and the Libertarian: A Defense of the Catholic Church’s Teaching on Man, Economy, and State.” Forest Lake: The Remnant Press, 2010.

        What about religious liberty? Blessed Pope Pius IX condemned it in his Syllabus of Errors when he denied that, “15. Every man is free to embrace and profess that religion which, guided by the light of reason, he shall consider true. — Allocution “Maxima quidem,” June 9, 1862; Damnatio “Multiplices inter,” June 10, 1851. ”

        http://www.papalencyclicals.net/Pius09/p9syll.htm

        In Libertas Praestantissimum, Pope Leo XIII’s encyclical about the nature of liberty, I’ve read that, “20. But, assuredly, of all the duties which man has to fulfill, that, without doubt, is the chiefest and holiest which commands him to worship God with devotion and piety. This follows of necessity from the truth that we are ever in the power of God, are ever guided by His will and providence, and, having come forth from Him, must return to Him. Add to which, no true virtue can exist without religion, for moral virtue is concerned with those things which lead to God as man’s supreme and ultimate good; and therefore religion, which (as St. Thomas says) “performs those actions which are directly and immediately ordained for the divine honor”,(7) rules and tempers all virtues. And if it be asked which of the many conflicting religions it is necessary to adopt, reason and the natural law unhesitatingly tell us to practice that one which God enjoins, and which men can easily recognize by certain exterior notes, whereby Divine Providence has willed that it should be distinguished, because, in a matter of such moment, the most terrible loss would be the consequence of error. Wherefore, when a liberty such as We have described is offered to man, the power is given him to pervert or abandon with impunity the most sacred of duties, and to exchange the unchangeable good for evil; which, as We have said, is no liberty, but its degradation, and the abject submission of the soul to sin.

        21. This kind of liberty, if considered in relation to the State, clearly implies that there is no reason why the State should offer any homage to God, or should desire any public recognition of Him; that no one form of worship is to be preferred to another, but that all stand on an equal footing, no account being taken of the religion of the people, even if they profess the Catholic faith. But, to justify this, it must needs be taken as true that the State has no duties toward God, or that such duties, if they exist, can be abandoned with impunity, both of which assertions are manifestly false. For it cannot be doubted but that, by the will of God, men are united in civil society; whether its component parts be considered; or its form, which implies authority; or the object of its existence; or the abundance of the vast services which it renders to man. God it is who has made man for society, and has placed him in the company of others like himself, so that what was wanting to his nature, and beyond his attainment if left to his own resources, he might obtain by association with others. Wherefore, civil society must acknowledge God as its Founder and Parent, and must obey and reverence His power and authority. Justice therefore forbids, and reason itself forbids, the State to be godless; or to adopt a line of action which would end in godlessness-namely, to treat the various religions (as they call them) alike, and to bestow upon them promiscuously equal rights and privileges. Since, then, the profession of one religion is necessary in the State, that religion must be professed which alone is true, and which can be recognized without difficulty, especially in Catholic States, because the marks of truth are, as it were, engravers upon it. This religion, therefore, the rulers of the State must preserve and protect, if they would provide – as they should do – with prudence and usefulness for the good of the community. For public authority exists for the welfare of those whom it governs; and, although its proximate end is to lead men to the prosperity found in this life, yet, in so doing, it ought not to diminish, but rather to increase, man’s capability of attaining to the supreme good in which his everlasting happiness consists: which never can be attained if religion be disregarded.”

        http://w2.vatican.va/content/leo-xiii/en/encyclicals/documents/hf_l-xiii_enc_20061888_libertas.html

        So it seems to me that, to be comapatible with these papal teachings,Congress would need to delete the Establishment Clause from the U.S. Constitution and make Catholicism the State religion.

      • Thanks, Bill. Tolls, tariffs, transaction taxes, and tonlieux would not hamper the market, because they would fall equally upon all market transactions, and would not therefore distort prices.

      • “So that notion, too, is chimerical.”

        As well as dangerous.

        Hamilton wrote in Federalist #84 concerning the danger involved with adding a Bill of Rights to the federal Constitution. Turns out he was right. But it took a terrible Civil War and the out of thin air doctrine of Incorporation “discovered” decades later “hidden” in the 14th Amendment to get it done. Amazing how simple it is to find such a thing hidden when you’re looking for precisely that, and among men so disposed. We know such men exist, so why make it easy on them?

  16. I need to clarify what I wrote a post ago because popes teach that, although non-Catholics may practice their religions in Catholic countries, Catholicism is the only religion that anyone has a God-given right to practice. We’re not talking about a theocracy, about a society where the Catholic Church or the pope governs. But the Catholic doctrine about Christ’s social kingship tells me that governments should make laws compatible with what the Bible and the Catholic Church teach about morality.

    Now you know why I reject separation of church and state.

  17. Pingback: Owned Government – The Orthosphere

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