Monday, July 22, 2013

Detroit. An Economics Lesson on How Not to Do It.

Over at The Market Ticker, Karl Denninger has a primer on how not to run a government.

If you increase tax rates then you decrease economic surplus.  This inevitably slows economic expansion; it mathematically must.

If you make political promises that can only be met through increased tax rates, now or in the future, you begin the process of slitting your own throat.  That outcome is inevitable when you agree to political promises that have escalating expenses over time as pensions, medical benefits, salary "step" increases, bond issues that have a payment schedule longer than the useful life of the asset bought and similar.

This is a must read article.

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Sunday, July 21, 2013

Bill Whittle Has More on False Narratives and Yellow Journalism

In his latest Afterburner video Bill Whittle unpacks the Martin/Zimmerman case with further examples of yellow journalism, outright false reporting, omission of key facts, etc. Anyone who relied on the MSM to follow the case could very well come away thinking that last week’s not-guilty verdict was not the right one. Watch this video and then ask yourself if you think you are being well-served by the MSM or whether you are being manipulated and deceived..

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Race Baiting and Lies in America–Some Perspective from Michael Yon

Former Green Beret turned freelance combat journalist and author Michael Yon points out that 17-year olds are not “children.” Yet a false narrative is being presented in the MSM and by certain professional race-baiters that Trayvon Martin was just some innocent young child who was gunned down in cold blood by a racist wannabe-cop, George Zimmerman. Based on the evidence presented at Zimmerman’s trial for second-degree murder a jury concluded otherwise. There was a lot more evidence that was not presented at trial that would tend to support the verdict even more strongly.

Michael had a similar experience as a newly qualified 19 year-old Green Beret when a man tried to assault him in a bar and Michael, who believed he was fighting for his life, the man had threatened to kill him, intercepted and countered the man’s first and only punch. Michael punched back and, so he thought, knocked the man out. In fact the man died and Michael faced a 6-month ordeal, replete with much of the same yellow journalism we are seeing today before being cleared.

Please do click through and read the whole thing. Whether you thought the Zimmerman verdict was just or not, you’ll learn something.

(full disclosure, I have met Michael Yon in person, once, and consider him a friend)

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Saturday, July 20, 2013

Megan McArdle Is Back (Again), Now at Bloomberg

If you aren’t reading Megan McArdle every day, you are really missing out on some very thought-provoking writing in the areas of business and economics. I have been following her writing since she was blogging from a trailer at the bottom of Ground Zero where she was working for a disaster recovery firm. She progressed from there to The Economist, The Atlantic, The Daily Beast and now here.

For just one example of her insightful writing, look at this post on minimum wage jobs, “McDonalds Jobs are Drive-Thru, Not Dead End.” An excerpt:

Even if it were possible to mandate that everyone in the country make almost the median income, this would come with a cost; I’d guess that most economists would agree that such a hike in the minimum wage would cause fairly significant job losses. The direct cost of labor at an average McDonald's is about 25 percent of payroll, according to, and of course, everything else they buy also has a substantial labor component. If everything at McDonald's cost, say, 30 percent more, they would sell fewer burgers and need fewer staff.

The real question no one has actually answered is whether every job should pay you enough to live on your own, or whether it’s OK for there to be jobs that are mostly a temporary arrangement, a waypoint en route to somewhere else. It doesn’t strike me as obviously wrong for those jobs to exist -- especially when the alternative may be no jobs at all. Even if I did think it was wrong, I’m not sure what I’d do about it. You can make McDonald's pay people more per hour. You cannot keep McDonald's from cutting those hours.

Read the whole thing.

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