patrick.net

I take Caltrain and I do not have to "interact" with fellow rage-filled road users. ;-)

We have to take our car to the train station though. Buses are so unreliable.

People should really pay the real price of driving.

I read the wikipedia entry on the Hong Kong property tax and don't get it exactly. Sounds like it's just a tax on rents, which I guess is similar, but not the same.

A tax on rents is limited by the rent people pay, and would not stop a bubble.

A tax on land values is not limited by rents, and would stop a bubble through high taxes.

Very interesting...

It seems prosperity follows when the majority of the population aspire to prosperity as opposed to economic equalization.

When prosperity does arrive, all "justifications" for economic equalization become null and void.

I guess Adam Smith was right:

“The real tragedy of the poor is the poverty of their aspirations”

Patrick, I don't know... but whatever it is, they cannot stop the housing bubble in Hong Kong.

But of course all "good" bubbles must come to an end.

Tell me the horrors of FDR’s world?

Very high tax rate. Social Security. Need I say more?

FDR bankrupted this country with his New Deal. We are going to see more and more of the effects.

The prosperity after WW2 was great. Let's review the facts again after all the Baby Boomers have retired.

(Was the prosperity a mirage? Or was it a natural result of the demographic hump? What will happen when there are not enough workers to support the system?)

Europe has even more social programs, and they are seeing more ill effects earlier.

I know I will not be productive if I get fed anyway and I cannot get rich by being productive.

I define "Superpower" as a nation who can win a war that ends all wars.

Ronald Reagan's SDI (real or not) could have been the tipping point of the Soviet collapse.

Peter P says

Information technology (not telecommunication) is one of the least regulated industries yet in the last 20 years we have been seeing a lot of
1. large, established companies being unseated
2. small, garage-type start-ups becoming giants (e.g. Google)
On the other hand, telecommunication is heavily regulated. See what LARGE corporations are still running the show!
Have faith in Nature. Things take care of themselves.

Well, actually IT jobs are the #1 positions being offshored right now so I dont necessarily see a lack of regulation as being complimentary. At the root of this is NAFTA, GATT and WTO....these programs favor wages 40 times less in India, Mexico etc.

Fair trade is needed, and that involves tax incentives and some regulation.

YES, I am a FAIR trader.

4X, we are living in interesting times...

Perhaps we can use this SDI-derived technology at home now:

http://www.youtube.com/watch?v=wSIWpFPkYrk

National Debt is not a simple number. There is also the hidden "debt" of generational shifts. If you see the nation as a business, the future loss of earning power would be a lot worse than the accumulation of debt. There is no denying that taxation reduces productivity.

Also, do not forget that US owes debt in its own currency.

Do not trust simple statistics.

Remember:

There are lies, damned lies, and statistics.

Another example, retirements for the commoners.

Regular people are not supposed to have decades of retirement from work. When we get to the wrong side of the demographic hump, we will see much turmoil from people's misplaced expectation of retiring at 65 and the reality.

Who is going to pay for all that?

With all due respect, I have yet to see you post ANY statistic on ANYTHING.

I did:

There are lies, damned lies, and statistics. :-)

I also asserted that national debt is not necessarily a measure of solvency, in the post gold standard era. Future assets (productivity) vs. liabilities (entitlements) is arguably a better measure.

Because Ronald Reagan blew up the tariffs and quotas and opened our borders to 3rd world competition.

That was simply an unavoidable consequence of globalization, another unavoidable consequence of history. To keep productivity here, we need to lower corporate tax rate (which is one of the highest in the world), eliminate minimum wage (a cause of inflation and unemployment), and relax certain regulations.

I heard that a golf manufacturer needs to outsource the manufacturing of titanium parts to China because of environmental regulations here.

There isn’t a German Bill Gates or Warren Buffett, but everyone has health care and everyone retires at age 67.

I don't know... but I am sure US has a higher number of private aircraft per capita than Germany. :-)

Remember that you need not be everyone. Why should you care about that mythical "everyone"?

I used to like Star Trek but now I think the idealistic future it portrays is nothing short of naive. I think the Firefly future is more likely. Brace.

Statistics and data (and the insistence of using nothing but numbers and mathematical models) led to the great crash of 2008. Common sense would have easily prevented that.

Numbers are just what they are - meaningless factoid without adequate interpretation.

Economics was invented to make Astrology look respectable. (I do believe in Astrology.)

Yet when things are up for interpretation, they are up for manipulation. It is useless to argue with statistics because each side can always find numbers that favor his position.

It is what it is. Buy it or not. :-)

There are many explanations to the trade deficit, like there are many variables in a equation.

Blaming it on Reagan is no better than me blaming all the ills on FDR.

At least Reagan gave us a tax cut.

It has been a great discussion. Thanks!

One may want to note that balance of trade is becoming less important with global investment.

US persons may well be holding stocks of companies exporting good to the US. With equities representing a large share of household wealth, balance of trade may not be painting the correct picture about the flow of wealth.

Kevin says

For that matter, if a coal company is dumping slurry into my drinking water, how will the free market stop it?

Uh, free markets don't have morals. That is why the founding fathers gave us a free market with a few protections on life, liberty and property.

We need private property laws that protect owners from damage by polluters. Pollution is like vandalism.

Private property laws are what is needed. Not a vast bureaucracy.

Private property laws are what is needed. Not a vast bureaucracy.

Exactly. I believe the primary function of a government is to protect the private properties of its people. (I consider life the property of a person.)

When a society begins to respect private properties (and not soft moralism), there will be liberty.

I think any sound meta-ethical system should center around properties and freedom.

It is not entirely accurate to say that free markets do not have morals, because we ought to define morality as the proper functioning of a free market.

Kevin, why don't you start a _legal_ "defense and reconstruction" company? ;-)

Perhaps you will really make billions.

I don't know... We have had three of the very best presidents since Jimmy Carter.

I actually like Bill Clinton.

The entire New Deal should be thrown out and replaced with something more reasonable.

I agree a social safety-net is sensible, but it should be just that, not a breeding ground for the welfare dependent.

Profit should be worshiped because that very aspiration will make us great.

But why should we trust the unions to monopolize the labor force?

Anyone who truly believes in Anti-trust should also believe in union-busting.

Bap33 says

freedom to suceed and freedom to fail.

Bap--don't you see a correlation between poverty and crime? All these "failures" as you call them. Where do you see them sleeping? You think things are bad in your city now, imagine what it would look like with no social services...

Unregulated capitalism is all the freedom you can afford, and not one drop more.

Related to my studying of The Irvine Company, I was doing some reading on LA history and found a funny story about one of the great capitalists of the day, Phineas Banning, who dredged the Port of LA and established a local transportation nexus from it. Then SPRR came through and took it all, making Banning an agent of the company.

Glibertarians forget that there is always a bigger fish in the sea that will take what is theirs eventually, that is the law of one-dollar one-vote. I prefer one-man one-vote, since the masses are more easily placated than the robber barons.

I prefer one-man one-vote, since the masses are more easily placated than the robber barons.

Unregulated democracy is the tyranny of the majority. In any human society, the majority of the people are losers. Why would you want to rest your future on losers?

Why won't you prefer a system in which there is a chance for you to become a winner?

The average IQ of a person is 100, but the IQ of the mass is 0.

I don't know about you, but I rather have a chance to be successful, or die trying, than a guarantee to be mediocre.

But my highly educated German peers would tell you point blank that the system of massive taxes (50% for single young workers) actually limits social mobility.

It's my general understanding that massive taxes mainly serve to limit real estate prices (and rents).

Germany didn't experience a big bubble this go through, right?

Why won’t you prefer a system in which there is a chance for you to become a winner?

Rawl's "Veil of Ignorance" moral argument, basically.

http://en.wikipedia.org/wiki/Veil_of_ignorance

AdHominem says

Uh, free markets don’t have morals. That is why the founding fathers gave us a free market with a few protections on life, liberty and property.
We need private property laws that protect owners from damage by polluters. Pollution is like vandalism.
Private property laws are what is needed. Not a vast bureaucracy.

I can't privately own the drinking supply, because I can't privately own all the ground water, rivers, lakes, etc.

So, what's going to stop them?

Oh, that's right -- NOTHING. Nothing did stop them, and that's why we had to create institutions like the EPA in the first place.

Unless I have the right to defend myself against the person who is poisoning my drinking water (that is to say, the right to stop them, by force if necessary), I do not have "freedom".

But, please, spend some time in a country that allows such unfettered capitalism. Let me know how that works out for you!

I can’t privately own the drinking supply, because I can’t privately own all the ground water, rivers, lakes, etc.

I'd take this a step further. The 19th century robber barons succeeded in conflating capital with natural resources, creating the intellectual cover for wealth to own and profit from mere "ownership" of the natural universe and not the active employment of entrepreneurial or capital management skills.

Commerce may not be a zero sum game, but ownership of natural resources, including land, sure is.

I consider myself a left-libertarian and would like to think a "geolibertarian" social order (where wealth cannot profitably concentrate in ownership of land and natural resources) might have a chance of working in the real world. Straight-up status-quo libertarianism . . . it is to laugh.

20 years ago when I first started thinking about this stuff I mused "those greedy capitalists would buy all the oxygen in the atmosphere if they could!" but lacked the intellectual framework to separate ownership of capital (saved wealth and the produced means of production) vs. ownership in Land.

It was only discovering Henry George when things fell into place.

http://homepage.ntlworld.com/janusg/coe/!index.htm

Kev,

Your argument is that government failed to protect private property therefore we need bigger government. Nice.

Or that "criminals who disregard gun laws have guns so we should have more gun control".

AdHominem says

Kev,
Your argument is that government failed to protect private property therefore we need bigger government. Nice.

I think Kevin is attempting to make the point that in a truly free market we would see rampant corruption, therefore the need for regulation is a necessary one.

Corruption is the ill of an ineffective big government. In a truly free market, it is logically impossible to have corruption.

Obviously, we need a government to defend Free Market against its many enemies: such as thieves, murderers, and, social engineers.

Let me repeat, Free Market is incorruptible because it has no will. It is always fair and effective, though cruel and merciless, just like Nature.

I just find it amusing that frequently those who put absolute faith on Evolution are also those who absolutely reject Darwinism.

Troy says: It’s my general understanding that massive taxes mainly serve to limit real estate prices (and rents). Germany didn’t experience a big bubble this go through, right?

House prices in Germany were very high outside of Stuttgart. Not Bay Area prices, but maybe 2x the American median (and I would consider it a median area in Germany). They seem to spend a lot on rent, but food and public transportation are cheap. People get a subsidy to have kids, and taxes are lower for families.

For lovers of unions though, their Workers Councils are pretty surprising. They ratify promotions, lateral job moves, and can even dispute who gets the axe in bad times. If people think employers can be unfair or petty, wait until your career path is controlled by your peers. It's a huge culture shock for Americans who take assignments there.

hey Peter, great point.

Thanks Bap!

I can already see the downfall of humanity. Perverting the survival of the fittest is the most intellectual way to bring about our extinction.

but first, we need legalized dope and french kissing married dudes on primetime.

Peter P says

Let me repeat, Free Market is incorruptible because it has no will. It is always fair and effective, though cruel and merciless, just like Nature

The problem is that there are several conditions that must be met in order to have a true free market. And the US doesn't meet them, so that's why we need government to help fight corruption.

Are you saying that it’s impossible to dupe shareholders in a free market system?

I am saying that shareholders should take full responsibilities in a free market system. If investors are conditioned to behave less like sheep perhaps they can learn to protect themselves.

If someone voluntarily buys a stock, he better not moan about being duped no matter what happens. The stock market had existed and operated long before any regulatory body. There have always been winners and losers. No one can change that.

One can quote data and statistics all he wants but there exist no objective truth. It always comes down to the world with that person being an observer. Nothing beats common sense and our Evolution-honed intuition. :-)