Min. Wage creates Poverty

March 7, 2016

In this new, excellent study from the Fraser Institute, Robert Murphy, Charles Lammam, and Hugh MacIntyre explore the employment consequences of minimum wages, especially as these play out in Canada.  Here’s a slice from the Executive Summary:

There is an enormous body of empirical research examining the e ects of the minimum wage. Canadian studies are considered of higher quality than US studies because (among other reasons) there is a wider variability in the provincial Canadian minimum-wage variable. Canadian literature generally finds that a 10% increase in the minimum wage reduces employment among teens and young adults (ages 15 to 24) by 3% to 6%. By making it harder for low-skilled workers to obtain an entry-level position, the minimum wage may perversely hinder the development of human capital and harm the long-term career prospects of the very people it ostensibly helps. Indeed, Canadian researchers have found that hiking the minimum wage has no statistically significant impact on poverty and in some cases can increase it.

Here’s a very brief video that accompanies this study.

And this cartoon perfectly captures the essence of the minimum wage and the chief fallacy that surrounds it.

The minimum wage is indeed a cartoonish policy that appeals to economically immature minds (and to those who greedily prey upon the economically immature).

A Shipload of Ignorance

March 4, 2016
This is circulating, meme-like, on Facebook.  Apparently it’s a big hit with people who are enchanted by Donald Trump.

Screen Shot 2016-03-03 at 3.50.03 PM

What to say?  An economist friend describes it as “a distillation of economic ignorance into pure form.”


It’s much like Trump himself: the very image of economic ignorance.

Trump is doing now from the political right what Paul Krugman has done so successfully over the past decade and a half from the political left, which is the following: boisterously assuring people that their untutored instincts about the economy are indeed accurate – telling people that what they immediately see in economic affairs and policies is all that there is to see in economic affairs and policies (that is, that there is no ‘unseen’ whose reality can be perceived and understood only by looking beyond that which is immediately obvious).


According to this bastardized, pandering version of economics, actual consumable goods (such as are pictured here) are reckoned to be costs (and not a benefit), while toil is reckoned to be a benefit (and not a cost).

In their ignorance, they believe the economic problem is not rooted in scarcity, it is rooted in abundance, that the problem is we are getting too much good stuff!

Social benefactors, therefore, are those who promise to deny to us the fruits of the economy’s abundance (along with, by the way, our economic freedoms) as they bestow upon us ever-greater scarcity that will bless us with the need for more toil.

The photo shown here is, in short, itself an intellectual cargo ship loaded down with countless tons of economic ignorance.

Modern World Part Two

February 23, 2016

I’m struck that many people do not understand that most of our modern wealth is the ‘summation’ of many small innovations, any one of which is not very significant.  One poster, for example, suggested that the absence of reggae music or any particular art form would not really be missed by many people today.  That poster is correct on the narrow point but incorrect on the larger point: we would all miss the accumulated and combined ‘small’ products of modernity.

Relatively few of our modern advances are so singularly momentous that their introduction alone creates a noticeable impact on our lifestyles.  These “relatively few” large-impact innovations that have occurred since 1916 include antibiotics (that’s probably at the top of the list), harnessing the electromagnetic spectrum for purposes of communication, jet propulsion for aircraft, Norman Borlaug’s green revolution, the microprocessor, and the Internet.

Note, though, some of the things that are not on this list – for example, the automobile, the telephone, and harnessed electricity.  These things existed before 1916, yet they were only just then becoming widely available.  Yet they were made widely available only by a series of relatively small innovations – some in the hard sciences, some in industrial organization and logistics, some in management techniques, some in finance.  Take away any one of these ‘small’ advances and the world is not noticeably a poorer place; take away many of these advances and the resulting impoverishment is palpable.  Put differently, the widespread availability of these (and other) ‘big’ visible things itself requires a whole host of ‘small’ unnoticed innovations and advances, very few of which are individually vital, but which, when taken together, are indispensable.

The bulk of our modern prosperity, it seems to me, is the product of – or can be dissected into – small advances that are easily dismissed by careless thinkers as contemptible.  (‘Who needs reggae?!’  ‘So what if Wal-Mart shaved a few fractions of a cent off of the cost of offering for sale each dollar’s worth of athletic socks, living-room lamps, and toasters?!’)  Remove a drop of water from the ocean and the effect is unnoticeable.  But keep removing drops of water.  Eventually the ocean will run dry.  Our prosperity poolwould be a poverty hole.

Look around your home, Mr. or Ms. Ordinary American of 2016.  Observe.  Do you see those paper towels in your kitchen?  While techniques for making paper have been known for centuries, the familiar roll of household paper towels first appeared in 1931.  And guess what?  If neither Arthur Scott nor anyone after him had ever had the creative idea that resulted in disposable paper towels – if today our world as we know it would be as we know it save for being without rolls of paper towels – we would not be much poorer than we actually are.  The reduction in our prosperity that would occur were we suddenly to be stripped of our paper towels would register hardly at all in our psyches and would register not at all in any official statistics.

Ditto for those fresh blueberries that you, in your home, ate this February morning at breakfast.  Ditto for the plastic, protective bag that covered the newspaper that you fetched this morning off of your driveway.  Ditto for the ten-percent that you saved on the price of the jeans that you’re wearing because Wal-Mart arranged improved logistics for handling its inventory.  (By the way, even if you didn’t buy your jeans from Wal-Mart, Wal-Mart’s lower prices on jeans pushed down – through competition – the price that you paid for your jeans.)  Ditto for the improved audio of your television.  Ditto for the four different varieties of sausage now in your freezer – packages of sausage sitting on a freezer shelf just below that box of pretty-darn-tasty frozen samosas.  Ditto for the draw-string embedded within your odor-resistant and surprisingly strong plastic kitchen garbage bag.  Ditto for the plastic (that is, not glass) bottle of shampoo in your shower, avoiding cutting your foot badly on a piece of glass from a glass bottle of shampoo that broke in the shower.)  Ditto for the easy-to-start engines on your snowblower and lawnmower.  Ditto for the wi-fi that you’re probably using now – you having forgotten that, in the not-too-distant past, to be on-line required a literal line of wires.

Ditto for the increasingly familiar Keurig pod and the machine that turns its contents into coffee.

Ditto for nearly all of it.

Ours is a world of marvels.

And nothing about these marvels is more marvelous than the fact that these marvels are so familiar and inexpensive and available to hoi polloi that intellectual fashion practically commands us – particularly us oh-so-perceptive intellectuals – to ridicule these marvels as contemptible baubles.

The Modern World

February 22, 2016



The invention of the steam engine (which used coal and wood at first, with oil and natural gas coming later) seems to be the catalyst for change in the human race. Now that’s a hockey stick we can all get behind!

Wikipedia has a similar graph:


Data extracted from Angus Maddison’s “World Population, GDP and Per Capita GDP, 1-2003 AD

And then there’s this one, going all the way back to 500 B.C.


Source: Victor V. Claar, “The Urgency of Poverty and the Hope of Genuinely Fair Trade,”Journal of Markets & Morality 16, no. 1 (Spring 2013): 274. GDP figures from J. Bradford DeLong, “Estimates of World GDP, One Million B.C.—Present.”

From the article:

This chart demonstrates just how real this “mountainous rise of well-being” has been over the last two centuries. What makes these economic gains even more astounding is that there has been a simultaneous population explosion. There are many more “capita” included in the “per capita” as the chart moves to the right, yet we still see enormous gains in per-capita GDP. As the economistDeidre McCloskey puts it,

Never had such a thing happened. Count it in your head: eight and half times more actual food and clothing and housing and education and travel and books for the average human being—even though there were six times more of them.

Yet a Barna Group survey released this past April found that most Americans remain unaware of these economic gains: “more than eight in 10 Americans (84%) are unaware global poverty has reduced so drastically. More than two-thirds (67%) say they thought global poverty was on the rise over the past three decades.” Both the reality of global poverty (1.2 billion people remain in extreme poverty) and the public perception of poverty’s pervasiveness and intractability deserve increased attention.

That downward blip around 1300 was likely due to the Great Famine of 1315:

The Great Famine of 1315–1317 (occasionally dated 1315–1322) was the first of a series of large scale crises that struck Northern Europe early in the fourteenth century. Places affected include continental Europe (extending east to Russia and south to Italy) as well as Great Britain. It caused millions of deaths over an extended number of years and marks a clear end to anearlier period of growth and prosperity between the eleventh to thirteenth centuries.

The Great Famine started with bad weather in spring 1315. Universal crop failures lasted through 1316 until the summer harvest in 1317, and Europe did not fully recover until 1322. The period was marked by extreme levels of crime, disease, mass death, and even cannibalism and infanticide. The crisis had consequences for the Church, state, European society, and for future calamities to follow in the fourteenth century.

Note that is was cold and rain, not excess warmth that caused this:

Between the early 14th and late 19th centuries, a period of cooling known as the Little Ice Age chilled the planet. Europe bore the brunt of its ill effects, experiencing harsh and fickle weather for several centuries and especially from 1560 to 1660. Scientists continue to debate the cause and timeline of the cold spell, which has been blamed for catastrophes ranging from droughts and famines to wars and epidemics. According to the latest study, described by an international team in this week’s Geophysical Research Letters, volcanic eruptions just before the year 1300 triggered the expansion of Arctic sea ice, setting off a chain reaction that lowered temperatures worldwide.

The Medieval Warm Period, lasting from about 950 to 1250, can also be seen on the graph. At around 1000 A.D., GDP peaked, then fell when weather turned cold and wet..

Then, the steam engine was invented, access to powerful yet inexpensive energy began, the industrial revolution took off, and the world never looked back.

The next time somebody tells you how terrible things are today, primarily due to fossil fuels, show them this graph and ask them if they’d like to go back to the sort of conditions then.

End of Copyright and other Nonsense

February 22, 2016
Repost of a great article by Gary North

Goodbye, Copyright. Farewell, Tenured Guilds.

Gary North – February 15, 2016

Remnant Review

Copyright law is in its terminal phase. I have known this for over 20 years. The Internet is killing it.

I am going to discuss a remarkable example of a website that today has 48 million stolen scientific articles online. It is beyond the ability of anybody to control. It is outside of copyright protection, despite the fact that academic journals want to defend their turf. There is no legal way for them to do this.

Before I explain what has happened, I want to take you back to 1994.


John Perry Barlow used to be a songwriter for the Grateful Dead. He is also a digital technician. In 1994, he wrote an article for the printed version of Wired magazine, because that was the only way we could buy the magazine. It was published in March 1994, eight months before the release of the original graphic internet browser, Netscape.

Barlow’s article was on the high cost of enforcing copyright in the digital age. The article is still online. Anybody who is interested in the issues of copyright law ought to read it.

It began with a quote from Thomas Jefferson:

“If nature has made any one thing less susceptible than all others of exclusive property, it is the action of the thinking power called an idea, which an individual may exclusively possess as long as he keeps it to himself; but the moment it is divulged, it forces itself into the possession of everyone, and the receiver cannot dispossess himself of it. Its peculiar character, too, is that no one possesses the less, because every other possesses the whole of it. He who receives an idea from me, receives instruction himself without lessening mine; as he who lights his taper at mine, receives light without darkening me. That ideas should freely spread from one to another over the globe, for the moral and mutual instruction of man, and improvement of his condition, seems to have been peculiarly and benevolently designed by nature, when she made them, like fire, expansible over all space, without lessening their density at any point, and like the air in which we breathe, move, and have our physical being, incapable of confinement or exclusive appropriation. Inventions then cannot, in nature, be a subject of property.”

From the beginning of copyright law in the early 17th century, when England licensed the printing of Bibles by Oxford and Cambridge — academic guild centers — copyright law could only be enforced in the way that it is possible for governments to to control the sale of liquor: by controlling the sale of bottles. Governments controlled publishing by controlling paper, ink, and especially printing presses. In other words, they controlled the bottles. But, in the Internet age, Barlow wrote, it is no longer possible to protect the liquid, meaning digits, by means of limiting access to the bottles, meaning printing presses and bookstores. I remembered this argument for over 20 years. It was a graphic argument, which is what a good debater uses to drive home a point. I searched the article for “bottle,” and I got this:

In other words, the bottle was protected, not the wine.Now, as information enters cyberspace, the native home of Mind, these bottles are vanishing. With the advent of digitization, it is now possible to replace all previous information storage forms with one metabottle: complex and highly liquid patterns of ones and zeros.

Even the physical/digital bottles to which we’ve become accustomed — floppy disks, CD-ROMs, and other discrete, shrink-wrappable bit-packages — will disappear as all computers jack-in to the global Net. While the Internet may never include every CPU on the planet, it is more than doubling every year and can be expected to become the principal medium of information conveyance, and perhaps eventually, the only one.

Once that has happened, all the goods of the Information Age — all of the expressions once contained in books or film strips or newsletters — will exist either as pure thought or something very much like thought: voltage conditions darting around the Net at the speed of light, in conditions that one might behold in effect, as glowing pixels or transmitted sounds, but never touch or claim to “own” in the old sense of the word.

This was published eight months before the arrival of the graphic internet browser, which produced the vast expansion of the World Wide Web.

I now invoke that most ancient of economic laws: the law of demand. “When the price falls, more is demanded.” The price keeps falling. Bandwidth keeps getting cheaper. Search engines keep getting more powerful. Copyright laws are now effectively dead for all except best-selling authors and their publishers. It is not economically possible to defend copyright any longer.


A member of this site posted a question regarding copyright law. He had come across a unique website, which claims to have 48 million scientific articles posted on the site. The site is www.sci-hub.io.

I began a brief investigation of the site. First, I wanted to know what the URL designation .io stands for. Here, I got an education. It is a country, but one that I had never heard of before: British Indian Ocean Territory. In the 1960’s, the British government stole a group of about 1000 islands that are located in between Madagascar and India. The most famous one is Diego Garcia. I had heard of that island. The United States government has a major military base on Diego Garcia.

The British expelled the residents of these islands. There is a Wikipedia entry on this island nation:https://en.wikipedia.org/wiki/British_Indian_Ocean_Territory. But this is more to the point:

Located in the Indian Ocean, the British Indian Ocean Territory is an archipelago south of India, about halfway between Africa and Indonesia. This area includes the entire Chagos Archipelago of 55 islands. The combined area of these islands is 21,004 square miles, about one third the size of Washington D.C. Currently there are no indigenous habitats on these islands. In the 1960’s and 70’s, approximately 1,200 former agricultural workers in the Chagos Archipelago were relocated to Mauritius and the Seychelles. In November 2000 they were granted the right of return by a British High Court ruling. However, this ruling was overturned in 2008, finding no right for the natives to return. By November 2004, approximately 4,000 United Kingdom and United States military personnel and civilian contractors were living on the island of Diego Garcia in a joint naval support facility.

So, the national judicial entity is based on theft. Historically, lots of nations are based on theft. Probably most entities are based on theft. But, because this was recent, is more obviously a product of the power of empire.

Second, I read this:

.IO has become one of hottest domain name extensions for startups. This is a little peculiar, since .IO has existed since 1997 and was originally assigned as the ccTLD for British Indian Ocean Territory. So, why are startups turning to .IO?With .IO, startups can get short and memorable names, because .IO has great availability. A .IO domain name can be a better option than coming up with a long and confusing domain name that uses a more established extension (or buying expensive premium domains). To put it simply, .IO’s are an easy way to get a great domain for a great price, and .IO has a handful of other defining benefits.

So, here we have a unique legal entity. The original owners were thrown out by the British. The main occupiers are now employees of the United States government. Because of the World Wide Web, people from all over the world are setting up domain names inside the jurisdiction this strange legal entity. It has no court system. It has no lawyers. Nobody lives there who runs one of the sites. Unless the organization that controls the issuing of domain names somehow shuts down a particular website, anybody can post just about anything.

I predicted over a decade ago that this would begin. I said that copyright was basically doomed, because of the multiplication of the number of island nations. As nation-states begin to break apart, there will be a multiplication of these small nations, especially island nations. I wrote years ago that because Web servers can be set up on these islands, an island that decides not to honor copyright is going to be in a unique position to sell domain name server space.

This is probably the best example that I have seen of domain immunity from lawsuits. I don’t know how legal ownership is established in a separate island nation run by the British. For a lawsuit to be successful, it has to be able to get support from some legal entity that possesses legal sovereignty. This is going to prove to be a problem.

What about the website itself? What kind of traffic does it have? I checked Alexa.com. This site is rated a little above number 13,000 in the world — out of a billion sites. That means it is an incredibly popular site. The main visitors come from the following nations, no one of which is above 12%: China, Iran, Brazil, India, and Russia.

The site was first set up in 2011 with a .org domain extension. It switched to .io last November after a lawsuit was filed against it. Yet it has gone from no traffic to a 13,000 Alexa ranking in about four months.

I have been unable to find anything about copyright law in this judicial entity. There are couple of references, but they are effectively dead. There is no information.

Next, I went to Wikipedia to see what there is on the website. I found that there is a lawsuit against the site by a technical publishing organization, but the lawsuit seems to be going nowhere. That is understandable; judicially speaking, there is nowhere to go. Wikipedia reports:

The site is currently involved in a legal case with Elsevier: Elsevier et al. v. Sci-Hub et al. Elsevier claims that Sci-Hub illegally accesses accounts of students and academic institutions to provide free access to articles through their platform ScienceDirect. The case is complicated by the fact that the site is hosted in St. Petersburg, Russia, making it difficult to target within the US legal system. Some question Elsevier’s motives behind its simultaneous attempt to partner with Wikipedia to disseminate their paywalled papers. A similar case is also being run against the site Library Genesis (LibGen), which may be based in the Netherlands or possibly Russia as well. Despite seizure of the websites as ordered by a New York district court on October 28, 2015, the site is still accessible through alternative domains as of December 2015. The site is also accessible through the Tor network.Alexandra Elbakyan has cited the UN Declaration of Human Rights “to share in scientific advancement and its benefits.” The Electronic Frontier Foundation has expressed support for Sci-Hub and its sister site LibGen. The lawsuit has prompted widespread criticism of Elsevier.

This is almost a poster child example of what I described over a decade ago.

I did a spoof on copyright protection almost exactly three years ago:http://www.garynorth.com/public/10623.cfm.


Late in 2015, I wrote an article about Matt Drudge’s fear that the U.S. government will someday shut down his site by making it illegal for him to post links to articles. I said that this is unlikely. I concluded:

The bureaucrats still extend their power, but bureaucrats really only want to get paid for as little work as they can get away with. The federal bureaucracy is gigantic, but generally it is impotent to change much. It cannot force major changes in the economy or anywhere else. Even the bureaucracies war against each other for funding and jurisdiction. There is no unanimity within the federal government. There are, quite frankly, multiple bureaucratic ghettos. We used to call them fiefdoms.The Supreme Court can do little to roll back the spread of rival opinions. A court decision may be able to take out Drudge. That would be too bad. But the government can always wipe out any individual. The government can simply prosecute until the person runs out of money. (In Drudge’s case, that would be a long time.) So, the Court may actually do something that will inhibit Drudge. But I still don’t see what the Court is going to do about him. Drudge can write his own headlines. Drudge’s site has enormous traffic. How can the Court take away this traffic?

Drudge is the symbol of what the Internet meant for the establishment: trouble. In 1998, he exposed the Emperor as having no clothes.

The Emperor still doesn’t have many clothes.

The government can pass any laws it can get through Congress — fewer and fewer. The Supreme Court can make all the rulings it wants. It is way too late. The genie is long out of the bottle. There is no way that any national government can put a cork back in the digital bottle. The decentralization inherent in the World Wide Web is going to accelerate. Decentralization has only just begun to disrupt the near-unanimity and near-secrecy required for modern governments to impose their will on citizens. We are in the early phases of the loss of legitimacy for civil governments around the world.

I don’t see how the owners of Facebook can do anything to stop this. I don’t think the owners of YouTube and Google can do anything about it. They make money with the spread of ghettos. They rake in the money. The more the ghettos multiply, the more money they rake in. This cannot be reversed. This will not be reversed. There is just too much money in it.

As I have written repeatedly, the Balkanization that is being produced by the Internet is destroying the gatekeepers and the establishments of the world. This is a tremendous benefit for liberty. The gatekeepers don’t like it, but they can do little about it.

With respect to copyright, I don’t think it has much of a future. As the number of national jurisdictions multiplies, as it will inevitably do, the ability of copyright defenders to defend their copyrights is going to disintegrate. The example of the Sci-Hub website is indicative. A lawsuit threatened to get its .org domain revoked, but within days, it had a new URL. It barely missed a beat. In fact, it got larger. You can see this on the Alexa site. The traffic jumped incredibly in a matter of days.

To be ranked on Alexa at about 13,000, and earning this position from November until February, is unheard of. I have literally never heard of anything like this. It means that the people bringing the lawsuit are going to lose the lawsuit. Even if they win the lawsuit, they’re going to be facing another version of this website in some other obscure national sovereignty within hours. We can be sure that traffic will follow this website. We have already seen this. It did no good for the people bringing the lawsuit to bring the lawsuit. It is expensive, and it is not going to get anywhere. They can bring a lawsuit inside the United States, but there is no way to enforce it. In any case, people in the United States hardly visit the site. It is being visited by people in China, Brazil, Russia, India, and Iran. Its market is exactly what the founders of the site say it is supposed to be, namely, scientists in Third World countries who cannot afford to buy the expensive articles at $30 apiece. So, they are going to get the articles for free.

I don’t think there is anything that scientific publishers can do to stop this. That is why I concluded over a decade ago that copyright protection is headed for extinction.

It may be possible to protect copyright for best-selling novels, videos, and other high-traffic items. I don’t know how, but it may be possible. The owners of these assets can afford to bring lawsuits. But the owners of almost all other digital assets cannot possibly afford to defend their property in courts. The courts are not set up to deal with millions of lawsuits. In any case, the courts don’t have any jurisdiction outside a specific geographical territory, and the World Wide Web does not respect these judicial territories.

The spread of information is unstoppable now. Copyright law is the product of government intervention, and it is no longer possible for the vast majority of people who think they have copyright protection to buy the protection they need inside any court system. Laws are irrelevant if they cannot be enforced. If there is no sovereign entity to enforce the law, and if there is no court system that is capable of enforcing a law, then it isn’t a law. It is simply a hope and a prayer on the part of people who cannot possibly defend what they say they own.


Academic journals and scientific journals cannot defend themselves today. When 48 million articles can be posted by an outfit that operates legally inside the jurisdiction of a stolen nation, and yet in fact operates out of Russia, there is no way for academic publications to defend their ownership. Those days are gone. They are never coming back.

These publications exist primarily for professors who are trying to establish temporal priority in discoveries. Very few of these discoveries will result in products that can be patented. These articles are mostly about gaining tenure or government research grants. They are mostly about being able to prove chronologically that the authors discovered something first, and therefore they can either get tenure get or government grants.

To get tenure, your article must be published in a peer-reviewed journal. Peer review is how academic guilds maintain control over the definition of what constitutes an acceptable idea or discovery within the guild. These guilds are always controlled by government, either directly or indirectly. This is the nature of guilds. They have to be enforced by government bureaucrats. In academia, the main form of enforcement is licensure of the words “college” and “university.” The system is maintained by means of accreditation, followed by government enforcement of trademarks established by the two words, university and college.

With respect to scientific discoveries, the only one that matters is chronology. If you can prove that you came up with the discovery first, you get the credit for it. This is now the sword of Damocles hanging above the heads of everybody in a guild that is protected by peer review. It takes months to get an article through a committee of fellow scholars.

Today, if somebody comes up with an idea, he had better get that online and time-stamped by the end of the day. This way, he can defend his priority. This way, somebody else will not be able to say that he made the discovery. This means that the peer review process is going to collapse. That is because the peer review process takes so long to implement by means of printed materials, or digital materials posted online. Somebody else can beat another researcher to the punch by posting his discovery online. From that point on, anybody else is simply “me, too.” Everybody else is “also ran.” Everybody else is “close, but no cigar.”

The peer review process is a process of guild control, and the guild is always defended by some government agency. You have to get your article approved by your peers in order to have an article that is considered academically respectable. But for somebody who is establishing priority with respect to an invention, the lawyer’s phrase is in fact central: “Time is of the essence.”

Prof. Dork may decide to use the discoveries of a team full of low-paid graduate assistants in order to establish priority for his discovery. But the good professor may be beaten to the punch by one of the graduate students. The graduate student can go online and post a discovery. Then Prof. Dork is an also ran.

The control of ideas by guilds that are supported by government intervention is coming to an end. These guilds are associations of gatekeepers. But the Internet is destroying the economic power of the guilds.


There is no international government that can defend copyright. The more nations there are in which you can set up a domain name, the less control over copyright there is. There is going to be a multiplication of nations. There is not going to be a worldwide government. Copyright is not going to be enforceable except in rare cases where a great deal of money is on the line. In academic matters, there is not a great deal of money on the line.

This means that the fruits of scientific research are not going to be in any way retarded by copyright protection. We know that now. Anyway, scientists in China, Iran, Russia, Brazil, and India know this. That is why this pirate site has an Alexa rating higher than 13,000.

The spread of information is now incredibly rapid. There is no way for governments to stop this. Thomas Jefferson saw this day over two centuries ago. Think of how much fun he would have had with the Internet. He would not have bankrupted himself by buying endless quantities of books. All he would have needed was a laser printer.

That is all anybody needs today.

Government out of control

February 9, 2016

EPA Seeks to Prohibit Conversion of Vehicles Into Racecars


This is what happens when bureaucracy runs out of things to do, they up the ante, completely unaware of how ridiculous they look or how pointless the idea is.

Top 5 Economic Fallacies

February 9, 2016

What is the most ridiculous economic fallacy that is believed by a significant number of professional economists?

Wow.  Good question.  There are many such fallacies, and it’s difficult to rank-order them according to their ridiculousness.  My list and rank-ordering, of course, reflects my own understanding of economics (which is Austrian) and my subjective assessment of ridiculousness.  But this question is fun, so here’s a list of five:

(5) the idea that government-subsidized health care will lower the cost of health care;

(4) the notion that government must have monopoly control over the money supply in order to ensure sound performance of the economy;

(3) the belief that large differences among people in monetary incomes or monetary wealth reflect some market failure that ought to be ‘addressed’ by the state;

(2) the blind faith that government officials in democratic societies can be trusted to exercise power over people who economists do not trust to make choices for themselves;

(1) the notion that the minimum wage is, or can practically be, a boon to all low-skilled workers.

Each of these notions reflects not only an ignorance of history but also an utter failure to grasp basic price theory

Keynes vs Hayek

February 9, 2016

A comment by Josef Šíma, president of CEVRO Institute, Prague neatly explained the difference between Keynesian and Hayekian economic thinking.

People often consider economic knowledge to be utterly theoretical with no direct practical implication for current economic policies. Can we somehow see the importance of the mainstream/mainline distinction when debating economic crises (such as the recent financial crisis) or current regulatory policies?

I will be brief after having gone on so long in the first answer, but ultimately the answer is unequivocally YES. The relevance of the distinction comes up in the most general terms about as I said above the veracity with which one believes the claims about the self-regulating properties of the private property market economy. But it gets even more detailed in debates such as that between “spenders” versus “savers” in the recovery phase of an economic downturn, as well as to whether the “cause” of the downturn is some “aggregate demand failure” or due to “price distortions” brought on by the manipulation of money and credit and impediments to smooth market adjustments to the previous pattern of errors. It was Adam Smith who warned about the consequences of the “juggling tricks” that governments – ancient as well as modern – rely on and that juggling trick is deficit finance resulting in accumulated public debt which in turn is ‘paid off’ through debasement of the currency. If the juggling gets out of hand, Smith warned, it is an economy killer. This is what economists believed from Adam Smith to F. A. Hayek and James Buchanan. The advice was straight forward – STOP THE JUGGLING. Keynes changed that, and his advice – LEARN TO BE A MASTER JUGGLER.

Cotton Candy

February 3, 2016
I’ve often been accused of viewing ordinary people with contempt. It causes me to ask: What could possibly give an obviously intelligent person that notion?
I think I have the answer – one that goes further than my previous replies.
The answer is that I am very critical of the opinions that most non-economists (and many economists) express about economics and economic matters.
It’s true that I do hold in very low regard – in, indeed, contempt – the “economics” expressed by many non-economists and by the politicians and pundits who cater to economic ignorance.
But this fact does not mean that I regard these people to be stupid or unable individually to tend properly and prudently to each of their own individual affairs.
I criticize such people in the same way that, I’m sure, an experienced engineer would criticize people who, seeking a way to allow motorists to get back and forth across the Mississippi river, propose to build a bridge made only of cotton candy. And just as the engineer would no doubt amplify the volume of his protests if the clamoring for such a cotton-candy bridge grew loud and began to display a real prospect for being taken seriously, I amplify the volume of my protests when similarly fanciful and unscientific notions – such as making us wealthier with tariffs or with minimum wages or by wealth redistribution – grow loud and display a real prospect for being taken seriously.
It is ungenerous – or, certainly, erroneous – to accuse someone who is an expert in X of thinking that those who know nothing of X, yet who express opinions about X, are contemptible. These expressed opinions about X are typically mistaken, and in many cases even contemptible. They are contemptible because such erroneous opinions directly threaten the freedom of everyone so subject to these opinions.
They become a public nuisance when politicians secure power by professing to share these mistaken opinions. It is, therefore, appropriate for someone who knows better to explain that those opinions are flawed. And if those opinions continue to be stubbornly held in ways that threaten to generate outcomes quite the opposite of the outcomes expected by those who profess those mistaken opinions, it is appropriate for a knowledgeable person to amplify his or her reasons for rejecting those opinions.
But, surely, just as no one would think the engineer to be arrogant or haughty if he continues to explain why a cotton-candy bridge will not support automobile traffic, no one should think the economist to be arrogant or haughty if he continues to explain why, say, tariffs do not create jobs or raise wages generally, or why the minimum wage will reduce low-skilled workers’ employment options. Yet no more should it be inferred from the economist’s protests that he views ordinary people with contempt than it should be inferred from the engineer’s protest that he views ordinary people with contempt.

BF now an IPCC Expert Reviewer

December 16, 2011
I applied to become an expert reviewer for the IPCC's next assessment report, 
specifically for Chapter 9 on Climate Modeling.

Here is my Letter:

Dear [Black Flag],

The IPCC Working Group I (WGI) Co-Chairs are pleased to announce the
Expert Review of the First Order Draft (FOD) of the WGI contribution
to the IPCC Fifth Assessment Report Climate Change 2013: The Physical
Science Basis (AR5) and invite you to serve as an Expert Reviewer. An
invitation letter is available from
and may be accessed using your individual username and password:

User name: [Black Flag email]
Password: ********

This username and password pair is personalized for you and may not
be shared. Your username and password will be required to access the
WGI AR5 FOD Chapters and to submit a review. The drafts, review form,
and additional supporting material are available from the WGI AR5 FOD
Expert Review website:


Expert Reviewers are kindly reminded that all materials provided from
this website are available for the sole purpose of the Expert Review
and may not be cited, quoted, or distributed.

The WGI AR5 Expert Review of the FOD will run from 16 December 2011
to 10 February 2012. All comments must be submitted through the above
website by the close of the Expert Review on 10 February 2012. 

Thank you in advance for providing a review of the WGI AR5 FOD.

Best regards,
on behalf of the WGI Co-Chairs

Intergovernmental Panel on Climate Change
Working Group I Technical Support Unit - IT   wg1-it@ipcc.unibe.ch
University of Bern                           ph:  +41 31 631 56 18
Zaehringerstrasse 25                         fx:  +41 31 631 56 15
3012 Bern, Switzerland                           www.ipcc.unibe.ch


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