State of Reality

Half a week ago Kenneth Green wrote this review of Michael Crichton’s newest book, State of Fear. It’s a good review and it’s a quality book—fast paced and informative. It was also an unexpected libertarian contribution from the man whose books often revolve around the arrogance accompanied with science (The Andromeda Strain), firms (Congo) or both (Jurassic Park, Timeline).

Easily his most political novel, Crichton attacks the theory of global warming, weaving scientific evidence with an all-too-real fictional story about eco-terrorists sabotaging the environment in order to push the global warming doctrine.

I loved this book and I torn through its 600 pages in a couple of days. It’s a fast, informative read (like so much of his other work) and encapsulates libertarian criticisms of politics.

The over-arching lesson of State of Fear is there’s a danger when we politicize science. When politicians become party to scientific theories, there’s a tendency to exaggerate, distort or manufacture the conclusions to perpetuate what the author calls, the state of fear. Reminiscent of Barry Glassner’s The Culture of Fear, Crichton talks of the “politico-legal-media complex” that’s replaced the military-industrial complex of yesteryear. Each of these factions has a genuine incentive to manufacture fear. “Politicians need fear to control the public. Lawyers need dangers to litigate, and make money. The media need scare stories to capture an audience. Together, these three estates are so compelling that they can go about their business even if the scare is totally groundless.” (p456) And of course powerful mechanisms of the political branch are interest groups.

Thus we get bullshit. Environmental interest groups scream global warming is a dangerous threat, DDT causes cancer and the West should regress its society to simpler times. In reality, there’s not a shred of scientific evidence that global warming exists, DDT’s safe enough to eat and “simpler times” is a euphemism for poverty. One of my favorite scenes in the book is when an island native took apart a Hollywood actor for singing the praises of the “old ways.”

Fear mongering is a powerful, self-perpetuating force. Because there’s so much money and power behind the lie of global warming, few people feel safe denouncing it. So many scientists support the theory despite the lack of evidence because those who criticize it are in danger of losing their funding. Crichton points out that all opponents of the theory are retired, and are no longer seeking grants.

Before reading Crichton’s books, I was on the fence when it came to global warming. Everyone said it was happening, but no one seriously challenged it. While scientists screamed it was happening, their data seemed to rely on computer models predicting decades in advance (an astounding feat considering my weatherman can’t forecast the temperature two weeks from now). But I never heard of any contrary evidence until now. Once again, Crichton masterfully joins science fact with engaging storytelling.

Hunting For Freedom

A few days ago my mom told me a story about my uncle Lawrence and my cousin, Bevin. Earlier this month, Lawrence purchased a hunting license and lent it to Bevin. Now Bevin hurt his foot a few months ago and had it wrapped up in a thick cast. Given his temporary impairment, Bevin loaded up in some kind of vehicle (my mom didn’t know) instead of hunting on foot.

Bevin and a friend of his stalked a deer to the edge of their property (yes, Lawrence had to purchase a license to hunt on his own land) and shot it. The animal ran off, stumbled across the property line, and died. As the pair left to dress the deer (leaving their load guns in the car), the game warden came over the hill and pulled the two aside. It seems they just broke four laws.

The warden charged them with: hunting without a license, hunting on another’s property, hunting from a vehicle and letting a loaded gun be unattended. I don’t know how much the total fines were, but you can bet the sum was around four hundred or five hundred dollars.

My uncle Bruce lives in Florida and whenever he comes up to visit, he hunts. When he heard about this story, he thought it was crazy—he’s never encountered a game warden, not once. Why did he show up at this perfect time? It turns out Lawrence was chatting to a friend of his about lending Bevin his license. This friend happened to be the very same game warden that would later issue four fines.

You can’t trust the state. You can’t trust it to let people use their property as they see fit. You can’t it them to let people hunt as they wish. You can’t trust it not to baby-sit the general public, not to punish people for endangering themselves. You can’t trust it look beyond appearances and circumstances—maybe the deer was shot, as in hunted, before it crossed the property line—if it means they can make a little money. Hell, you can’t even trust it enough to tell it a story without being stabbed in the back the moment it becomes convenient. Don't give The Man and inch. Not one.

The Des Moines Consensus

The Des Moines Register’s Editorial Board (DMREB) ran this opinion piece in the Des Moines Register yesterday about the “Ownership Society.” Seems the President is trying to create a country where people, as individuals, possess society’s assets, instead of relying on the government. The theory isn’t new to libertarians—people who own their property manage it better than the government. Vouchers and private health coverage will bring better education and insurance, respectively. I’m hardly one to applaud the Bush administration, but this is certainly a step in the right direction (but he still has a long way to go).

The DMREB article disagrees and, not surprisingly, their arguments are riddled with economic errors and factual suspicions. They say: “Unfortunately, Bush's tax cuts have had the effect of concentrating wealth more, instead of spreading it around.” I don’t really know that they can say that. As I pointed out in “Why Lou Dobbs Is Wrong, Part II,” job growth in the highest income quartile is skyrocketing, exceeding all other quartiles, combined. This may or may not be because of the tax cuts—economics is complicated that way—but there’s no evidence that “concentrating wealth.”

We can double check with economics. The anti-tax cut theory tends to go like this: more money for the rich doesn’t help the economy because the rich spend it on yachts or stocks or whatever and not on things people need. The middle class do—which helps the economy. But as I point out in “The Magic Yacht,” that’s an absurd argument. People build, sell, maintain and design yachts. Some of the revenue from selling stock goes to buy things, which others have to provide. Money in the bank is loaned out to others (that’s how banks make profit) which they use to buy things, which people have to provide. All of these production roles are real jobs, ones based on genuine demand, and pay real incomes, not government hand outs. Money moves and people get richer.

Conversely, the article gives credit to the Democratic opinion, which says, “[t]he best way to build more wealth for more people is to raise wages, so people can afford to save…” As individuals, that’s true. If I want more wealth, the best way to accomplish that is to pay me more. But “more wealth for more people?” Hoover tried that during the Depression by encouraging industry to keep their wages up despite a plummeting demand. Economists call this the purchasing power fallacy: high wages are the key to economic expansion and they can be maintained even if productivity does not increase accordingly. Of course, wages are an expense like anything else and inflating them without reason bars companies from hiring more workers. Thus unemployment increases. High wages are a sign of economic expanse (they go up because productivity goes up) not a cause of it.

If the Hoover logic held, then a nine dollar-an-hour minimum wage would be good for the economy, thus a nine hundred dollar-an-hour minimum wage would be really good for the economy and a ninety thousand dollar-an-hour minimum would be amazing for the economy. Of course, the logic doesn’t hold and creating minimums creates more wealth for fewer people—exactly what the DMREB accuses the Bush administration of doing.

Insourcing

Over the last few weeks, we’ve bounced about the idea of outsourcing, how we think it’s good, but that it has a rather bad reputation in the media. In fact, David even today made a brief allusion to it in his post The Capitalist Media. It occurred to be today that there is another way we outsource, but backwards: we insource. Specifically, I had in mind sports. Whether at the collegiate or professional level sports has it in mind to win and to be the best. But sports managers and coaches have often found the local talent pool lacking. And so we go shopping for talent: the Caribbean for baseball, Canada for hockey, Latin America or Europe for soccer, and so forth.

Myself, I’m not a sports fan. I don’t watch or play, and so I am not in a position to offer much commentary about the economy of sports. My observations are merely antidotal. That said, it seems pretty clear that the player pools in those geographic regions must be particularly adept at playing their respective sport. Maybe some of it is natural predisposition (such as height in basketball), but I suspect that most of it is just specialization. Unlike America, most countries have one or two major national sports. Consequently, the players of a given sport in those countries are likely to be especially skilled and practiced in it. And, because American sports offer them and their families an immensely better life, there is great incentive to perform successfully and break into an American league. By analogy, this does not seem to me much different from outsourcing tech jobs to India, or manufacturing jobs to East Asia. More and more ours is a specialist economy, which brings me to wonder: I wonder whether Lou Dobbs’ housekeeper or nanny has a greencard?

The Capitalist Media

A couple of days ago I picked up How Capitalism Saved America, by Thomas J. DiLorenzo. In the second chapter, DiLorenzo discusses the anticapitalists—particularly intellectuals as the responsible for “secondhand dealers” of neo-mercantilism. Of these secondhand dealers, DiLorenzo pays special attention to the media: they claim the trade deficit means something (it doesn’t), they imply tariffs are good for the economy (they aren’t), they suggest economics is a zero-sum game (it isn’t) and they even outright state that outsourcing is draining away our economy (while it actually enhances it).

From this, DiLorenzo claims the media is “liberal.” Inspired by their Democratic professors, the media echoes their protectionist mantra for the common ear. The accusation of the “liberal media” isn’t new—conservatives have made the same claims for decades using arguments similar to DiLorenzo’s. But such twisted logic doesn’t hold water.

I’ve never believed the spin that the media is a liberal mouthpiece. People change from college to career, probably because they enter the “real world” and face new challenges (like taxes). And DiLorenzo’s argument has inconsistencies. Liberal intellectuals also favor open immigration policies, international involvement and gay marriages. Yet the modern media shouts down immigration as poor economics (which it isn’t), often shrinks international coverage to a minute or less (unless some Americans died) and refuses to put gay marriage in a positive light—neutral studies of that praise gay marriage are crowded out by preachers and conservatives saying it’s evil. (The only time homosexuals are featured in the mass media is in sitcoms, where they function as comic relief.) If the media was truly “liberal,” then these examples would not exist.

So why does the mass media favor protectionism, if it isn’t because of their former professors’ influence? DiLorenzo should know—he wrote it on page 13 of his book, quoting Mises:

Neither the entrepreneurs not the farmers nor the capitalists determine what has
to be produced. The consumers do that.

The consumer is king. That’s what all these distortions have in common: they all are what the people want. The trade arguments resonate with average viewer. The immigration jargon “seems right” to Joe Everyman. Downplaying international news leaves more time for cute stories about local people. Focusing on anti-gay marriage arguments is favored in a country where most of the population doesn’t like gay marriage. All of these distinctions about the media have pithy arguments—arguments than can easily be captured in a sound bite. The mass media panders to the masses, not to their former professors.

The Banning of Fascism

In light of Prince Harry’s run-in with a swastika, German officials are readying to widen the ban of the Nazi symbol to include all of Europe. Now like most people with a shred of morality, I don’t like Nazis, fascism or oppression. But I were a European, I’d be afraid of the ban, not the symbol.

Setting aside the fact that for all intents and purposes the Nazi party is in position to rise up again, banning the symbol, continent-wide or not, isn’t in the spirit of freedom and open communication. Wolfgang Bosbach, deputy president of the Christian Union Party, said the main justification for the main is to protect the feelings of Holocaust survivors. That’s a nice idea and if there weren’t any unintended consequences of it, I’d almost be on his side (almost because I don’t think people’s freedom of expression—no matter how tasteless—should be curtailed simply because it makes other people feel bad.

So what are some of the unintended consequences? Like so many popular symbols, the swastika is simple one—it can be drawn with just two lines. This simplicity makes it easily reproducible by the masses and easily identified. But that simplicity embodies widespread adaptation, even if it is unintended.

Under the ban, governments could have the power to control people if citizens happen to doodle a sketch, build a machine part, construct a floor plan, forge a sculpture or design a panel that, in whole or in part, happens to resemble a swastika. Is such a case likely to happen? I don’t know—I can’t predict the future. But I do know that banning any symbol isn’t beneficial for the public discourse, no matter how much it makes people feel good about themselves. Banning swastikas doesn’t stop Nazis but it does take a tiny step down the long road of control and oppression.

Double Speak, or “No” Speak

I tried to watch Meet the Press today. Every few weeks, I give it another shot, thinking that this is supposed to be America’s most respected Sunday morning weekly round-up. This is where the great newsmakers of our time are supposed to come before the American people and speak for themselves, rather than having their words filtered through journalists and newsrooms and editors and redactors. It’s supposed to be A time of candor and openness (to the degree possible with government officials), a chance to rid ourselves of quotes taken out of context. This is not what Meet the Press is.

In “1984” life is based upon “double speak.” You say one thing, but mean another. Nothing one says can be trusted or relied upon, and whatever the government says at that moment, regardless of what it may have said in the past, is now and has always been the truth and the only position it has ever taken. Naturally we regard this kind of thing with a great deal of trepidation, and so we are very critical of “flip floppers” in our society. And thankfully, we do not generally have double speak on Meet the Press either.

Instead, we have “no speak.” This is where the highest ranking and most politically powerful and influential people in the country sit for an hour and say, in many words, absolutely nothing. This has turned into quite an art.

Question (Russert): Does the president think that private savings accounts will save social security?

Answer (Bartlett): The president will work with Congress.

Answer (Bartlett): The president is willing to spend political capital.

Answer (Bartlett): We aren’t going to have this debate with ourselves, we’re going to work with Congress.

How many ways can you say absolutely nothing? Why bother going on the show at all? Why not stay at home in the Bush White House and get some work done, because you aren’t doing or saying much about anything on the show. It has become the policy of public officials of all kinds to say nothing about anything. Don’t comment about anything, don’t say anything, don’t reveal what you actually think about anything, don’t give an opinion, don’t contribute to the public debate (whatever that is), even if you have a position. Read only the authorized party-approved cue cards and pre-screened, pre-vetted, pre-focus-grouped sound bites. Keep your answers to under 15 seconds, and for God’s sake, don’t “say” anything.

And why not? You have jerk-off journalists like Tim Russert who don’t ask hard questions, or for that matter, do any journalism. And when he does ask a question that might seem to be masquerading as a tough question, it’s a “gotcha” question – the kind where you take a quote from 15 years ago out of context and say “you said this, do you think this.” Answer: I don’t remember making that specific comment, but I can tell you that we are working with Congress on it.”

In the face of all this, it may turn out that in another 20 years that the only reliable journalism will come from the paparazzi – at least they still dig.

Revisiting Wal-Mart, et al.

Riding along with my mother past Wheeling today, we noticed from the highway where they have broken ground for the construction of a new Lowe’s Home Improvement Warehouse. And she immediately began to complain about this monstrosity coming into the outskirts of the downtown, surely to drive out what little small business remains there. Now, what you should know is that there is another recently constructed Lowe’s not 10 minutes drive from this location. Knowing this, I suggested that instead they should have built a Super Wal-Mart since there are none of those for some distance around Wheeling. This threw my mother into what can only be called a “tizzy.”

She denounced Wal-Mart as a corporation that doesn’t pay its workers a living wage, does not provide benefits, etc. Now these are half-truths, but they are not entirely false, either. That said, I tried to explain to my mom the basic economics upon which Wal-Mart operates as a volume discounter, the lack of margin, and so on. I pointed out that the workers she is talking about are nothing by (not that I mean to make light of their livelihoods) cashiers and stock boys, and that this is perhaps not the level of employment that would justify such salary and benefit. And I attempted to explain how Wal-Mart’s clientele are largely working poor and lower-middle class folk who are most greatly benefited from the lower prices Wal-Mart offers – and that these folks typically include the Wal-Mart employees themselves. Mom actually agreed with all of that, more or less, if grudgingly.

But then she stumbled onto the real problem. You see, the City of Wheeling and the County of Ohio, are investing millions of tax dollars to develop this site so that we can beg Lowe’s (or anyone else) to come in and pay petty $6/hour jobs, and only on a 7-year contract at that. That’s not to mention the tax incentives they’re offering in the form of discounts and exemptions. You see, the worry is that Lowe’s will come in, drive out the competition, realize there isn’t enough business to justify two Lowe’s in 10 miles, and then close, leaving what’s left of the downtown industrial quarter absolutely destitute. And I think she’s on to something there.

You see Lowe’s likely wouldn’t build a second facility so close to another one if it had to foot the bill. But since the kindly citizens and businessmen of Wheeling are footing the development bill, and all Lowe’s has to do is plop down a giant cinderblock box, hey why not. And if it doesn’t make a go, the city is contractually obligated to buy it after the seven years. Lowe’s just moves the inventory, and that’s that. Wheeling, on the other hand, is even further behind than when they started, with all the levy debt, and no revenue either from Lowe’s or from their former employees.

Now, I’m all for corporate America. But this kind of collusion is bad for everyone. It encourages bad business practices by alleviating companies of the risks associated with doing business. It’s bad for the city, because that site will either have to be sold (a building that big, to whom?) or re-developed at even greater expense. And it’s bad for taxpayers for sooo many reasons.

It’s not just Lowe’s, by the way. Wal-Mart, Home Depot, Cabellas, and so on are all subject to the same criticism. For my mom’s sake, I think that we would do well to occasionally qualify our pro-business remarks so that people realize that we are speaking of business in purist terms; that in the real world, it doesn’t always go off like that, and that we are ready and willing to be critical of a business that uses the state to pervert the market.

A Tsunami of Disease

A couple of days ago, CBS issued this report about malaria in the tsunami disaster area. According to the report, malaria could easily double the death toll and possibly increase it by 150 percent—more than an addition 100,000 dead.

Fighting this bout of malaria, however, is proving to be the hardest in recorded history. The sheer size of the rising epidemic isn’t helped by the limited options.

According to the report, “The classic malaria prevention approach of distributing pesticide-impregnated bed nets to communities will not be part of the effort to protect the local population because there is a world shortage of nets, they are bulky to transport if they are available and, in an emergency situation, it's difficult to teach the people how to use them properly, [Richard] Allan, [director of the Mentor Institute,] said.”

Though fumigators will spray homes with pesticide, there’s little chance DDT—the most efficient killer of mosquitoes—will be used, thanks to the near global ban on the chemical (which is based on unfounded claims). If this is truly the rising epidemic the experts are saying it is, then why isn’t the best weapon for this war being flown in? Perhaps people should read more.

The Origin of R&D

Today I started Evan I. Schwartz’s page-turning historical account of the invention of the television: The Last Lone Inventor: A Tale of Genius, Deceit, and the Birth of Television. I can tell you that it’s a solid read as I’m over 160 pages into it and I’m a slow reader. But between this work and Diamond’s Guns Germs and Steel, the economics of invention have been weighing heavily on my mind. Their words are driving me to conclude a take on innovation that they would surely describe as heartless, while I call it hopeful.

Diamond and Schwartz have similar views of technology. In GGS, Diamond points out that most inventions were created by tinkers—people who were merely curious about the world around them. Technological advancement isn’t generated by necessity, as the saying goes; it’s generated by inquisitive people in a free society.

The invention of television offers a powerful example: Philo Farnsworth was a curious genius, determined to make this new wonder. As Diamond would surely point out, Farnsworth was driven by intellectual obsession, not a lust for profit. Schwartz uses Farnsworth as a romantic symbol to drive home a point: in the 20s and 30s, heartless, greedy companies crowded out “lone inventors” and forced them to extinction. “Corporations now saw scientists, engineers, and inventors as property whose minds could be systematically milked for their ideas.” (p167)

Schwartz implies the culture of creativity was taken from the people and transplanted (and sterilized) to the corporation. The overall tone of the work embodies a definite hatred of large companies. Diamond seems to think along the same lines: the heartless pursuit of profit isn’t needed for invention; impassioned individuals can do a fine job.

Now there’s a lot of merit to what each these authors are saying. Freedom is the cornerstone to innovation for it allows new and radical ideas to be tested and tried. I wouldn’t be surprised if more major inventions were created by the passionate than the profit-seeking. I wouldn’t be taken aback if I discovered firms made inventing seem less wondrous because a scientist was now concerned about deadlines, company brass and corporate culture. But I would argue that this is a good and inevitable thing.

Schwartz describes Farnsworth as “the last lone inventor.” There’re two was that can be wrong, depending on how you define as “lone.” If we take “lone” to mean the main source of intellect behind an invention, than Farnsworth wasn’t the last one. From Mr. Popeil to the hundreds of independent computer enthusiasts of the 60s and 70s all invented things on their own. If we add just one more person (technically not “lone” but still a cultural and physical departure from some kind of corporate technology factory), we would have to include the Steves who created the first personal computer in their garage.

The other way to take “lone” reveals an interesting way to think about technology. Let’s define a “lone inventor” as an independent individual who created a new device solely with the tools available to society at large. If I go to Radio Shack and build a new robot from parts I got at the store, I’m a lone inventor. If I need my friend Ben to make a special part, I’m not a lone inventor because I needed someone else to help. Again, Farnsworth was not a “lone inventor.” He enlisted a local geologist to help discover the right coating for screen interior. His brother-in-law, Cliff, blew the special glass tubes. Cliff had to learn the art from a local glass blower. The “lone inventor” had half a dozen lab assistants. Farnsworth was not alone.

Increasingly, this is the story of modern inventions. Because modern inventions are really new combinations of existing technology, melding these components often requires unique parts (invention is rarely a matter of putting together a big jigsaw puzzle). Creating these parts require specialized knowledge and because a single person can only know so much, getting all this knowledge requires more people. As technology becomes more advanced, more knowledge (and thus more people) is needed. This is why the invention of the wheel would’ve required just one person, but inventing the television and modern car required several.

The more people that are needed, the less likely a single “tinker” can get the job done. Sure, she may be able to pull together the needed knowledge from family and friends but as technology advances, finding those people and getting them to set aside the time to make that special thing becomes harder and harder. The increasing difficulty to invent makes it less likely an inventor/hobbyist will create in his spare time, “just for fun.”

But the corporation acts as a coordination mechanism by offering incentives (salaries) for specialists to gather and collaborate. And because inventing is paired with a steady paycheck, creators have the time to go through the difficult process of creating, instead of doing it in their spare time. But to generate the revenue for paychecks, companies and inventors must seek the most promising avenue of profit. Necessity becomes the mother of invention once more.

Of course, not all inventions require this institutional framework. Independent inventors will always exist. But it will be harder and harder to invent as it requires more knowledge and time to pull it off. The possibility that our society will see another Edison—another that creates hundreds of revolutionary inventions—is highly unlikely. Surely that person would have to command a breadth and depth of science they would rival the collective knowledge of our greatest universities. More likely, the future holds a communal pursuit of knowledge, one built on liberty and competition, where the brightest minds are attracted from all over the world. Racial, gender, ethnic and religious barriers are torn away so that the best minds can work together for a better tomorrow. And, oh yes, for lots and lots of money.