Jim Ulvog

Tidbit to remember next time someone says the private sector deserves 100% of the blame for the financial crisis.

The Wall Street Journal editorial on 1-28 evaluated The Bernanke Legacy. (cross-post from my other blog, Outrun Change.)

In dividing his tenure into three parts, before/ during/  after the financial meltdown, they provide a good assessment of the during phase. An evaluation of the after phase will have to see how the Fed unwinds the gazillions of dollars of quantitative easing.

On the before phase the assessment places much blame for the housing bubble on the Fed in general and Mr. Bernanke in particular. Their comment: (more…)

By Jim Ulvog, ago

What strange, mysterious, magical force is loose that increased US production of both oil and gas by one-third in six years?

Is it targeted federal subsidies?  Breakthrough law from the Congress?  Socialist industrial policy?  Keynesian monetary policy?  Blockbuster documentary from Hollywood that changed minds across the country?  More support for college loans? A landmark special on network TV? Quantitative Easing?

No. It’s none of those things.

Barron’s is pondering the question as well:  The Secret of U.S. Energy Success.

Federal subsidies have produced a substantial increase in some things. The editorial provides a partial list. Subsidies have given us…

..our national surpluses of grain, milk, unemployment, nonprofit companies, disabilities, and mortgage debt.

Those subsidies didn’t produce the massive increase in oil production in Bakken and Eagle Ford.

The best paragraph from the editorial: (more…)

By Jim Ulvog, ago

More examples of unintended consequences

Five more examples of unintended consequences.  The problem? People don’t always do what you tell them. They often do something totally different from what you expected. (Cross-posted from my other blog, Nonprofit Update.)

Cracked describes 5 Laws That Made Senses on Paper (And Disasters in Reality). (Caution, some naughty words.) These examples are from government.  My three favorites are how to:

  • increase number of guns on the street
  • increase number of cobras on the loose
  • increase pollution from cars

Gun buybacks increase number of guns on the street. (more…)

By Jim Ulvog, ago

3 of the common myths about capitalism

  • Pro-capitalism = pro-business
  • Capitalism generates unfair distribution of income
  • Capitalism is responsible for the financial crisis and great recession

Not true. Those three (false) myths disposed of in this video:

[youtube=http://www.youtube.com/watch?feature=player_embedded&v=KGPa5Ob-5Ps]

 

That is from Professor Jeff Miron from Harvard.

A few highlights from the video:

(more…)

By Jim Ulvog, ago

Crony Capitalism is the reason we won’t find any incandescent bulbs on the shelves

As of the start of 2013, it is illegal to manufacture or import 40- and 60-watt incandescent light bulbs in the U.S.  Last year the 75-watt bulbs were gone and the 100-watt the year before. The last of the smaller bulbs will be off the shelf.

Then you will only be able to buy more expensive bulbs that may or may not last a lot longer.

Why?

It isn’t to improve efficiency or save consumers money. That’s the excuse.

Blame crony capitalism. The ban is courtesy of businesses seeking favors from the government and the government happily granting said favors.

(more…)

By Jim Ulvog, ago

Is it moral for an economic system to make life better for billions of people?

The answer is yes, according to Walter Williams, who says Profit Has Improved The Human Condition.

Of course, he explains when compared to heaven or a utopia where unicorns romp freely and all the food you want magically appears on your table every day, capitalism falls short. When compared to every other economic system on earth, it does wonders.

Apart from billions of people being lifted out of grinding poverty, let’s examine other changes relatively recent in our human history, like how it becomes possible to gather wealth. Mr. Williams says: (more…)

By Jim Ulvog, ago

Graph to illustrate Thatcher’s comment that socialists want the poor poorer provided the rich were less rich – Part 2

Previously mentioned a graph that illustrates the idea that socialists

would rather the poor were poorer provided the rich were less rich.

Here is a revised graph:

inequality graph 2

This is a much busier graph. Like the earlier graph, it is from Dave Poling and is used with his permission. Here are a thousand words to describe his graph.

It shows the same relationships –

In a generation, the poor become as well off as the middle were a generation earlier. The middle gains a lot and is as well off as the rich a generation earlier. And yes, the rich become really rich.

Under socialism, the rich, middle, and poor all get worse off.

An addition to this graph is the government and cronies. I call the latter group the crony capitalists, those companies and individuals who make their business thrive by lobbying the government and getting special treatment. They do quite nicely under socialism, thank you very much.

Since there is so much going on here, let’s look at the graphs in more detail.

(more…)

By Jim Ulvog, ago