08 Dec 2009

The Benefits of Procrastination: The Economics of Geo-Engineering

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I don’t think this EconLib article will get me on Joe Romm’s Christmas card list. An excerpt:

Many critics of geo-engineering overlook an important fact: there is a gain from procrastination. In some of their expositions, they argue, implicitly and sometimes explicitly, that because humans will eventually have to reduce greenhouse-gas emissions anyway, we might as well do the adult thing and start the painful adjustment today. But this ignores the principle that a “quick fix” can allow the deferment of solving a particular problem, lowering the total cost of the long-run solution.

Although procrastination is often a sign of immaturity, in the context of climate change it may not be. In the typical debate over geo-engineering, proponents argue that it is “the” solution to global warming, while the critics worry about all the things that could go wrong. Yet this “geo-engineering: yes or no?” debate overlooks the important possibility that the most economically efficient outcome involves the postponement of carbon-abatement strategies, along with the simultaneous research and development of varied geo-engineering techniques to be deployed if they should become necessary. Back-of-the-envelope calculations suggest that this strategy could leave our descendants many trillions of dollars richer than the alternative of implementing immediate and large cuts in emissions.

07 Dec 2009

Why Are We So Sure CRU Was Hacked?

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Correct me if I’m wrong, but isn’t the main reason we are “sure” that the CRU emails and code were hacked that…the CRU people told us that’s what happened? (Well that, and the fact that everyone for two weeks has been referring to them as “hacked” and/or “stolen” emails?)

Check out this news story in the UK Telegraph (HT2 a Crook):

[IPCC head] Mr Pachauri said the Intergovernmental Panel on Climate Change (IPCC) received contributions from scientists worldwide and had a rigorous peer review system which ensured a balanced view.

“The processes in the IPCC are so robust, so inclusive, that even if an author or two has a particular bias it is completely unlikely that bias will find its way into the IPCC report,” he told The Guardian.

His comments came after the apparent suggestion in the leaked emails that work on climate change which the scientists did not agree with was not included in the IPCC’s fourth assessment report, published in 2007.

Mr Pachauri said: “Every single comment that an expert reviewer provides has to be answered either by acceptance of the comment, or if it is not accepted, the reasons have to be clearly specified.

“So I think it is a very transparent, a very comprehensive process which insures that even if someone wants to leave out a piece of peer reviewed literature there is virtually no possibility of that happening.”

*Yawn* OK nothing to see there, right? But wait, your diligent blogger kept reading the article and discovered this:

Last week, Paul Hudson, a BBC weather presenter and climate change expert, admitted he was sent the controversial emails more than a month before they were made public.

It raised questions about why the BBC did not report on the matter sooner, and reignited the debate over whether the Corporation is “biased” on the issue of climate change.

In his BBC blog, Mr Hudson said: “I was forwarded the chain of emails on the 12th October, which are comments from some of the world’s leading climate scientists written as a direct result of my article “Whatever Happened To Global Warming”.

“The emails released on the Internet as a result of CRU being hacked into are identical to the ones I was forwarded and read at the time and so, as far as I can see, they are authentic,” he added.

The BBC has previously accused of failing to cover the climate change debate objectively. Earlier this year, Peter Sisson, the veteran newsreader, claimed it is now “effectively BBC policy” to stifle critics of the consensus view on global warming.

Doesn’t that strike you as odd? Apparently whoever had this bundle of fun in his or her possession, first tried to get the BBC to pick up the story when it ran a skeptic-friendly story. After a month went by and it was clear the BBC wasn’t going to run with it, the bundle of fun was uploaded to a Russian server and quickly sent to skeptic-friendly websites.

I admit that both the outside-hacker and inside-job hypotheses can handle this new twist, but this sounds more and more like an inside job to me. Perhaps the person wasn’t a true whistleblower who was agonizing at night over the ethics; it could have been a spy planted by the Russian government (say).

But if I had to guess, I’d say someone working at CRU was involved with this. This doesn’t seem at all like some random Glenn Beck computer hacker got past CRU’s firewall.*

* You’re right, I don’t even know if this sentence makes sense. I truly used to be “good with computers,” but that was back when I had a Tandy 1000 running DOS. Remember this prompt?

A>

Ahhh, those were the days. If you wanted to send an electronic message to someone in California, you uploaded it to the BBS hub that was a local call and you were ecstatic if it got there 2 days later.

07 Dec 2009

Climategate Potpourri

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* Lew Rockwell on how the Left was diverted from its noble mission of opposing wars and protecting civil liberties. (Rockwell also passes on this story: US creationists defend the Climategate scientists!)

* Clive Crook has a similar take to mine.

* Because of Crook, Megan McArdle also starts to thinking that maybe there is something there after all.

07 Dec 2009

This Sounded Funny to Me

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“But first, a word about policy. There is absolutely no reason that I can come up with not to try an expansionary monetary policy now. If my views of money are correct, that policy will not work, but neither will it cause any harm.”

– Arnold Kling, December 6, 2009.

07 Dec 2009

Thoughts on Libertarians and Immigration

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Thoughts on Libertarians and Immigration
By Robert P. Murphy

Immigration is one of the most hotly contested areas in libertarian theory and politics. In a short article like this I couldn’t hope to address all of the different arguments. For a start in that direction, I point the reader to Anthony Gregory and Walter Block’s Journal of Libertarian Studies article [.pdf] on the subject, which comes down in favor of “open borders” but gives serious attention to the arguments of Hoppe and the later Rothbard.

I personally agree with Gregory and Block on the technical issues of libertarian theory. Yet in the present essay I just want to make some practical observations on topics that puzzle me when I hear them discussed in the typical debates.

Using the Term “Illegals”

In my opinion, the oddest practice in American political discourse on immigration is to refer to the people in question as “illegals.” Out of all the groups in the country who violate legislation enacted by a few hundred people in D.C., why is the term “illegal” reserved for those who violate immigration laws?

On the one hand, I think it’s because the term “criminal” would be too harsh. In other words, people don’t call murderers and rapists “illegals,” they call them criminals. Yet if people were to refer to all illegal immigrants as criminals, it would make it difficult to distinguish the otherwise-law-abiding immigrants from those that were actually committing violent crimes and committing individual acts of theft.

On the other hand, I think it’s inconsistent to use the pejorative term “illegal” to classify an entire group of people. The term might make sense for law-and-order Republicans to use, but not for libertarians, especially for libertarian anarchists. After all, most libertarians don’t refer to pot smokers or tax evaders as “illegals,” even though they are breaking the laws of the United States too. Indeed, I bet there are a higher fraction of “illegals” at most libertarian conferences than there are at most construction sites!

Focus on Government Cash Flows

Besides the term “illegal,” another thing odd about the typical immigration debate—at least when conducted among self-described libertarians—is the focus on tax payments and government expenditures. The opponents of unrestricted immigration point to evidence showing how much more the government has to pay in terms of welfare, schooling, hospital visits, and so forth, to people who aren’t “on the books” and don’t pay any income taxes. The defenders of immigration counter with studies showing how much they pay in sales taxes, how they are net contributors to Social Security if they work under a fake name, and so on.

Although these empirical studies are interesting, they largely miss the point. My contribution to society is not gauged by my net payments to the government. On the contrary, I serve people (and they serve me) in the voluntary private sector. My paycheck is the best measure of how much I’ve contributed to others, at least in terms of tangible wealth. (Personally, my stunning good looks are also a huge positive externality I shower on those in my community, but I don’t charge them for this.)

A large, bustling city like New York or San Francisco couldn’t survive without millions of low-paid people performing all sorts of mundane yet crucial jobs. If all the illegal immigrants suddenly disappeared tomorrow, my hunch is that most Americans would find themselves poorer—and especially those who live in areas with a high population of illegal immigrants. It’s true that the city or state governments might see an improvement in their bottom lines (though maybe not), but again, that’s hardly the decisive consideration. The real benefit of immigrants, whether approved or not by the politicians, is that they are people with skills who can raise the productivity of everyone through enhancing the division of labor. The United States is very thinly populated, and every new baby born here represents not just a belly to feed but a brain that can create. For libertarians who can see the absurdity of China’s birth control policies, it should be clear that more immigrants won’t spell economic disaster either.

Again, it might make sense for the standard Republican to care about tax payments, but I don’t see why a libertarian would get worked up about immigrants failing to fund the government. I conduct my own consulting business in full compliance with tax laws, if only because I am a worrier and want to be able to sleep at night. But I know many libertarians who celebrate tax dodgers, at least when it comes to tax dodgers who hold American citizenship. Why then should this be a strike against people who also broke an arbitrary immigration rule laid down by the people collecting the unjust taxes?

Related to this, I don’t understand why the biggest objection to government-run health care for so many people is that, “I’ll be paying for illegals to get medical treatment.” This popular hostility was epitomized when Joe Wilson famously called out Obama’s statement that illegal immigrants would not receive taxpayer-funded medical coverage. Yes, of course Obama was lying, but that speech must have had a few dozen lies in it. I don’t think the part about illegal immigrants receiving funding was the most important. No, I think it’s far more significant that the more government controls health care, the more leverage it will have over its opponents. A critic of a future Administration will be a lot less likely to speak out if his daughter is in the queue for a kidney transplant.

Don’t get me wrong, I agree that it is unjust for foreigners to move into my neighborhood and (indirectly) take money out of my pocket by receiving government services. But in the grand scheme of things, I am quite sure that military contractors and investment bankers ripped me off far more than illegal immigrants in the past year.

What Other Problems Do We Trust the State to Fix?

Finally, even if we think that unrestricted immigration is a problem, why would we trust politicians to fix it? Illiteracy, drug abuse, malnutrition, dangerous roads, and terrorist attacks are all potential problems too, yet most libertarians recognize the problem with giving the government more money and power in exchange for promises to solve these social ills. Why then do so many critics of the government constantly hope that finally a certain candidate will “get tough and protect the border”? Isn’t that a bit like hoping for a politician who will “end corruption”?

Just look at the perversity of the Immigration and Naturalization Service (INS). In the Saturday Night Live-inspired movie The Coneheads, the INS agent played by Michael McKean explains that he is pursuing Beldar not because he is an alien (literally!) but because he’s trying to get a job. In the end, Beldar can remain on Earth only if he can demonstrate that he has a skill no human has (and hence isn’t “stealing one of our jobs”).

Although the McKean character is a caricature, it’s pretty accurate. I never read of large-scale “busts” of illegal immigrants who are collecting welfare checks. No, I only read of INS agents swarming into a factory where dozens of people were busting their foreign buns cranking out goods at low prices for American-born consumers. So not only does our federal government spend lots of money going around burning pot plants, it also spends lots of money going around shutting down productive factories.

My only personal experience (secondhand) with the INS certainly left a bad taste in my mouth. When I taught at Hillsdale College in southern Michigan, my wife and I joined a cooking club. One of the other couples had just moved from Canada, because the husband had gotten a good job in Hillsdale (not with the college). In January that couple stopped coming to the dinners, and it turned out that the mother had taken the kids back to Canada to visit her family for Christmas, and then the border authorities wouldn’t let them back in the country. Even though the father had a proper work visa, because they had a common law marriage in Canada, the U.S. government didn’t recognize the woman and kids as part of his family. So the young kids had to start at a new school in Canada in the middle of the year, because it was clearly going to take months before the U.S. government decided they didn’t pose a threat to the country.

Finally, there is the very sobering point that I first saw Anthony Gregory make: If you give the government the power to keep people out, they just might use those fences and guns to one day keep people in. I’m a lot more worried about government agents than I am about immigrants stealing some of my money (with the help of government agents):

Robert P. Murphy holds a Ph.D. in economics from New York University. He is the author of The Politically Incorrect Guide to the Great Depression and the New Deal (Regnery, 2009), and is the editor of the blog Free Advice.

06 Dec 2009

Wise as a Serpent

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Jesus was the whole package, as they say, and this means that sometimes people latch on to only one or a few of his traits. For example, some people (especially well-meaning non-believers who are trying to be cordial) have this idea that Jesus was a really sweet guy, and it was too bad that those awful religious leaders plotted to have Him killed.

But that is unfair to both Jesus and those who plotted against Him. They didn’t have a guy crucified merely for going around healing people. No, He publicly denounced them many times.

The reason the “aww such a sweetie” stereotype is unfair to Jesus is that it makes it seem as if He was Forrest Gump getting picked on by the bullies. Not exactly. Check out this exchange where the people trained in the Scriptures try to trap Him and must flee from His counterattack:

 1 Now it happened on one of those days, as He taught the people in the temple and preached the gospel, that the chief priests and the scribes, together with the elders, confronted Him 2 and spoke to Him, saying, “Tell us, by what authority are You doing these things? Or who is he who gave You this authority?”
3 But He answered and said to them, “I also will ask you one thing, and answer Me: 4 The baptism of John—was it from heaven or from men?”
5 And they reasoned among themselves, saying, “If we say, ‘From heaven,’ He will say, ‘Why then did you not believe him?’ 6 But if we say, ‘From men,’ all the people will stone us, for they are persuaded that John was a prophet.” 7 So they answered that they did not know where it was from.
8 And Jesus said to them, “Neither will I tell you by what authority I do these things.” (Luke 20:1-8, New King James Version)

05 Dec 2009

The SEC Is On Me Now…

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…because Scott Sumner blew my scheme wide open. In the comments to this post someone asked Scott:

How do you square TIPS with Gold? Does gold have better marketing, or are the TIPS measure of CPI skewed, and large number of market players think Gold is a better predictor of inflation? Maybe gold is a better prediction of worldwide inflation, people worried that the solution of cooperative money printing will come about (I think Eichengreen had thsi idea in a Vox EU paper).

A commenter Doc Merlin responded, and then Scott answered:

Doc Merlin, Even if supply was the cause of the higher gold price, the numbers you provide would not be expected to impact gold prices. This is because efficient markets priced in the data you provided a long time ago. Prices move on new information. So it must be the recent articles I have been reading predicting a sharp drop-off in future gold production. Again, past data from 2008 would have no impact on 2009 gold prices.

My hunch is that it is a combination of fast rising Asian demand, some Westerners who have been reading Bob Murphy’s blog, and sharply falling expected supply.

Bold added, of course.

05 Dec 2009

Jon Stewart on the Afghan Surge

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Jon Stewart is awesome. He was good on Climategate, but I think this one is more important and funnier to boot (HT2LRC):


The Daily Show With Jon Stewart Mon – Thurs 11p / 10c
30,000
www.thedailyshow.com
Daily Show
Full Episodes
Political Humor Health Care Crisis

Make sure you watch the movie clips at the end.