11 Dec 2016

Maybe God Is Trolling Us

Religious 14 Comments

I am quite certain that most people will dislike this post, but for the few who see what I’m saying, I hope you appreciate the new angle I may open for you.

First, a digression. I am an unabashed troll on Twitter and Facebook (and sometimes on Scott Sumner’s blog). However, I would argue that I’m a good troll. My purpose is never to hurt someone’s feelings, but instead to say something funny and/or intelligently provocative. I am just about always either (a) trying to directly entertain people and/or (b) educate them. Even for the people who are my “targets”–where perhaps I will point out what I think is a contradiction in their professed positions–my ideal outcome isn’t that I “blow them up,” but rather that they see it and then grow from the encounter. (For example, no matter what cockamamie inflationist scheme he cooks up next Thursday, I will go to the grave grateful for Nick Rowe freeing me from my mental prison regarding the government debt debate.)

But what’s funny is that a lot of people GET REALLY MAD AT ME when I troll them, especially if they don’t know me. (For example, sometimes I troll close friends on their Facebook posts, but their friends don’t know who I am and they bite my head off for “attacking” their friends.) They may think I’m stupid, insensitive, cruel, and oblivious to their personal situation. They think I’m trying to hurt them when really I’m trying to help them.

OK I think you guys see where I’m going with this. I think in addition to realizing He is utterly good, when we encounter God in the afterlife we will look back at the (previously) inexplicable events from human history and say, “Ohhhhhh… OK that’s really funny.”

10 Dec 2016

An Interesting Combination of Positions in the Carrier Debate

Libertarianism, Trade, Trump 72 Comments

I don’t want to make too much of this, and I’m not even saying there is an outright contradiction here. I’ll succinctly state the interesting combination in the form of a script, loosely based on actual events that I observed firsthand on social media.

TRUMP SUPPORTERS: You idiot libertarians need to drop your faith in free trade. US manufacturers can’t compete when foreign governments subsidize their exporters through special tax rebates and looser regulations. If we had a level playing field, where foreign companies faced the same taxes and regulations that US companies did, then American workers would come out on top.

LIBERTARIANS: Ha ha, you’re afraid of “dumping”? What a loaded term. Uh, if goods come in more cheaply, that only *helps* Americans. Sure, it might throw particular US manufacturing companies out of business, but the country as a whole benefits because of the gains to consumers. Haven’t you read Bastiat? Are you mad about the “unfair” competition from the sun? Do you even econ, bro?

BOB MURPHY ON CARRIER DEAL: It’s not the tax cut I would’ve proposed, but from a purely ethical perspective, this is reducing a firm’s taxes and in that sense reduces injustice.

LIBERTARIANS: That’s not the issue here Murphy. The issue is providing a level playing field. How are other US manufacturers supposed to compete when Carrier is getting special tax rebates and regulatory relief? How obtuse can you be to not see this?

09 Dec 2016

Clarifying My Comments on the Twitter Exchange Between Rep. Amash and Scott Adams

Trade 26 Comments

[UPDATE: Amash clarified what happened; see the bottom of the post. Now I can sleep peacefully.]

In Episode 799 of the Tom Woods Show, I was the guest and we were talking about the Carrier deal. Tom brought up the fact that I had mentioned on Twitter that I thought Rep. Justin Amash (R-MI) had misunderstood (at least initially) the point that Dilbert creator Scott Adams brought up.

I’ve had a few people challenge me, saying that *I* was the one missing things. I wasn’t going to bother with this, because I don’t want it to seem like I was taking Trump’s (or Adams’) side on the broader debate. FOR THE RECORD: I TOTALLY AGREE WITH JUSTIN AMASH’S DEFENSE OF FREE TRADE, AND HIS OPPOSITION TO TRUMP’S THREATS AGAINST U.S. COMPANIES THAT ARE CONSIDERING OUTSOURCING.

However, since I guess the cat’s already out of the bag, I might as well be clear on exactly what motivated my remarks on Tom’s show. One last thing, though: If you go and listen carefully, I hedged and said something like, “At the very least, one reading Amash’s tweets would understandably *think* that he didn’t get the point.”

So anyway, here we go. I’ll paste in a selection of Amash’s tweets taken from the debate, with my commentary following each:

This is what got the ball rolling. Clearly, at this point Amash is thinking of a general tariff that actually gets implemented. If he *weren’t* thinking that, then the 35% figure would be wrong (because it would be arbitrary). For example, suppose it would only take, say, a 28% tariff to scare every US firm and keep it from outsourcing. Well then, if Trump had threatened a 28% tariff, then no company would move, and Amash would tweet, “This is a 28% tax on all Americans…” If Trump then jacks it up to 35%, it would still be the case that no company moved, but that wouldn’t make their products more expensive yet again. In that case, Amash would still have to write, “This is a 28% tax on all Americans…”

Thus, at this initial stage, when Amash is first responding to Trump’s twitter rant, it is clear that Amash is thinking the 35% tariff will actually be triggered, and *that’s* why Amash is (correctly!) saying it’s not just a penalty on the outsourcing company, but on American consumers.

In the next stage, Scott Adams replies:

OK, so we see that Adams is challenging the initial logic. (By the way, I had never considered this possibility until Adams brought it up. I don’t know whether Trump himself was thinking this.) OK fair enough. Let’s see what Amash says in reply:

OK, so *this* is the point where I, Bob Murphy, jumped into the twitter debate. At this point, it sure seemed like Amash missed what Adams had argued. For one thing, Amash is talking about a tariff increasing production costs. But in this scenario, there IS NO tariff. Rather, it’s the THREAT of a tariff that is doing the work.

That may sound like quibbling to some (and we’ll get to that in a moment, over the narrow vs. broad use of the term “tax”), but look how weird Amash’s usage would be in other circumstances. Suppose Trump says, “If a CEO wants to outsource, I will shoot him in the head.” Then Amash says, “Outrageous! Bullets hurt brains.” Then Scott Adams says, “No, the idea is that no CEO will want to get shot in the head, so no outsourcing.” Them Amash comes back and says, “No, even if no company moves, the bullet still causes damage. This is basic physiology.” Wouldn’t people think Amash had misunderstood?

OK, you still don’t believe me? Then what about Amash’s claim in the tweet that, “This is basic economics.” If we interpret the previous sentence to mean, “A tariff is imposed on goods coming into the US,” then yes of course, it IS basic economics. But if we interpret the previous sentence to mean, “No tariff is actually imposed, but the threat of it keeps companies from outsourcing and thereby keeps their production costs artificially high, and makes US consumer prices higher than they would otherwise be,” then HECK NO that’s not basic economics. In fact this is the first time I’ve ever heard such a claim. I *agree* with it, but it’s not basic economics.

Thus, I think I was on solid ground when I said, at this point in the debate, that Amash had missed Scott Adams’ point.

Next, Amash tweeted out a link to Don Boudreaux’s blog post:

Now here I made a mistake. I started skimming Don’s piece, and saw that he immediately said that Amash was right and Scott Adams was wrong. Since at this point I was confident that Amash had misunderstood Adams’ point, I stopped reading (I was in an airport, cut me some slack) and I tweeted that Amash and Don were both missing the point. However, I realized later (when I had time to carefully read Don’s post) that Don fully understood Adams’ point, and gave a great reply.

At this point, let me just post a screen shot of the back-and-forth Amash and I had:

amash-vs-murphy

OK, so after I said I thought Amash and Don were missing Adams’ “narrow point,” Amash assures me he gets it. I PROMISE YOU, folks, at this point I totally believed him. After all, Amash is a sharp guy, and Adams’ point wasn’t too hard to grasp.

So I threw in the towel, and said, “OK,” and just clarified why I thought he had been unclear by calling it a tax, rather than a *threat* of a tax. I was ready to walk away; my work was done here. At this point, I would’ve bet $1,000 that Amash understood Adams’ point.

And yet… and yet… look at how Amash then replied to me, in the last item above. The entire point of Scott Adams’ argument was that no tariff would exist. And yet Amash chooses to wrap up the debate by saying, “…the existence of a tariff increases prices…” Again, for someone trying to convince me that he understands we’re talking about a scenario where no tariff exists, summarizing his whole position as being based on the existence of a tariff is a bit confusing.

In light of the above, I stand by my remarks on Tom’s show. After his last comment, I would no longer bet $1,000 that Amash fully grasped Scott Adams’ original point. Maybe he did, maybe he didn’t, but at this point I was once again unsure.

AND JUST TO REPEAT: I TOTALLY OPPOSE TRUMP’S THREATS AGAINST COMPANIES. I SUPPORT AMASH’S DEFENSE OF FREE TRADE.

Update: Amash read this post and then resolved all problems by explaining:

08 Dec 2016

Tom Woods and I Talk About the Carrier Deal

Shameless Self-Promotion, Tom Woods, Trade, Trump 18 Comments

This isn’t Contra Krugman; instead it’s episode 799 of the Tom Woods Show.

05 Dec 2016

Questioning Scott Sumner’s Numeracy

Scott Sumner 21 Comments

Don’t worry, this isn’t (directly) about Trump.

In a blog post titled, “Innumeracy drives me nuts,” Scott Sumner lists several examples of people (allegedly) being innumerate. I definitely agree with some of his examples, but others are stretching it.

However, one of Scott’s arguments in particular seemed flat out wrong to me. Here’s what Scott wrote:

The claim that greater infrastructure spending would significantly boost US economic growth is absurd. It might boost it, but the US economy is far too large and diverse for a $550 billion infrastructure package to make much difference, especially during a period of 4.6% unemployment and monetary offset. Tax reform and deregulation are more promising, but even here the claims of 4% to 6% RGDP growth are ridiculous, at least over an extended period of time (I suppose one or two quarters are possible.) Trend RGDP growth during the 20th century averaged about 3%, under wildly different policy environments. I’m not saying policy had no impact (I’m a moderate supply-sider), but people tend to overrate the impact.

Now this is a strange argument indeed. Imagine if someone said, “It’s ridiculous to suppose you could sample Americans and get four guys in a row who are over 6’5″, because the average height over the whole population–including people with wildly different genes and diets–is about 5’10”.” The fallacy–dare I say innumeracy?–there would be obvious, and yet that seems to be what Scott’s argument is.

In any event, here’s a chart on annual percentage increases in real GDP, using quarterly data, from FRED:

As you can see just eyeballing the chart, Scott’s apparent claim that 4% to 6% real GDP growth (for longer than a quarter or two) is “ridiculous” is simply wrong.

Indeed, I crunched the numbers and, assuming no Excel mistakes, I found that from 1950 through 1979, the arithmetic average of year/year growth rates in real GDP was 4.0%. If we just look at 1960-1969, the figure rises to 4.5%.

In context, Scott is talking about people who are saying tax reform and deregulation could deliver sustained 4% – 6% real GDP growth. (I found John Taylor saying it here, for example.) I would think that surely, if a new Trump Administration could deliver 4% or higher for four years straight, then that would satisfy these claims. Yet Scott seems to be arguing that history shows us such hoping is ridiculous.

Well, assuming I didn’t make an Excel mistake, if you take the period 1948 – 2016 (3q), and calculate all the arithmetic averages of the annual growth rates in real GDP looking forward 4-years, then 29 percent of the time, that number will be at least 4%.

In other words, if you randomly pick a quarter from the postwar period (as far back as the standard BEA real GDP series goes), there is a 29 percent probability that from that point forward for 4 years, annual GDP growth will exceed 4%.

(For purists: You have to be careful with averaging the individual growth rates etc. [This is why reports of the “average performance” in a stock fund can sometimes be grossly misleading.] So I downloaded the levels of real GDP, and calculated the compounded annualized growth rate from 1950 to 1970: it was 4.2%.)

Now to be sure, we can quibble with the legitimacy of the BEA’s numbers. For example, maybe they are driven by the Korean and Vietnam Wars, and in that respect are bogus. But Scott didn’t seem to be throwing out the “official” numbers, he seemed to be saying the official numbers showed that sustained 4% – 6% growth had never happened in the US.

Yet on the contrary, it did happen, and during a time with very high marginal income tax rates. So I agree with John Taylor that a smart package of economic policies would allow the US economy to grow in this range for several years. (I’m talking in general. As readers know, I have long been warning of a coming crash due to the Fed inflating an asset bubble.)

04 Dec 2016

Why Some Christians Oppose “Globalism”

Big Brother, Religious 36 Comments

I realized recently that secular people with little familiarity of Christianity (particularly fundamentalist Protestantism) might not understand the suspicion that so many have of “globalism” or “the globalists.” With Brexit, Trump, etc., this issue has more political relevance now than at any time I can remember.

For my Bible study tonight we were covering chapter 15 of Exodus, and we were linked to this:

The Song Of Moses And Of The Lamb

Exodus 15:1-20, 21

  1. Orr

We cannot fail to connect in our thoughts the circumstances of this magnificent triumph-celebration with that other scene, described in the Apocalypse, where they who have “gotten the victory over the beast, and over his image, and over the number of his name, stand on – i.e., on the margin of – the sea of glass, having the harps of God,” and “sing the song of Moses, the servant of God, and the song of the Lamb” (Revelation 15:2). We do not enter into any elaborate explication of the Apocalyptic symbols. The beast and his followers obviously represent the Antichristian foes of the Church – the worldly secular powers that resist, oppose, and persecute the true servants of Christ. God’s judgment on these hostile world-powers, already summarily depicted in Exodus 14:19, 20, is to be afterwards more fully described under the imagery of the seven last plagues.

I’m not going to get into it in much detail right now, but here’s a bit more context: In Exodus, Moses (himself following God’s instructions) leads the Israelites out of bondage from Egypt. Pharaoh’s mighty army has just been slaughtered through divine intervention when the Red Sea parted to allow the Israelites safe passage, but crashed back on the soldiers and chariots.

(You may know this scene:

)

So for Christians who take the Bible literally, the Devil is the “prince of this world.” The earthly governments are “of the world” and are actively fighting God’s people. (I’m not cracking a joke, I’m being serious: I realize certain American evangelicals combine this general perspective with their adoration of the US federal government and endorsement of the US military. I’m just noting the apparent contradiction here, before some wiseguy jumps on me in the comments.)

So no, I’m not saying that a Bible-believing person necessarily would say, “God doesn’t like the eurozone”; it’s way more complicated than that. But I’m giving some of the context for why right-wing groups dislike “globalism.” They associate it with worldly powers that are the enemies of God’s people.

03 Dec 2016

Latest Contra Krugman Is a Good One

Contra Krugman 2 Comments

I’m being dead serious, we really caught Krugman in a whopper on this one (unless someone wants to defend his honor in the comments and explain why I’m wrong). Also, keep listening after the ending music kicks in–there’s a fun bonus.

And if you want to check out my limited-time book offer, here’s the direct link.

02 Dec 2016

On My Anti-Anti-Trumpism: I Regret Nothing!

Economics, Humor, Trump 20 Comments

Some people in the comments of previous posts have been psychoanalyzing me, wondering why I spend so much of my precious time pointing out hypocrisy in Trump’s critics (as opposed to ridiculing Trump’s ridiculous statements). I actually thought maybe they had a point, and then this happened on Twitter.