Two Sumner Predictions: One Specific, One General
In a recent post at his blog, Scott gave the title, “Please, do buy. You won’t regret it.” He first linked to a post about bubble theories that were promulgated in 2009-11, and said they had recently been refuted. Then he talked about property values in Dubai. My question: Is Scott just saying “buy a house in Dubai, you won’t regret it?” or is he saying more generally, “Go ahead and buy the U.S. stock market and Treasuries, the alarmists have been crying wolf for years”?
(Incidentally, you can’t just say, “Bob, why not ask Scott what he meant?” The reasons are twofold. First, if a writer phrases things in a way that leads readers to believe he “surely” meant X, then he can’t get out of culpability if strictly speaking, technically he didn’t claim X for sure. [Krugman does this a lot–I think on purpose.] Second, Scott has said that–consistent with his weird post-modern view of what truth is–the meaning of a writer’s post depends on what the readers thought he meant, not what he intended to mean. Now it’s possible he was being tongue in cheek when he wrote such things, but it’s not my fault if he meant it as a joke and I didn’t get it–see how that works?)
Now for the more general Sumner claim that I find radically wrong, though it will be much harder to falsify because it is so open-ended. Here’s Sumner at EconLog:
My grandma was born in 1890 into a middle class family in small town Wisconsin. Her home probably lacked indoor plumbing, most home appliances, electric lights, telephone, TV, radio, car, etc., etc. Slightly improved from life in ancient Rome. She lived to see jet air travel, computers, atomic bombs, antibiotics, and died the week they landed on the moon.
I was born in a world of indoor plumbing, atomic bombs, jet air travel, home appliances, computers, cars, telephones, TV, radio, antibiotics. I’ll turn 60 this year, and live in a world of indoor plumbing, atomic bombs, jet air travel, home appliances, computers, cars telephones, TV, radio, antibiotics, plus the internet and cell phones. Yeah, I’d say change is slowing down, really fast.
!!! Meanwhile, back at the Hall of Justice, Scott Alexander recently had a post quoting from leaders in the field who thought that the danger of Artificial Intelligence turning against humanity was something that should be seriously studied. The U.S. military already has flying killer robots, and they’re working on ground-based ones too. We have seen the inventions of the blockchain and 3D printing. Sumner casually dismisses the internet and cell phones as not a big change during his lifetime, whereas I think future historians will mark that as a very significant milestone–especially if they phrase it as “smart phones” rather than cell phones. These things are always hard to see when you’re at Ground Zero–remember Krugman’s line about the internet?–but it’s arguable that the Arab spring uprising was due to social media.
At Some Point It Would Be Nice If Rothbard’s Critics Actually Read His Article on Legal Theory
Gene Callahan doesn’t like my article in which I said that Rothbard had given a prima facie plausible response to critics like Steve Landsburg and David Friedman, who argued that the libertarian approach to property rights would mean that (say) your neighbor could force you to not use any electronic devices. Here’s Gene:
This argument is so bad I doubt Rothbard put it forward thinking it worked: he was merely chucking up whatever he can to rally the troops. First of all, what the hell happened to value subjectivism?! “They are therefore not really invasions of property, for we must refine our concept of invasion to mean not just boundary crossing, but boundary crossings that in some way interfere with the owner’s use or enjoyment of this property.” So, I say I can’t enjoy my property if it is all full of radio waves: How is Rothbard going to prove that is wrong?
This proves way too much. Suppose someone taps my rear bumper at a red light. I get out and say, “You moron! You just caused me $1 billion in psychic damage!” Does this example show that Rothbard has to agree that cars must be banned in a libertarian society, or that he must admit that the 1871 subjective value revolution was wrong? C’mon.
But what’s really bizarre is when Gene writes: “And Rothbard didn’t even attempt a harder case, like smoke from a BBQ, which absolutely is harmful and can definitely alter someone’s enjoyment of their property in a real, tangible way.”
Now if Gene had written “Rothbard DOESN’T even attempt” then we could just interpret that as saying, “In the short quote Bob put in his article about harmless electromagnetic waves, Bob only talked about Rothbard handling harmless magnetic waves–the type of thing Landsburg brought up in his critique.”
But no, Gene said “Rothbard DIDN’T even attempt.” That makes it sound like Gene clicked the link and actually read the discussion to see if Rothbard had the decency to handle other cases.
Well, for what it’s worth, on literally the page before Rothbard talks about radio waves (page 80 here), he brings up the distinction trespass and nuisance. Here’s part of that discussion:
On the other hand, ‘‘contact by minute particles or intangibles, such as industrial
dust, noxious fumes, or light rays, has heretofore generally been
held insufficient to constitute a trespassory entry, on the ground
that there is no interference with possession, or that the entry is not
direct, or that the invasion failed to qualify as an entry because of
its imponderable or intangible nature.”55These more intangible invasions qualify as private nuisances and
can be prosecuted as such. A nuisance may be, as Prosser points
out:“an interference with the physical condition of the land itself, as by
vibration or blasting which damages a house, the destruction of
crops, flooding, raising the water table, or the pollution of a
stream or of an underground water supply. It may consist of a
disturbance of the comfort or convenience of the occupant, as by
unpleasant odors, smoke or dust or gas, loud noises, excessive
light or high temperatures, or even repeated telephone calls…”Prosser sums up the difference between trespass and nuisance:
“Trespass is an invasion of the plaintiff’s interest in the exclusive
possession of his land, while nuisance is an interference with his
use and enjoyment of it. The difference is that between. . . felling
a tree across his boundary line and keeping him awake at night
with the noise of a rolling mill.”57But what precisely does the difference between “exclusive
possession” and ‘‘interference with use” mean? Furthermore, the
practical difference between a tort action for trespass and for
nuisance is that a trespass is illegal per se, whereas a nuisance, to be
actionable, has to damage the victim beyond the mere fact of invasion
itself. What, if any, is the justification for treating a trespass
and nuisance so differently?
You might say, “Well c’mon Bob, how was Gene supposed to know that Rothbard had placed the specific example of radio waves in a broader discussion of legal theory, especially the distinction between trespass and nuisance?” My answer would be, Because I specifically said that in the original article.
To be clear, I am not saying Rothbard solved all of the problems in this arena. What I’m saying is that it’s frustrating to see people coming up with thought experiments and other objections that (they claim) are crippling blows to the Rothbardian approach, without even bothering to see whether Rothbard talked about these specific things.
For an analogy, I am a critic of the pure time preference theory of interest. But if someone said: “And get this, Rothbard thinks interest is about present goods being preferred to future goods–but what about ice in the winter vs. summer? Idiot.” then that wouldn’t be a great critique.
Music City Friends of Liberty Performs “Come Together”
Not sure if you guys here at the blog know about this, but I’m part of the Music City Friends of Liberty (here’s our Facebook page). Last night we unveiled this ditty at The 5 Spot in Nashville:
At This Point Steve Landsburg Must Classify Me as a “Nuisance”
I wanted to push back against Steve Landsburg casually saying that libertarian property rights theory doesn’t work. I thought Rothbard probably handled this type of thing, but I was pleasantly surprised to see just how specific it was. Here’s Rothbard:
Consider the case of radio waves, which is a crossing of other people’s boundaries that is invisible and insensible in every way to the property owner. We are all bombarded by radio waves that cross our properties without our knowledge or consent. Are they invasive and should they therefore be illegal, now that we have scientific devices to detect such waves? Are we then to outlaw all radio transmission? And if not, why not?
The reason why not is that these boundary crossings do not interfere with anyone’s exclusive possession, use or enjoyment of their property. They are invisible, cannot be detected by man’s senses, and do no harm. They are therefore not really invasions of property, for we must refine our concept of invasion to mean not just boundary crossing, but boundary crossings that in some way interfere with the owner’s use or enjoyment of this property. What counts is whether the senses of the property owner are interfered with.
But suppose it is later discovered that radio waves are harmful, that they cause cancer or some other illness? Then they would be interfering with the use of the property in one’s person and should be illegal and enjoined, provided of course that this proof of harm and the causal connection between the specific invaders and specific victims are established beyond a reasonable doubt. (emphasis added)
Now for those of you getting snarky with me about my unwillingness to grapple with the “obvious” implications of my property rights worldview–I’m thinking of you, Josiah Neeley–I’m sure you will apologize in light of this stunning revelation.
On the Minimum Wage “Experiments”
I wonder if minimum wage workers feel comfortable reading Noah Smith. An excerpt:
The early evidence said that minimum wage laws reduce employment growth–just as the textbooks and intro classes taught students for decades.
Then, there was a wave of studies in the 1990s that challenged this orthodoxy, including the famous Card-Krueger paper in 1994. Furthermore, these new studies also found that regions with higher minimum wages tended to have lower employment growth. But if you included a bunch of other factors, then the effects of the minimum wage variable lost independent explanatory power. It seemed like maybe it was just a coincidence that states that had slower employment growth (for various reasons) also tended to have legislatures that passed more aggressive minimum wage hikes.
Also, all (to my knowledge) of the empirical studies finding that minimum wage hikes have no ill effect on employment growth are talking about a modest hike, not the ridiculous hikes that are being now implemented. (For more on the scholarly debate, see my EconLib article.)
Larry Summers Wants TPP Because of What It Represents
This is a bit freaky. Tyler Cowen points to Larry Summers who writes:
The Senate’s rejection of President Woodrow Wilson’s commitment of the United States to the League of Nations was the greatest setback to U.S. global leadership of the last century. While not remotely as consequential, the votes in the House last week that, unless revisited, would doom the Trans-Pacific Partnership send the same kind of negative signal regarding the willingness of the United States to take responsibility for the global system at a critical time.
The repudiation of the TPP would neuter the U.S. presidency for the next 19 months. It would reinforce global concerns that the vicissitudes of domestic politics are increasingly rendering the United States a less reliable ally. Coming on top of the American failure to either stop or join the Asian Infrastructure Investment Bank, it would signal a lack of U.S. commitment to Asia at a time when China is flexing its muscles. It would leave the grand strategy of rebalancing U.S. foreign policy toward Asia with no meaningful nonmilitary component. And it would strengthen the hands of companies overseas at the expense of U.S. firms. Ultimately, having a world in which U.S. companies systematically lose ground to foreign rivals would not work out to the advantage of American workers.
By my count, Summers lists at least five separate arguments for the Trans-Pacific Partnership, but none of them was the standard comparative advantage argument for free trade. Now maybe it’s because Summers thinks Greg Mankiw already handled that obvious starting point, or it could mean that a lot of powerful people were trying to ram this thing through for reasons besides their horror at tariffs.
People who are busy at work and taking their kids to soccer games should realize that we are operating in the context of all sorts of international agreements that would cede political authority to supernational organizations. With my consulting work, I am most familiar with the upcoming UN climate deal negotiations in December in Paris, but there are groups of busybody academics and officials always meeting somewhere, talking about ways to reduce any remaining oases of freedom on planet Earth. This is one of the rare times when I agree with Paul Krugman: the TPP isn’t about free trade.
Potpourri
==> Dan Sanchez has a great post on ISIS and its debt to Washington, DC.
==> David R. Henderson on two recent cases of government working badly.
==> Bryan Caplan talks about Frances Wooley’s good critique of how economists teach public goods.
==> Also, on my last post I linked to my Mises CA post on Yglesias and Iceland. I forgot to link to this good reaction by Scott Sumner, who also provided the link to the Sadowsky takedown.
Krugman and Yglesias Get Tough on Bankers–After It Doesn’t Matter
Matt Yglesias recently posed as brave battler of bank bailouts (referring to the case of Iceland), and Krugman high-fived him. Yglesias literally wrote an article titled, “In Praise of TARP.” Here’s an excerpt of my latest at Mises CA:
It’s ironic that they now strike this pose, given their behavior since 2008. There was a person with some political influence articulating a very minority-viewpoint when the financial crisis hit the U.S. That person was Ron Paul. He definitely took a hard line against the financial elites, rejecting bailouts. Far from welcoming his challenge of the orthodox, Krugman and Yglesias mocked him and his ideas, saying they would lead to disaster. Krugman and Yglesias are the Very Serious People, when it really matters.
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