miércoles, 18 de febrero de 2009

Posting hiatus

I will be leaving on Friday for Europe and will almost certainly not be posting during my stay there. I will return late April. Wish me Bon Voyage! =)

miércoles, 11 de febrero de 2009

Cervantes Saavedra volvió!!!

One of the greatest pieces of literature I have ever found in the blogosphere. My professor's satiric piece on U.S. China relations can be found here: http://tradeandtaxes.blogspot.com/2009/02/geithners-upcoming-dialogue-with-chinas.html

Here is the text:

Imagining Geithner's Constructive Dialogue with China

In his testimony to the Finance Committee, Treasury Secretary Timothy Geithner wrote:

More generally, the best approach to ensure that countries do not engage in manipulating their currencies is to demonstrate that the disadvantages of doing so outweigh the benefits. If confirmed, I look forward to a constructive dialogue with our trading partners around the world in which Treasury makes the fact-based case that market exchange rates are a central ingredient to healthy and sustained growth.

I can already hear the constructive dialogue he will have when he arrives in China...

Geithner: Thank you President Hu and Premier Wen for inviting me to dialogue with you about matters of the utmost importance to the future of your economy.

Hu: Welcome esteemed Treasury Secretary. We are looking forward to your kind consideration in our affairs.

Geithner: I understand that you now have $1.7 trillion dollars in your currency reserves. That's more than enough to protect the yuan should it fall in the currency markets. For your own benefit, you should stop buying so many dollars and use your country's savings to help your own people, instead of us.

Wen: Thank you for your kind consideration. But we are always concerned with the welfare of the American people and want to provide them with the financing that they need to buy our products.

Geithner: You realize of course, that the dollar will eventually fall in value by 50% while your yuan will rise in value by 40%. You will lose money if you keep changing your yuan for dollars in order to keep the dollar high and the yuan low.

Hu: You are most considerate. Your president has chosen a treasury secretary of rare intelligence. But we do want to help your people so much, we are willing to sacrifice our own interests. We will indeed continue to finance your stimulus package so that your people can buy more Chinese imports.

Geithner: I am concerned about the future markets for Chinese products. If you don't buy our products, our consumers won't get the sustained growth in income that they would need in order to buy ever increasing amounts of imports from you.

Wen: Your thoughtfulness knows no bounds. You are truly the wisest and most thoughtful treasury secretary that we have yet encountered. But do not trouble yourself. Your people will not need more income. We will provide all of the financing that they will need to buy our products.

Geithner: Thank you for taking my advice into your consideration. Our economists are convinced that market exchange rates are a central ingredient to healthy and sustained growth.

Hu: Most esteemed treasury secretary, how can we ever thank you enough for such sage advice. We will certainly take your advice into consideration as we make our five year plans. And be assured, we will continue to supply the financing that you need so that your stimulus plan can stimulate American imports.

[Exit Geithner]

Wen: Do you have your copies of the Journal of International Money and Finance handy. I'd like to read Heng-Fu Zou's 1997 paper again. It gives me such a laugh to know that a Peking University professor explained our strategy to the Americans and they still haven't figured it out.

Hu: That's nothing. The Japanese used the same strategy for five decades, and the Americans never understood what was happening, even while the Japanese targeted one American industry after another.

Wen: Speaking of that, have you seen the latest reports. We gained market share in our competition with every single remaining American industry during the last quarter! Four more American corporations are filing for bankruptcy. We will be in a very strong position when this recession ends.

Hu: I find this earnest young man to be very amusing. I love the way that he is always looking out for our welfare and never the welfare of his own country. Do be sure to invite him back, and do tell him that we look forward to our next constructive dialogue.

miércoles, 4 de febrero de 2009

Perdón Sr. Presidente, pero me toca a mí

1. Free trade with coutries who want to free trade (Latin America!). Selective import certificates for countries praticing mercantilism (China & Japan). Perhaps we could have the entire NAFTA system use import certificates on China.

2. refurbish the tax system. Now I must admit I lean Fairtax/value added tax, but I think we should also include something along the lines of a Georgian land tax and perhaps a capital gains rollover tax, but the fairtax sort of doubles for both of those I *think*.

3. Set a constant money supply growth Federal reserve policy

4. stop corporate welfare and discretionary fiscal policies.

5. ideally move to low levels of taxation/gov spending, but not so much that we don't have a government

6. make all highways tolled so as to stop subsidizing big box retail.

viernes, 30 de enero de 2009


There's a war going on at Disciples of Diotima! Join the carnage!

Men: Yeah!
Women: I knew liking warrior princesses would come in handy someday.

Esta un conflicto en Disciples of Diotima. Vengan! Hablan! Ganan por muerte!

Hombres: Mas Bueno Che!
Mujeres: Pensia que me gusta reinas con weapones vaya necessario.

jueves, 29 de enero de 2009

Wage Discrimination?

In the context of an article about wage discrepancy laws, the Lincoln Journal Star recently contained a remark that said something like this: "According to the US Census Bureau, women earn 73 cents for every dollar earned by men doing equivalent jobs." The way the paper presented it, this looks like evidence of wage discrimination, but is it? Here's some reasons it might not be.

1. What is an "equivalent job?" Is being the chef at Grisanti's equivalent to being the waiter/waitress? It does not seem implausible that men would usually be in the higher up and better paying of two positions when two jobs that are really different are considered equivalent. Is a part time job equivalent to a full time job?

2. Does "equivalent job" mean "equivalent work?" It makes sense to pay women less if they do less work then the men on the same job for reasons of physical capacity. For example, if there are women construction workers, it would be plausible for them to statistically have a lower work output, and thus be paid less.

3. Do women, on average, earn 73 cents for every dollar earned by men on average? Or does American Womankind earn 73 cents for every dollar earned by the declined American male? If there are more working men and the study used the second option, wage discrimination would probably not exist.

4. It is possible (though unlikely) that men create a better "impression," either in their initial interview or in the workplace. I don't think that having a part of the wage be based on impression counts as discrimination.

5. Some employers (such as my grandfather) view women employees as relatively unreliable because they have to occasionally take off time at work to have children or take care of home/child matters. Just as risky mortgage applicants have to pay higher rates, risky employees would have to be paid lower wages.

6. Does the study take into account family-run businesses where a husband and wife work but only the husband counts as the one receiving the money?

7. Last, but not least, the Papal Encyclicals (and probably Chesterton's principles of subsidiarity as well) state that it is ideal if the family lives on one income, the father's and not the mothers, and if possible, companies should pay fathers enough so that mothers do not have to work. An employer with this view (which would not only be Catholic employers) would likely pay his women less. This is not discrimination.

My Research Paper

Here's a research paper I did on the conflict between Lebanon and Israel, if you want to learn more about the general Israel situation. I think that when you read it and then consider that the leaders of the middle east nations could be letting the people in the refugee camps that generate the Islamic radicalists that cause the problems assimilate into middle east nations nations but these leaders do not do so, you will begin to see why I commented the way I did on Don Pedro's post on Israel a few days ago.
Ever since sin entered the world, there have been conflicts between nations. One that has been highly publicized is the semi-perpetual state of tension between the nation of Israel and its Arabic neighbors. One country in particular that has had a rough relationship with Israel is Lebanon, the small nation directly to the north. At its root, this conflict is religious, and the situation would be alleviated by the increased spread of Christianity in Israel and Lebanon.
History of Lebanese Elements in the Israel-Lebanon Conflict
The Israel-Lebanon conflict actually started because of internal tension in Lebanon. Years ago, when Lebanon was formed from territory that was previously French, there was a slight majority of Christians (mostly Maronites) in the population. The constitution insured that there would be six Christian representatives for every five Moslem representatives, that the President would always be a Christian and that the Prime Minister would always be a Moslem. Although this system worked well for a time, the decrease in the Christian/Moslem ratio and the accumulation of wealth and power in the hands of the Christians resulted in an increase of tension. The two religions began to build up private militias to enforce their respective collective wills, eventually leading to all-out anarchy and civil war, with factions of Sunnis, Shiites, Druze, Maronites and others. At some point in their effort to “subjugate” the Christians, the Moslem factions allied with (by inviting to Lebanon) the Palestinian Liberation Organization (PLO), an organization of exiled past inhabitants of the area that is now Israel. These people, in addition to being allies of the Moslem factions in Lebanon, were also determined to destroy the nation of Israel so that they could repossess their entire native land of Palestine. In addition to their anti-Christian activities, the PLO also carried out anti-Israeli activities. Although an invasion of Lebanon by Israel forced the PLO to leave Lebanon for a time, Israel and the United States were either unable or unwilling to stop the civil war. Eventually, the PLO returned to Lebanon and peace was established through a new constitution that included provisions for 50-50 (Moslem, Christian) distribution of seats in the Lebanese legislature (seen as an injustice by many Christians, although they comprised only 30% of the population). Today, Hamas (A Lebanese Islamic terrorist organization founded by Israel as a counterbalance to the PLO), and Hezbollah (a Lebanese Islamic terrorist organization founded by Shiite clerics and funded by Syria and Iran), carry out most of the anti-Israeli terrorism from Lebanon. Thus, the conflict between Israel and Lebanon has generally not been one of invasion and counter-invasion, but of terrorism inflicted by Lebanese Islamic groups on Israel’s population, infrastructure, and military establishments, followed by Israeli retaliation.
Why the Lebanese Internal Conflict is a Religious Conflict
Although economic elements may have played a role in the increase of tension in Lebanon and the strained relationship between Lebanon and Israel, the element that changed Lebanon from peaceful to chaotic was the religious element. While there are examples of people of different religions living peacefully together (such as the United States) and of people of one economic class ruling those of a lower economic class (such as the feudal system in the Middle Ages), the fact that both of these separations were in place in Lebanon simultaneously made the situation much more difficult. Because the Christians had all the influence in the government, due to the required 6/5 Christian-Muslim ratio in the Lebanese parliament, all the people of one religion and wealth class were put in power, despite the fact that the country, with its Moslem majority, masqueraded as a democracy. Religion aggravated a potential source of conflict: money. Religion also provided a means for the minority to take power from the majority, an action that would be perceived as an injustice in a democratic nation.
Why Christianity Would Alleviate the Situation
A Christian evangelization of Lebanon would have many beneficial affects on the situation in the area. Obviously, the spread of Christianity in Lebanon would mean the decrease of the Moslem portion of the population. Such a situation could decrease (and if carried out completely, eliminate) the civil strife in Lebanon because the Christians would no longer be all wealthy and disproportionately powerful, thus pacifying the religious-defined class conflict behind the main desire of the Moslem population to continue to support the PLO. A Christian Lebanese population would probably also cease to support the Hezbollah organization; founded as it is by Shiite clerics, it certainly has an Islamic, not a Christian agenda. With an official name like “Islamic Resistance Movement,” Hamas also would be likely to collapse if Lebanon became a Christian country. All three organizations would most likely weaken insofar as Christianity strengthened. Each of the three organizations that cause conflict between Israel and Lebanon would be likely to weaken or collapse and thus cause no conflict with Israel if Christianity were to be spread in Lebanon.
To understand fully how the conflict is a religious conflict, however, it is also necessary to understand why the groups in Lebanon have a conflict with Israel in the first place, and thus, to understand Israel’s history.
History of Israel side of Israel-Lebanon Conflict
Israel was founded in 1948 by British mandate as a home for Jews. Many of these Jews were Zionists, who were attached to the idea of a distinctly Jewish state for both the purpose of Jewish advancement and the avoidance of another Holocaust. Many other founders had other very Jewish agendas, such as the reunification of the Jewish Diaspora, the spiritual and cultural advancement of the Jewish people, and the hastening of the coming of the “Messiah.” They further thought that these agendas would be achieved through the founding of a Jewish state. After the state was founded, the Jews lived in a situation of tension with their neighbors and with the Palestinians who lived in or used to live in the area of Israel and who refused to assimilate into Israel’s population. In 1967, the Israelis launched a preemptive war against the Syrians, Jordanians and Egyptians, taking the Sinai peninsula, Old Jerusalem, and the West Bank (which holds the holy places of Judaism). However, these Jews were faced with a problem: they could not possess the entire Biblical land of Israel with out either losing their Jewish character to the Palestinians who would be voting along with the Jews or losing their democracy by tyrannically excluding the Palestinians from the voting process. Naturally, the native, conquered Palestinians in this area were displeased with their lot, launching the Intifada rebellion in 1987. The displaced Palestinians settled in many places, such as Lebanon. In Lebanon, they were (and 200,000 of them still are) kept landless in refugee camps, longing for their homeland because they have not assimilated into the Lebanese population. These refugees allow Hezbollah to work in Lebanon because they “destabilize” it. These same refugees also make up much of the PLO organization that contributes to both the Lebanon-Israel conflict and the Lebanese civil conflict. These conflicts have not ceased, despite the fact that Israel ceded all of Gaza to the Palestinians in 2005 and despite the fact that 70-80% of the West Bank is currently under Palestinian control.
Why the Israeli-Lebanese-Palestinian Conflict is a Religious Conflict
The Palestinians outside Israel have a quarrel with Israel’s very existence. Because Israel’s existence is a religious existence, this quarrel is a religious conflict. Additionally, there are other religious elements in the quarrel that Lebanese refugee Palestinians have with Israel. Lebanese Moslems use these Palestinians in their religious conflict with the Lebanese Christians in the manner outlined above. At the same time, both Israeli Jewish and Lebanese Moslem politicians use Hamas to create among the people religious and/or ethnic/patriotic rage against their enemies, and thus keep themselves in office. The Lebanon-Israel conflict has both religious roots and religious elements that exacerbate it even today.
Why Christianity Would Alleviate the Situation
A Christian evangelization of Israel would have many beneficial effects on the tense situation in the area. Because Israel would lose its identity as a Jewish state, the people would have nothing but ethnic and economic objections to the immigration and assimilation of 200,000+ Palestinians, thus giving homes to many of the refugees who make up a large portion of the PLO and destabilize Lebanon. Perhaps there would even be a reverse-assimilation, where the Israelis abandon the notion of Israel altogether and assimilate into some sort of Palestinian nation. Although some Christian denominations may pressure Israel to keep its Jewish identity, after Israelis realize certain Christian teachings, they ought to realize that the Jewish identity will not necessarily make them better Christians, but this identity will necessarily impede the spread of peace in the area. Israelis would be able to admit many more solutions to the Lebanon-Israeli conflict if they became Christian.
The Lebanon-Israel conflict is primarily a conflict of religious classes. While the Christians and Moslems fight for power in Lebanon because of its undemocratic religion-based democracy, the Jews and non-Jewish Palestinians (including those in Lebanon) fight for land by war and by terrorism in the West Bank, Gaza and Israel because Israel’s status as a Jewish state does not permit many refugee Palestinians to live in their ancestral homes. The spread of Christianity in Israel and Lebanon would weaken the lines and distinctions that separate and provoke the warring factions, thus crippling both their ability and their desire to fight each other. Although the Israel-Lebanon conflict may not be between the religion of Israel and the religion of Lebanon directly, it is a religious conflict nevertheless, and it requires a primarily religious solution.

miércoles, 28 de enero de 2009

el monetarismo

My fellow distributists do not talk a lot about monetary policy and do not understand why I simultaneously subscribe to both the monetarist and the distributist schools of economic thought. Here's the short of it: they both contain uncommon common sense. While I do not agree with Milton Friedman's radical political views, I believe his approach to monetary policy is the best one yet.

Monetarism is the simply idea that money should be money. Keynesians and supply siders focus on their pets projects which have the goal and making money somehow a magical cure all to the business cylce. I suspect that they countercyclical policy actually retards overall economic growth, but I have no proof of that. Now, money has 4 purposes:

1. a medium of exchange

2. a unit of value

3. a standard of deferred payment
4. a store of value

Now monetarists aim for a constant money growth target of about 3% greater than growth of GDP. This ensures that there will be no deflation, but very low inflation. Now, supply siders and Keynesians are always inflating or deflating the dollar insanely fast, erroding away its 3 of its 4 basic functions. While the function of medium of exchange is not usually affected, in cases of very bad activist decisions (à la Zimbabew), it can. As a unit of value, the contantly changing currency loses its efficieny and messese with everyone's interanal price regulators. Supply sider Bush inflated the dollar 20% during his administration, and I expect a similar amount from Keynesian Obama. As a standard of deferred payment, money fares even worse under our Keynesian/supply sider tyranny. Frankly, you never quite know how much the money you are going to receive will be worth, which distracts from productive efforts and engages a large part of the economy in speculating about policy/inflationary expectations, etc. And finally, as a store of value, considering that currencies are almost always inflating, just at varying rates, frequently currencies are not very good stores of value. While I have no problem with the monetarist constant low rate of inflation (which I imagine would encourage people to invest in capital and not just throw everything in a savings account or the like), the inflation we have with the Keynesians/supply siders creates dificulties with economic efficiency. Because monetarism proposes to keep money as money, I believe that it is the most logical of any current school of monetary policy.