Half Sigma

New value transference essay no. 2 - free markets

When people talk about “free markets”, they seem to me to be referring to both a lasses-faire economy and an economy with perfect competition

Libertarian-conservative types will say something like “the United States is a free market, and in a free market people get rich by creating value.”

With respect to the laissez-faire component of a free market, the United States is certainly not a laissez-faire economy. There are massive amounts of laws and regulations which keep growing every time Congress or a state legislature meets and government spending is a significant percentage of GDP.

Libertarian-conservative types spend too much time congratulating themselves on the freedom of American markets compared to evil socialist Europe. If the former communist Soviet Union was a 10 and a completely laissez-faire economy such as Somalia or Galt’s Gulch is a 0, then probably America falls in at a 5 and Western Europe at a 5.5.

Libertarian-conservative types also have the false belief that competition flourishes only in the absence of government regulation. This is also obviously untrue. Look at Somalia. Without government to make and enforce basic laws against involuntary value transference, what happens is the toughest guy becomes a warlord and extracts resources from everyone else in his fiefdom. The social structure evolves into something surprisingly like the feudalism of the middle ages. Feudalism and not perfect competition appears to be the natural state of society in the absence of a strong central government.

Laissez-fairism did work in Galt’s Gulch, but unfortunately that was a fictional community. What completely unregulated economies have in common with totally regulated economies is that they both only work well in fiction.

The assertion that our economy has perfect competition, or anything even close to perfect competition, can easily be disproven by the existence of billionaires. In an economy with competition, no one can become super-rich, because as soon as people see someone making a lot of money, they compete against him and reduce or even eliminate his profits.

Libertarian-conservative types are in denial about American not having perfect competition. Oh yes, they will say I am attacking a straw man. “We know that perfect competition is a model which only exists in theory.” But in fact, they really do believe that our economy has something close enough to perfect competition such that the only way to make a billion dollars is to be a superman who can personally create tens of thousands times more value than the average man. To me, this sounds like something which defies the laws of nature, such as someone running faster than a speeding bullet or leaping over tall buildings. Until someone can identify the exact inhuman traits which enables Bill Gates to create tens of thousands of times more value than the average person with a high IQ, I will assume he’s the fortunate beneficiary of inefficiencies in our economic system which he exploited either unwittingly or intentionally.

I personally believe in the superiority of an economy with near-perfect-competition. The ideal society is one where the only way to make money is to create value. This can only be achieved with government laws and regulations that prevent people from making money from value transference, forcing them to create value if they want to have money. This can only happen when the primary goal of lawmakers is to achieve such a society, and of course that’s not the goal of either political party right now, and it’s not even a concept that they understand.

Ron Paul has no gravitas

Ron Paul announced that he is running for president. He has no chance of winning even the Republican nomination because he lacks gravitas. One blogger wrote yesterday that he sounds like an “angry constipated chicken.” That’s not the image of someone who can win a national election.

Ron Paul’s strong support from the Stormfront White Nationalist Community is not enough to help him win.

Nena

In her music video, 99 Luftballons, she’s 24 years old and quite cute. I love the guidette hairstyle! You don’t see girls with hair like that anymore.

I think it’s some kind of anti-war song.

New value transference essay no. 1

I think I need to write more about value transference.

* * *

The reason we need to talk about value transference is because other people are talking about “value creation.” If you look at the Google ngram viewer, you will see that the phrase “value creation” was practically nonexistent before the 1970s, and that its use skyrocketed during the last two decades.

I don’t really know why the phrase was originally created, but people of a libertarian-conservative bent have glommed onto it as a way of explaining the results of what they call “free markets” and as a way of justifying a libertarian-conservative approach to taxation

The theory behind value creation is that people and businesses make money be creating value that other people are willing to pay for. People may pay in currency, but of course currency is just a store of value that allows people to more efficiently trade the value they created for the value that others created.

Because the United States has a so-called free market, it is argued that the only way to make money in the United States is by creating value. Therefore, the richest people (at least the richest self-made people) are those who created the most value, because there’s a direct and nearly-perfect correlation between value created and how much money an individual or business has accrued.

The correlation between value creation and wealth bolsters the libertarian-conservative viewpoint that taxes should be kept low. Suppose Doctor Uno is lazy and only saves one life per week. Doctor Dos works hard and saves ten lives per week. Is it fair to punish Doctor Dos for his hard work and his life-saving contributions to society by hitting him with a higher tax rate?

What about rich people who clearly didn’t do anything useful in order to become rich, such as people who were born rich or who married rich spouses? The libertarian-conservatives would argue that, if property rights are to mean anything, they should mean that rich people are entitled to do whatever they want with their money, and that includes giving it to spouses and children. So taxing these people would be punishing the original act of value creation.

Even if one accepts the argument that all wealth accretion is the result of value creation, it doesn’t necessary follow that progressive tax rates are wrong or immoral. The purpose of taxation is not to punish anyone but to fund necessary government functions. The rich are taxed at a higher rate because they can afford to pay more and because they have a lower marginal utility for additional money.

As you know, it’s my hypothesis that great fortunes are the result not of value creation but the result of transferring the value created by the hard work of other people. This is what I call value transference, and it’s a necessary counterbalance to the now popular term of “value creation.”

Why do people deny the truth of value transference? No doubt for the same reason they deny the truth of evolution, or HBD. Libertarian-conservative types are so psychologically invested in the idea of wealth equals value creation that any hint of a greater truth causes severe cognitive dissonance. And they get angry at me. If the rich are rich not because they created value but because they transferred the value created by the hard work of others to themselves (some might replace “transferred” with the less polite word of “stole”), what justification is there for allowing them to keep their wealth?

Actually, history is full of justifications for why the people with wealth and power are entitled to their wealth and power. There has never been a society in recorded history where there weren’t a few who were rich and powerful and many who were poor, and the rich and powerful always had explanations for why they were entitled to their positions long before modern theories of economics were invented. Divine right was one such explanation. The Pharoah of ancient Egypt went one better and said the he himself was a god. Today we look back at these explanations and laugh, but who’s to say that in the distant future, humans wiser than ourselves won’t look down similiarly at the justifications used by the billionaires of the present?

This introductory essay leaves many unanswered questions, such as:

1. Is our economy really a free market?
2. What the heck do people mean by a free market anyway? (Answering this question is necessary to answer the previous question as well as the following question.)
3. Is it true that the only way to make money in a free market is by creating value?
4. Why would anyone voluntarily give money to someone else unless they were getting value in return?

Learn something new

When the eighties New Wave group Bow Wow Wow recorded their music video for I Want Candy, their lead singer was a 15-year-old half-white half-Burmese girl with a mohawk. She looks really mature for 15.

I’m pretty sure that “candy” is a euphemism for sex.

Newt vs. Joe Biden; Newt and Catholicism

“SkepticalCynical” writes:

Newt strikes me as sort of a Joe Biden type. He's smart, but mostly uses that to run his mouth in random directions.

I thought this comment was interesting because when I wrote yesterday that Newt is the Republican I’d most like to have a beer with, I was also thinking that Joe Biden is one of two Democrats I’d most like to have a beer with. The other is Jerry Brown.

However, I think that Newt is smarter than Biden. I don’t think that Biden could write science-fictiony novels by himself.

“Jay” writes:

[I]t seems to me that Newt's conversion to Catholicism is just further evidence of his intelligence. Most right-wing intellectuals seem to be Catholic these days, just look at the Supreme Court, or the National Review crowd.

Newt’s conversion strikes me as evidence that he’s not a True Believer in his religion and that he converted to Catholicism to make his younger wife happy. Although Newt aligns himself with the religious right, he always struck me as someone who believes that religion is good for people rather than someone who truly believes that the Bible is the absolute word of God.

I think that Republicans like Catholic judges because there are more Catholic judges who are reliably anti-abortion. I think that liberals like Jewish judges for similar reasons.

Newt

Newt really plans on running for president this time.

I like Newt. Media Matters accuses him of being a “racist”, but I agree with every single one of Newt’s points. Being accused of racism actually means that a person is unafraid to speak the truth.

I especially like Newt’s idea about orphanages. The problem with the welfare system is that it rewards women for having babies they can’t support. Taking the baby away from the mother and putting it in an orphanage ensures that the baby won’t die from starvation, but at the same time it punishes the mother for her bad behavior.

I like Newt because he floats out ideas like that.

When Newt accused Sotomayor of being a “racist,” what he really meant was that if a white man said that a wise white man could make better judicial decisions, he would be accused of being racist, so applying the same standard to Sotomayor makes her a racist also. Anyone who doesn’t get the point is either stupid or refusing to understand the point because they hate Newt.

* * *

Actually, it's not clear if Newt has announced he is going to run, or if he announced that he is going to announce he is going to run.

* * *

Commenter Caleo writes:

Newt is a dyed in the wool Globalist and rabid open borders apologist. He has spoken to large crowds of Hispanics and pandered to them and their core. I'm surprised you don't know about any of that, but he is far worse than almost any candidate you can name. A two faced opportunist who will say whatever he thinks is best in the moment to please the group he's speaking to, and then the next day completely contradict himself someplace else.

I seem to get these Newt-hating comments every time I write something favorable about him.

Yes, I do know about Newt’s “nuanced” views on immigration. Are there any likely GOP candidates who are anti-immigration? The answer sadly is a very big NO. If Newt becomes president, I don’t forsee U.S.policies on immigration being any looser than if Mitt Romney becomes president.

Regarding Newt being a “two-faced opportunist who will say whatever,” how does this make him different from other politicians? Mitt Romney was pro-choice when he was running for governor of a liberal state, and then became pro-life when he was running for the Republican nomination for president.

I don’t see Newt as being inconsistent so much as I see him being a man of big ideas who’s not afraid to float ideas out there and see if they stick. I don’t fault him for this. As Ralph Waldo Emerson once wrote, a foolish consistency is the hobgoblin of little minds.

Newt comes off as a real person, while Mitt Romney seems just a little bit robotic. If I had to choose which of the two I'd like to drink a beer with, it would definitely be Newt. I couldn't think of any Republican I'd rather have a beer with than Newt.

Muslim Brotherhood to dominate Egypt

The Wall Street Journal reports:

The leading candidate in Egypt's presidential race said that if he was elected he would break with former President Hosni Mubarak's reliably amenable policies toward Israel.

Amr Moussa, the 74-year-old outgoing head of the Arab League, said the former regime's attempts to resolve the Palestinian-Israeli conflict had "led nowhere" and that Egypt now needs policies that "reflect the consensus of the people."

Mr. Moussa, in an interview with The Wall Street Journal, also described a political landscape in which the Muslim Brotherhood, outlawed under Mr. Mubarak, is dominant. It is inevitable, he said, that parliamentary elections in September will usher in a legislature led by a bloc of Islamists, with the Brotherhood at the forefront.

Now who could have predicted Islamists taking over Egypt?

Well back on January 28th, I wrote:

These protests in Egypt can’t be a good thing. In all Muslim Arab countries, the ruling elite are a lot more sane than the mobs. If there is regime change, the next regime will be more Islamist, even if the MSM is claiming that the protests are “secular.”

Half Sigma was right. The MSM was wrong.

Newspapers in Maine and value transference

Many states have archaic rules about posting public notices in newspapers. For example, the last I knew about the laws of Arizona, when you create a corporation in Arizona, you have to have the articles of incorporation printed in a newspaper once a week for three weeks (or something like that).

This may have once made sense (if only barely) in pre-internet times, but today it makes a lot more sense for these items to just be put on a government website.

The state of Maine is trying to reform similar archaic rules, but the Maine newspapers are fighting back to keep their ad revenue.

This is an example of how private companies could care less about whether they make money by creating value or by transferring value. The newspapers are fighting to maintain a law that’s wasteful and stupid so they can make some extra money.

Was bin Laden shot dead after he was captured?

Bin Laden’s daughter says that the SEALs shot bin Laden after they had already captured him.

Now of course you shouldn’t take everything that bin Laden’s daughter says as the Gospel Truth, but it has the feel of truth to me. The official story about how/why bin Laden was killed kept changing. The impression I had even before reading that story is that the SEALs intended to kill him but the administration is being cagey about it.

If someone gave the order to the SEALs, it was probably Leon Panetta and not Obama. Killing bin Laden was the right thing to do. I don’t see the value of capturing him alive. There’s no reason to put him on trial. A trial is what you use to determine if someone is guilty. We already know that bin Laden is guilty. What would happen if a hotshot lawyer got bin Laden acquitted with a catchy phase such as “if the turban don’t fit, you must acquit”? Would we let bin Laden go back to Pakistan and continue running al-Quaeda?

The Obama administration should man up and admit that it was in our interests to kill him, so we did.

* * *

Eric Holder says that even if we had intentionally killed bin Laden even though he wanted to surrender, it would have been “legal.”

This is yet another example of the Administration not having its story straight. If the killing was an accident, why is Holder saying this? And if it was intentional and legal, why not just say that we intended to kill him?

The administration is acting like lawyers and not like leaders.

Maybe Obama doesn't even know if the killing was intentional or not because Leon Panetta was running the operation and Obama doesn't really know the details? The story about Leon Panetta going behind Obama's back would explain why the administration doesn't have a straight story.

Obama the anti-American Wimp, part II

According to Live Leak, Leon Panetta (the old Italian guy) is the guy with the guts to pull off the attack on Osams bin Laden. Obama resisted taking action, and Panetta tricked Obama into sort of giving his approval, and then launched the mission without Obama knowing about it.

This story is more consistent with what I believe about Obama being anti-American and opposed to doing anything that would be good for America.

* * *

If you followed the link, you may be wondering, who the heck is this Valerie Jarrett person who is Obama’s senior advisor for “Public Engagement and Intergovernmental Affairs” and who urged him not to take any action against bin Laden?

She was born in Iran, to African-American parents. She’s from an extremely well-connected Chicago family, and several of her ancestors had notable accomplishments. Her great-grandfather, Robert Robinson Taylor, was the first black architect in the United States.

So this is one of the secret behind-the scenes people who have the ear of the President. Not a Jew as anti-Semites would have suspected, but a black woman with some sort of Islamic connection. (Her maiden name sounds Jewish, but her father is a black man who graduated from Howard University and who worked as a consultant for several Islamic countries including Iran.)

So Obama, a black man raised in an Islamic country has for a senior advisor a black woman raised in an Islamic country.

UPDATE

A reader advised me that Valerie Jarrett claims to have a Jewish great-grandfather. Which means she’s not Jewish enough to make Aliyah to Israel, and we don’t know if she’s ever stepped inside a synagogue in her life (although she probably attended a Bar Mitzvah or two, because what liberal Jewish parents wouldn't want a well-connect black couple at their kid's Bar Mitzvah to demonstrate how non-racist they are?), but anti-Semites use the one-drop rule to hate everyone who has some distant ancestor who was Jewish (which could be a pretty large percentage of the population, including even Skinheads and neo-Nazis).

Be healthy. Eat salt!

A new study shows that the conventional medical advice is, once again, wrong. Middle-aged study participants who ate high salt diets actually had fewer heart attacks and strokes than those eating a low-salt diet.

And as I’ve written before, the only study of this type that you can truly trust is one in which the conventional wisdom is shown to be wrong. Because people from higher social classes, who have longer life expectancies and better health for many reasons not all of them known, are more likely to engage in the “correct” behaviors and eat the “correct” foods, it is common to get correlations where there is absolutely no causation.

But of course the politically correct medical establishment will insist on denying the truth. You can't trust science anymore.

Get the nukes

If the United States can just go into Pakistani territory and take out Osama bin Laden, maybe we also have the ability to go in there and take out their nuclear weapons.

Or maybe that’s just wishful thinking on the part of India.

Musharraf says we violated Pakistan’s sovereignty

Former Pakistani President Pervez Musharraf on Monday accused the U.S. of violating his country’s sovereignty by sending in special forces to kill Osama bin Laden.

“American troops coming across the border and taking action in one of our towns, that is Abbottabad, is not acceptable to the people of Pakistan. It is a violation of our sovereignty,” Mr. Musharraf told CNN-IBN, an Indian news channel. [source]

I agree with him that we violated Pakistan’s sovereignty.

But I disagree with the part about it being “not acceptable.” Apparently, there’s nothing that Pakistan can do about it so they are going along with accepting it.

Why did Obama do such a dastardly deed? Either (1) he knew that Pakistan is not a trustworthy “ally” despite wasting billions of dollars trying to buy them off with foreign aid, and that if we asked for Pakistan’s help, bin Laden would have been alerted and he wouldn’t have been there to be killed, and Obama believed that killing bin Laden was important for U.S. and world security; or (2) Obama wanted a big public relations victory to help his re-election, and that wouldn’t have happened if Pakistan captured bin Laden.

What should India learn from Osama’s capture?

The the author of this Indian op-ed article sees it, Pakistan was harboring Osama, and the U.S. ignored Pakistan’s sovereignty and went in there with special forces and grabbed him.

The op-ed writer says that India should take similar actions against anti-Indian terrorists who are being harbored by Pakistan.

Obama the wimp

Obama should have buried Osama in pig-skin to deny him Paradise, which is what the Russians are said to have done to the Chechen terrorists (although not reported by the MSM). Instead, he gives him an Islamic burial at sea. This is a disgusting act of placation to our enemies.

* * *

One can't help but note that Osama was not hiding out in a cave in Afghanistan, he was living in a "luxurious mansion" in Pakistan only an hour and a half drive from Islamabad, near a Pakistani military academy. Can we stop giving that country billions of dollars in aid now? We gave them $18 billion since 9/11, and they don't even notice that Osama has been living for the last several years in a luxurious mansion.

You have to appreciate this news article dated Oct 19, 2010:

Pakistan has rejected the report that the world’s most wanted terrorists and Al-Qaeda’s top leaders Osama bin Laden and his deputy Ayman al-Zawahiri have been living comfortably in the country’s northwest region.

“I categorically deny the report about the presence of Osama bin Laden or Ayman Al Zawahiri or even Mullah Omar in Pakistan,” the Dawn quoted Interior Minister Rehman Malik, as saying to reporters.

“Bin Laden… and all other terrorists are anti-Islam and anti-Pakistan and hired assassins. If we have any information we will take action against them,” he added.

A foreign ministry official also dismissed the report as “baseless,” and alleged that it had been “put out to malign Pakistan”.

Meanwhile, a NATO spokesman in Kabul said the alliance had no immediate comment.

Earlier, a news channel had reported that Laden and Zawahiri were believed to be hiding close to each other in houses in northwest Pakistan, though not together.

“Nobody in al Qaeda is living in a cave,” the CNN quoted the official, as saying, who declined to be named because of the sensitivity of the intelligence matters involved.

Rather, they are believed to be living in relative comfort, protected by locals and some members of the Pakistani intelligence services, the official added.

* * *

At least Obama had the good sense to take out Obama with U.S. forces. I suspect that if we had told the Pakistanis about his location, he would have mysteriously disappeared again.

UPDATE ON 5/3/2011

Maybe I overreacted about the pigskin suggestion, but on the other hand I don't think we needed to respect the 24-hour burial tradition. We had every right to hang onto the body for proof that he's really dead, and he wasn't entitled to an Islamic burial.

Also, maybe I overreacted on the title of the post. The Islamic burial was wimpy, but going into Pakistan without Pakistan's permission or knowledge, that part wasn't wimpy.

Osama is dead. Big deal?

Wolf Blitzer says everyone will remember where they were when they heard that Osama bin Laden is dead.

I doesn’t seem like a very big deal to me. He was invisible to the world anyway and people thought he might be dead for a long time.

Now, I do remember where I was when the space shuttle blew up the first time (between classes at college), when OJ was driving around in his SUV (during a bar review class), when Princess Diana died (the Cajun House in Scottsdale, Arizona), and 9/11 (in my bedroom).

If I remember this, it's only because I wrote a blog post about it.

* * *

I was at work when the OJ verdict came in. There was a viewing party.

I never even bothered to watch the trial. I knew he did it after I heard Kato Kaelin testify at the preliminary hearing.

Obama’s gentile cabinet

Some anti-Semites have been accusing Obama of being secretly controlled by cabal of Jews. A blog reader said in a comment that there are no Jews at all on Obama’s cabinet, so I did some research, and he is right! Obama has an all-gentile cabinet.

Hillary Clinton, Secretary of State, Methodist (but probably a crypto-atheist).
Timothy Geithner, Secretary of the Treasury, was raised Episcopalian (but is probably a crypto-atheist). Anti-Semites probably think he’s Jewish because he has a German name and he was born in Brooklyn, and they think that all people with German names who were born in Brooklyn are Jewish.
Robert Gates, Secretary of Defense. His religion is unknown, which means he’s not Jewish because if he were, the anti-Semites would be on top of it. And how many Jews come from Kansas? Gates is probably an atheist.
Eric Holder, attorney general, Caribbean black (from Barbados), Episcopal
Ken Salazar, Secretary of the Interior, Hispanic (but a fake Hispanic like Bill Richardson III), Catholic.
Tom Vilsack, Secretary of Agriculture, Catholic
Gary Locke, Secretary of Commerce, Chinese
Hilda Solis, Secretary of Labor, Hispanic, Catholic
Kathleen Sebelius, Secretary of Health and Human Services, Catholic.
Shaun Donovan, Secretary of HUD, Irish.
Ray H. LaHood, Secretary of Transportation, Catholic of Lebanese and German descent (and his Lebanese half is the Catholic half).
Steven Chu, Chinese
Arne Duncan, Secretary of Education, religion unknown.
Eric Shinseki, Secretary of Veterans Affairs, Japanese-American.
Janet Napolitano, Secretary of Homeland Security, a Methodist with an Italian name. (Her non-Italian half appears to be German and WASP from Missouri. Some anti-Semites have probably called her Jewish because they think that all German names are Jewish.)

Obama’s cabinet is certainly the most Asian cabinet we’ve ever head. Two Chinese and one Japanese.