What is "Price Gouging?"

You’d expect economist Thomas Sowell to be annoyed by the concept of “price gouging.”  And he is.  Just what exactly is "price gouging," anyway, he asks?

The phrase is used when prices are higher than most people are used to. But there is nothing special or magic about what we happen to be used to.
When the conditions that determined the old prices change, the new prices are likely to be very different. That is not rocket science.

OK.  Quite right, Dr. Sowell.  So they complain to their congressman.

But let us indulge in a little amateur psychology here.  People don't like unexpected increases in prices.  They don't like them because at some point they are going to have to change their behavior and do something about the increased prices.  They experience a "felt uneasiness," in the words of Ludwig von Mises, and feel called upon to act.  They could act by reducing their consumption, either of the newly expensive product or something else.  Or they could act by writing to their congressman, or bitching at the office about "price gouging."

Acting to change your consumption patterns is hard.  Acting by writing to your congressman is easy.

Congressmen know that it is no good arguing with an irate constituent.  The best thing is to do some arm-waving and pretend to do something by introducing legislation.  Hopefully, by the time you have finished your arm-waving the constituent will have got over his anger.

What is "price gouging?" It is a price increase large enough that doing nothing may not be enough.  And we don’t like it one bit.

Why We Don't Take Comedy Seriously

Back in the good old days of Greek drama, the arts were properly balanced between tragedy and comedy, argues Julian Gough. 

Unfortunately most of the comedies were lost, and only Aristotle’s rules of tragedy were preserved in the Poetics.  His rules of comedy were lost.

Then along came Christianity with an overbalance towards the tragic view of life. So 

western culture since the middle ages has overvalued the tragic and undervalued the comic. We think of tragedy as major, and comedy as minor. Brilliant comedies never win the best film Oscar.

He doesn’t say it, but it’s not just Christians that are too serious.  Your average academic lefty is far too serious too.

And we know why.  When you want political power the last thing you would think of doing is to talk about the Human Comedy.  Power comes from frightening the people and then leading them to safety.

But there’s been plenty of good comedy down the ages.  Gough lists his favorites:

Rabelais, Cervantes, Swift, Voltaire, and on through to Joseph Heller’s Catch-22 and the late Kurt Vonnegut’s Slaughterhouse 5.

That’s all very well, of course.  I’d reply with Shakepeare’s comedies, Jane Austen, Dickens, Trollope, Dorothy Sayers, and Tom Wolfe.  That’s because I’m a guy who celebrates our shared human comedy rather than take a holier-than-thou ironic distance like Heller and Vonnegut.

The problem with the modern arts is, of course, that it has joined the establishment.  All those university professors of English and artists-in-residence create a distance between the creator and the audience.

Probably the best thing for the arts would be for it to be banished from the ivory tower and forced to work for a living.

But that would never happen, because art is too important to be left to the vagaries of the market, old chap.

Iran Tottering on the Edge

How bad are things in Iran?  It’s hard to know.  Our international media are good at showing us made-for-TV bombs in Baghdad, but not very good at peering under the blankets of thug-dictator regimes like Ahmaninejad’s.

According to Spengler, things are in very bad shape.  Inflation is 20 percent, monetary expansion 40 percent, and it is beginning to look as if the regime is faking its economic statistics.  Then there is employment, or lack of it. 

Iranian dissidents put overall unemployment at 30% and youth unemployment at 50%. Government subsidies sustain a very large portion of the population; 42% of the non-agricultural population is employed by the Iranian state, compared with 17% in Pakistan.

 And now Ahmaninejad has passed a decree to roll back interest rates. Yeah.

So what is going to happen?  Is Iran going to stop its imperial program, or go for broke?  Can we talk them out of it?

An old piece of diplomatic wisdom states that one always should give one’s enemy a way out. But I see no way out for the pocket empire of Persia.

That means war, and war sooner rather than later.  Maybe even this very summer.

After all, it is at least 18 months till the Democrats take over in the US and that may be too long.

We Are All in It Together, Clinton Says:

Presidential candidate Hillary Clinton says that the Bush “ownership society” is really an “on-your-own” society, according to Holly Ramer

"I prefer a ’we’re all in it together’ society," she said. "I believe our government can once again work for all Americans. It can promote the great American tradition of opportunity for all and special privileges for none."

That means pairing growth with fairness, she said.

One of the interesting questions when a Democrat ups and says something like this is: Are you saying that the $2.5 trillion the government spends on social programs from education to training to health care to pensions isn’t working?

Everyone believes is fairness. Everyone believes that we’re all in it together.  The question is what do you define by “fairness” and what do you propose to do about it?

Judging from the content of Clinton’s speech, she wants to jiggle around the various special tax breaks and dodges and increase energy taxes. 

I’m not sure what that has to do with being in it together.

Since Hillary Clinton is a Democrat we assume that what she wants to do is spend more money on Democratic voters, stuff like increasing the earned income tax credit.  But Democratic voters are already drowning under $2.5 trillion a year in government programs.  I don’t know if they can stand any more.

Of course, Clinton also wants to increase income taxes, to restore the tax system of the 1990s.

And when the president’s irresponsible tax breaks for high-income Americans expire, we will return to the income tax rates for upper- income Americans that we had in the 1990s, rates that were consistent with a balanced budget and economic growth.

Funny thing.  AP writer Holly Ramer didn’t mention Clinton’s proposal to increase personal income taxes in her article. You would think that would be the most important “news you can use” and that as a professional journalist, Ramer would be anxious to communicate this to her readers. 

I wonder why.

GOP Tide in Full Ebb

Don’t look now, writes David Frum, but the party of Ronald Reagan is heading into “a horrible Republican defeat in 2008.”

And it’s not going to do any good to invoke the Gipper this time around. 

Ronald Reagan was elected at a time when every social indicator seemed to be moving in the wrong direction: crime up, abortion up, divorce up, welfare dependency up, test scores down.

 Reagan-era politics just isn’t going to cut it in the 21st century.

No doubt.  But let’s not get carried away by the gloom and doom.  It is right and proper for the Democrats to win in 2008.  It is time for a change.  The whole point of democratic politics is that you get to throw the rascals out.  Again and again.

Here’s a cheery thought.  After 1932 and the Great Depression it took 5 presidential terms before the voters upchucked the Democrats.  After 1960 it took 2 terms, after 1976 one term.  Then when Clinton was elected in 1992 it took half a term for the voters to upchuck the Democratic Congress.  Sensibly, Clinton governed like a Republican from then on.

It will be interesting to see how Democrats fare after 2008.  First of all, they’ll want to raise taxes to pay for all their programs.  Then there is the question of the war on terror.  Then there is the Social Security mess, the Medicare mess, the education mess, and the single parent mess (see above) for everyone except college graduates.

All in all, I’d say the Democrats deserve to win in 2008.

As H.L. Mencken said:  “Democracy is the theory that the common people know what they want, and deserve to get it good and hard.”

Marriage in America: It's a Class Thing

As the June wedding season swings around The Economist(sub) is taking a look at marriage in America, keying off Kay Hymowitz’s Marriage and Caste in America.  What do they find?

There is a widening gulf between how the best- and least-educated Americans approach marriage and child-rearing.

They have a handy little graph which shows the percentage of children living with single parents since 1964.  It looks like this:

Mother’s education	1964	1995	2001
Less than high school	13%	42%	37%
High school	7%	27%	29%
Post high school	6%	25%	23%
College degree	5%	11%	10%

 Yes.  It’s special, isn’t it?

Now the question is, why?  How could the child-raising practices of Americans have diverged so much over half a century?  It couldn’t be anything to do with the War on Poverty, could it?

Let us do some reckless speculation.  The reason that college-educated women don’t go in for single parenthood is that you can’t raise a middle-class kid in a neighborhood with decent schools and send them to college if you are a single mother.  The numbers just don’t add up. For college-educated women it just makes sense to dial in a husband and father when you are planning to have children.

But if you have no education then the government offer of support looks pretty good.

But notice that the incidence of single motherhood has been going down among the least educated since 1995.  That’s interesting, isn’t it? 

Now let’s see.  In 1996 Congress enacted welfare reform.  It could be that since the end of welfare-as-we-know-it more under-educated women have been choosing marriage for raising their children. 

It’s a concept.

Down the Memory Hole

Last fall John J. Miller observed that military history is dying out in our nation’s universities.  There are still a few old codgers left, aging professors close to retirement, but they aren’t being replaced.

On this Memorial Day Rich Lowry adds his two cents worth.

John A. Lynn recently looked back at the past 30 years of the prestigious academic journal The American Historical Review. He found no articles on the conduct of World War II, the American Revolution or the Napoleonic Wars.

We know why wars and military history are marginalized in the modern university.  It is bias, pure and simple.

New Republic contributing editor David A. Bell locates that bias deep in the social sciences: "The origin of these sciences lie in liberal, Enlightenment-era thinking that dismissed war as primitive, irrational and alien to modern civilization." This represents a fundamental misapprehension of human nature and thus the nature of history.

That is to say, it goes beyond bias to the fundamental understanding of the world held by Enlightenment-era thinkers and their adepts.

The odd thing is that, in its revolutionary subculture, the Enlightenment folks understand conflict completely.  They understand that marginalized peoples must elbow their way into history or be ground underfoot.  The racism-sexism-classism-homophobia folks experience everything in terms of power and conflict.

And Saul Alinsky famously wrote his Rules for Radicals to teach lefties how to battle the reactionary establishment.

The good thing is that men love studying wars and conflict so much that plenty of military history can go forward outside the academy.  It shows up on the groaning shelves of military history at the local bookstore and on cable’s History Channel which has so much programming about World War II that wags have renamed it the "Hitler" Channel.

Chances are that in the near future we’ll need a generation of leaders well versed in military arts and military history in order to deal effectively with radical Islam.

It’s a pity that our universities won’t be of any help.