New MRU video on American stasis

by on March 21, 2017 at 10:07 am in Books, Economics, History, Science | Permalink

1 Joël March 21, 2017 at 10:30 am

Nice video. At the end, when we see the big metallic drag with “great rest” written on it, destroying old corporations and the congress, I was waiting for the small white cars representing the few disruptive firms jumping on it and finding their way to stop it, saving us all. Disappointed it didn’t come!

2 SG March 21, 2017 at 10:46 am

Beware of the pundit peddling a “Big Idea”

3 Thiago Ribeiro March 21, 2017 at 12:02 pm

Even if he bears gifts?

4 Alain March 21, 2017 at 11:19 am

Another great video.

Interesting that the two largest unicorns are, at their core, about busting regulations and that they have increased the net welfare by such a large degree.

5 carlospln March 22, 2017 at 1:53 am

If you’re referring to Uber, you win the Dunce Prize!

The word you were searching for is ‘evading’, and Uber will never make a profit, let alone a return for the idiots who put up its VC funding.

Why do you think le proprieteur has dropped it like a hot potato, right TC?

Dunce Prize Winner, come on down!

6 mad_kalak March 21, 2017 at 11:23 am

Tyler inadvertently made a video that is a perfect case for the Trump budget.

7 mad_kalak March 21, 2017 at 11:25 am

….and tax plan.

8 anon March 21, 2017 at 12:03 pm

There are two solutions to expanding “autopilot” funding. One is to cut that spending, which has been so far impossible. The other is to boost tax and spending toward average OECD levels.

A case for the Bernie Sanders budget.

9 mad_kalak March 21, 2017 at 12:30 pm

Which would lead to ever larger entitlements, such as “free” college tuition, leading to even more spending on autopilot relative to the amount being taxed and spend…so you end up where you were before.

10 anon March 21, 2017 at 12:36 pm

I found this very convincing, fwiw

https://niskanencenter.org/blog/cant-make-government-smaller/

(I too hate “free college for all”, for “some” maybe, but not all.)

11 anon March 21, 2017 at 12:38 pm

One nugget:

“As our namesake Bill Niskanen showed, tax cuts that lead to budget shortfalls don’t lead to corresponding cuts in government spending. On the contrary, financing government spending through debt rather than taxes makes voters feel that government spending is cheaper than it really is, which makes them want even more of it.”

12 mad_kalak March 21, 2017 at 2:03 pm

That people want services for themselves based of taxes other people pay, politicians spread the largess in good times and are fearful of seeming to cut back in bad times, and the governments often borrow more than they earn is kinda universal to human history. I’m not denying, as the blog post suggests, that as we get wealthier our standards change to expect more as the new norm and that borrowing makes it seem cheaper, but the problem is just as much that people don’t feel the bite of taxes to pay for the services we get now because many are paid indirectly, not allowing them to make the appropriate cost/benefit analysis. These are all either alternate explanations, or more likely the multi-causal explanation, of why spending never seems to go down.

anyway…*bookmarks blog post to more thoroughly read later*

13 anon March 21, 2017 at 11:47 am

You want complacent? I got complacent:

https://twitter.com/foxandfriends/status/844126949693784064

14 mad_kalak March 21, 2017 at 11:54 am

Funny, but not relevant.

15 anon March 21, 2017 at 11:56 am

I was only going for funny

16 Todd Kreider March 21, 2017 at 3:28 pm

First, U.S. productivity did *not* “boom throuhgout most of the twentieth century” as Tyler claims in the video. There was strong post WWII productivity growth until 1973 and resumed from 1992 to 2010.

Second, Tyler says “But Starting in 1973 we see a sharp decline in productivity growth, and that has continued except for one excetional period in the mid 1990s.”

Again, no. Being generous and saying the mid 1990s is from 1992 when productivity was 4.5% to 1998 when it was 3.0%, the average growth was 1.9%. That is what Tyler calls the exceptionally fast period. If you take off the end points and use 1993 to 1997 then even slower.

There was really 15 years of strong average productivity growth that ended with the Great Recession: 1996 to 2000 = 2.8%; 2001 to 2005 = 3.2% and 2006 to 2010 = 2.0% 2011 to 2016 = 1.0%.

So that’s it – only the recent post recession productivity is lower at 1.0%.

BLS
https://data.bls.gov/pdq/SurveyOutputServlet

17 Anonymous March 21, 2017 at 4:24 pm

I remember a big thing in the 1990s was “downsizing,” eliminating white-collar workers to make the companies more efficient. It all ended around the time of the Bush election and 9/11, and from then on, the layoffs fell only on the blue collar workers, the legions of paper-pushers never feared decline. Maybe that had something to do with the fact that the 1990s were the period of significant productivity growth.

18 JK Brown March 22, 2017 at 1:01 pm

Believe that innovation and creation of small business has declined, look no further than the regulatory state. No need for me to repeat what was well said 70 years ago, when it was a warning rather than a diagnosis. Interesting coincidence. The regulatory state went into high gear, especially in its attack on small and new businesses, around 1973.

“The Dictatorial, Anti-Democratic and Socialist Character of Interventionism

“Many advocates of interventionism are bewildered when one tells them that in recommending interventionism they themselves are fostering anti-democratic and dictatorial tendencies and the establishment of totalitarian socialism. They protest that they are sincere believers and opposed to tyranny and socialism. What they aim at is only the improvement of the conditions of the poor. They say that they are driven by considerations of social justice, and favour a fairer distribution of income precisely because they are intent upon preserving capitalism and its political corollary or superstructure, viz., democratic government.

“What these people fail to realize is that the various measures they suggest are not capable of bringing about the beneficial results aimed at. On the contrary they produce a state of affairs which from the point of view of their advocates is worse than the previous state which they were designed to alter. If the government, faced with this failure of its first intervention, is not prepared to undo its interference with the market and to return to a free economy, it must add to its first measure more and more regulations and restrictions. Proceeding step by step on this way it finally reaches a point in which all economic freedom of individuals has disappeared. Then socialism of the German pattern, the Zwangswirtschaft of the Nazis, emerges.”

von Mises, Ludwig (1947). Planned Chaos

See also, Mises ‘Bureaucracy’ for a more detailed look :

“This vehement indictment of bureaucracy is, by and large, an adequate although emotional description of present-day trends in American government. But it misses the point as it makes bureaucracy and the bureaucrats responsible for an evolution the causes of which must be sought for elsewhere. Bureaucracy is but a consequence and a symptom of things and changes much more deeply rooted.

“The characteristic feature of present-day policies is the trend toward a substitution of government control for free enterprise. Powerful political parties and pressure groups are fervently asking for public control of all economic activities, for thorough government planning, and for the nationalization of business. They aim at full government control of education and at the socialization of the medical profession. There is no sphere of human activity that they would not be prepared to subordinate to regimentation by the authorities. In their eyes, state control is the panacea for all ills.”

von Mises, Ludwig (1945). Bureaucracy

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