Law

[China] must adopt a planned economy and social legislation to secure the livelihood and survival of every citizen, and it is imperative that we eventually accomplish the objective of “transforming [all] capital into state capital [nationalization of capital], and transforming [all] enjoyment into enjoyment of the masses.”

The answer is here.

That is from Morris L. Bian, The Making of the State Enterprise System in Modern China: The Dynamics of Institutional Change, p.205.  This book is useful for showing early Chinese moves in the direction of state planning and state-owned enterprises.

Arnold Kling poses that question., and he writes:

Suppose that when they meet with bankers, for example, Fed officials had to wear cameras and audio recorders, which could be obtained by FOIA requests. Or suppose that IRS officials had to wear cameras, for example, when they wrote emails or engaged in discussions about dealing with tax-exempt groups.

The intended consequences of the camera rule would be, as with having police wear cameras, to make sure that public officials remember that they are being watched and to reduce instances where they are wrongly suspected of acting against the public interest.

What might be the averse unintended consequences of forcing high-level public officials to wear cameras and recording devices when engaged in their ordinary duties?

I believe this practice would induce some offsetting adjustments.  First, public officials would much more frequently act as if they were on television.  We more or less know what that is like.

Second, the unmonitored positions would rapidly become much more powerful.  The monitored positions would become a bit like the British monarchy, namely of great ceremonial importance, and capable of causing a public scandal with ill-thought out remarks, but not the real decision-makers.

Third, the demand for unmonitored “private contractors” would go up.  These contractors would attach themselves to individual politicians, and carry out their will with the outside world, receiving  their instructions as those politicians were initiating their love-making, off camera of course.

toddler

Other good photos, with different subjects, are here.

This is perhaps today’s underreported news story:

Catalonia’s regional government said Tuesday it was suspending its promotion of an independence referendum, a day after a decision by Spain’s Constitutional Court blocking the nonbinding vote.

Catalonia’s leaders still hoped to hold the vote on Nov. 9, said spokesman Francesc Homs, but meanwhile they are halting the campaign for the referendum to avoid subjecting public servants to possible legal liability for defying the court.

There is more here.  Here is an El Pais in English story about how they hope to fight back and continue anyway, but it sounds like a losing cause.  Here is a story on a protest march to defend the referendum idea.  Developing…

The return to education in France?

by on September 30, 2014 at 3:34 pm in Economics, Education, Law | Permalink

Pierre Mouganie has a new paper:

In 1997, the French government put into effect a law that permanently exempted young French male citizens born after Jan 1, 1979 from mandatory military service while still requiring those born before that cutoff date to serve. This paper uses a regression discontinuity design to identify the effect of peacetime conscription on education and labor market outcomes. Results indicate that conscription eligibility induces a significant increase in years of education, which is consistent with conscription avoidance behavior. However, this increased education does not result in either an increase in graduation rates, or in employment and wages. Additional evidence shows conscription has no direct effect on earnings, suggesting that the returns to education induced by this policy was zero.

You should note of course that the “return to education you wish to do for non-draft-avoiding reasons” still may be positive or strongly positive.  Nonetheless this is an object lesson in the point that the goal is not to increase educational attainment per se, but rather good outcomes probably require “education plus some of the prerequisites and complements of education.”  The large number of unemployed engineers in some of the Arabic countries illustrate a related point.

For the pointer I thank the excellent Kevin Lewis.

Bras, girdles and leggings infused with caffeine and sold as weight loss aids were more decaf than espresso, and the companies that sold them have agreed to refund money to customers and pull their ads, U.S. regulators said on Monday.

The Federal Trade Commission said Wacoal America and Norm Thompson Outfitters, which owns Sahalie and others, were accused of deceptive advertising that claimed their caffeine-impregnated clothing would cause the wearer to lose weight and have less cellulite.

There is more here, and for the pointer I thank Glenn Mercer.

Swiss voters on Sunday rejected a plan to ditch the country’s all-private health insurance system and create a state-run scheme, exit polls showed.

Some 64 percent of the electorate shot down a plan pushed by left-leaning parties who say the current system is busting the budgets of ordinary residents, figures from polling agency gfs.bern showed.

Going public would have been a seismic shift for a country whose health system is often hailed abroad as a model of efficiency, but is a growing source of frustration at home because of soaring costs.

“Over the past 20 years in Switzerland, health costs have grown 80 percent and insurance premiums 125 percent,” ophthalmologist Michel Matter told AFP.

There is more here, and for the pointer I thank Samir Varma.

From Joe Palazzolo at the WSJ:

There is no research yet on whether the use of risk evaluations in sentencing has aggravated, for example, the gap between sentences for black and white men for similar crimes.

Ms. Starr said the disparities created by risk measures are evident. “When it comes down to it, these assessments stand for the proposition that judges should sentence people longer because they were in foster care as children or had too many bouts of unemployment,” she said.

Christopher Slobogin, a Vanderbilt University law professor, said the alternative was potentially worse. “At least these risk-assessment instruments don’t explicitly focus on race or poverty, unlike what might occur in a sentencing regime where judges are making risk assessments based on seat-of-the-pants evaluations,” he said.

Some observers, such as U.S. District Judge Richard Kopf in Nebraska, say age or race should be considered if doing so yields a more accurate measurement of risk. He wrote in a blog post last month: “If race, gender or age are predictive as validated by good empirical analysis, and we truly care about public safety while at the same time depopulating our prisons, why wouldn’t a rational sentencing system freely use race, gender or age as predictor of future criminality?”

There is more here.

Logistics firm DHL is using a drone to fly parcels to the German island of Juist, in what it says is the first time an unmanned aircraft has been authorized to deliver goods in Europe.

The company, owned by Germany’s Deutsche Post, joins the likes of Amazon.com and Google in testing the potential for drones to deliver parcels and packages.

Its drone – the “parcelcopter” – can fly at up to 65 km (40 miles) an hour. It will deliver medication and other urgently needed goods to the car-free island of Juist, off Germany’s northern coast, at times when other modes of transport such as flights or ferries are not operating.

There is more here, via Eli Dourado.

In my post on why economics is detested I quoted Arnold Kling:

The intention heuristic says that if the intentions of an act are selfless and well-meaning, then the act is good. If the intentions are self-interested, then it is not good.

In contrast, economics evaluates an act not by its intentions but by its consequences. Since “bad” intentions can lead to good consequences (“as if by an invisible hand”). It’s not surprising that economists often praise what others denounce. Here’s a case in point:

At a Sydney technology startup conference, Evan Thornley, an Australian multimillionaire and co-founder of online advertising company LookSmart (LOOK), gave a talk about why he likes to hire women. “The Australian labor market and world labor market just consistently and amazingly undervalues women in so many roles, particularly in our industry,” he said. When LookSmart went public on Nasdaq in 1999, he said, it was one of the few tech companies that had more women than men on its senior management team. “Call me opportunistic; I thought I could get better people with less competition because we were willing to understand the skills and capabilities that many of these woman had,” Thornley said.

Thornley went on to say that by hiring women, he got better-qualified employees to whom he was able to give more responsibility. “And [they were] still often relatively cheap compared to what we would’ve had to pay someone less good of a different gender,” he concluded. To illustrate his point he showed a slide that said: “Women: Like Men, Only Cheaper.”

For his comments, Thornley’s was labelled a sexist and loudly denounced, especially so by furious women. Strange? Not according to the intention heuristic which judges self-interested actions as bad.

If we judge actions by consequences, however, Thornley should be encouraged, perhaps even praised. Accepting for the sake of argument the truth of the story, it’s Thornley who has overcome prejudice (his or his society’s), recognized the truth of equality and taken entrepreneurial action to do well while doing good. It’s Thornley who is broadcasting the fact of equality to the world and encouraging others to do likewise. Most importantly, the consequence of Thornley’s actions are to increase the demand for women executives thereby increasing their wages.

Women’s wages aren’t pushed down by employers who hire women but by employers who don’t hire women. So why does Thornley get the blame? Instead of denouncing Thornley, whose actions push up the wages of women he hires and the wages of the women he does not hire, why not ask, How can we encourage employers not to overlook talented women and minorities?

For those wanting to break the bonds of discrimination whether they be women, blacks or Dalits, lower wages and a competitive market aren’t the cost of discrimination but the cure. It’s the lower wages that give employers an incentive to overcome prejudice, seek out talent, and experiment with new ways of doing business. And it is the self-interested pursuit of profit that is the surest means to increase the wages of the unjustly ignored and overlooked.

Just hours after Scotland voted “no” to independence from the United Kingdom, Catalonia’s regional parliament announced on Friday that it had passed a law, which Catalan leaders say authorizes them to hold a non-binding “consultation” on independence from Spain in November.

The law was passed with a vote of 106 to 28.

Spain’s central government and Spanish Prime Minister Mariano Rajoy, however, categorically oppose Catalonia’s campaign for a referendum, as the Spanish constitution doesn’t allow referendums that don’t include all Spaniards.

There is more here, and much more here.  My view is that we’ve been getting lucky on these European political events — in relative though not absolute terms — and sooner or later that streak of good fortune is bound to end.

The Obama administration on Thursday announced measures to tackle the growing threat of antibiotic resistance, outlining a national strategy that includes incentives to spur the development of new drugs, tighter stewardship of existing ones and a national tracking system for antibiotic-resistant illness. The actions are part of the first major federal effort to confront a public health crisis that takes at least 23,000 lives a year.

The full story is here.

The Hill has more detail.  It is an executive order:

The president’s directive creates the Task Force for Combating Antibiotic-Resistant Bacteria, co-chaired by the secretaries of Defense, Agriculture and Health and Human Services.

The group is charged with implementing a plan to track and prevent the spread of antibiotic-resistant bacteria, promote better practices for the use of current drugs and push for a new generation of antibiotic medications.

To that end, the White House on Thursday announced a $20 million prize “to facilitate the development of rapid, point-of-care diagnostic tests for healthcare providers to identify highly resistant bacterial infections.”

The added incentive and the timeframe given to the task force indicate the urgency with which the administration is acting, said Dr. Eric Lander, who co-chairs the President’s Council of Advisors on Science and Technology.

“This is a pretty tight timeline to now come up with a national game plan,” Lander said.

There is also this:

In December, the Food and Drug Administration (FDA) unveiled a plan to phase out the use of antimicrobials for the purpose of fattening chickens, pigs or other animals destined for human consumption. But the plan relies in part on voluntary industry cooperation, and advocates argue the government’s efforts are lagging behind even some industry players.

Here is the new full 78 pp. report to the President on antibiotic resistance (pdf).

This initiative — or its failure — is potentially a more important health issue than Obamacare, yet it will not receive 1/1000th of the attention.  Without reliable antibiotics, a lot of now-routine operations would become a kind of lottery.

Here are previous MR posts on antibiotic resistance.  I would note it is difficult to judge such a plan at the current level of detail.  It is better than nothing, but any initial plan is going to be not nearly enough, relative to an ideal.  By the way, Alex tells me there is also a British prize, discussed here.

Colombia extends its wealth tax

by on September 17, 2014 at 11:03 am in Current Affairs, Economics, Law | Permalink

Colombia is one of the world’s most unequal societies. Last week, the government of Juan Manuel Santos, who began his second term as president in August, announced the extension of a wealth tax introduced in 2002 to pay for the mounting costs of the country’s 50 year drug-fuelled guerrilla war.

“In that sense, we are actually ahead of the curve of what Piketty proposes,” says Mr Cárdenas.

…“This touches only 50,000 Colombians out of the entire population” of 48m people, he says, “that is less than 1 per cent of the population.”

President Santos himself is a product of that 1 per cent. A US-educated economist and member of a wealthy family of the Colombian establishment, he heads up a centrist administration, not a Venezuela-style leftist regime.

Mr Santos has increased rates for various tranches of the levy, in some cases by 50 per cent. Those with a net worth of between $510,000 and $1.5m must pay a 0.4 per cent tax. The rate rises to 2.25 per cent for net worth above $4m. That applies to 45,000 businesses and about 1,000 individuals, Mr Cárdenas said.

Only about five percent of Columbians actually pay into the standard income tax system.  The FT piece by Andres Schipani is here.

Here is the latest:

David Cameron faces a “bloodbath” at the hands of Tory MPs after all three parties pledged to continue high levels of funding for Scotland if it rejects independence.

The Prime Minister is facing mounting dissent among English backbenchers after promising that Scotland’s special funding arrangements will continue even when the country is given control over its own taxation and spending.

One Tory MP said the promise to Scottish voters, issued by Mr Cameron, Ed Miliband and Nick Clegg in the Daily Record newspaper, “smacks of desperation”.

Under the Barnett formula, devised in the 1970s by Labour Treasury minister Lord Barnett, spending is allocated according to population size, rather than the amount each country actually needs.

Critics say this gives Scotland an unfair share of government spending and even Lord Barnett has called for it to be replaced.

According to research at Stirling University, England loses around £4.5 billion of public spending every year because the money is handed to Scotland instead

In other words, this story will not end with a “no” vote from Scotland, unless it is strongly decisive.  Regardless of the result, allowing this referendum to go forward likely will go down as one of the greatest unforced errors in recent times.

Chitmahals

by on September 15, 2014 at 1:57 am in Books, History, Law, Uncategorized | Permalink

I had not known of these:

The Indo-Bangladesh enclaves, also known as the chitmahals (Bengali: ছিটমহল chitmôhol), sometimes called pasha enclaves, are the enclaves along the Bangladesh–India border, in Bangladesh and the Indian state of West Bengal.

There are 106 Indian enclaves and 92 Bangladeshi enclaves. Inside the main part of Bangladesh, 102 of these are first-order Indian enclaves, while inside the main part of India, 71 of these are Bangladeshi first-order enclaves. Further inside these enclaves are an additional 24 second order- or counter-enclaves (21 Bangladeshi, 3 Indian) and one Indian counter-counter-enclave, called Dahala Khagrabari #51. They have an estimated combined population between 50,000 and 100,000.

In September 2011, the Prime Ministers of the two countries (Manmohan Singh of India and Sheikh Hasina of Bangladesh) signed an accord on border demarcation and exchange of adversely held enclaves; however, the Indian parliament has yet to ratify it. Under this intended agreement, the enclave residents could continue to reside at their present location or move to the country of their choice.

Here is the Wikipedia entry.  It now seems the ruling BJP party seems to want to take that 2011 agreement back.

Alastair Bonnett, in his new and excellent Unruly Places: Lost Spaces, Secret Cities, and other Inscrutable Geographies, notes that these enclaves are usually not supplied with public goods.  Furthermore:

In order to leave these tiny enclaves, the inhabitants have to obtain a visa to travel through the foreign territory that surrounds them.  But in order to obtain a visa they have to leave their enclave, since visas can only be obtained in cities many miles away.

And:

The Indian Enclave Refugees’ Association has been formed to lobby for the right to “return” to India.

Many of them are denied the right to settle in what is ostensibly their home country, namely India.