Category: History
Points I made about charter cities and free cities
I do favor experimentation in these directions, but often at Liberty Fund conferences, and indeed more generally, I play the role of contrarian. I am not supposed to report the comments of others, but here are a few of the points I made in the discussions over the weekend:
1. It is striking that charter cities — a partial unpacking of nation-states — are proposed for a region, namely Central America, where Central American unification has been an ongoing proposal for hundreds of years. Could it be that Central American nation-states were not optimally carved up in the first place? Are cross-national unification and charter “unpacking” really polar opposites as proposals, or do they have more in common than it might at first appear?
2. Under what conditions would, in equilibrium, landowners capture most of the value created by a charter or free city? Well-governed land would seem to be very scarce.
3. To what extent do charter cities require the active support or at least implicit support of a major hegemon? Great Britain and then the U.S. backed Hong Kong and Singapore. The U.S. took over Puerto Rico. Yet Portuguese Goa and French Pondicherry are no longer real entities in part because no powerful government stood behind them.
4. To what extent are landlocked charter cities viable, or will their rents get swallowed up by larger and adjacent neighbors, much as India gives Nepal somewhat of a raw deal on transport? Are successful charter and free cities more likely to be on the water?
5. Are the most likely countries to approve charter cities those which plan to use them as “special purpose vehicles” to keep offshore oil and gas revenues out of the hands of the legislature or other domestic “interest groups”?
6. More generally, what kind of selection process will rule which charter cities are approved and which wither on the vine? How much will this selection process make the original idea worse (or better)?
7. When it comes to local land rights and the like, to what extent can the new legal authority of a charter or free city operate independently of the original legal system? Or must the new legal authority defer to the documents, maps, and other decisions of the previous authority? How many of the new legal decisions can in fact be disembedded from the previous legal authority?
8. Are charter and free cities likely to work better or worse with free or restricted immigration? Which are they likely to evolve?
A few James Buchanan reminiscences
Most of all I thought of him as a moralist and one of our best moralists. I don’t mean an ethical philosopher (though he did that too), but a personal moralist and a judge of all that was around him. His advocacy of a 100% inheritance tax is essential to understanding the man, as was his dislike of northeastern elites, a category to which he was never quite sure if I belonged. He was a dedicated romantic who, after an intellectually traumatic encounter with Frank Knight, was looking for new, non-religious foundations for some rather old-fashioned views, often of a regional nature (Buchanan was from Tennessee). He remains one of the least well understood and least accessible economics Nobel Laureates, and I don’t foresee that changing anytime soon.
Woe to the man caught shirking by Buchanan. He was up every day, working at 6 a.m., and expected not much less from others.
He was not always easy to have as a colleague. He created a world around himself, intellectually, socially, and otherwise, and he lived in no other world but his own.
Betty Tillman was an essential ingredient behind his success, and over the years I grew to understand her managerial and advisory talent for Jim and for the Public Choice Center more generally.
His Better than Plowing is one of the underrated autobiographies of economics.
He favored titles with alliteration, such as The Calculus of Consent, The Limits of Liberty, and The Reason of Rules, three of his best books.
Jim was a splendid manager of collaborations and brought out in the best in Gordon Tullock, Geoff Brennan, Dick Wagner, Yong Yoon, and others. Institution-building was another important part of his legacy. Not just the Center for Study of Public Choice, but also Mont Pelerin, Atlas, Liberty Fund, and the Institute for Humane Studies were all important to him, among other groups.
Some of his key phrases were:
“the relatively absolute absolutes” (don’t ask)
“Don’t get it right, get it written”
and, most of all:
“Onward and upward”
He made us all better and I will always miss him.
Retrying Socrates, in front of Judge Posner
Star litigators in Chicago are preparing to retry a controversial 2,400-year-old free speech case that famously resulted in the death of Socrates, now considered the father of Greek philosophy, when he drank a cup of poisonous hemlock.
Dan Webb of Winston and Strawn and plaintiffs lawyer Robert A. Clifford, a former chair of the ABA Section of Litigation, will represent Socrates at the Jan. 31 proceeding, which is being held as a fundraiser by the National Hellenic Museum in Chicago. The case for the City of Athens will be made by former U.S. Attorney Patrick Fitzgerald, now a partner at Skadden Arps Slate Meagher & Flom, and Patrick M. Collins of Perkins Coie.
Judge Richard A. Posner of the Chicago-based 7th U.S. Circuit Court of Appeals will head a three-judge panel that also includes his federal appeals court colleague William J. Bauer and Cook County Circuit Judge Anna Demacopoulos.
Here is a bit more, and for the pointer I thank John C.A.K. I suppose Socrates is now in exclusive company with Conrad Black.
In which countries is crude libertarianism most and least true?
For least true, I nominate South Korea. Other than comparing it to North Korea, how much do you hear libertarians claiming South Korean policies as their own? It seems the government there did a lot and mostly it paid off. The best the libertarian can manage is something like “their economy would have grown rapidly in any case,” and that may not even be true.
For “most true” you might say North Korea, but that is too easy a pick. How about India? Government there has done lots but most of it has worked out quite badly, whereas their deregulations generally have gone well (see our India unit on MRUniversity.com). Further deregulation of the economy would likely be a good idea.
Singapore can be claimed for either category.
In which country is Marxism most true (“least untrue?”)? Least true? How about other ideologies?
The Prison Population is Down
After more than thirty years of constant increase, prison populations have leveled off and in the last few years have begun to decline (pdf). It’s a momentous change and Keith Humphreys argues that the story has been under-reported because few people want to play up the good news
(1) Most of the state, local and federal officials who have helped reduce incarceration are scared to publicly take credit for it. In general, reducing incarceration is a good thing, but probability dictates that in particular cases it will be a horrible thing. At least a few of the roughly 100,000 fewer people under correctional supervision in 2011 versus 2010 for example will do something extremely violent and high-profile, and no politician wants to risk being in a story headlined “Convict released by thug-loving governor murders nun”.
Hat tip: Matt Yglesias.
What has San Diego contributed to American culture?
In honor of the AEA meetings I was going to do “My Favorite Things San Diego” but frankly I came up with what is more or less a total blank. Eddie Vedder? I like Tom Waits. Lots of athletes. What else?
San Diego, by population, is the eighth largest city in the United States. Yet it seems to have had hardly any cultural influence. What gives?
Movie, set in: Almost Famous, or perhaps A Day Without a Mexican.
End of story, unless you can tell me more. I’m sure to enjoy the weather, though I’ll look longingly at Tijuana just across the border.
*The World Until Yesterday*
The author is Jared Diamond and the subtitle is What We Can Learn from Traditional Societies?
This is a difficult book to review. It is well written and intelligent, yet I struggle to find the novel propositions or the traction. Much of the book is description of the author’s earlier work in Papua New Guinea. These sections I enjoyed, though I did not find them revelatory or even mildly gripping. They also did not much incorporate more recent research on these communities. Other parts of the book repeat probably correct but tired points about privacy, obesity, the role of the elderly, and the like, comparing the modern world to earlier times. The discussions of the Pygmies — the hunter-gatherer community I know most about — seemed fine but not insightful. Beneath the surface is the question of how much different “hunter-gatherer” societies are alike or can be subject to generalization. Diamond never makes objectionable claims in this regard but ultimately the very premise of the book seems to require some objectionable claims, even if they are never put on paper.
If I had to place this book into the “good book” pile or “bad book” pile, I wouldn’t hesitate before putting it into the former. But I could not describe it as essential reading either. Perhaps I would have liked it more if I had expected less. In any case, I would have preferred a “more wrong” book that made me think more.
Here is a Chicago Tribune review of the book.
Kevin Kelly on why Robert Gordon is wrong
This is a very good piece. Here is the closing bit:
In his paper Robert Gordon talks about the huge value gained from “one-time” events, such as the one-time (first and last) move of a large proportion of women into the workforce. This new gain happens only once (assuming they remain). In this computer-internet economy we are experiencing a one-time gain from a huge one-time event. This is the first and only time a planet will get wired up into a global network. We are alive at this critical moment in history, and we are just at the beginning of the beginning of the many developments that will erupt because of this shift.
Cory Doctorow has interesting comments.
Markets in everything
Instead of long beards and robes, they wear track suits and T-shirts. Their tablets are electronic, not hewn of stone, and they hold smartphones, not staffs. They may not look the part, but this ragtag group of Israelis is training to become the next generation of prophets.
For just 200 shekels, about $53, and in only 40 short classes, the Cain and Abel School for Prophets says it will certify anyone as a modern-day Jewish soothsayer.
The school, which launched classes this month, has baffled critics, many of whom have dismissed it as a blasphemy or a fraud.
Here is more, and for the pointer I thank Asher Meir. By the way, I found this to be an especially odd and ineffective response:
“There is no way to teach prophecy,” said Rachel Elior, a professor of Jewish thought at Jerusalem’s Hebrew University. “It’s like opening a school for becoming Einstein or Mozart.”
I wonder what Bryan Caplan will think of this line:
Hapartzy can’t guarantee his course will give his students a direct line to God. But, he says, the syllabus provides the essential tools to bring out the prophet in anyone.
Here is another oddly incorrect statement:
Roie Greenvald, a 27-year-old tennis instructor attending the classes, also showed some skepticism. While he expressed interest in the spiritual development the course offers, one crucial detail stands in the way of his religious elevation.
“I’m not going to become a prophet,” he said. “I don’t think it pays very well.”
The school takes on all comers and it is run by a Russian immigrant and software engineer.
Happy Holidays to MR Readers!
How minimal is our intelligence?
From a longer post by Douglas Reay, this is all worth a good ponder:
Q is polygenetic, meaning that many different genes are relevant to a person’s potential maximum IQ. (Note: there are many non-genetic factors that may prevent an individual reaching their potential). Algernon’s Law suggests that genes affecting IQ that have multiple alleles still common in the human population are likely to have a cost associated with the alleles tending to increase IQ, otherwise they’d have displaced the competing alleles. In the same way that an animal species that develops the capability to grow a fur coat in response to cold weather is more advanced than one whose genes strictly determine that it will have a thick fur coat at all times, whether the weather is cold or hot; the polygenetic nature of human IQ gives human populations the ability to adapt and react on the time scale of just a few generations, increasing or decreasing the average IQ of the population as the environment changes to reduce or increase the penalties of particular trade-offs for particular alleles contributing to IQ. In particular, if the trade-off for some of those alleles is increased energy consumption and we look at a population of humans moving from an environment where calories are the bottleneck on how many offspring can be produced and survive, to an environment where calories are more easily available, then we might expect to see something similar to the Flynn effect.
For the pointer I thank Michelle Dawson. Here are some not totally unrelated remarks from James Flynn.
“Soviet Power Plus Electrification: what is the long-run legacy of communism?”
That is a newly published paper by Wendy Carlin, Mark Schaffer, and Paul Seabright, and here is the abstract:
Two decades after the end of central planning, we investigate the extent to which the advantages bequeathed by planning in terms of high investment in physical infrastructure and human capital compensated for the costs in allocative inefficiency and weak incentives for innovation. We assemble and analyse three separate types of evidence. First, we find that countries that were initially relatively poor prior to planning benefited more, as measured by long-run GDP per capita levels, from infrastructure and human capital than they suffered from weak market incentives. For initially relatively rich countries the opposite is true. Second, using various measures of physical stocks of infrastructure and human capital we show that at the end of planning, formerly planned countries had substantially different endowments from their contemporaneous market economy counterparts. However, these differences were much more important for poor than for rich countries. Finally, we use firm-level data to measure the cost of a wide range of constraints on firm performance, and we show that after more than a decade of transition in 2002-05, poor ex-planned economies differ much more from their market counterparts, in respect to both good and bad aspects of the planning legacy, than do relatively rich ones. However, the persistent beneficial legacy effects disappeared under the pressure of strong growth in the formerly planned economies in the run-up to the global financial crisis.
This paper is a very good place to start for trying to seriously figure out what communism did and did not do. It accounts for the relatively disastrous performance of East relative to West Germany, while helping to explain why Russia is in some regards a better place to live than Mexico. It is also a very strong testament to the extreme importance of human capital and good formal education.
They also cite a recent Broadberry and Klein piece, “When and Why did Eastern European Economies Begin to Fail?, Lessons from a Czechoslovak/UK Productivity Comparison, 1921-1991,” available in an earlier form here (pdf); in this case I worry more about the quality of the statistics, plus legacy effects can sustain a formerly successful economy for some while.
Jared Diamond on how hunter-gathers raised their children
Speculative, in my view, but I pass it along nonetheless out of general interest. The article is here, and hat tip goes to The Browser.
By the way, here is Diamond’s forthcoming book (Dec.31) The World Until Yesterday: What Can We Learn From Traditional Societies?
“The state of intoxication is a house with many mansions.”
So reads the preamble to the Winter 2013 issue of Lapham’s Quarterly, titled merely “Intoxication.” A tribute to tanking oneself, the anthology collects some 60 essays, poems, and stories from across the ages. As though anticipating Alex and Tyler’s trip to the Subcontinent, Lapham’s preamble traces the dignified heritage of the drink to those sacred Hindu texts (page references omitted):
Fourteen centuries before the birth of Christ, the Rigveda … finds Hindu priests chanting hymns to a “drop of soma,” the wise and wisdom-loving plant from which was drawn juices distilled in sheep’s wool that “make us see far; make us richer, better.” Philosophers in ancient Greece … rejoiced in the literal meaning of the word symposium, a “drinking together.” The Roman Stoic Seneca … recommends the judicious embrace of Bacchus as a liberation of the mind “from its slavery to cares, emancipates it, invigorates it, and emboldens it for all its undertakings.”
The litany continues through the Persians, Martin Luther, Samuel Johnson, and Baudelaire. Next to Plymouth and the American experiment.
The spirit of liberty is never far from the hope of metamorphosis or transformation, and the Americans from the beginning were drawn to the possibilities in the having of one more for the road. … The founders of the republic in Philadelphia in 1787 were in the habit of consuming prodigious quantities of liquor as an expression of their faith in their fellow men—pots of ale or cider at midday, two or more bottles of claret at dinner followed by an amiable passing around the table of the Madeira. Among the tobacco planters in Virginia, the money changers in New York, the stalwart yeomen in western Pennsylvania busy at the task of making whiskey, the maintaining of a high blood-alcohol level was the mark of civilized behavior. The lyrics of the Star-Spangled Banner were fitted to the melody of an eighteenth-century British tavern song. The excise taxes collected from the sale of liquor paid for the War of 1812, and by 1830 the tolling of the town bell (at 11 A.M., and again at 4 P.M.) announced the daily pauses for spirited refreshment.
Add in all other intoxicants, and we have some dark comparisons within a realm of human experience that’s about worth Spain’s economy:
If what was at issue was a concern for people trapped in the jail cells of addiction, the keepers of the nation’s conscience would be better advised to address the conditions—poverty, lack of opportunity and education, racial discrimination—from which drugs provide an illusory means of escape. That they are not so advised stands as proven by their fond endorsement of the more expensive ventures into the realms of virtual reality. Our pharmaceutical industries produce a cornucopia of prescription drugs—eye opening, stupefying, mood swinging, game changing, anxiety alleviating, performance enhancing—currently at a global market-value of more than $300 billion. Add the time-honored demand for alcohol, the modernist taste for cocaine, and the uses, as both stimulant and narcotic, of tobacco, coffee, sugar, and pornography, and the annual mustering of consummations devoutly to be wished comes to the cost of more than $1.5 trillion. The taking arms against a sea of troubles is an expenditure that dwarfs the appropriation for the military defense budget.
Words to ponder this holiday season, when more bottoms are up than usual, and as the complex world of 2013 awaits. Cheers, Sarah Skwire, for the pointer.
Just how bad is corruption in China?
In a new paper, my colleague Carlos Ramirez has the scoop:
Abstract:
This paper compares corruption in China over the past 15 years with corruption in the U.S. between 1870 and 1930, periods that are roughly comparable in terms of real income per capita. Corruption indicators for both countries and both periods are constructed by tracking corruption news in prominent U.S. newspapers. Several robustness checks confirm the reliability of the constructed corruption indices for both countries. The comparison indicates that corruption in the U.S. in the early 1870s — when it’s real income per capita was about $2,800 (in 2005 dollars) — was 7 to 9 times higher than China’s corruption level in 1996, the corresponding year in terms of income per capita. By the time the U.S. reached $7,500 in 1928 — approximately equivalent to China’s real income per capita in 2009 — corruption was similar in both countries. The findings imply that, while corruption in China is an issue that merits attention, it is not at alarmingly high levels, compared to the U.S. historical experience. The paper further argues that the corruption and development experiences of both the U.S. and China appear to be consistent with the “life-cycle” theory of corruption — rising at the early stages of development, and declining after modernization has taken place. Hence, as China continues its development process, corruption will likely decline.