Saturday, January 31, 2009

The Best Homemade Buffalo Wings in the World

Being Super Bowl weekend and all, I wanted to share my personal recipe for Bufallo Wings. While good fried wings from the restaurant are awesome, I find that an oven yields the best results at home. I have a convection roast mode on my oven that is great for this, but the regular bake setting works fine:


1/2 stick (4 tablespoons) butter - the good stuff
1/2 cup Frank's Red Hot - Original (Not the Buffalo flavor)
1 tablespoon Louisiana Hot Sauce - Original
1-2 tablespoons Tabasco pepper sauce (depending on desired heat level)
1 tablespoon brown sugar
1 tablespoon apple cider vinegar


up to 36 wing pieces (flats and/or drumettes) - Fresh, room temperature, patted dry
cayenne pepper (optional)
canola oil
Pam cooking oil spray

1. Sauce - Melt the butter over low heat. Add the brown sugar, then add vinegar, and hot sauces. Cook on lowest heat for 3-5 minutes, then turn off heat source.

2. Wings.
a. Pre-heat oven to 425. Use convection or convection roast feature if available.
b. Sprinkle a little salt, pepper, and cayenne pepper to all sides of wing pieces.
c. Brush a thin coating of canola oil to all side of wings. (This helps crispiness.)
d. Line sheet pan with aluminum foil, add wire rack insert, and spray rack with Pam.
e. Evenly space on rack(s) making sure they don't touch, and place in middle rack of oven.
f. The wings take 25-30 minutes to cook. Depending on the oven, setting, and number of wings, you may need to move the wings around or even flip them. The skin should be crispy and golden.

Once the wings are done and out of the oven but still on the racks, use a clean brush to brush on the Buffalo sauce. Instead of a big soupy bowl of sauced wings, I prefer to serve the wings crispy with a side of additional sauce to dip one by one. Add another side of blue cheese dressing and you are good to go.

If you have a good exhaust fan, you will appreciate it. If not, be prepared to open a window. The oil and aluminum foil help, but the chicken fat dripping into the sheet pan tends to smoke.

Conservatives are Happier than Liberals...

... Because conservatives don't buy the dogma of equality. So says a NYU research paper.

Rationalizing inequality—for example, by seeing it as emerging from a fair, legitimate, and meritocratic system—serves a palliative function not only in the United States, but in nine other countries as well. That is, right-wingers report greater happiness and satisfaction than left-wingers around the world, and most especially in countries where the overall quality of life is relatively low. The endorsement of meritocratic beliefs is also associated with subjective well-being in these countries. Furthermore, meritocratic beliefs account for the association between political orientation and subjective well-being to a significant degree.

Now, I don't like placing myself on the left-right spectrum, but if I do subscribe to the traditional Protestant work ethic, and accept inequality, so I guess that puts me on the right. And happy I am.

To go Bible for a minute, I think about Jesus' parable on the talents shows that even though each of us inherit or are given unequal resources, we are expected to do the most we can in our life to be better and do better. At the same time, the poor will always be with us, and the Proverbs make it clear that "He who oppresses the poor shows contempt for their Maker, but whoever is kind to the needy honors God."

So I am pro-meritocracy and pro-charity. I give credit and thanks to God for my good blessings, and recognize that the more blessings I have the bigger my responsibility to do good for others. But I don't think you can have virtue without choice, so taxes and a collectivist society are not the tools I prefer to help the needy.

The Good Ol' Days: Interesting article

Steven Malanga is a senior fellow at the Manhattan Institute, which I am not familiar with but found, thanks to Wikipedia, that sorta-conservatives William Kristol and Peggy Noonan are on the board, so I guess that would put it right of center on most issues. No big deal, but I try to learn a little about the authors to see where they are come ig from. In any event, Malanga asks an interesting question, Can Free Markets Survive In a Secularized World?

It begins:

The 18th Century English cleric and theologian John Wesley was troubled by a paradox that emerged as his teaching spread. He, like other Protestant thinkers stretching back to Calvin, taught that one could honor God through hard work and thrift. The subsequent burst of industry and frugality generated by Wesley’s message improved the lot of many of his working-class followers and helped advance capitalism in England. But, “wherever riches have increased, the essence of religion has decreased in the same proportion,” Wesley observed, and subsequently pride and greed are growing more common, he complained.

In order to survive and thrive, Malanga poses, capitalism needs restraint, and that restraint has historically been the virtues preached in the Protestant work ethic. But success has largely changed America from a country of work to a country of consumption, and thrift has been replaced with debt. He concludes:

People instinctively know something is missing, just not what. A religious revival in America seems unlikely. Is it equally as unlikely that our institutions, most especially our schools, would once again promote the virtues that made capitalism thrive and Western societies prosper--not just hard work, but thrift and integrity, or what we once called the Protestant ethic?

Let me see if I figure out how to embed a video:

Friday, January 30, 2009

More on Taxes

I love it when I find people who agree with me. Of course, it would be more accurate to say I agree with them, but this is my blog so I am allowed to have illusions of grandeur. Anyways, just after I finished the last post, look what I find: Masonomist Russel Roberts speaks up in Forbes:

I'm proposing today a radical re-imagining of our tax system. I am recommending the elimination of the payroll tax. The payroll tax is a regressive tax that falls harshly on the poor. And it is deceptive, an unacceptable characteristic of a tax in a democracy.

Half of the payroll tax appears to be paid by employers. In fact, studies of the payroll tax show that the employer merely lowers worker compensation in response to the tax burden. So workers pay virtually the entire 15%.

Worse, the payroll tax gives the illusion that taxes are "contributions" toward future social security payments.
It's like he was in my head or something. He continues with a list of government spending prescriptions:

--Eliminating all corporate welfare. Corporate welfare rewards those corporations that excel at lobbying rather than serving their customers. Eliminating it will save $100 billion annually.

--Implementing spending reductions in all departments of 10%, saving over $250 billion. Such cuts in a federal budget heading toward $3 trillion are hardly draconian. They merely return spending to the level of a year or two ago.

--Making small across-the-board increases in the income tax rate, yielding $350 billion. The poorest workers will in fact see a significant improvement in their after-tax income because the elimination of the payroll tax will overwhelm the increase in income taxes. The richest Americans will see a slightly larger increase because their payroll tax contributions are currently capped.

Rock on.

Risk & Profits

Economist Arnold Kling speaks on Minsky-nomics:

Minsky's key insight is that risk tolerance is cyclical. Investors will be risk averse for a while, and then gradually they will loosen up. Eventually, they become more and more complacent, until euphoria sets in, leading to bubbles and manias. This continues until a crash takes place, after which investors revert to being highly risk averse.

Minsky described this risk tolerance cycle in terms of three phases: hedge finance; speculative finance; and ponzi finance. During the hedge finance phase, investors are allergic to risk. You can say, "Here is a project that is probably going to offer some really nice returns," and the investors reply, "No, I don't want to touch it. I'm not buying anything that has a down side."

During the speculative finance phase, investors make reasonable trade-offs between risk and return. During the ponzi finance phase, investors ignore risks. Giving subprime borrowers option ARM mortgages was ponzi finance in every sense of the word.

Minsky's cyclical risk theory explains why the billions pumped into banks mostly failed to unfreeze the credit markets. Even with huge amounts of capital to loan, banks are unwilling to do it if they don't trust the borrowers. It is also why "tax-rebate" checks won't work since smarter people use the money THE WAY THEY SHOULD and pay off debt or put it into savings. Kling then gives his opinion on how to escape the current hedge finance phase we find ourselves in:

Under the circumstances of hedge finance, the only way that businesses are comfortable expanding is by financing investment out of profits. Another element of Minsky's thinking is that profits are the key to escaping a recession. Government deficits can contribute to this process by raising profits.

Makes sense to me. If companies had more money left over at the end of each day, they would be both psychologically prepared and financially motivated to put profits to use by way of hiring, investing, and purchasing.

The pro-profit measures being discussed center mostly on corporate taxes and corporate contributions to the payroll tax. I think corporations should be tolled or taxed in some way, but I won't get into that right now. However, I do say get rid of FICA altogether. It would not only raise profits for corporations, but it would eliminate a most regressive tax on the low and middle class.

Who are we kidding? There is no magical vault with all the FICA contributions stashed in them, waiting for disbursement in Social Security payments. The money collected from FICA goes into general revenue to be wasted spent without distinction. Replace it with a single progressive income tax that is highly tiered, like 1% for every additional $10k in income, and at non-bailout/stimulus spending levels, we could come out ahead with a top tax bracket around 35% for people making $350k or more a year. Not ideal, but better.

Thursday, January 29, 2009

The good ol' days

I have been reading Life: The Movie by Neal Gabler, which is a book that covers the history of Entertainment in America. What can I say, I was a sucker for the $1 book sale at the public library. Anyways, it has reconfirmed that the "Good ol' Days," where everyone was virtuous and lived without a sensationalist media and wicked entertainment corrupting their minds, well, it never really existed. People have always been pretty much the same, the media has always loved a good story first and facts second, and entertainment of dubious moral value has always been way too easy to find. One thing that has changed dramatically, however, is the strength of the institutions that have historically counterbalance individual desire. Per David Brooks in his recent NYT editorial:

In this way of living, to borrow an old phrase, we are not defined by what we ask of life. We are defined by what life asks of us. As we go through life, we travel through institutions — first family and school, then the institutions of a profession or a craft.

Each of these institutions comes with certain rules and obligations that tell us how to do what we’re supposed to do.

Families. schools, work. Looks like America is striking out at the moment.

How in a conversation on institutions does Brooks not mention church? Does an oblique reference to charities count?

Now, I have some very dear friends that are not a part of any church or organized religion. They are great people full of love, and will remain great, caring, productive members of society wherever their exploration of faith takes them. They are philosophers. They contemplate right and wrong, seek meaning in life, and want to leave the world a better place. But as my marriage has taught me (I love you, honey), not everyone is a philosopher. Most people seek the structure and comfort of institutions. After all, that is what Brooks is writing about.

As tonight's The Office highlights, no one likes the morality police. Yet, even the harshest critics of religions will admit the ability of faith to mold behavior. So any nostalgia of institutions without even considering faith rings a little hollow to me. Still, this is an important topic, and Brooks makes several good points. Institutions, at their best, can indeed save and bring a purpose to life.

Truth in Black and White

Republicans are proud of the House Republicans, and Democrats are disgusted by them. Me, on the outside of both parties, find cold comfort in the words of Richard Spencer:

The GOPers have essentially gone into “principled opposition” mode in which they’ll start voting against the kind of Big Government legislation they know will pass anyway—and which they would have undoubtedly supported had a Republican been in the White House and their party been in control of Congress. Such stalwarts of limited government would have also voted “nay” last night if Obama had proposed, say, a trillion-dollar prescription drug plan, a proposal for the greater federalization of public schools, or a 700 billion fund for the “troubled assets” of the Wall Street bankstas.

Ahh, reality.

Wednesday, January 28, 2009

When Terrorists Make Sense

In a recent Op-Ed, Muammar Qaddafi provides important non-western insight concerning the Isreal/Palestine crisis.

Now, as Gaza still smolders, calls for a two-state solution or partition persist. But neither will work.

The problem with the UN's partition of the Palestine region was that legislation is not sufficient to bring a country into being, at least without repercussions. Throughout history, the preferred method has been total conquest and subjugation, or at least the threat thereof. To no great surprise, the neighbor Arab states did not want to accept the UN's mandate, and war soon broke out. Isreal actually conquered additional lands from it original borders, but in my humble opinion, did not go far enough. It should have conquered the now disputed Gaza strip and West Bank. If it had, the people living there could have assimilated into Isreal, regardless of their religous and ethinc backgrounds. As Qaddafi poits out:

Assimilation is already a fact of life in Israel. There are more than one million Muslim Arabs in Israel; they possess Israeli nationality and take part in political life with the Jews, forming political parties. On the other side, there are Israeli settlements in the West Bank. Israeli factories depend on Palestinian labor, and goods and services are exchanged. This successful assimilation can be a model for Isratine.

Sixty years later, the solution remains a single state. Muslims, Christians, and Jews should all be allowed to live within a secular Israel, share the holy lands, and participate in the political process together. How this happens may not be pretty, and it is likely that even then the fighting would not end forever, but it certainly has a better historical track record than outside government intervention.

On Not Blogging.

Busy. Overwhelmed. Distracted. Annoyed. Those are just a few of the reasons I have not posted in over a week. So I'll try to make up for lost time a little bit. But before I begin, let me give perhaps a more honest reason.

I don't know what to make of the new President.

For all my liberal and/or Democratic friends that may read this, please continue to love me, be my friend, and understand it may be a personal flaw I am working through. The fact is, I just never caught Obama-mania.

That said, I am glad Obama won instead of McCain. Conservative/Republican friends, please continue reading.

Honestly, I didn't see enough difference between them in their actual politics, so I figure it would be best to let the Democrat enact Democratic Party policies instead of a Republican. That, and I hold out a shred of hope that the Presidency can at some point in our near future revert to more of a constitutionally limited position, in which case it would be great to have a charismatic, diplomatic, and youthful leader giving brilliant speaches as opposed to an old, ailing curmudgeon.

In any event, I do wish President Obama well. All the media genuflection over Obama was entirely predicatable given the current era of extreme sensationalism and dead-horse flogging, but Obama can't really be blamed for that. Still, one of the main reasons I didn't post is that almost everthing I was reading was Obama-related, and I am 1) over it and 2) taking a wait and see approach.

Really, the more I read history, philosophy, religous texts, and current news/views, the more convinced I am that the best government systems will not work if its people are morally bankrupt and the best economic policies will not work if people refuse to play by the rules and consider the common good. So while I enjoy, and will continue, posting on government and economics, I will try to keep the human element center stage in my mind, if not in my posts.

Sunday, January 18, 2009

Thank you MSM & Thrift as a Virtue

It's not often I can say this, but when both of my blog posts come courtesy of CNN (see below) and Newsweek, I have to give props to the much derided main stream media.

Joseph Epstein's article on prudence as a virtue again hits it on the head. If I was a narcissist, or was blind to the reality that only 3-4 people have visited this little corner of the internet, I would think the guy read my blog posts on Keynes and virtues. But while my hopes for originality have perhaps been dashed, I am much the happier to know that there is a growing recognition of the value of virtues that our modern society until so recently considered outdated and irrelevant.

The brief article is worth a read in its entirety, but a couple nuggets:

If the old game plan for American ambition entailed the slow but steady accretion of wealth, the new plan called for getting it now, lots of it, and as soon as possible.

This spirit is distinctly not the spirit of thrift. At a lower level of ambition, neither of course was the spirit of thrift to be found in the millions of Americans who allowed themselves to lapse into heavy credit-card debt or bought houses they couldn't afford, thinking, hope against hope, that they could somehow swing it, that something, surely, would turn up that would allow them to live beyond their means in perpetuity.

Preach. And on the current situation:

The recent global economic meltdown has put paid to unfettered financial optimism. But will it restore the spirit of thrift to Americans in their economic behavior? Hard to predict, of course, especially when government financing, backed into the corner of the present crisis, is far from being able to practice thrift. Quite the reverse. Balanced budgets, we have been told, are a thing of the past, and not likely to be part of the immediate future. The necessary thing, we are also told, is to get credit flowing again, to trigger people's spending, so that the economy can swing back into action. In all this, the practice of thrift doesn't really come into the conversation. Thrift is at its base anti-Keynesian. Lord Keynes, after all, said that "in the long run we are all dead." He also said, "The engine which drives enterprise is not thrift, but profit."

Is it possible to spend and yet not be spendthrift? It once was and had better be again, or we may all have had the course. (The name of the course is Western Civilization, Decline and Fall.)

Right on Joe, but can I maybe get a little mention next time?

My Man Wynton

As a trumpet player, Wynton Marsalis was one of my first musical heroes. He did a cd signing at my local Best Buy way back in the day, and I stood in line with a couple hundred other people to meet him. When I finally got to the table, I sheepishly handing him my CDs. He smiled and looked right at me, asking if I was a musician. When I answered in the affirmative, he got wanted to know everything - how long I had been playing, what solo I was working on, and problems I was facing. As a high school band geek, this was all very exciting to me. When I told him about my problems mastering the F-G trills in a trumpet concerto, he smirked in knowing agreement. Then, to my surprise (and to everyone else at Best Buy also), he pulls his trumpet case out from under the table. He cooly explained his method of approaching and playing trills as I was mesmerized by the wild appearance of his horn. Then, making it look as easy as only a master can, he produced an f-g trill the likes of which I have never been able to replicate. In total, he gave me 3-4 minutes of his time, but he treated me like I was the only person in the store, and I had his full attention. I'll never forget how engaging Wynton was, and he earned my permanent respect.

I say all this because his most recent article for CNN gives a great bit of insight as he retells his own experience meeting jazz legend Roy Eldridge when he was in high school.

But the quote I want to highlight here is

The most natural revolutionary requires a conservative establishment to rebel against. The most stilted tradition must have some new vivifying energy and imagination.

Indeed. With this, Wynton again nails it on the head with as much understanding and mastery as playing a perfect f-g trill.

Thursday, January 15, 2009

More Sweatshops, Please

As I said in a post below, I find myself agreeing with Kristof's articles, including the most recent on foreign sweatshop factories:

But while it shocks Americans to hear it, the central challenge in the poorest countries is not that sweatshops exploit too many people, but that they don’t exploit enough.Talk to these families in the dump, and a job in a sweatshop is a cherished dream, an escalator out of poverty, the kind of gauzy if probably unrealistic ambition that parents everywhere often have for their children.


When I defend sweatshops, people always ask me: But would you want to work in a sweatshop? No, of course not. But I would want even less to pull a rickshaw. In the hierarchy of jobs in poor countries, sweltering at a sewing machine isn’t the bottom.

My views on sweatshops are shaped by years living in East Asia, watching as living standards soared — including those in my wife’s ancestral village in southern China — because of sweatshop jobs.

As in most instances, personal experience shows that reality is messier than our ideals would like.

I mentioned a while back that I had an idea about how tariffs would work if I were made king, and while I am not ready to present a coherent explanation, the basic idea is as follows: Tariffs levels would be applied for each trading partner of the US based on a checklist of comparative regulations.

Before I begin, however, I will reiterate that I am mostly a deregulation type guy with respect to smaller, private, and non-financial companies. On the other hand, while there is good regulation (FDIC insurance) and bad (SOX), financial companies, publicly traded companies, and large multinationals do require more strict regulation in return for the special (often government-granted) privileges they receive.

In manufacturing specifically, I would like to see a steep reduction in many regulations, but find them necessary for Air/Water Safety, Worker Safety, and Product Safety.

To use an example, the plan would look something like this: If OSHA is considered essential regulation, and if meeting OSHA standards adds 10% to the cost of a toilet made in the US, and no OSHA equivalent exists in India, slap a 10% tariff on toilet bowls coming from India. Same with Clean Air Act, Clean Water Act, CPSC, food safety, etc. If the trade partner has equivalent regulations, then no tariff.

Of course, I don't advocate a per product breakdown, but a scale could easily be developed for most industries, data already exists on regulatory "burden" costs. Here is the twist, however. While half or more of the tariffs collected would go to however government decides to spend it, a certain percentage would be reserved and made available to help developing countries institute these safety programs on their own. In the process, it:

- Helps level the playing field for American manufacturers
- Allows continued foreign development without too large a burden
- Provides incentive for individuals & companies work for local safety reform
- Provides funds to help governments initiate such reform
- Leads to more fair and free trade as tariffs are lowered as a reward for safety reform
- Will help improve the quality and safety of imported products
- Provide a pathway from fair trade to free trade that benefits most

I would apply an additional set of tariffs to industries that have a national security interest, such as agriculture and autos.

I have to think about it more, but that is where I'm at for now.

I heart Camille Paglia

Yes she is is basically everything I am not (atheist, radical feminist, Democrat, etc.), but she is awesome, and is one of the most intellectually honest people in the media. Every once in a while she responds to reader questions, as she does in her current Salon contribution.

I highly recommend you set aside the time to read the entire piece, but here are a few of my favorite tidbits:

On Congress:

Surely both parties should be rooting for Congress to dig in its heels and assert its constitutional authority vis-à-vis the White House. The U.S. was meant to have a vigorous tripartite government, which has been weakened by the post-Nixon slide toward an ad hoc imperial presidency. The legislative branch shouldn't roll over and play dead like a cutesy pound puppy.

On the other hand, I agree with you that Congress has come across lately like a clumsy, flea-bitten bunch of "bozos." Its poll ratings are lower than stinking swamp mud. I have a soft spot for the nimble Nancy Pelosi, a master of the ladylike stiletto thrust, but Harry Reid is a cadaverous horse's ass of mammoth proportions. How in the world did that whiny, sniveling incompetent end up as Senate majority leader? Give him the hook!

On Katie Couric:

And let me take this opportunity to say that of all the innumerable print and broadcast journalists who have interviewed me in the U.S. and abroad since I arrived on the scene nearly 20 years ago, Katie Couric was definitively the stupidest. As a guest on NBC's "Today" show during my 1992 book tour, I was astounded by Couric's small, humorless, agenda-ridden mind, still registered in that pinched, tinny monotone that makes me rush across the room to change stations whenever her banal mini-editorials blare out at 5 p.m. on the CBS radio network. And of course I would never spoil my dinner by tuning into Couric's TV evening news show. That sallow, wizened, drum-tight, cosmetic mummification look is not an appetite enhancer outside of Manhattan or L.A. There's many a moose in Alaska with greater charm and pizazz.

On the fairness doctrine:

If there's anything that demonstrates the straying of the Democratic Party leadership from basic liberal principles, it's this blasted Fairness Doctrine -- which should be fiercely opposed by all defenders of free speech. Except when national security is at risk, government should never be involved in the surveillance of speech or in measuring the ideological content of books, movies or radio and TV programs.

On the case for Anthropogenic Global Warming:

I have been highly skeptical about the claims for global warming because of their overreliance on speculative computer modeling and because of the woeful patchiness of records for world temperatures before the 20th century.

On College:

The American system of higher education has become an insane assembly line -- bankrupting families to process hapless students through an incoherent, haphazard and mediocre liberal arts curriculum.

and in a later response:

Why is egregious theoretical verbosity being force-fed to cyber-savvy, text-messaging young people who barely read as it is and who still haven't found their own writing voices? The answer, my friend, is blowin' in the wind -- yes, the big wind of elite school flatulence, which may be the true cause of global warming.

Really, the whole thing is great, and she covers additional topics of delight such as Toni Braxton's virtuosic if campy melodrama, Kate Winslett and Madonna's figures, the morality tale embedded within Titanic,and the greatness of Frank Zappa.

And although I of course disagree greatly with her assertions about the New Testament and Jesus, she also manages to explain her atheist rejection of Jesus as messianic savior with an acceptable degree of deference for a non-believer.

Wednesday, January 14, 2009

Reality or Sour Grapes?

I never know what to think when I read what Brits have to say about America, yet I find myself nodding in agreement with much of Paul Kennedy's WSJ opinion piece:

The planned imbalances are worrying for three reasons. The first is because the total projections have been changing so fast, always in a gloomier direction. I have never, in 40 years of reading into the economics of the Great Powers, seen the figures moved so often, and in such vast proportions. Clearly, some people do believe that Washington is simply a printing machine.

The second reason all this is scary is because no one seems to be certain how usefully (or fecklessly) this money will be applied. I wish Barack Obama's administration all the best, but I am frightened by the prospect that he and his team will feel under such time pressures as to shovel out the money without adequate precautions, and that lots of it will slip into the wrong hands. The news in the press last week that lobbyists were pouring into Washington to make the case for whatever industry, interest group, or service sector they have been hired to represent made my heart sink. Printing lots of unsecured money is bad enough. Frittering it away on courtiers is worse.

The third thing I'm really scared about is that we'll likely have very little money ourselves to pay for the Treasury bonds that are going to be issued, in tens of billions each month, in the years ahead.


Moreover, no three or four of those countries -- and perhaps not a dozen of them combined -- have anywhere like the staggering array of overseas military commitments and deployments that weigh upon Uncle Sam's shoulders. That brings us back, I'm sorry to say, to the "imperial overstretch" remarks I made some 20 years ago.

Granted, I may not ever have come into existence except for my Dad being stationed in Italy with the Army and meeting my mom, but that was over 30 years ago. The cold war is over! How does having military bases scattered throughout Europe serve to help protect and defend us from Islamic terrorists?

I say bring our standing army back to America, and close all those bases. We can save money and reduce our imperial overreach. And we may need them here if Mexico up and collapses on us.

Good For Him

John Paulson saw the collapse of the financial house of cards coming, put his money on the line, and profited from it. I don't begrudge him at all. Interesting article. I will say, however, that the article portrays him as only having one love in life, making more money. A little sad if true, but what do I know?

Tax as regulation...

I prefer it to taxes as redistribution. Bob Herbert writes about a financial transactions tax for the New York Times:
The economist Dean Baker is a strong advocate of a financial transactions tax. This would impose a small fee — ranging up to, say, 0.25 percent — on the sale or transfer of stocks, bonds and other financial assets, including the seemingly endless variety of exotic financial instruments that have been in the news so much lately.
I give Dean Barker points for calling out Republican Conservatives for being the free-market hypocrites that they are in his booklet The Conservative Nanny State, but his recommendations usually have me rolling my eyes in bewilderment. Still, this financial transaction tax is something I can perhaps get on board with, with some reservation.

Speculation is often used as a dirty word, and it is not. Those who assume financial risk by investing on an educated guess make new businesses, jobs, products, and services possible. These are good speculators. The manic traders described by Herbert would be better labeled as gamblers. They use real-time market information made possible by technology to "flip" securities without adding any value to the market except to line the pockets of stock brokers with commission fees. So I say allow free access to the stock market, make using a broker optional, and then let the US Gov't get some juice from those that like gambling for a living. And for true speculators/investors, waive the tax on the sale if they hold it for a certain period of time.

Monday, January 12, 2009

Virtues, A Rennaissance?

Instead of using this blog solely for criticism or description, I want to put my personal beliefs and opinions out there as I seek to define some sort of prescription for what I see as wrong with me and the world in which I live.

My philosophical starting point, if it has to have a label, would be virtue ethics.

The pillars of this philosophy are Aristotle, Cicero and St. Thomas Aquinas (and Confucius if you look to the East). These thinkers greatly influenced the founding fathers of America. And while virtue ethics largely went by the wayside of philosophical thought with the developments of the "Enlightenment", they have been revived in the last generation as the dead ends of utilitarian and deontological thought are becoming more evident in our society with every passing day. The modern torchbearer of virtue ethics is Alisdair MacIntyre, although those in Christian circles may be more familiar with Stanley Haurwas, who has a great deal to say of ethics in his writings.

Of course there is also the Bible. It surely has one or two things to say about virtue and ethics! A good beginning is 1 Corinthians 13:13 - But now abideth faith, hope, love, these three; and the greatest of these is love.

But my reason for using the term virtue ethics is that, while I believe true Christianity to capture this fully for application in my personal life, the philosophy itself is neutral and suitable for discussions of public application. Virtue ethics draws from the virtues common to many world religions and traditions, so whether one believes in the Holy Spirit, the spirit of Gaia, or simply the human spirit, one can see the value of a society built on goals of virtue without feeling threatened by Church and State intermingling.

Since I have begun this little research project during my limited free time, it has been fascinating to notice so many others in the media and blog world awakening to the great need for a return to a more virtuous way of life. Following are a few selected links that begin to weave a picture of the hunger that is out there and growing:

Vincent Nichols, Archbishop of Birmingham

Book Review of On Kindness by Phillips/Taylor

Liberty without virtue? (Note the Samuel Adams quotes)

Glenn Beck - The Three Deceivers
(Control, Ownership, and Independence - what's not to like?)

Alright, that's it for now.

No Charity Allowed

That is, if new regulations with many unintended consequences go into effect as written:

Barring a reprieve, regulations set to take effect next month could force thousands of clothing retailers and thrift stores to throw away trunkloads of children's clothing.

The law, aimed at keeping lead-filled merchandise away from children, mandates that all products sold for those age 12 and younger -- including clothing -- be tested for lead and phthalates, which are chemicals used to make plastics more pliable. Those that haven't been tested will be considered hazardous, regardless of whether they actually contain lead.

"They'll all have to go to the landfill," said Adele Meyer, executive director of the National Assn. of Resale and Thrift Shops.
Awesome. This article highlights the yin and the yang of regulation, reactionary over-regulation due to lax regulation somewhere half-way around the world.

This is not the right time to lay out my whole thought process on regulation and international trade, but suffice it to say I don't think that "Molly Orr, owner of Molly O Designs in Las Vegas" was planning to use lead thread in her Spring 09 line.

Mail Justus: Discussing the NY Times

I promise I will do an honest blog post soon, but it has been crazy lately. In the meantime, another e-mail dialogue. I sent a good friend a link and the following excerpt:

In the 90s, the Times bet that it could become the general newspaper of elites across the United States - become in the category of a general newspaper what the Wall Street Journal had already become as a national business paper. Falling printing costs and new forms of communication brought the costs of distributing the paper nationwide down sufficiently far that regional production and distribution were within striking distance of costs of the metropolitan NYC paper. Combined with a rising urban elite in many city centers, the national newspaper strategy was not a mad dream. I certainly thought it a smart strategy at the time. Elite regional papers, such as the Los Angeles Times, were justifiably frightened; the Washington Post Company did the smartest thing of all and diversified a few years later out of media and into the Kaplan test prep cash machine.

Content was already shifting. The Wall Street Journal, by contrast, always had to remain anchored in the core presentation of semi-specialized facts and data to satisfy a hard nosed business audience, but it wrapped that staid, fact-oriented newspaper around a conservative, polemical editorial page, while keeping them emphatically separate, and so got two national audiences for one paper. The Times could not do that. It correctly understood that its new, national target audience was what David Brooks famously called the Bobos, the market oriented yet professional, bourgeois yet bohemian, affluent and self-regarding, self-involved elites of the major cities. They didn't seek facts as such from the New York Times. They already had the ones that really mattered from other, more specialized sources. The only factual area where the Times retained an edge was in foreign reporting, but years of shutting down foreign bureaus and cutting correspondents had largely depleted that competitive advantage, to the extent that this new readership cared about it.

What the Bobos sought instead from the Times was a cultural attitude, confirmation of who they were. The Times, for them, was less about sense than sensibility. The tendency of contemporary baby boomer journalism to narration, reportorial self-expression, and Dickensian sentimentalizing was already pronounced; call it the Long March of the New Journalism through the Institutions. The result was a New York Times that gradually began turning its news pages, and especially the front page, into a magazine.

Magazines are good things. At their best, they are 'informed opinion' - each of those, however, a separate qualification. But magazines are not driven by a fundamental, baseline assumption that a story, or a front page, or a newspaper is worth reading each and every day just because the facts are the facts and you need to know what's going on. A caricature, of course; every newspaper understands that it needs a certain amount of sensation beyond the straight facts. Still, the ultimate justification of a daily paper is "this happened." A good magazine, by contrast, is not about the value of contemporaneous facts as such, but instead some form of post-hoc analysis - sometimes deep and sometimes not and sometimes pure entertainment - but always something that draws you in beyond the bare fact that the facts are the facts. (As for television "news" - the nature of the medium is visceral imagery, not facts; it is finally just about shocking sensibilities, including via the ubiquitous talking heads, whose principal function is to appear to talk - their mouths move, sounds come out - but actually merely to emote: sensibility, once again, not sense.)

In the Times's new business model for content, the newspaper is really a magazine and opinion is the draw. Value is supposedly added by publishing stories that are carefully calibrated to the pre-held sensibilities of the consumer-reader. And yet, in order to preserve the idea that this is still a newspaper, the opinions are presented not as a magazine would, but as a daily newspaper does - as verisimilitude. Confirmation bias reigns; this is true at conservative as well as liberal media outlets, of course, but the difference is political dominance of the mainstream media oligopoly, as Noam Chomsky might say. The New York Times as facilitator of elite onanism; high-gravitas journalism as convenor of the elite circle jerk. Opinion as news, offered daily as fact. Readers are no doubt yawning at this 'discovery'; tell me something I don't know.

To which he replied:

Oh big surprise - another conservative on the offensive against the NYT. And, once again, another conservative tries to rationalize my tendencies toward the moderate/liberal end of the political spectrum. Seriously, the patronization and condescension (redundant?) had gotten old long, long ago.

Let me address one issue at the outset. There is a difference between elite and elitism. I am elite. You are elite. Most of the folks we encounter on a daily basis are "elite." There it is. By way of example, let me present a short version of my biography - I attended a fairly-elite private university, I have an advanced degree, I spend far too many hours working at a job that pays an above average salary. I pride myself on being well-informed, well read, ambitious in my family, social, and professional endeavors, and I understand that intellect is only half or a third or maybe even an irrelevant factor on the ethical-successful continuum of life. So there you have it, I am elite, guilty as charged, and unashamedly so.

However, elite, as a word, is frequently confused by conservatives with "elitism." Kinda like the distinction between Democrat and Democratic: two different things altogether that have been willfully and intentionally confused in order to distract the audience. If you read my description of "elite," I'd wager it is similar or nearly identical to many conservatives, like Ken Anderson, who use the word with such contempt. Mr. Anderson himself, by virtue of his education and position, is an elite. There is nothing inherently wrong with being elite. There is, however, much wrong with elitism. Elitism is as nasty as Mr. Anderson would have it sound - it represents exclusivity, simple-mindedness (ironic, when you think of it; note I did not say close-mindedness), and bigotry of another sort. It is a nasty thing indeed.

Now that I got that out of the way, I'll address the substance of Mr. Anderson's comments. At the same time I do and I don't agree with him. As with most conservatives, he confuses the slant of the NYTimes editorial page with the newsroom. Therefore I would disagree that the news is biased - it is no more biased than the WSJ's newsroom. The reporting is, in my opinion, high quality and the quality of the writing is generally on par with the reporting. The extensive treatment of news, particularly in the Sunday edition, is beyond rival. Mr. Anderson's statement that the news offering are magazine-like or merely informed opinion is a stretch. Opinion exists everywhere, and it is nearly impossible to remove from reporters. Still, I don't find that the writers' opinions get in the way of the news any more than they do at Reuters or the WSJ (both of which I consult at least weekly). Furthermore, bias exists in the eye of the beholder. So you're guaranteed to find bias if you set about to find it. And Mr. Anderson has found his mark. The NYT is not, for example, the Huffington Post or the DailyKos.

Certainly, part of the attraction to the NYTimes is the cultural offerings which simply aren't available in any single daily as they are in the NYT. The Times travel section, arts section and Sunday Styles treat these frivolities with the same level of quality as the national and world news. And, as a musician, a lover of the arts, and a traveler, it makes perfect sense that I would be drawn to the NYT. If the WSJ has similar offerings, I'd read it more frequently.

I can't say that I've noticed the quality has suffered in the 4 years that I've been a subscriber or the 8 years since I began using as my primary online news resource. I have, on occasion found errors, and frequently wish news items received greater attention.

Anderson's true issue is with the opinion page, and he's not exactly alone in that position. Moderates, progressives, and liberals have opinions just as conservatives do, and the NYT opinion desk tilts in the direction of liberal. However, the NYT doesn't contend otherwise - it competes directly with the WSJ, and so it makes perfect sense that the opinion desk would, in general, be the contrapositive of the WSJ

Now why do I, an unashamed elite, read the NYTimes? Three reasons:

1. the depth and breadth of the reporting

2. my own world view tends to align with the majority of its opinion writers (specifically Krugman, Cohen, Friedman, and Kristof)

3. New York is the modern day Rome, and even uniformed Romans in the outer regions of the empire were affected by the events in Rome. Whether you like it or not, NYC is like no other city in the world, and I have a love-hate relationship with the City. Which is why I read the NYT with equal parts contempt and rapt fascination. Not because I want confirmation of my elite status or because I want to feed my ego or because I am an elitist. My spare time is both limited and valuable; therefore, I choose carefully what I take time to read.

And to which, I responded:

- "Oh big surprise - another conservative tries to rationalize my tendencies toward the moderate/liberal end of the political spectrum." Considering that you are in political minority in our common circle of friends, I can see how this probably does get tiresome. It works both ways, however, as conservatives are often rationalized as some combination of backwoods redneck, fundie Bible thumper, warmongerer, and/or corporate elitist.

- "I understand that intellect is only half or a third or maybe even an irrelevant factor on the ethical-successful continuum of life." I agree with you on this, but I would argue you to be in the minority of the "elites" in this regard. Elites exist across the political spectrum, but very few have the humility to see the truth of your statement. It is human nature for everyone to feel they could fix the world if only they were king for a day, and elites have more ego, power, education, and money to encourage them. My perhaps overly cynical view is that elected officials are controlled by the elitists (per your distinction) in their camp trying to live out their "king for a day" vision for society.

- I defer to your analysis of the NYT's news reporting, as I am guilty of ignorance, and mostly only read the NYT’s editorials. The same is true of the WSJ. I only read straight news if it catches my interest when browsing the headlines on iGoogle.

- Sidenote: I love/hate the term Bobos. It both describes me and also the people I most enjoy mocking. It is a terrible hypocrisy that I am working my way through. Perhaps that is what you meant by "I read the NYT with equal parts contempt and rapt fascination."

-I like the NY as Rome analogy.

- The editorials are what they are, and the NYT should not have to apologize to anyone for their opinions. In my opinion, those that attack the paper as a whole because of the tilt of their editorials do nothing but reveal their own insecurities and fears of being invalidated.

- I just started reading the NYT editorials regularly fairly recently, but I am familiar with Krugman's work and Friedman's writing outside the pages of the NYT. Following are my impressions, if you care.

- I don't often agree with Krugman. The guy won the Nobel Prize for economics, and I stayed at a Holiday Inn Express last night, so I fully realize I have little weight in how history judges him. His research and modeling skills, particularly in trade theory, may be off the charts, but he is a Keynesian through and through, and I VERY humbly reject Keynesian philosophy as heavy-handed, unnecessary, and harmful government manipulation of the market.

- Friedman is tough. He has an amazing mind and writing skill, but I simply disagree with his conclusions. I was against war with Iraq because I don't believe in exporting democracy or pushing for the “modernization” of Arab states. I believe sovereign states should reign in corporate power instead of the other way around, and I am also less "free trade" than Friedman, at least in the sense that the term is used to denote free trade agreements.

- I like what I have read of Cohen, and particularly enjoyed his Pan Am article a couple weeks ago. He is probably my favorite of the group. I like what I have read of Kristof also, and have found myself in agreement.

Thanks again for your response. As fascinated I am with friends who have different opinions from me, I will try my best to always be respectful, and never “marginalize or rationalize” your tendencies.

Thursday, January 8, 2009

Justus Mail: My thoughts on Keynes?

A friend inquires:

What are your thoughts on the sudden revival of Keynesian policy?

I will use this as an opportunity to answer him and get a blog post in.

I loathe Keynes. Actually, I should say I loathe Keynesian economics. Even though I don't think I would have liked him, I never met the guy. Economically, at least, I consider Keynes a nihilist that only cared about dealing with the present without regard to future consequences, as evidenced by his famous remark that "In the end, we are all dead." His policies set into motion a pattern of ever widening pendulum swings in the economy. On the plus side that means longer booms and fewer busts. On the flip side, empirical evidence shows that the set of Keynesian policies that were used in the Great Depression, and which are currently in revival by the current crop of policy makers, were a failure that made the bust much more dangerous and difficult to escape from.

Before the Great depression, the US economy would be in recession every 2-4 years. This seems scary, but in truth they were never particularly harmful to the general population, or posed significant risk to the wide economy. These recessions were a proper reflection of the different industries dealing with naturally changing factors such as technology, demographics, foreign competition, and so on. The feature these recessions shared is that they were mostly short in length, and action by private enterprise to liquidate bad investments and adjust costs worked to keep the economy on a long term upward trajectory. It was not until Keynesian policies were used in the late 20's and 30's that the word depression had to be created as an economic term to distinguish it from recessions, as nothing had ever approached its length or magnitude.

To illustrate in non-economic terms, critics of Keynes often compare it to curing a patient of a broken finger by cutting off the entire arm. What they mean is that an economy in recession is a reflection of errors in judgment made by business persons, and Keynesian policies make the problem worse by perpetuating further, larger errors in judgment.

In economic terms, entrepreneurs are little more than risk takers. They speculate that their products/services will be in demand, and ramp up production based on those expectations. In the process, they create jobs and bring more competitive pricing to the market. Everyone wins, unless the speculation on the entrepreneur's part was wrong, and then there is a problem of too much investment in capital goods (raw materials and business machines) and wages/jobs, and too little return on those investments to break even or make a profit. Traditionally, the business owners would liquidate these bad investments, take the financial hit, and if possible focus on remaining good investments. If the business bought those capitol goods on credit, then the bank would liquidate the assets for them if payments could not be maintained. This all changes when Keynesian politicians decides that full employment, high wages, and stable prices must be maintained, so they work to prime the pump of the economy (inflate the price level, increase tariffs, increase government spending, ease lending standards, bail out industries, etc.) giving entrepreneurs false impression that maybe their investments weren't so bad after all, and maybe they should even expand production, or on the other hand tie their hands so they cannot reduce wages or liquidate assets. The continuation of poor/risky business behavior only serves to make matters worse once the charade becomes apparent and the flow of money stops.

That is why I am scared when I hear the government plans of economic stimulus. With regards to the Great Depression, the economic recovery was only realized with World War II, and I do hope we could find a better way out this time around.

In terms of theory, I am pretty much Austrian in my views, as I think it is the most comprehensively sound theory. Maybe throw in a dash of classical Smithian economics. The biggest flaws with Austrian theory, which would apply to the other theories as well, is that it can't account for external factors, so in a globalized environment where no economy can disregard the policies and practices of other countries, concessions have to be made to the ideal to make it practically feasible. In my humble opinion, these trade offs include allowances for certain tariffs (I will get to this topic, eventually), regulations (specifically for large corporations and financial institutions, and especially in regards to environmental, worker, and consumer safety), and taxes/tolls (to capture externalities, such as business use of public infrastructure).

Austrian economics is mostly derided for being old-fashioned, cruel, or unpractical, but it mostly just inconvenient for bankers and politicians. I would personally love to see a (global) gold standard, high reserve requirements and strict limitations to the fractional reserve lending system, and ending the Fed's ability to manipulate interest rates.

Tuesday, January 6, 2009

Lessons from India - Part 2

Now, a few comments on Mr. Sabhlok's article.

Starting with:

Whatever else is true about capitalism, this much is clear that never did John Locke, David Hume, Adam Smith, J.S. Mill, Ayn Rand, F.A. Hayek, or Milton Friedman advocate unbridled capitalism or freedom. It seems that socialists like Marx and Nehru have badly sullied the reputation of liberty. The socialists have repeatedly alleged that capitalism caters to so-called ‘capitalists’ and gives them unbridled powers to exploit the weak. But that is totally false. Philosophers of liberty have always insisted that freedom comes with responsibility and justice. Adam Smith opposed mercantilism and monopolistic industrial interests. David Ricardo wanted more competition and free trade. Adam Smith and J.S. Mill advocated labour unions to face the economic power of the owners of industry.
Love it. I am just getting into really reading the classical economists, and regardless of what the press or modern economists would have everyone believe, "the invisible hand" of Smith is not used to praise the mysterious wonder of laissez-faire capitalism. The "Lost Legacy" blog I link on the blogroll goes into much more detail, including that "Adam Smith was never linked to laissez-faire in his lifetime; he never used the words and, if anything, considered those who used them, such as the French Physiocrats in the 1760s, too extreme in their ambitions for commercial economies", and that the term 'capitalism' was not invented until almost 80 years after the writing of Wealth of Nations. Smith was first and foremost a moral philosopher, an recognized the need for law and justice to protect the many from the vices of a powerful few.


By repeating lies against liberty long enough, socialists have made it appear that the system of natural liberty encourages corruption and things like the sub-prime crisis. But what are the actual facts? Capitalism begins by looking at human nature. The fathers of capitalism, Hobbes and Locke, pointed out that since human nature is far from perfect, some people will always try to cheat, mislead, and misuse their powers. So if anyone cheats, then systems of justice should catch and punish the cheats. Thus everyone must be held equally to account and no one is to be above the law. In this manner, by ensuring all crimes are punished, capitalist societies are today among the most ethical on this planet.
True - mostly. The rest of the article continues extolling the superiority of free economies to their corrupted and controlled counterparts. While it is all true, there may be a few omissions about the not so great aspects of capitalism, particularly as it is currently practiced in America. There is a problem with corporate giants that get "their guys" elected or appointed to government positions, then use lobbyists and the dangling carrrots of campaign funds to ensure the government works for them. Marx was right about powerful business using government to strengthen its own interests to the detriment of the working class. And he was also right in his prediction that while capitalism would increase wealth, the spread between rich and poor would grow exponentially. These are enormous current wrongs with our current system that need to be set on a new trajectory. And no, that does not make me a Marxist.

At the end of the article, the writer mentions the lack of virtues being taught to citizens. This begins to really get to the core of my own developing philosophy, and I hope to explore it in greater detail in the posts to come.

Monday, January 5, 2009

Lessons from India

Before getting into the main post, a set of quotes from thinkers across the political spectrum (according to them):


"A new revolution is possible only in consequence of a new crisis” Karl Marx

"Only a crisis, actual or perceived, produces real change. When that crisis occurs, the actions that are taken depend on the ideas that are lying around. That, I believe, is our basic function: to develop alternatives to existing policies, to keep them alive and available until the politically impossible becomes politically inevitable.” Milton Friedman

And finally

"You never want a serious crisis to go to waste." Rahm Emanuel

So with Rahm Emanuel, along with most every other political figure around the world, declaring the need for intense government action, the words have been flying in print, on air, and of course on the Internet as to exactly what those actions should be. There are those who are convinced that this crisis was convinced by deregulation, others that are equally convinced the cause to be over-regulation and government intervention, and others that don't really care as long as they can use this opportunity to punch their meal ticket, be that in the form of government contracts, bailouts, handouts, or social services.

Personally, I see it as trying to solve an equation with 100 variables, which is to say, nearly impossible. Government overstepped in some areas (Fannie, Freddie, CRA, Fed Reserve), and came up far short in other areas (lowering reserve requirements, voluntary regulations, muddy accounting rules). This of course caused problems, but none that weren't exacerbated by the modern white-collar pirates known as banking and finance executives. These "greed is good" laissez faire capitalists sowed what they planted. And the average citizen, as a cog in the great consumption based society, with a negative savings rate, addicted to easy credit and lured by nonsensical mortgage products, sang "Laissez le bon temps roulle"and partied away. Except the party wasn't supposed to end. But when someone decided that maybe $310,000 for a 828 square foot house in Compton is not the best long term investment, especially when the median income for the area hovers at $31,819, things got messy, and fast.

So all that to say that whether any one ideology, party, group, or institution really caused the present crisis, someone must be blamed, so the war of words rages on.

So who is worth listening to? I found myself largely in agreement with Indian economist Sanjeev Sabhlok in his recent blog entry, Unbridled Capitalism?

I have to get some sleep right now, but will share my thoughts on this article tomorrow. Good night.