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Archive for February, 2004

The dangers of intuitive economics

February 12th, 2004 18 comments

One problem with the debate over the trade aspects of the “Free Trade Agreement” with the United States is that a lot of FTA supporters are inappropriately relying on intuition derived from arguments about free trade in a context where trade barriers are removed in a nondiscriminatory fashion. For example, Jason Soon says

Let’s note that unilateral lifting of trade barriers is almost always a good thing so the fact that the Australia has ‘given up’ on more trade barriers than the US is irrelevant. The fact that Australia under the FTA is now committed to the gradual phasing out of car and textile tariffs which hurt consumers is a good thing regardless of whether we get more access to the US market

and Stephen Kirchner pushes the same argument further.

The claim is valid in the context of a small country unilaterally reducing tariffs on a non-discriminatory basis. In this case, the world price is unchanged by tariffs, so the entire burden of the tariff falls on domestic consumers. Provided that the tariff revenue can be matched by a less distorting tax, reducing the tariff unilaterally will improve welfare.

This argument does not work in the case of a decision by country A to make a unilateral cut in tariffs for imports from one country (say country B), but not for others. In this case, in general, the incidence of the tariff cut will be shared between consumers in country A and suppliers from country B. Unless the distortions associated with the tariff are large, the net impact on country A will be negative. (This is a special case of the larger literature on trade diversion and trade creation, all of which casts doubt on the claim that bilateral free trade deals will be economically beneficial to the parties concerned). A straightforward first approximation to assessing the issues in the case of the US-Australia FTA is to look at the reductions in tariff revenue. As I mentioned in the post to which Kirchner took objection, this article states that

Currently, the United States pays 10 times as much as Australia does in tariffs in the joint trade between the two countries.

Except under extreme assumptions about elasticities, this implies that Australia will be worse off under the trade aspects of the deal simply by virtue of the associated revenue losses. Because our tariffs are already close to zero, these transfers will not be offset to any significant extent by reductions in deadweight losses. A straightforward calculation indicates that the deadweight loss from a 5 per cent tariff on imports is around 0.05 per cent of GDP. Since the US only accounts for something like 20 per cent of our imports, the associated loss is around 0.01 per cent of GDP or about $70 million per year, which is trivial in the context of tariff revenues around $1 billion per year

Of course, the trade aspects are less important than the issue of institutional integration, beginning with intellectual property and the PBS, but likely to extend in future rounds to issues such as privatisation, environmental regulation and taxation.

UpdateAlexander Downer has been quick to accuse critics of the deal of being anti-American, and Ken Parish takes a similar line, making the point that no similar objections were made to CER with New Zealand.

The implication is that I and other critics would have welcomed a comparable deal with, say, the EU, one which left the Common Agricultural Policy intact, but removed all restrictions on imports of European goods and gave Brussels the right to control Australian domestic policy, for example by prohibiting the use of any names for varieties of wine or cheese to which Europeans laid claim (a standard EU claim in trade negotiations, which we’ve acceded to on some occasions and rejected on others, comparable to the situation, until now with American claims on IP).

I suggest on the contrary, that most of those who’ve supported the FTA would agree with me in regarding such an agreement as outrageous (I make an exception for those who, mistakenly as I’ve argued, support all unilateral reductions in Australian tariffs). But perhaps I’m wrong on this, and such a deal would be welcomed with open arms.

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The aftertaste

February 11th, 2004 13 comments

For those still inclined to defend the Free Trade Agreement with the US, the news that the sugar industry is to be bought off should be the clincher. Both in the specific terms of the Agreement, with respect to copyright, the PBS and other issues, and in the payoffs to those who were left out this deal represents a commitment to bad public policy. What’s the betting we’ll see yet more handouts to Manildra and the ethanol lobby out of all this.

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Free trade or economic integration ?

February 10th, 2004 10 comments

It looks like we have all the information about the “Free Trade Agreement” with the United States, and I’ve finally had the time to formulate a proper response.

I’ll begin with an observation about responses to the agreement. Although everybody recognises that the official name is a misnomer, immediate responses have naturally focused on what was missing, such as any market access for sugar. But it’s a mistake to view this deal primarily as a free trade agreement with some pieces missing. If that description was correct, it would be reasonable to support the deal.

But far as free trade in the traditional sense is concerned, Australia has almost no trade barriers of any significance to the US, and therefore nothing to remove (a point I’ll refer to). Our general tariff of 5 per cent is at a level which implies minimal distortions and can be justified under the revenue tariff provisions of the GATT.

The US has a lot of relevant barriers and distortions, but the most important, the production and export subsidies in the Farm Bill, weren’t even on the table. In addition, most of the specific barriers to Australian exports of any relevance remained in place. The announcement trumpeted the removal of restrictions on imports of lamb, but we’ve never had any success in persuading the Americans that eating lamb is a good idea.

If the agreement isn’t about free trade, what is it about? The real issue, is that of economic integration with the US. As the example of the European Union, cited by FTA supporters like Alan Oxley, shows, economic integration means common economic institutions. In the present case, it’s obvious that this means Australia adopting the institutions of the United States, and not vice versa. Examples that have come to light so far include the extension of copyright from 50 to 70 years and a range of other measures that enhance the capacity of US owners of intellectual property to act as discriminating monopolists. I expect that, when the details are rolled out, we’ll see things like restrictions on parallel imports.

There are two issues in deciding whether economic integration with the US is a good idea. The first is whether, in general terms, the economic and social institutions of the US are better than those of Australia. If you read the writings of FTA supporters, it’s pretty clear that they think this is the case, that we would be better off with less government intervention of all kinds, weaker unions, greater income inequality and so on.

The second issue, thrown into relief by the FTA negotiations is whether it’s a good idea to let our economic institutions to be determined by a government that is responsive to American interest groups, but not concerned with the welfare of Australians. The issue of copyright provides a nice example. There are a lot of arguments for and against long periods of copyright, but there are also issues of income distribution. In aggregate, an extension of copyright terms will redistribute income from Australians to Americans because the Americans own more copyrights of general interest than we do. Whatever the balance of the economic arguments, it’s a safe bet that American decisionmaking processes will err on the side of long copyright terms.

I’ve developed this argument at greater length here and in a submission to a Senate Inquiry which I’ll try to post here. Around the blogosphere, only Peter Gallagher has made the point that economic integration is the main issue.

A final observation on the FTA process is that it illustrates the validity of a traditional argument against unilateral tariff reductions. If you cut your tariffs unilaterally, you’ll have no bargaining chips to trade for reductions by less high-minded bargaining partners.

More precisely, I’d say that unilateral tariff reductions made sense given our previous focus on multilateral negotiations. In these negotiations our free-trade credentials gave us credibility as leaders of the “Cairns group”. But now that we’re moving to a bilateral approach, this counts for nothing, as we’ve seen.

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In Defense of Rumsfeld

February 10th, 2004 6 comments

US Secretary of Defense has received general derision for the following rather convoluted statement

Reports that say that something hasn’t happened are always interesting to me, because as we know, there are known knowns; there are things we know we know. We also know there are known unknowns; that is to say we know there are some things we do not know. But there are also unknown unknowns – the ones we don’t know we don’t know

As I’m giving two papers on this general topic in the next couple of days, I feel I should come to his defense on this. Although the language may be tortured, the basic point is both valid and important.
Read more…

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Dead on arrival?

February 9th, 2004 5 comments

My understanding of the legal status of treaties is imperfect, to put it mildly. I know that, unlike the US, there is no requirement for Parliamentary ratification of treaties. And I recall from the Franklin Dam case, that the Commonwealth Parliament can pass legislation to implement a treaty in a field that would otherwise be outside its jurisdiction, such as environmental protection.

But I don’t know what happens in the case of a treaty like the just-signed FTA, which apparently requires changes to Australian law in a large number of areas – certainly copyright and probably the PBS. I assume the entire treaty must be put to Parliament as a package and ratified without amendment, otherwise the US side can just walk away.

But if this is the case, I would judge that the treaty is already dead. It’s hard to see how Labor can consent to any watering down of the PBS, in full knowledge of the fact that Big Pharma is out to kill the scheme altogether. If no amendment is possible, they’ll have to vote against the treaty outright.

The politics of this seem entirely straightforward for Labor. Hardly anyone in Labors constituency has anything obvious to gain from the deal (in fact, the immediate benefits for anyone in Australia are trivial and the indirect benefits entirely speculative) Latham has already alienated anyone who objects to standing up to the Americans. OTOH, the majority of the Labor base who objected to the Iraq war can see that Howard hasn’t even managed to secure fair treatment in return for our loyal support of the US, let alone any favours.

Conversely, the politics seem diabolical for Howard. If legislation has to be pushed through Parliament that means De-Anne Kelly, Ron Boswell and the rest of the North Queensland Nationals will be opened up to ferocious attack from Bob Katter if they vote in favor. Labor can just sit back and watch, throwing in quotes from Howard and Anderson to the effect that they would “never ever” abandon the canegrowers (and, for that matter, the beef industry). And once the deal is rejected, everyone except the canegrowers and cattlemen will forget about it.

But of course, all of the above is premised on my shaky understanding of the procedural rules – would anyone care to set me straight.

Update Ken Parish answers my questions on the process and argues that the procedures for examining the treaty mean that nothing will come before Parliament until after the next election. It seems to me that this makes things even better for Labor. Rather than rejecting the treaty outright, they can say that, when elected, they will demand a renegotiation of the treaty (the fact that the US will also have an election complicates the issue, but mostly in a way favorable to this claim – for example, a statement by Bush that the terms of the agreement are ironclad can’t bind his successor).

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Dropkick

February 9th, 2004 5 comments

I was going to post on a piece by David Dale in the Sun-Herald asserting (with reference to the use of the baseball code [first base, etc] as an indicator of progress in dating) that no-one under 60 now uses Australian sporting metaphors. He cited “sticky wicket” and “hit for six” as examples that have gone out. In my lexicon, the first of these has always been confined to toffee-nosed Poms, and the second is still current. But I’m only a decade or so short of 60, and I thought perhaps I was just showing my age.

I’m therefore please to note the following unsolicited comment from Steve Edwards, on the FTA “Latham is 10 metres out, directly in front on this one. He can’t miss.”

On a marginally more scientific note, a Google search on “hit for six” :.au produces 1660 hits. Most are in a (metaphorical) sporting context, but there are also several political and financial instances.

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Monday Message Board, late again

February 9th, 2004 7 comments

Here (late again, but on Monday at least) is your chance to comment on any topic (civilised discussion and no coarse language, please). I may be a bit quiet for the next few days. (I’m in Melbourne to become a Distinguished Fellow of the Australian Agricultural and Resource Economics Society), so please do your best to fill the gap in my absence.

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Sweet FA from FTA

February 9th, 2004 13 comments

So far, all we have on the US-Australia Free Trade Agreement is a rewritten press release, but I think that’s enough to conclude that this is an election-loser for Howard. The reports have noted that there’s nothing on sugar and nothing much on beef or dairy, but it’s more revealing in some ways to look at the list of wins. Of particular interest is that the US Federal government procurement market has been opened up to Australian suppliers. As of last weekend, our demands included state government procurement as well, particularly in California.

And of course we have yet to see the list of concessions on things like IP, parallel importing and so on. The PBS looks to have been kept off the table, but I wouldn’t count on it.

Overall, this is about as unbalanced an agreement as could be imagined.

Update I’m travelling and haven’t yet had time for a detailed study, but I thought I’d look at the US reponse. Naturally, it’s anything but front-page news. Buried deep in the business section of the NYT, I found this article, which notes, with respect to the abolition of tariffs on manufactures

supporters of the trade pact said its main significance, assuming Congressional approval, was the virtual elimination of import duties on American manufactured goods to Australia. Currently, the United States pays 10 times as much as Australia does in tariffs in the joint trade between the two countries.

This is a pretty fair summary of the distribution of gains and losses in the deal. The Washington Post has a story leading to a broken link and the LA Times nothing I could find.

Further updateI’ll take this chance to welcome Ken Parish who’s back as an active blogger. Ken is deferring judgement, but has a lot of useful links.

Welcome back also to Kim Weatherall who reports that the IP components of the agreement are as expected, that is, about as bad as they could possibly be.

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Two sets of books

February 8th, 2004 1 comment

Anyone who’s been following recent discussion of the US economy will be aware that the Bureau of Labor Statistics produces employment statistics from two different surveys, and that the results have diverged radically since 2001. The BLS preferred numbers on employment growth come from a survey of employers (the Establishment Survey) while other numbers, including the unemployment rate are derived from a survey of households (Current Population Survey). As the BLS Commissioner’s latest statement notes (PDF file)

From the trough of the recession in November 2001 through January 2004, payroll employment decreased by 716,000. Over the same period, total employment as measured by the household survey increased by about 2.2 million (after accounting for the changes to that survey‚s population controls).

Not surprisingly supporters of the Administration have been pushing hard to discredit the Employment Survey in favour of the CPS. While noting some reasons for the discrepancy, the BLS seems to be sticking with the payroll survey, noting that there are a lot of problems in estimating employment growth from the CPS, and that the payroll data is consistent with data on new claims for unemployment benefits.

If that’s the case though, the implication appears to be that the CPS results are unreliable, and therefore that the unemployment rate (derived from the CPS) is an underestimate. Allowing for the fact that non-employed people are divided between unemployed and those not in the labour force, the discrepancy could easily be a full percentage point, implying that unemployment is now higher than when the recovery (as measured by output) began. This seems consistent with anecdotal impressions.

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What I'm reading, and watching

February 8th, 2004 4 comments

I’m reading After the New Economy by Doug Henwood, after Brad DeLong kindly sent me a copy. I plan to do a review of this book, which has already been reviewed by several contributors to Crooked Timber.

I watched the first round of The Einstein Factor, which turns out to follow, in crucial respects, the Mastermind format peculiar to public broadcasters, namely a round of questions on a special topic that would be regarded as too narrow if proposed for a PhD thesis (those today were Jack the Ripper, Australian campaigns in France in WWI and heavy metal bands of the 1980s), followed by absurdly easy general knowledge questions (in one round there was even multiple choice – shades of Eddie McGuire!).

The “special topic” approach is unsatisfactory in too ways. First, even a well-informed viewer doesn’t have a chance of answering more than a handful of questions, which makes viewing not that much fun.

Second, it’s impossible for anyone (including the setters) to tell whether the questions are of comparable difficulty between topics. Which is harder, to name the head roadie for Megadeth or the constable who discovered the body of Jack the Ripper’s third victim? For all I know, one question is comparable to naming the song sung by the Sirens and the other is basic knowledge for all aficionados of the topic. Think about blogging as a special topic from the viewpoint of your non-blogging friends, and see what I mean.

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After the deluge

February 7th, 2004 11 comments

Electoral commentary hasn’t yet absorbed the magnitude of the disaster suffered by the anti-Labor parties in Queensland tonight. It’s true that Labor’s massive majority has been reduced a little relative to the outcome in 2001, but this was distorted by the presence of One Nation, which has now been almost completely eliminated. This was a ‘normal’ election, with no last-minute scare campaign or other disturbing factor, and the coalition has been crushed.

Let’s look first at the National Party. They are supposed to be the alternative government, but they got only about 17 per cent of the first preference vote and have been reduced to the status of a rural rump, as in NSW and Victoria, the only other states where they remain a significant force. The seats they have regained have been in areas that should have been safe and were lost because of the One Nation upsurge. . Outside their heartland, they actually lost more ground this time around, losing the seat of Keppel. In the Gold Coast, where they were once the dominant party, they have disappeared for good. In provincial cities like Cairns, Toowoomba and Townsville they have gone nowhere. Even in the heartland, their gains were partly dependent on the “agin the government” vote in sugar electorates – this will work against them when the Federal election comes around, unless the fabled FTA with the US includes access to sugar markets (and, since GWB has an election of his own coming on, that’s not very likely).

Then there’s the Liberals. They hold about half the Federal electorates in Queensland, but they remain completely marginal in State politics. It’s quite possible that they will hold only one Brisbane electorate in the new Parliament, as they did in the old one. As a resident of Indooroopilly, I only have to walk down the street to be stunned by the idea that this is a marginal Labor seat. admittedly the University of Queensland is a disturbing factor (it brought me here, after all) but the general ambience is that of Toorak or Double Bay. The same is true in spades of Clayfield, which Labor looks certain to retain. At least at the state level, urban electors want schools and hospitals and think Labor is more likely to deliver them than the Liberals.

Perhaps the best feature of the election from my viewpoint is that Labor’s massive win followed the introduction of a new tax (the ambulance levy) and there was no commitment not to raise existing taxes or introduce new ones. There were some justified tax cuts (for example, in stamp duty on house purchases) but the government is now in a position to meet its expenditure commitments without resorting to deficit finance.

State and Federal politics are very different, but the core vote from which the Coalition is working is about 35 per cent. Given a competent campaign, Federal Labor should pick up enough Queensland seats to make the next election a very close call.

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Vote late and vote once

February 7th, 2004 18 comments

The old Australian tradition ‘vote early and vote often’ is under official attack here in Queensland. The pamphlet distributed by the Electoral Office laid great stress on the fact that we should vote exactly once.* And a fair bit of publicity was given to the fact that polling booths are most crowded between 8am and 10am.

*For non-Australian readers, I should point out that not voting at all is not a legal option here. If you want to abstain, you have to do so actively, by turning up and casting a blank ballot.

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No comment

February 7th, 2004 13 comments

In the middle of a generally reasonable Newsweek article about the failure to find WMDs, I came across the following para

But if Saddam didn’t have weapons of mass destruction, why didn’t he come clean? After all, he could have given U.N. inspectors free rein; he could have allowed them to interview all of his scientists in private—even outside the country—and let them rummage through his palaces. Faced with war, wasn’t that the sensible option?

But, but …(lapses into stunned silence)

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My take on DDT

February 6th, 2004 1 comment

My posts regarding the third-hand junk science on DDT presented by Christopher Pearson have provoked an interesting debate, which leads me to want to clarify my position on the issue. You can find relevant references in my previous posts and the comments threads. Here are the conclusions I have drawn:

The ban on the agricultural use of DDT, beginning in the US in 1972, and much reviled by junk scientists, was fully justified, for several reasons.

  • DDT has well-established adverse environmental effects, particularly on predatory birds
  • DDT persists and accumulates in human body tissues, which is an undesirable property for any potential toxin. There is strong, but not conclusive evidence of health risks to humans  arising from this
  • DDT has broad-spectrum effects, killing beneficial as well as harmful insects, and is highly persistent
  • Indiscriminate agricultural use of DDT promotes the development of resistance, reducing or eliminating the usefulness of DDT in its most beneficial use, as an antimalarial

The early success of DDT as an antimalarial in countries such as India and Sri Lanka was not sustained, but this had little or nothing to do with the 1972 ban. The main problems were the development of resistance and the lack of sustained funding. Resistance problems also reduced the effectiveness of antimalarial drugs and there was little commercial interest in the development of new ones.

The use of DDT as an antimalarial, sprayed on house walls or insecticidal nets was not banned in 1972, and never has been. The majority of junk science diatribes, including Pearson, state or imply the contrary, either through ignorance (almost certainly the case for Pearson) or malice.

Between about 1995 and 2000, debate over DDT was intensified because environmental groups wanted a complete phaseout of DDT as part of the UN convention on persistent organochlorine pollution (POP). Environmental groups argued that there were safer, and equally effective alternatives, such as pyrethroids and pressed developing countries to adopt these methods. In some cases, for example in South-East Asia, this worked fairly well. In other cases, such as South Africa, the alternative methods failed or funding was inadequate and it was necessary to return to DDT. During the debate leading up to the POP convention, rhetoric on both sides was heightened, tending to obscure agreement on the basic points that the only legitimate use of DDT was antimalarial and that replacement of DDT was contingent on the provision of affordable and effective alternatives, funded by rich countires. Quoted out of context, some of the arguments on the pro-DDT side have been used by junk science writers to back up their attacks on the 1972 ban. There are some instances in which environmental pressure led to ill-advised decisions to abandon DDT. But far more damage to the viability of DDT as an antimalarial was done by its use as a broad-spectrum agricultural insecticide – the very policy defended by junk science writers.

The current position is that, in at least some poor countries (particularly those where there has been no history of extensive spraying and therefore no buildup of resistance) there is no affordable and effective alternative to using DDT spray on house walls. As long as this remains the case, DDT use should be continued. Where there is a more expensive, but equally effective, alternative, the cost should be borne by rich countries, since the benefits of reduced DDT in the environment are global.

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A tree grows in Noosa

February 5th, 2004 11 comments

As the boom in Australian property prices comes to add hundreds of thousands to the value of any block of land from which the sea is visible, trees that get in the way of those views have been disappearing rapidly. In most places, this has reached the point where further clearing has been tightly restricted by law, but this has merely produced an epidemic of midnight tree-fellings and mysterious poisonings.

I was told today (but haven’t been able to check it) that Noosa Council has adopted what seems likely to be an effective deterrent. In the event of a suspicious tree death, a new tree will be replanted. While it is growing it will be supplemented by an artificial visibility barrier equal in height and width to the old tree. Perhaps the tree-fellers can find a countermeasure, but it’s not obvious how.

And on this kind of thing, as Noosa goes, so goes the nation.

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Driving hard

February 4th, 2004 6 comments

Kieran’s piece on kids being driven to school reminded me of a post I’ve been planning for a while. One of the issues debated at length on my blog is that of speeding and law-enforcement measures such as speed cameras. I’ve argued against speeding and in favor of rigorous law-enforcement. Not surprisingly, and perhaps reflecting the fact that more than 80 per cent of drivers regard themselves as above-average, this has been very controversial. You can read some instalments in the debate here and here or use the search facility for “speeding”. Unfortunately most of the extensive and interesting comments were lost in a database failure.

In the course of this debate I discovered the fact, surprising to me, that, although the rate of road deaths per person in the United States is nearly twice that in Australia and the United Kingdom, much of this difference can be accounted for by the fact that distances travelled in the United States are a lot higher and are rising (there are problems with the numbers and biases in the measure, but I’ll leave that to one side for now). The differences between US and UK are plausible given differences in population density and well-developed public transport in London at least, but the differences between the US and Australia certainly surprised me. Australia is every bit as car-dependent as the US and has much lower population density.

All of this is a prelude to the fact that, in economic terms, time spent travelling is a really big deal. In their book Time for Life, based on the 1985 US Time Use Study, Robinson and Godbey estimate that the average adult American spends 30 hours a week in paid employment and 10 hours a week travelling (they also, controversially, argue that working time has been falling, not rising). It’s pretty clear that distances and times spent travelling have increased since 1985 in the US (in both the US and Australia, driving is by far the dominant mode of travel).

If, as I’ll argue below, most travel should be regarded as being in the same economic category as working and if, as the stats linked above imply, Americans spend about twice as much time travelling as Australians, then reducing travel times to the Australian level would be equivalent to a productivity improvement of between 12 and 15 per cent. As it happens, combined with the relatively small difference in hours of paid work, adjusting for hours of work and travel would just about eliminate the gap between Australian and US GDP per capita (about 20 per cent on standard PPP estimates).
Read more…

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Limiting limited liability

February 4th, 2004 5 comments

Via Lawrence Solum, I found this interesting post from Professor Bainbridge arguing that corporations should not be compelled to pay reparations for past wrongdoing (in this case, complicity in slavery). He says

Punish the wrongdoers, you say? Sorry, but the corporation’s legal personhood is a mere legal fiction. A corporation is not a moral actor. Edward, First Baron Thurlow, put it best: “Did you ever expect a corporation to have a conscience, when it has no soul to be damned, and nobody to be kicked?” The corporation is simply a nexus of contracts between factors of production. As such, there is no moral basis for applying retributive justice to a corporation – there is nothing there to be punished.

So who do we punish when we force the corporation to pay reparations? Since the payment comes out of the corporation’s treasury, it reduces the value of the residual claim on the corporation’s assets and earnings. In other words, the shareholders pay. Not the directors and officers who actually committed the alleged wrongdoing (who in most of these cases are long dead anyway), but modern shareholders who did nothing wrong.

This seems plausible. On the other hand, the obvious implication (one that was clearly implicit in Thurlow’s original point) is that the principle of limited liability is untenable, at least in relation to civil and criminal penalties for corporate wrongdoing. The wrongdoers are, as Bainbridge says, the officers and shareholders at the time the wrong is committed, and they should be held personally liable. The law has moved a bit in this direction in recent years, but Bainbridge’s argument implies that it should go a long way further, restricting the principle of limited liability to the case of voluntarily contracted debts.
Read more…

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Drunken banker week

February 4th, 2004 1 comment

I enjoyed the series of stories Drunken Banker Week presented by Gummo Trotsky. Start here and work back.

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Horoscope-Ed pages

February 3rd, 2004 3 comments

The ‘Gray Lady’ nickname of the NYT implies the kind of conservatism and caution that’s appropriate to a journal of record. But in what is, as far as I know, a newspaper first, today’s NYT brings the astrology column onto the Op-Ed page, providing horoscopes for the Democratic Presidential hopefuls.

I’m bemused by this. If the implied view is that astrology is so patently silly that no-one would take it seriously, isn’t this rather a juvenile trick to play on Erin Sullivan, noted as the author of Saturn in Transit and the forthcoming Astrology and Psychology of Midlife and Aging., who appears to have contributed her column in all seriousness? If the implied view is anything other than that astrology is too silly to be taken seriously, isn’t this rather insulting to every reader of the NYT who has even a high school level of scientific literacy? No doubt there is some ironic postmodern stance that is appropriate here, but I can’t quite locate it.

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Swinging voters?

February 3rd, 2004 18 comments

In today’s SMH, Gerard Henderson repeats all the standard claims about swinging voters, for example

Elections in Australia are invariably decided by people who in most other democracies would not vote, or who, if they choose to back a minor party or independent, would not express a preference for either of the major parties. This is due to the unique federal electoral system, which comprises compulsory and preferential voting – introduced in 1924 and 1918 respectively.

In other words, it is the essentially uncommitted and/or uninterested – living in marginal seats – who decide election outcomes in Australia … Since the end of the Pacific War, the Government has changed hands only five times – 1949 (Menzies), 1972 (Gough Whitlam), 1975 (Fraser), 1983 (Hawke) and 1996 (Howard). The outcome in each case was determined by the change in allegiance of essentially non-political voters, along with a proportion of newly enrolled electors. 

There’s a trivial sense in which all of this true, just as the outcome of a cricket match [at least if it isn't drawn] is always decided by the last ball. And in a constituency-based system with only two parties capable of winning seats, it’s broadly speaking correct that only marginal seats count – however, swings are more variable these days so more seats are marginal.

Apart from that, however, Henderson’s analysis is (to the extent that it was ever valid), totally out of date. The implied picture is one in which most voters, and all who take a serious interest in politics, are committed supporters of one major party or the other, in roughly equal numbers. Hence, the remainder, the ‘swingers’ determine the outcome.

This was always a problematic viewpoint. As Henderson’s own family experience during the Split (he has an interesting piece on this in the latest Sydney Institute newsletter) people can and do make permanent changes in their political allegiance. A conversion of this kind is far more valuable to the gaining party than winning a swinging voter for a single election.

More importantly, the number of “rusted-on” major party voters has declined drastically. Both sides have recorded votes of 35 per cent or below in their worst recent outings, which puts an absolute upper bound of 70 per cent voters committed to one party or the other. But even within this group, there are almost certainly some who changed over time, or voted on a specific issues. For example, Keating lost lots of hardcore Labor voters in the 1996 election, but he undoubtedly gained some “cafe latte” votes with his cultural agenda – many of these will not be so attracted to Latham, while the former hardcore may return.

Henderson is particularly unsatisfactory when it comes to the minor parties. He notes that most Green preferences go to Labor, but there’s a big difference between getting a primary vote and getting 70 per cent of second preferences. To be precise, on these numbers the average Green vote is worth 0.4 first preferences votes to Labor.

More importantly, since minor party preferences are now crucial, what basis does Henderson have for equating minor party voters with “the uncommitted or uninterested”? The decision to vote for a minor party means that the voter has rejected both of the obvious choices, which normally implies some degree of interest in the process. It’s hard to argue that Democrat and Green voters as a group are less interested in politics than major party voters, whatever you might think of the results of their interest. Even One Nation voters, who are on average closer to Henderson’s idea of the apolitical swinger, were expressing a (negative) interest in political ‘business as usual’ when they abandoned their traditional allegiances to vote for Pauline.

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The facts on DDT

February 3rd, 2004 21 comments

Thanks to reader Jim Norton, who points to this letter to the Oz on DDT from parasitologist Dr Alan Lymbery, demolishing the nonsense peddled by Christopher Pearson (it’s on Keneth Miles site). My take on Pearson’s nonsense was here, with links to earlier pieces. I’m pleased to see it matches Lymbery almost point for point.

One fact Lymbery adds, of which I was not aware, is that Rachel Carson, who has been much maligned in the debate on this topic, explicitly noted, in relation to the growth of resistance arising from indiscriminate use of DDT

No responsible person contends that insect-borne disease should be ignored . . . The question that has now urgently presented itself is whether it is wise or responsible to attack the problem by methods that are rapidly making it worse

Lymbery concludes

Malaria is responsible for enormous suffering and death. The facts are readily available in the scientific literature. To blame a reduction in DDT usage for the death of 10-30 million people from malaria is not just simple-minded, it is demonstrably wrong. To blame a mythical, monolithic entity called the environmental lobby for the total reduction in DDT usage is not just paranoid, it is also demonstrably wrong. Your article is not only poor journalism, it is an insult to the people who work for the control of parasitic diseases that afflict developing nations.

The same could be said of the dozens of junk science sites in the blogosphere that have reproduced the same nonsense, usually with no attempt to check original sources.

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Blowing up pipelines

February 2nd, 2004 1 comment

This piece by William Safire alleges that the CIA was engaged in terrorist activity in Russia in the early 1980s, sabotaging a gas pipeline funded by Britain and Germany, and allegedly leading to its explosion.

Of course, Safire doesn’t use the word terrorism and regards the whole thing as a major victory in the Cold War, but we don’t need to use our imagination to see how the US would regard the same thing done in reverse – blowing up pipelines is one of the main terrorist activities of the Iraqi insurgents.

The sabotage was allegedly done by supplying defective computer chips of a type that were under embargo because of their supposed military use. I get the impression Safire thinks that this makes the deal OK and that it’s different from blowing up the pipeline with dynamite (but I can’t be sure of this).

Finally, I should add that the story sounds phony to me.

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Monday Message Board

February 2nd, 2004 12 comments

For the first time in many weeks, the Monday Message Board is on time and under budget. Please post your thoughts on any topic (civilised discussion and no coarse language, please).

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More steps than ties on a railroad

February 1st, 2004 Comments off

The slow-motion renationalisation of British Rail takes one more step.

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Unchangeable minds

February 1st, 2004 22 comments

Among the famous quotes attributed to JM Keynes, one that stands out is

When the facts change, I change my mind – what do you do, sir

I am reminded of this whenever I read discussions of what was in the minds of those who pushed us into the Iraq war. It’s regularly stated that the behavior of Saddam Hussein in obstructing weapons inspections led analysts to assume he had something to hide. I shared this view until late 2002, and was reinforced in this by the behavior of Bush and Blair, including the various dossiers they published and the push for UN Resolution 1441 – they acted like police who had their suspect dead to rights, and only needed a search warrant.

In November and December 2002, however, the facts changed. First Saddam announced that he would readmit UN inspectors, without restrictions on the sites to be inspected and that he would declare all his weapons. Then he proceeded to do just that, claiming to have no weapons at all. Meanwhile Bush and Blair suddenly started hedging about the nature of the knowledge they had declared. The same pattern proceeded right up to the outbreak of war. Time after time, some condition would be declared crucial by Bush and Blair (overflights, interviews with Iraqi scientists, out-of-country interviews with Iraqi scientists), the Iraqi government would agree after a brief delay and then new condition would be raised. As quite a few observers noted, the behavior was the same as that of the Austro-Hungarian government with respect to Serbia in 1914.

Given the change in facts, any unbiased observer would have concluded, correctly that the balance of probabilities favored the hypotheses Bush and Blair were bluffing and that there were no weapons of mass destruction in usable form. I drew precisely this conclusion at the time, though with the mistaken corollary that Blair would stick to his word and refuse to go to war once Saddam called their bluff.

If those facts weren’t enough, it was obvious that, if Saddam did have weapons he would use them in the early days of war, preferably before Coalition troops had entered the country. Thus, it was apparent by the first days of the war that (with probability close to 1), there were no usable weapons. The fact that the contrary belief prevailed for so long is testament to the power of faith in the face of experience.

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What I'm reading, and more

February 1st, 2004 1 comment

I’m still working through the O’Brien/O’Brian (Patrick and Flann) section of the bookshelf. I missed the movie of Master and Commander, as I was out of town too long, and will have to watch it on DVD, which will definitely be a second-best option for this kind of film. I did see Japanese Story, a film with a rather slight plot, but an excellent performance from Toni Collette.

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