The President is a man of principle. The WaPo reports:

Obama said he told House Minority Leader John Boehner (R-Ohio) that his core goals — lowering health-care costs for businesses and individuals and expanding coverage to the uninsured — remained non-negotiable.

Maybe he should pick “core goals” that are compatible instead of ones that in direct conflict with each other.

Here’s a letter that I just sent to the Washington Post:

Your favorable front-page remembrance of the late U.S. Rep. John Murtha inadvertently testifies to the abysmally low standards to which politicians are held (“John Murtha dies; longtime congressman was master of pork-barrel politics,” Feb. 9).  By your own account, Mr. Murtha was the “King of Pork.”  He was known for skillfully using Congressional procedures to earmark funds for his district – that is, to prompt Uncle Sam to take money from Americans at large and give it to the relatively small number of Pennsylvanians who elect Mr. Murtha to office.

His justification? “I take care of my district.”  Nothing here about spending taxpayer money wisely; nothing about the general welfare; nothing about principles or fiscal responsibility.

If Mr. Murtha on his own had traveled the country picking pockets, robbing banks, and burgling houses, only to bring the booty back to western PA and share it with his friends, he would have been rightly despised as a common criminal.  But because Mr. Murtha joined forces with persons having similarly questionable morals, who together pass off their thievery as “lawmaking,” he’s celebrated in your pages – celebrated for doing, save on a grander scale, exactly what is done by common thieves.

Sincerely,
Donald J. Boudreaux

Below are two letters that I sent yesterday to the Wall Street Journal.  Both are in response to this essay whose author argues that America needs an “industrial policy.”  (This essay has many flaws beyond those that I highlight in my letters.)

John Hofmeister builds his case for a U.S. industrial policy on a foundation of falsehoods (“The U.S. Needs an Industrial Policy,” Feb. 8).

The most notable falsehood is Mr. Hofmeister’s assertion that American manufacturing is faltering.  In fact, America remains the world’s leading manufacturing country, one whose manufacturing output continues to increase.  For example, in inflation-adjusted dollars, the value of U.S. manufacturing output in 2007 was 8 percent higher than it was in 2000, 69 percent higher than it was in 1990, and 184 percent higher than it was in 1980.

And while it’s true that the Chinese will one day produce more manufacturing output than do Americans, that eventuality is hardly surprising given that China is home to one-sixth of the world’s population.  Moreover, the fact that manufacturing outputs in newly industrializing nations such as China are growing faster than American output no more means that American manufacturing is in poor health than does the fact that a two-year-old girl is growing faster than her ten-year-old brother mean that the brother is shrinking, is in poor health, or is in need of a ‘height’ policy.

Sincerely,
Donald J. Boudreaux

and

According to John Hofmeister, “Where to stimulate job creation should be as obvious as the cosmetic smile on an elected official’s face: manufacturing.  Go where we’ve been” (“The U.S. Needs an Industrial Policy,” Feb. 8).

If Mr. Hofmeister’s logic is correct, his recommendation is too modest, for there’s an industry that once employed a far larger percentage of Americans than were ever employed in manufacturing: agriculture.

So if it’s wise to “go where we’ve been,” Uncle Sam should implement policies that create lots of agricultural jobs.  He can do so by outlawing farm machinery, fertilizers, pesticides, and refrigeration, as well as all packing materials invented after, say, 1900.  Just imagine the millions of jobs restored to that glorious industry that once employed nearly nine in every ten workers!

Now if Mr. Hofmeister nevertheless insists that Uncle Sam create more jobs in manufacturing, similar steps will be necessary.  For example, all post-WWII – aw heck, all post-WWI – advances in automation and inventory control can be banned from use, along with all use of modern computer technologies.  The resulting plunge in productivity will mean that many more workers will be required to produce the same amount of output that a single worker produces today.  And with all those workers shifted back to manufacturing, America would have fewer service-sector workers – folks such as pharmaceutical researchers, highly specialized physicians, and software designers – dragging down measured average wages.

What a recipe for prosperity that is!

Sincerely,
Donald J. Boudreaux

My friend and former colleague (from my time at Clemson University) Bruce Yandle has two new essays very much worth reading.

“Lost Trust: The Real Cause of the Financial Meltdown”

&

“Producing Jobs: Thoughts on Obama’s Plan for Small Businesses“

EconLog’s Arnold Kling asks a question that would fuel befuddled, and perhaps even angry, stares at the typical Manhattan or Beverly Hills cocktail party — but it’s a great question that, in fact, is not rhetorical:

Is it really the case that people want the government to create jobs? I have seen many progressives and pundits claim that people are angry about jobs, but I have not seen any people clamoring for the government to create jobs. (Emphais added – DBx)

Below is the abstract of a paper that looks very interesting.  Its title is “Proposition 13 and The California Fiscal Shell Game“; its authors are Colin McCubbins and Mathew McCubbins:

We study the effects of California’s Tax and Expenditure Limitations, especially Proposition 13. We find that Proposition 13 was indeed effective at reducing both ad valorem property taxes per capita and total state and local taxes per capita, at least in the short run. We further argue that there have been unintended secondary effects that have resulted in an increased tax burden, undermining the aims of Proposition 13. To circumvent the limits imposed by Proposition 13, the state has drastically increased nonguaranteed debt, has privatized the public fisc, and has devolved the authority to lay and collect taxes and to spend the proceeds so gained. The devolution of authority has been among the swiftest growing aspects of government finance in California, to a far greater extent than in other states. Lastly, we argue that the new tax and spending authorities that have been created to circumvent Proposition 13 have led to a reduction in government transparency and accountability and pose an increasing threat to our democracy.

Here. An excerpt:

He has been narrow, not broad. He has been partial, not post-partisan. He has been ideological, not pragmatic. No number of “eloquent” speeches can alter these facts. This is why his major initiatives have failed, why his net job approval has dropped 50 points in 12 months, and why he is substantially weaker now than he was a year ago.

But that’s just the punch line. The intro is just as good.

Here:

Hayek contre Keynes – VOSTfr
Uploaded by Liberte_Cherie. – Click for more funny videos.

For the last year or so I’ve been thinking about trade in a new way, a mix of Smith and Ricardo, an idea I first heard from Jim Buchanan and enhanced by conversations with Don Boudreaux and Mike Munger. In this week’s EconTalk, I lay out the idea. Hope you like it.

Here’s the best line that I’ve read in a long, long time:

Today’s tax system was shaped by sadists who were trying to be nice.

It’s penned by George Will, and appears in his column in today’s Washington Post.  The entire column is worth reading, as it very nicely summarizes Rep. Paul Ryan’s plan for restoring at least some sanity to Uncle Sam’s fiscal looney bin.

Today’s Washington Examiner has this short but wonderful interview with my dear friend Tom Palmer.  Here’s the final question and answer:

At your core, what is one of your defining beliefs?

I believe that the individual human life matters. I believe that human freedom is a constituent element of a good life — of human happiness — and is, consequently, intrinsically valuable.

Below the fold. TY to Alois Lang. I encourage you to create a subtitled version.

Thanks to Andrew Garland for this link, which provides details about Melanie Shouse, the St. Louis woman who once worked for the Obama campaign and who died last week of breast cancer.

Contrary to the implication that I drew in my previous post, Mr. Obama did not know Ms. Shouse, so I was off-base to suggest that perhaps he should have personally paid for her medical care.

Ms. Shouse should have paid for it.

All the available evidence suggests that she could have afforded to do so.  First, — and contrary to what Mr. Obama said — Ms. Shouse did have health-insurance.  It was a catastrophic-coverage policy.  That is, annually her insurance paid nothing until her medical expenses hit $5,000.

So the most that she could have been out of pocket each year is $5,000.

That’s not a small sum of money, but nor is it a sum out of reach for most Americans.

Second, Ms. Shouse and her boyfriend, for 12 years, owned their own small business.  I have no idea how profitable it was, or is, but because they’d been in business for 12 years I infer that it did not leave them anywhere close to destitution.

Ms. Shouse also found time to volunteer to work for Mr. Obama’s presidential campaign.  This is time that she could have instead spent working at a job that paid her extra income.  But, as reported, she chose to contribute, free of charge, some of her time to a political campaign.

It’s quite possible that the value of the hours that Ms. Shouse contributed to Mr. Obama’s campaign exceeded the cost she would have incurred had she gone to the MD when she discovered a lump in her breast.

Third, Ms. Shouse knew that she had a lump in her breast and she knew that such a thing put her life in severe jeopardy.  Yet she chose not to spend up to a maximum of $5,000 annually (and likely less) to check this malady out with a physician.

Yes, she excused her failure to see a physician because, allegedly, she couldn’t afford it — that is, allegedly she couldn’t afford to pay up to $5,000 annually to save her life!

Her allegation is not believable.  Again, there’s no evidence that she was destitute.  She was wealthy enough to donate that most valuable of commodities — time — to a political campaign.  And her total, out-of-pocket annual expenses had she chosen to visit a physician when she discovered the lump in her breast would likely have been far lower than $5,000.

Fourth, she chose to buy a catastrophic-coverage policy, probably because the higher costs of policies with lower deductibles were not worthwhile for her to pay.  Given her choice, surely she and her boyfriend knew — or ought to have known — that each year there is a good chance that one or the other or both of them will require routine (that is, non-catastrophic) medical care.  Could they not have saved a small sum of money each year to cover this obvious likelihood?

Here’s the bottom line: Ms. Shouse chose not to pay for medical attention when such attention might well have saved her life.  If she was unwilling to pay no more than $5,000 annually to save her own life, why should the rest of us be forced to pay for what she, obviously, judged not to be a worthwhile expense for her herself to incur?

Here’s a letter that I sent to the New York Times:

You open your report on the President’s continued push for health-care reform with the following account: “For a moment, President Obama’s pledge to keep fighting for major health care legislation got personal on Thursday night as he told supporters at a fund-raiser about a former campaign worker in St. Louis without health insurance who had died of breast cancer.  ‘She insisted she is going to be buried in an Obama T-shirt,’ he said…. ‘How can I say to her, ‘You know what, we’re giving up’’? ” (“Democrats Ask, Can Health Care Bill Be Saved?” Feb. 5).

What have we here?  A politically successful multimillionaire stands idly by as an employee – who seems also to have been Mr. Obama’s personal acquaintance – dies because she cannot afford proper medical care.  Then Mr. Obama deploys this tale of woe not to apologize for, or to criticize, his own refusal to help a friend but, instead, to criticize millions of other people who never met this woman for their refusal to be forced into ponying up for her health insurance.

A truly ethical person voluntarily sacrifices from his own purse to help others when appropriate.  And he never pretends that he fulfills his ethical duties by calling upon the state to compel people to do what he himself refuses to do voluntarily.

Sincerely,
Donald J. Boudreaux

As Dave Schmidtz points out to me in the e-mail that he sent alerting me to this report, the entire story has a distinct air of unbelievability about it.  It’s likely untrue – a fact that raises a whole ‘nother set of issues.

University of Virginia politics professor Gerard Alexander makes the case – in tomorrow’s Outlook section of the Washington Post — that so-called “liberals” are generally more condescending than are conservatives.

Here’s a letter that I sent to the Wall Street Journal:

You report that “The U.S. and Canada … reached a preliminary deal to settle what had become an acrimonious dispute over ‘Buy American’ provisions in the U.S. stimulus package.  The deal, if approved, will give companies on both sides of the border access to government procurement contracts at the state and local levels” (“U.S., Canada Reach Deal on ‘Buy American’,” Feb. 5).

In other words, Washington agrees that it will spend Americans’ tax dollars wisely – that is, get the most value in return for each dollar spent – only if Ottawa does the same with Canadians’ tax dollars.  If instead Ottawa had stubbornly insisted on wasting Canadian taxpayer dollars by refusing to buy lower-priced goods and services from Americans, Washington would have boasted of its commitment to continue wasting American taxpayer dollars by refusing to buy lower-priced goods and services from Canadians.

This sort of Dali-esque surrealism of government behavior is ignored by the public and the punditry only because it is all too common.

Sincerely,
Donald J. Boudreaux

Knowledge Problem’s Lynne Kiesling identifies another small yet worthwhile additional drop of prosperity into the Prosperity Pool.

Here’s a wonderful 1978 video, six-minutes long, of Milton Friedman in his prime, defending free trade. (HT Andy Roth)