Liberty Fund

Silent Originalism and the Reweighting of Precedent 

The Court’s recent gerrymandering decision recognized Reynolds v. Sims as so flawed in its reasoning as not to deserve mention.

A Carbon Tax Is Not a Slam Dunk, by David Henderson

Advocates of a carbon tax argue, correctly, that a tax is a much better way to reduce carbon usage than any system of regulations could be. The reason is that every use of carbon that creates carbon dioxide imposes damage, and a carbon tax based on the amount of carbon dioxide created will cause everyone who creates carbon dioxide to, indirectly, take that damage into account. The carbon tax beautifully scales the payment to the damage: those who create more damage pay more in carbon taxes.

By contrast, a system of regulations or subsidies that favors one energy source over another, or one energy use over another, depends on central planners having information that they cannot possibly have. So, for example, if government planners require that a certain percentage of energy usage come from solar, they do not take account of the cost of solar and they foreclose ways of producing energy, such as natural gas, that produce less carbon dioxide than other ways, such as coal. A carbon tax, by contrast, automatically pushes electricity production away from coal and towards natural gas. As a bonus, if, under a carbon tax regime, solar energy turns out to be less expensive than natural gas, the market will push energy production more in the direction of solar.

On the Road with Robert Kaplan

We must understand both the can-do spirit of America and the restraints imposed by the realities of a harsh landscape that won’t yield to mere optimism.

Tyler Cowen on Big Business

Author and economist Tyler Cowen of George Mason University talks about his book, Big Business, with EconTalk host Russ Roberts. Cowen argues that big corporations in America are underrated and under-appreciated. He even defends the financial sector while adding some caveats along the way. This is a lively and contrarian look at a timely issue.

Aristotle insists that man is either a political animal (the natural state) or an outcast like a "bird which flies alone" (4thC BC)

Mallaby on Grant’s Bagehot, by Alberto Mingardi

I cannot add the second post before this afternoon but it would be this

I’m halfway through James Grant’s Bagehot. The Life and Times of the Greatest Victorian. The book has been widely reviewed and it is, indeed, excellent. Grant writes engagingly and makes the most of Bagehot’s life (by the way, I was saddened by his reference to Thomas Hodgskin as “a kind of anarcho-socialist”, but this is a very minor fault of the book).

Of the reviews I read, I’ve particularly appreciated Sebastian Mallaby’s, published on Foreign Affairs. Mallaby starts his piece by writing:

In James Grant, it sometimes seems, the nineteenth century has been resuscitated. Towering, gaunt, bow-tied, and pinstriped, he writes with a sly wit that recalls the novels of William Thackeray. His signal achievement is a fortnightly cult publication bearing the antique title Grant’s Interest Rate Observer. He is a nostalgic believer in the nineteenth-century gold standard. He eyes modern banking innovations with stern, starch-collared suspicion, as though peering at them through a monocle. Even traditional financial instruments elicit a wry scorn. “To suppose that the value of a common stock is determined purely by a corporation’s earnings,” Grant once wrote, “is to forget that people have burned witches, gone to war on a whim, risen to the defense of Joseph Stalin and believed Orson Welles when he told them over the radio that the Martians had landed. Now, Grant has written a delightful biography of Walter Bagehot, the great nineteenth-century Englishman in whom Grant perhaps recognizes a grander version of himself: the would-be Victorian sage is paying tribute to the authentic one.

Ask the Author: Questions for Karelis, by Bryan Caplan

Charles Karelis, author of The Persistence of Poverty, is happy to answer your questions.  Please write them in the comments, and he’ll respond in a regular post.

To get things started, here are a few questions from me.

1. Your theory seems to imply that when people temporarily have many personal problems, they will start doing painful things with long-run benefits.  Example: If you’re already (temporarily) miserable, why not go on a diet and start exercising, so when your problems end, you’re thin and fit?  But as far as I know, almost no one does this.  Please comment.

Letters on the Factory Act (Nassau William Senior)

Letters on the Factory Act, as it affects the Cotton Manufacture (London: B. Fellowes, 1837).

Bernard Mandeville concludes his fable of the bees with a moral homily on the virtues of peace, hard work, and diligence (1705)

Frederick Douglass’s “Plea for Freedom of Speech in Boston”

A man’s right to speak does not depend upon where he was born or upon his color. The simple quality of manhood is the solid basis of the right.

The Theory of Moral Sentiments: Part VI, Section II, Chapter III

Of universal Benevolence

St. John, private property, and the Parable of the Wolf and the Good Shepherd (2ndC AD)

Producers

Introduction

A producer is someone who creates and supplies goods or services. Producers combine labor and capital—called factor inputs or factors of production —to create—that is, to output —something else. Businesses —called “firms” —are the main examples of producers and are usually what economists have in mind when talking about producers. However, governments are producers of some kinds of services—such as police services, defense, public schools, and mail delivery—and sometimes goods, such as when a government owns the oil fields and oil production (for example, OPEC). Households and individuals are producers of non-market goods and services such as cleaning, child-rearing, cooked food, etc.

Producers pay wages to workers. Wages include salaries, bonuses, and benefits such as health insurance. What producers pay for capital is called economic rent. Economic rents include interest payments. Anything left over for the owner of the business is called economic profit.

Definitions and Basics

Producer, Dictionary.com.

1. Economics. A person who creates economic value, or produces goods and services.

To Hell and Back

In The Hell of Good Intentions, Stephen Walt tries to draw a false dichotomy between American security and liberal order.

Gold Standard

The gold standard was a commitment by participating countries to fix the prices of their domestic currencies in terms of a specified amount of gold. National money and other forms of money (bank deposits and notes) were freely converted into gold at the fixed price. England adopted a de facto gold standard in 1717 after the master of the mint, Sir Isaac Newton, overvalued the guinea in terms of silver, and formally adopted the gold standard in 1819. The United States, though formally on a bimetallic (gold and silver) standard, switched to gold de facto in 1834 and de jure in 1900 when Congress passed the Gold Standard Act. In 1834, the United States fixed the price of gold at 20.67 per ounce, where it remained until 1933. Other major countries joined the gold standard in the 1870s. The period from 1880 to 1914 is known as the classical gold standard. During that time, the majority of countries adhered (in varying degrees) to gold. It was also a period of unprecedented economic growth with relatively free trade in goods, labor, and capital.

Mary Wollstonecraft, “A Vindication of the Rights of Woman” (1792) (Mary Wollstonecraft)

The Best of the OLL No. 33: Mary Wollstonecraft, “A Vindication of the Rights of Woman” (1792) (Indianapolis: Liberty Fund, 2013).

A Devils’ Alliance and a Civilizational Failure

During the Hitler-Stalin Pact, the two nations’ secret police shared intelligence. The NKVD turned German communist exiles over to the Gestapo.

Thomas Jefferson in the Cyclopedia

The Jeffersonian Cyclopedia: A Comprehensive Collection of the Views of Thomas Jefferson. Classified and Arranged in Alphabetical Order Under Nine Thousand Titles, Relating to Government, Politics, Law, Education, Political Economy, Finance, Science, Art, Literature, Religious Freedom, Morals, etc. Edited by John P. Foley (New York: Funk & Wagnalls Co., 1900).

Two Books of the Elements of Universal Jurisprudence (Samuel von Pufendorf)

This was Pufendorf’s first work, published in 1660. Its appearance effectively inaugurated the modern natural-law movement in the German-speaking world. The work also established Pufendorf as a key figure and laid the foundations for his major works, which were to sweep across Europe and North America. Pufendorf rejected the concept of natural rights as liberties and the suggestion that political government is justified by its protection of such rights, arguing instead for a principled limit to the state’s role in human life.

In Shakespeare's Henry V the king is too easily persuaded by his advisors that the English economy will continue to function smoothly, like obedient little honey-bees in their hive, while he is away with his armies conquering France (1598)

The A B C of Finance (Simon Newcomb)

The ABC of Finance: or, the Money and Labor Questions Familiarly Explained to Common People in Short and Easy Lessons (New York: Harper and Bros. 1877).

Best Boss Ever

Members of the Obama administration have put together a book of “deeply moving stories” that “show us how hope becomes real, sustainable change.”

Phillip W. Magness, “William Leggett: Free Trade, Hard Money, and Abolitionism” (July, 2019)

The American political journalist William Leggett (1801-1839) had a short but productive period of activity between 1834-39 when he became famous, even notorious, for his opposition to slavery, tariffs, a state privileged National Bank, and government intervention in the economy to benefit special interests (like bankers, industrialists, and slave owners). Leggett's position of consistent opposition to the state interfering in the economic affairs of individuals is one that does not sit well with the new school of economic historians of "capitalism" who argue that slavery and capitalism were joined at the hip and were "symbiotic". In this discussion Phil Magness, senior research fellow at the American Institute for Economic Research, argues that it is Leggett who is the consistent one and the advocates of the "New History of Capitalism" are the ones who are confused and do not seem to know about this "broader liberal political tradition" of which Leggett was a member. He is joined in the discussion by Anthony Comegna, from the Institute for Humane Studies, Brian Schoen, associate professor of history at Ohio University, and Lawrence H. White, professor of economics at George Mason University.

See the Archive of "Liberty Matters".

80th Anniversary of a Poisonous Partnership: Hitler and Stalin

When two dictators divvied up the weaker countries of Europe between them.

Assessing the Faith-Friendly Colleges

Could it be that their purported improvement on this score is just more “bad religion” of the kind that Ross Douthat described?

The Logos of Western Civilization: A Conversation with Sam Gregg

Sam Gregg explores how the West is built on the union of the God of the Philosophers and the God of the Bible.

Universal Economics (Armen A. Alchian)

Universal Economics. Edited by Jerry L. Jordan. Foreword by William R. Allen (Indianapolis: Liberty Fund, 2018).