Liberty Fund

One Benefit of Tariffs, by Pierre Lemieux

Perhaps one benefit of President Trump’s tariffs and trade war will be to illustrate standard results of trade theory.

One general result is that a domestic tariff against imports also increases the domestic price charged by domestic producers of the protected good. There is only one price in the market for a given good (quality being constant). Domestic producers will get the same higher price that foreign producers charge tariff-included on the domestic market. I gave an example of steel prices as reported by the Wall Street Journal in my post “A Simple Illustration of Standard Trade Theory,” July 3, 2018.

On Wednesday, the Journal gave another example, this time on aluminum prices:

Aluminum prices in the U.S. have climbed this year after the Trump administration imposed a 10% tariff on imported aluminum in March.

Democracy in America: The Electoral College versus Third Party Candidates

Even assuming that the electoral college is a defect in our democracy, the possibility of third party candidates that spoil elections is a worse problem.

Sacrifice in A New Leaf and In Bruges

Each film carries the theme effortlessly, almost unexpectedly, and in so doing, each film punches with unexpected power.

Kevin McKenna on Characters, Plot, and Themes of In the First Circle

Russian Literature Professor Kevin McKenna of the University of Vermont talks with EconTalk host Russ Roberts about the characters, plot, and themes of Aleksandr Solzhenitsyn’s masterpiece, In the First Circle. This is the second episode of the EconTalk book club discussing the book. The first episode–a discussion of Solzhenitsyn’s life and times–is available on EconTalk at Kevin McKenna on Solzhenitsyn, the Soviet Union, and In the First Circle.

Hamilton, Madison, and American Oligarchy: A Conversation with Jay Cost

Jay Cost, author of The Price of Greatness, discusses the political and economic debates between Hamilton and Madison.

A Connecticut Yankee in Georgia: Abraham Baldwin and the Establishment Clause

There are excellent reasons to oppose state involvement with religion, but originalist arguments are not among them.

What’s good for big tobacco . . ., by Scott Sumner

I’m not a fan of laws restricting tobacco use, except in government buildings. So I might be expected to look favorably on a change in FDA regulations that led to a boost in the prices of tobacco stocks.

But this particular stock market reaction leaves me concerned:

Tobacco stocks surged Wednesday after regulators threatened to pull e-cigarettes from shelves if manufacturers do not control “widespread” teen use.

Shares of Altria rose more nearly 7 percent to their best day since November, 2008. Philip Morris International increased about 3 percent. British American Tobacco shares increased nearly 6 percent to their best day since December, 2008. In London, Imperial Brands rose 3 percent. . . .

Investors welcomed the regulatory crackdown. E-cigarette sales have threatened Big Tobacco companies.

Meritocracy Without Borders: Sowell Edition, by Bryan Caplan

In recent years, Thomas Sowell has been a staunch advocate of stricter immigration policies.  Which is ironic, because this passage from his Compassion Versus Guilt has stuck with me for thirty years:

When I travel through California’s vast agricultural areas, the people I see working in the fields under the hot sun are usually Mexicans.  So are many of the people who clean the hotels.  But when I have been approached by a panhandler in San Francisco or Los Angeles, it has never been a Mexican.

The Thoughts of Blaise Pascal (Blaise Pascal)

The Thoughts of Blaise Pascal, translated from the text of M. Auguste Molinier by C. Kegan Paul (London: George Bell and Sons, 1901).

Richard Nixon’s 1968 Campaign for President, by David Henderson

The first thing that Martin did for Richard Nixon—one of the first things—it’s dated July 4, 1967—is to make the argument for abolishing the military draft and moving to an all-volunteer armed force.

This is my Hoover colleague Annelise Anderson reminiscing about how she and her husband, the late Martin Anderson, got involved in Richard Nixon’s 1967-68 campaign for president of the United States. Obviously, for those who know my view on the draft, this was my favorite segment of the 1.5 hour discussion on C-SPAN. It’s titled “Richard Nixon’s 1968 Victory,” and was shown on September 21, 2018. The whole thing is way more fascinating than I expected it to be. The moderator is Geoffrey C. Shepard and the 3 other panelists, besides Annelise, are Kenneth L. Khachigian, Patrick J. Buchanan, and Dwight L. Chapin. All 3 were in the Nixon campaign and then the Nixon administration. Chapin later went to prison for lying to a grand jury.

Life Finds A Way: Jurassic Park‘s Warning at 25

Jurassic Park's question remains: is technology subject to our control anymore?

Methodology

An Economics Reading List

Buchanan, James, What Should Economists Do?

Cairnes, John Elliot, The Character and Logical Method of Political Economy

This tautly reasoned work begins by comparing the logical and scientific methods of various sciences (such as physics and chemistry) with the logical and scientific methods available to economists. Cairnes then illustrates the power of working out those principles by examining debates of the early to middle 1800s. He devotes a chapter each to clear expositions of Malthus’s population principle (Lecture VII) and Ricardo’s development of the theory of rent (Lecture VIII). His discussions set a new standard of careful thinking about economics. Cairnes’s explanations are written with unusual clarity, making this book a great way to learn to think clearly about economics proposals in general, whether they are presented as loosely as in the popular press or as precisely as in advanced research papers.

Klamer, Arjo and David Colander, The Making of an Economist

Klein, Daniel, (ed.), What Do Economists Contribute?

Sneak Peek!

Letters from Piety Hill

A rich, entertaining, and often instructive selection of Russell Kirk’s correspondence.

The Aeneid (Dryden trans.) (Virgil)

Virgil’s Aeneid, trans. John Dryden with Introduction and Notes (New York: P.F. Collier and Son, 1909).

Reassessing the productivity gains from trade liberalization

JAEBIN AHN, ERA DABLA-NORRIS, ROMAIN DUVAL, BINGJIE HU, LAMIN NJIE REVIEW OF INTERNATIONAL ECONOMICS Abstract: This paper reassesses the impact of trade liberalization on productivity. We build a new, unique database of effective tariff rates at the country‐industry level for a broad range of countries over the past two decades. We then explore both the direct […]

Why Law Students Need to Learn More about Originalism

Law is a professional discipline and students should be prepared for the world as it is rather than what their professors fantasize it could be.

The Alchemy of Happiness (Al Ghazali)

The Alchemy of Happiness, by Mohammed Al-Ghazzali, the Mohammedan Philosopher, trans. Henry A. Homes (Albany, N.Y.: Munsell, 1873). Transactions of the Albany Institute, vol. VIII.

Montesquieu argues that the law of a free society is like a very large fishing net (1720)

A Cure for Our Health Care Ills: The Supply Side

In our previous article, “A Cure for Our Health Care Ills,”1 we debunked some persistent myths and discussed some key regulatory, spending, and insurance changes on the demand side that would make health care more affordable while not cutting, and possibly increasing, quality. But the demand side is only half the story. Important reforms on the supply side would also make health care cheaper and more accessible. All of them involve some form of deregulation.

We often hear that governments in the United States should regulate health care more because free markets have made it more expensive than in other countries. It’s true that medical care in the United States is usually more expensive than in other countries, even after accounting for differences in wealth. But the cause is not the free market. For more than half a century, there hasn’t been a free market in health care because governments at both the federal and state levels have heavily regulated doctors, hospitals, and drugs. We propose abolishing virtually all of this regulation so that doctors’ and hospitals’ services and drugs would be more plentiful and cheaper.

The City of War and the City of Peace on Achilles' new shield (900 BC)

Reforming U.S. Environmental Policy

Start with two big obstacles to good policymaking on the environment: federal review under NEPA, and undue judicial deference to the executive branch.

William Blake's Illustrations of the Book of Job

Related Links in the GSR: - Job

Related Links: - Book of Job - William Blake

Book of Job. We include a number of his illustrations here and a full list.

Does Situationism Threaten Free Will and Moral Responsibility?

MICHAEL MCKENNA & BRANDON WARMKE JOURNAL OF MORAL PHILOSOPHY Abstract: The situationist movement in social psychology has caused a considerable stir in philosophy. Much of this was prompted by the work of Gilbert Harman and John Doris. Both contended that familiar philosophical assumptions about the role of character in the explanation of action were not supported […]

John Gray on the Seven Kinds of Atheism

Philosopher and author John Gray talks about his latest book, Seven Types of Atheism, with EconTalk host Russ Roberts. Gray argues that progress is an illusion and that most atheisms inherit, unknowingly, a religious belief in progress that is not justified. While Gray concedes that technological know-how and scientific knowledge improve over time, he argues that morality and political systems are cyclical and that there is no reason to be optimistic about the future.

Bastiat on the fact that even in revolution there is an indestructible principle of order in the human heart (1848)

Virgil Storr, "Marx and the Morality of Capitalism" (October, 2018)

This year is the bicentennial of the birth of Karl Marx (1818-1883) and in this month's Liberty Matters online discussion we will explore the strengths and weaknesses of Marx's political, economic, and social thought. The lead essay is by Virgil Store, senior research fellow at the Mercatus Center and a professor of economics at George Mason University, where he explores Marx's "moral critique of capitalism" which he argues underlies his economic and social critiques of capitalism. He is joined in this discussion by Pete Boettke, Professor of Economics and Philosophy at George Mason University; Steve Horwitz, Distinguished Professor of Free Enterprise in the department of economics at Ball State University in Muncie, Indiana; David Prychitko, professor of economics at Northern Michigan University; and David Hart, the Director of Liberty Fund's Online Library of Liberty Project.

See the Archive of "Liberty Matters".

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.

Mises on classical liberalism and the gold standard (1928)

Hosea (KJV) (Old Testament (Various Authors))

The Parallel Bible. The Holy Bible containing the Old and New Testaments translated out of the Original Tongues: being the Authorised Version arranged in parallel columns with the Revised Version (Oxford University Press, 1885). Hosea.

The Free Sea (Hakluyt trans.) (Hugo Grotius)

Grotius’s influential argument in favor of freedom of navigation, trade, and fishing in Richard Hakluyt’s translation. The book also contains William Welwod’s critque and Grotius’s reply to Welwod.