That’s not a brief for denial, it’s a brief for adaptation

Kevin D. Williamson asks the progressives of California to please demonstrate their competence at risk management before exporting their methods world-wide.  From Global Warming Guacamole:

[The drought in] California presents the global-warming dispute in miniature. The Left, with the prominent advocacy of President Barack Obama, has argued that the challenge of global warming necessitates a new form of economic organization under political discipline. Never mind, for the moment, that the Left has been arguing for a new form of economic organization under political discipline for more than a century (the crisis changes every generation, but the identical solution endures); consider the actual choice presented by Sternbergh’s avocado. We could embark on a sprawling, unfocused, and unmanageable crusade to cajole and coerce the world — including the not-especially-cajolable gentlemen in Beijing — into reorganizing the entire human race’s means of sustenance in accordance with not especially well-defined atmospheric metrics. Or we could insist that California get its act together on the matter of water infrastructure.

California not only is effectively a single-party state operating under Democratic monopoly, its Democrats are impeccably progressive, almost spotlessly so. The progressives are forever insisting that they are the ones who know how to handle infrastructure projects, that they are the ones who care about them, and that their broader understanding of public goods will contribute to general prosperity. In reality, California has the worst water infrastructure situation in the country, with the EPA in 2013 calculating that the state requires nearly $45 billion in improvements. A more liberal view of California’s real possibilities would identify an even larger deficit. California’s recent lack of precipitation is nature’s doing; its inability to weather the ordinary variations of life on Earth is entirely man-made.

The actual challenges presented by the threat of global warming look a lot more like California’s current situation than Waterworld or The Day After Tomorrow. As a matter of political rhetoric, it is attractive to frame the choice as a matter of affiliation: Cast your lot with the truth-speaking scientists on one side or the oil-addicted pre-Enlightenment goobers on the other. The actual choice is between making a naïve attempt to reorganize the world’s economy — an attempt that certainly will fail — and embarking on a series of discrete, manageable adaptations, such as improving the water-management facilities of millions of people who live, let’s remember, in a desert.

The Left’s potted moral outrage notwithstanding, that isn’t a brief for denial, but a brief for adaptation. And if the Left really believed half as much in global warming as its rhetoric suggests, its leaders would be moving forward with a robust program for adaptation — especially in California, a large and prosperous jurisdiction that is under nearly complete progressive political control.

Instead of making those improvements, what California has in reality experienced under one-party progressive rule is little more than wealth transfers, largely from the private sector to the public sector — which, through its labor unions, dominates California politics — or from private-sector constituencies with low political value to Democrats to private-sector constituencies with high political value to Democrats. The Democrats have been filling up their campaign coffers, not California’s reservoirs.

The same people who saw to their own political and financial interests while shortchanging California’s water infrastructure argue that they should be empowered to act on a global scale in response to global warming. Having failed to deal with the relatively mild problems of California — which has almost everything in the world going for it — they believe themselves ready to take on the hairier challenges of Bangladesh and Sudan.

The global-warming debate is, at its heart, about risk management. Maybe we should let Governor Brown et al. prove that they can make things work in California before we risk taking their methods worldwide.

Posted in Environmentalism, Politics, Science | Tagged | 1 Comment

“Unlike F500 CEOs, we actually pay these guys”

Kevin D. Williamson writes about “the 1%” – or a critical difference among them:

The city manager of my hometown — the sprawling and urbane metropolis of Lubbock, Texas — makes $235,000 a year, which seems to me much more significant than what the boss makes at IBM or Goldman Sachs. For one thing, there are only 500 Fortune 500 CEOs, but there are a hell of a lot of small-fry city managers, six-figure high-school principals and million-dollar superintendents, $300,000-a-year Philadelphia police detectives, etc. Running parks and recreation in Pawnee, Ind., doesn’t seem like all that high-paying a gig for the fictional Leslie Knope and her gang — but in the real world, it’s a pretty good jump on a 1 percenter’s income.

Another important difference between Fortune 500 1 percenters and government 1 percenters is that you don’t have to pay CEOs unless you really want to. I have worked for closely held and publicly traded companies, and I have seen some pretty awful executives in action. (In a desk drawer somewhere, I still have my Journal Register Company stock-option paperwork, which I drag out from time to time when I want to make myself feel bad.) Unlike Senator Jim DeMint and that other flaming right-winger, Bernie Sanders, Senator Clinton voted for the Wall Street bailout; but the occasional Clinton-approved handout aside, you don’t have to worry much about whether any given CEO is worth his salt. That decision, for better or for worse, is made by boards of directors on behalf of the shareholders who own the company. Some boards do a pretty good job, some don’t. But if you are a shareholder who believes that Apple is misspending your money, then you can rally other shareholders against the management or you can just sell your Apple shares.

On the other hand, if you thought that Bell, Calif. — population 35,000 — was overpaying its city manager (at $800,000 a year!) you couldn’t sell your Bell shares or short the hell out of Bell. You had to keep paying, or the sheriff and burly men with guns would eventually come and seize your property. Say what you like about Warren Buffett, Berkshire Hathaway doesn’t have the power to withhold money from your paycheck or order you to pay up at gunpoint.

If Fidelity, Goldman Sachs, and the nation’s drug-store chains want to dump wheelbarrows full of 100-dollar bills at Mrs. Clinton’s feet for the privilege of listening to Herself talk about Herself, that’s between them and the suckers who own their shares. (Government-funded institutions such as colleges, and organizations that have financial relationships with government agencies, are another question.) But if we really want to take a look at whose elephantine paychecks are weighing heavily on the finances of those “everyday” Americans that Mrs. Clinton likes to talk about, it isn’t Lloyd Blankfein’s fat stacks. It’s your local city manager’s, your high-school principal’s, your police detective’s when he’s earning more in questionable overtime than he is in salary. It’s your local union-goon lobbyist getting a lifetime pension for one day’s work as a substitute teacher.

Why? Because, unlike with Fortune 500 CEOs, you actually pay these guys.

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Atlas grabs a smoke, Part II

If it weren’t for the economy in Texas and the fracking revolution on private lands throughout the country, we’d have no growth at all.  If it weren’t for all the workers who gave up and dropped out of the labor market, unemployment would be north of 10%.  From today’s WSJ:

What’s Wrong With the Golden Goose?

The literature on economic development shows that U.S. states and nations tend to prosper when tax rates are low, regulatory burden is restrained by the rule of law, government debt is limited, labor markets are flexible and capital markets are dominated by private decision making. While many other factors are important, economists generally agree on these fundamental conditions.

As measured by virtually every economic policy known historically to promote growth, the structure of the U.S. economy is less conducive to growth today than it was when Mr. Obama became president in 2009…

Despite the largest fiscal stimulus program in history and the most expansive monetary policy in more than 150 years, the U.S. economy is underperforming today because we have bad economic policies. … Economic policies have consequences.

With better economic policies America was like the fabled farmer with the goose that laid golden eggs. He kept the pond clean and full, he erected a nice coop, threw out corn for the goose and every day the goose laid a golden egg. Mr. Obama has drained the pond, burned down the coop and let the dogs loose to chase the goose around the barnyard. Now that the goose has stopped laying golden eggs, the administration’s apologists—arguing that we are now in “secular stagnation”—add insult to injury by suggesting that something is wrong with the goose.

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More on corporations and free speech

Corporations have speech rights only when that speech is in support of approved causes.  If only there were a name for such a philosophy

The Grey Lady’s op-ed page has become so intellectually sloppy, it’s barely recognizeable compared to even just 10-15 years ago.

Here’s James Taranto in The Authoritarian Media – II.

The [New York] Times editors were pleased but not satisfied: “Just issuing corporate statements against such a law is relatively easy and actually doesn’t provide protection against discrimination.” The Times wants corporate America to engage in far broader political activism. For one thing, “corporations and their executives . . . should make clear that they will not donate to or support the campaigns of politicians who back such regressive legislation.”     (Actually, campaign donations by corporations are legally prohibited at the federal level.)

The editorial adds: “Another thing businesses can do is to make clear that they want lawmakers in all states to pass anti-discrimination protections for lesbians, gay men, bisexuals and transgender people. More than three dozen chief executives of technology companies did just that in a statement released on [April 1].”

“Hypocrisy,” charged’s “Jazz Shaw” who compared this Times editorial with one from January 2010, prompted by the free-speech victory in Citizens United v. Federal Election Commission:

With a single, disastrous 5-to-4 ruling, the Supreme Court has thrust politics back to the robber-baron era of the 19th century. Disingenuously waving the flag of the First Amendment, the court’s conservative majority has paved the way for corporations to use their vast treasuries to overwhelm elections and intimidate elected officials into doing their bidding.

Congress must act immediately to limit the damage of this radical decision, which strikes at the heart of democracy.

The charge of hypocrisy certainly fits. What the Times now urges is that corporations attempt to “intimidate elected officials into doing their bidding”—precisely what it found objectionable five years ago. On the other hand, it is possible to reconcile the paper’s objection to Citizens United with its support for corporate political activism—but that resolution reveals something worse than hypocrisy.

The Times’s position is that corporations (with the convenient exception of “media corporations” like the New York Times Co. itself) have no rights under the First Amendment. That view underlay its histrionic objections to both Citizens United and last year’s Hobby Lobby v. Burwell, in which the high court extended the religious-liberty protection of the federal Religious Freedom Restoration Act to corporations that objected to the ObamaCare abortifacient mandate on conscientious grounds.

But now the Times is urging corporations, and executives acting in their corporate capacity, to speak out aggressively in favor of a political cause the Times supports. How could they even do so without free speech? 

That seems like a rhetorical question but isn’t. Opponents of free speech, such as the Times editorial board, do not oppose speech. They oppose freedom. Authoritarian and totalitarian regimes may not brook dissent, but they encourage speech in favor of the regime. Totalitarian regimes frequently compel pro-regime speech.

To be sure, the New York Times is not a government; its editorials have the force of wishes, not laws. But the aspirations here are authoritarian in character. In the Times’s ideal world, corporate speech would be permitted, but only in the service of permissible viewpoints. That is the antithesis of free speech, a central feature of which is viewpoint-neutrality.

Posted in Freedom, Politics | 1 Comment

Political bargains of the past are the burden of the future

california-drought2It may be a, er, dry subject, but:  another great Holman Jenkins column, this one on the CA drought.

From California’s Water Woes Are Priceless:

California’s drought is frightful and a challenge for an 800-word column, since the problem can be solved in five words: charge realistic prices for water.

If homeowners paid two pennies a gallon instead of 0.5, they might take shorter showers and be more parsimonious with their lawns, but their lives wouldn’t change materially. If farmers found it remunerative to reduce by one gallon the 3.5 it takes to grow a lettuce, who doubts they’d make it work.

Yet for all the agonizing of the TV news and Gov. Jerry Brown, the appetite for a price solution is not only nil, it is undiscussed except by bloggers and op-ed writers. Movie fans know why: “Forget it Jake, it’s Chinatown”—California’s convoluted water politics. Imposing realistic prices on urban dwellers might be feasible, but up would go a cry, “What about farmers?” Then politicians would face a skein of favoritism and log-rolling practically beyond the power of democratic politics to unravel…

Making the desert bloom is a lovely sentiment but makes sense only if it makes economic sense: Using five gallons of California’s water to produce a walnut probably doesn’t make sense if water is realistically priced. But then neither does a forthcoming San Diego plant that would incur large energy costs to convert seawater into drinking water.

As the late economist and social thinker Mancur Olson taught, political bargains of the past are the burden of the future. The U.S., like California, is a country that has grown old thinking of itself as young. By now, we’re one of the world’s most aged experiments in representative government, and increasingly paralyzed by an accretion of calcified institutions like Social Security or California’s water politics

If America is not rushing down the tubes quite as energetically as Europe, it’s because in parts of our society (see Silicon Valley, see fracking) politics has not yet completely ruled out the possibility of innovation and surprise.  One of these innovative surprisers isn’t Gov. Brown, whose emergency plan doubles down on political allocation of water, imposing mandatory cuts on population centers. The purpose, of course, is to agitate voters to agitate Washington to do something, meaning free up water from elsewhere and give it to California

Water supplies will fluctuate, like any commodity. The real problem is a non-price allocation system that guarantees waste, shortages and political fights over water.

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CA already rations iPhones and cabernets, so why not water?

In The Dry Math of Scarcity, Kevin D. Williamson comments on CA’s man-made drought and makes a few broader points:

I am glad California is having a drought. Not because I hate California (I love California) or Californians (I hate them only a little, for what they’ve done to California) or Central Valley farmers (some of my best friends . . .) or even Governor Jerry Brown, droll disco-era anachronism that he is, but because the episode presents an excellent illustration of the one fundamental social reality that cannot be legislated away or buried under an avalanche of government-accounting shenanigans and loan guarantees or brought to heel by politicians no matter how hard the ladies and gentlemen in Sacramento and Washington stamp their little feet: scarcity.

California has X amount of water at its disposal, and it has politicians in charge of overseeing how it gets divvied up. Which politicians? The same ones responsible for the current sorry state of California’s water infrastructure, of course.

Should be a hoot…

Governor Brown’s response is a textbook example of the central planner’s fatal conceit. He issued an executive order imposing 25 percent cuts on the state’s 400 local water agencies… 25 percent figure looks bold and authoritative, but when was the last time you saw the production, consumption, or price of a scarce commodity in the real world move by such neat increments? When something disturbs the equilibrium of the world’s oil markets — which happens every single day — then the markets make minuscule, complex adjustments, and continue to make them around the clock — the markets never sleep — with producers and consumers both modifying their behaviors to accommodate the new economic realities as they emerge. Amazingly (but not amazingly), this happens with no Governor Brown in charge of the process. You’ve never seen the price of pork bellies or soybeans simply jump 25 percent and stay there indefinitely, or rice or wheat consumption fall by neat round numbers. But Governor Brown imagines that he can rationally manage by fiat the consumption of the most important commodity in the world’s seventh-largest economy…

Among tragedies of the commons, California’s water situation is Hamlet, a monumental work fascinating for all of the possibilities it raises and not given to easy resolution. But even given the underlying complications, from the hydrological to the legal (California’s system of water rights is remarkably complex), the fundamental problem is that nobody knows what a gallon of water in California costs. Water allocations are made mainly through politics rather than through markets, with the state’s legal regime explicitly privileging some water uses over others.

There are two possible ways to allocate water in California: The people in Sacramento, Governor Brown prominent among them, can pick and choose who gets what, with all of the political shenanigans, cronyism, inefficiency, and corruption that brings. Or Californians can get their water the same way they get most everything else they need and value: by buying it on the open market. This is an excellent opportunity to apply the cap-and-trade model that many progressives favor when it comes to carbon dioxide emissions, with an important difference: This deals with real, physical scarcity, not artificial scarcity created by regulation…

As the economist Alex Tabarrok puts it: “California has plenty of water — just not enough to satisfy every possible use of water that people can imagine when the price is close to zero.” …

Everyone has his own favorite drought bugaboo: suburban lawns, almond farms, the delta smelt, golf courses, illegal marijuana cultivation, etc. Given enough time, somebody will figure out a way to blame this all on the Koch brothers, illegal immigrants, or the Federal Reserve. But the fact is that nobody knows — nobody can know — what the best use of any given gallon of water in California is. Californians can put their money where their parched mouths are, or they can let Governor Brown play Ceres-on-the-Bay, deciding which crops grow and which do not.

Whether the commodity is water or education or health care, if you care about something, put a price tag on it. You can’t afford for it to be cheap, and you sure as hell can’t afford for it to be free.

UPDATE (4/8/15, 11:58AM):  the author  comments on the comments generated by his piece:

As anticipated, much of the response to my piece on California’s drought goes roughly: “You can’t use market prices for water! Water is a fundamental human necessity! You can’t treat it like just another commodity.”

Thought experiment: You have ten people in the desert and 1,000 gallons of water. There are many ways you could divide that: You could let people fight over it, you could let them trade for it, etc.

But you know that after a while, that 1,000 gallons is not going to be enough for ten people. So your ten people form a legislature, and that legislature passes a law declaring water a fundamental human right, and mandating a minimum allowance of 500 gallons of water for each of the ten people in your community.

So, 500 times 10. How much water do you have? Answer: You still have 1,000 gallons, doofus.

Scarcity is real, and declaring a scarce commodity a fundamental human right is meaningless insofar as it does nothing to change the supply of that scarce commodity.

Of course California is going to ration water. It rations iPhones and cabernet already, and nobody seems much inconvenienced by that, because there are intelligent ways to ration goods (markets) and dumb ways to ration goods (Governor Brown et al.). But politicians cannot simply command more water into existence. There are fiat currencies, but there aren’t any fiat commodities.

Posted in Economics, Freedom | Leave a comment

“No specific performance” doctrine

For anyone still how hasn’t had his or her fill of the issue… Andrew McCarthy writes that the RFRA isn’t a good law and that “We used to understand that our law isn’t capable of making people coexist cooperatively — only peacefully.”

Back when there was more wisdom in the practice of law, meaning back when the profession had more humility, there developed a sage doctrine: Courts should resist ordering “specific performance” when a personal service contract is breached. The idea is that when a provider, especially one of small scale, breaks an express or implied agreement to provide a service to a consumer, it is not sensible for a judge to direct that the agreement be carried out as written.

The doctrine leapt to mind during this week of manufactured controversy over the state of Indiana’s near-verbatim replication of the federal Religious Freedom Restoration Act (RFRA).

The “no specific performance” doctrine recognizes that, while our law is capable of many things, it cannot force people to get along. To try to do so, especially with people embroiled in a bitter disagreement, would more likely lead to additional strife, not calm resolution. What’s more, there are other, better ways to make a wronged party whole.

In most instances, for example, a court can order money damages. That leads us to another quaint bit of prudence: If there are no concrete damages, there is no legal case. Of course, the lack of a clear, measurable harm that can be compensated by money does not necessarily translate into the absence of a wrong. But not all wrongs are fit for judicial resolution. Some are too trivial; others implicate social relations that, in a free society, are best left to political processes or market forces.

Why does a family pizzeria’s business have to ignite a civil-rights firestorm? Why can’t it be treated just like any other run-of-the-mill breach of a caterer’s agreement to supply food? Indeed, in the Indiana dispute over the pizzeria’s theoretical objection to catering a same-sex wedding, we don’t even have an agreement except to the extent one is implied by the mere fact that the business is open to the public. And there are plainly no damages: Even if this pizzeria does not wish to cater a same-sex wedding (assuming it were ever asked to do so), there must be scores if not hundreds of pizzerias that would welcome not only the business but the favorable publicity for taking the gig.

If this were actually about pizza, a demand for specific performance would be frivolous. We have a controversy in Indiana, and now nationally, only because liberal fascists want a controversy. They want what a free society should never grant: License to use the law not as a protective shield but an offensive sword for extorting compliance with their own intolerant agenda — something that, as Tammy Bruce explains with moving eloquence, ought to be especially offensive to gay people who’ve felt the sting of condemnation over being different.

He provides a bit of (surprising?) history:  the RFRA was written in response to a SCOTUS decision penned by Justice Scalia (!) that “If you hold that a person can flout the laws that apply to all of us because of his subjective religious beliefs, he becomes a law unto himself. That is an invitation to anarchy.”

Moreover, RFRA does not provide a principled, knowable carapace of religious freedom. Rather, it transfers the power to decide what religious convictions will be respected from where it belongs, in the hands of free people through their elected representatives, to where it should not reside, in the whims of politically unaccountable judges whose sensibilities often differ widely from the community’s sensibilities.

When someone claims a law burdens religion, RFRA imposes a test: The government must prove that the law serves a compelling public purpose and represents the least burdensome manner of doing so. There is no reason to believe judges are better equipped to perform that balancing than legislatures; and there is nothing about a law degree that makes a judge a suitable arbiter of which tenets of your faith outweigh the government’s interests, and which do not…

Trumped up controversies like the one in Indiana are needlessly divisive. There would be many more Americans supportive of, or at least resigned to, the concept of gay marriage if it were just a matter of live-and-let-live tolerance. Instead, the Left’s agitators have made it the leading edge in a campaign to suppress traditional religious belief. They demand not toleration but compulsory approbation — with dissenters stigmatized and subjected to the prohibitive expense of legal fees.

We should not allow the law to be used this way. The law is supposed to be a reflection of our social consensus, not a cudgel to impose an unpopular outcome that breeds resentment.

Posted in Culture and Religion, Freedom, Politics | 1 Comment