Ground Economics, part IX plus Bonus

I need to pause for a moment to recall all the finer points of Basic Economics by Thomas Sowell. The book represents a turning point in my personal education on the economy, in that rather than focusing on key issues which explain in detail what and how an issue happened, but moving more into the core principles of our mixed capitalist and socialist culture.

Basic Economics actually doubles as a text book for certain college level classes, if only as a generally informing piece for certain political classwork. Unlike many of his works that I have read previously, Sowell decided to make more comparisons of America against the Soviet Union during the Cold War, which was fairly unique. In fact, comparing economics to history is probably one of Sowell’s greatest feats, as most economists tend to explain the formulas and theories before correlating them to history to make the circumstances of what and why obvious.

One of the tackled issues in Basic Economics was the presence of government involvement in the market. The government’s involvement takes several forms. Regulations, laws, taxes, commissions, so on and so on. The market frequently works around these issues, much like a river flowing around a stone in the middle of the stream. One of the biggest problems this causes is a political presence in the market means a reaction to political pressure. I’ll dive into this later.

Now after finishing this book, this post is a double whammy in that I finished a second book, Outliers by Malcolm Gladwell. In and of itself, Outliers has very little to do with the state of our economy, but certain elements of the book co-relate to arguments that may arise when viewing the most extreme examples of success in America. Chiefly, the rise of people such as Bill Gates, Steve Jobs, and the systems and events that led to their success.

I have to note that two things disturb me about Outliers. The first is that the book is very short, it’s about 300 pages, but the font is large and the pages themselves small. The book was finished in about 24 hours, and that small amount of time that took concerns me with the possibility of a lack of more through research, and second that some of his points came across as so generalized that taking them at face value was somewhat difficult. For example, Gladwell examined the attitudes of lower and middle class parents treated their students over summer vacation. The book referenced some sampling of twelve families, and a skeptical part of my mind asked itself whether more depth and detail were necessary to give more credit to his theory. However, the belief that roughly 10,000 hours of practice and learning seemed sound in that it was a strong argument for the “practice makes perfect.”

Now for the bad news. While I haven’t given up my researching and learning on economics, I have to let it sit for a while. A few things have played a role in this. The first was Christmas and the holidays, on top of a recent move back in November. Well, we’re passed that now, but as of next month, I must have a new job lined up. I say this because the contract I am currently working is set to end very soon, and I have to line something up.

Yes, I will return to studying and posting. I’ve been thinking about doing something slightly different, basically reading The General Theory of Unemployment by John Maynard Keynes and writing each chapter in this blog in a “Cliff Notes” style research notes for later. This would make me write more often and really help other people understand what I’ve learned. This is because after looking over my previous notes, they’re nothing more than summaries with few details explaining the reasoning that needs to find its way into these posts. I’ll decide soon enough. Until then, adios 2009 and good luck to all in 2010!

LGBT March on Washington

Young Protesters

Normally, I would have had to wait to hear what various news sources had to say about the event, but on Sunday of October 11th, 2009, I went to see the events for my own eyes. And take pictures and write upon the experiences as I had witnessed.

The trip on the metro was filled with protesters. Some were not very decorative, but others came prepared with “Legalized Gay” tee shirts, signs and tell tale bands of six rainbow colors. Many protesters were not even out of high school, and were chaperoned by much older women.

As we exited the metro, we traveled north from Metro station towards
15th and I. There we didn’t find the march, but did find a checkpoint denoted by a rainbow flag, and two helpful women who pointed us towards the east where the march was starting. There, we saw converging groups gather together as they came down our way. We moved to the sidewalk in order to take pictures and get the clearest view of the march, but that proved difficult as protesters began spilling out upon them, and the sun worked against the photos opportunities.

One protester held a large sign for a Seaman in the navy who had died this year. I took pictures but was constantly thwarted by the crowd who rubbernecked looking at it. The man kept holding it out and I kept trying until I finally took a solid picture.

August Provost

Vendors saw an excellent chance to make some money, offering $5 rainbow flags and bumper stickers that comically suggested that gay people share in the misery of marriage like the rest of us. While such vendors could be excused for providing the props for such events, the purity of the event itself was somewhat scratched when other groups showed up. Protesters against the massacres in Sri Lanka showed up with an ugly set of photo graphs of the events going on in the civil war torn country. Socialist worker groups spread their propaganda about those near them. And the Screen Actors Guild showed up to state that unions support the struggle for gay rights, although they seemed to be the only union there.

What caught my eye was the various tones carried in each poster that the protesters relied on. Some believed it was primarily a factor of equal rights. Some posed thought provoking questions, while others stuck to religious points that God loves all his children.

Ugly signs...

Others demanded the rights they sought, and still others came with veiled threats of removing the rights of others by voting them out.  Others were concerned with repealing the “Don’t Ask, Don’t Tell” policy, and the “Defense of Marriage Act.”

And others turned around and voiced anger against Obama, accusing him of turning his back on his promises. Marching amongst the groups were people representing certain states and universities. The speaker at the end stated that people from all states were represented. But we did not care for whomever the speakers were, but the civil action taken by the protesters themselves. Here is a break down of various photos from the event:

There are of course, more pictures. If for some reason you want these, feel free to contact me via comments.

Grounding Economics, part VIII

Milton Friedman

The economic and historic readings have been an invaluable start to the direction that I want to take my research. They build a fundamental basis on which to better relate the writings I intend to add to the site. I have to admit, while my original plan was to write an essay about our economic woes, the amount of reading I had to absorb just to build an abstract understanding has slowed that goal to a crawl.

In his work, Capitalism and Freedom, Milton Friedman compounded the theory that Capitalism is the root of freedom within our country, that the ability to possess property is the root of what gives Americans their rights.

The book was not thick, some 200 pages of his thoughts on matters ranging from the education system to fundamental things we as Americans take for granted, such as roads. One of the core points is that those we currently view as conservative were in fact “liberals”, at one point, as they were against the constant intrusion of the government in the marketplace since Franklin Roosevelt’s New Deal.

The most important aspect that relates to today’s political struggles involves the concepts of guilds and unions. Friedman believed that such organizations were still a form of monopoly, through of a variety of means do they control the commodity of labor and services, vital to the needs of American consumers and businesses. One big example was a guild known as the American Medical Association, who (bare in mind that this book was published in the 60’s) controlled the number of medical schools and doctors who offered medical services. As such, there was control over prices and use of the AMA’s credibility to harm alternative practices such as chiropractors.

Unions can easily be another form of monopoly. If they possess membership of all a factory’s employees, they can strike and force the business to negotiate better benefits and salaries for their employees. These costs in time and money trickle down to the consumer, as the business needs to stay in the black to survive the marketplace.

One example of a powerful union today is the United Autoworkers who were part of Ford, General Motors and Chrysler. One abused fact on both sides is the perception of the UAW Member’s pay. The right incorrectly assessed it as an average of $70 an hour. The left slyly explained that it was actually an average of $28 an hour, while downplaying the rest of the story. The reality is that the automobile companies were shelling out roughly $70 an hour total for salary and all the benefits such as health insurance and especially the pensions. Which were further complicated by job banks, an ‘employed’ unemployment program which protected UAW Members.

Right now, I’ve gone back to the Wealth of Nations to start from the beginning. While these books have given a great understand of our current system, I believe that no one can call themselves an economist and not have read this book. Time will tell.

More Sowell

It’s been a long hiatus as I spent time preparing for the GMAT (the pre-business school test) and moving. But somehow I’ve found time to continue my studies into economics and history.

Black Rednecks and White Liberals(which one can abbreviate appropriately as BRAWL), is actually a composite of a few essays outlining various theories and political statements made throughout the years, and discerning the facts from the claims.

The first essay is probably the best remembered one, outlining out much of what we presently define as “black culture” is actually a derivative of Southern culture in general, traced even further back to roots in Scotland. Sowell extends this further to explain how the prevailing political agendas have created a backlash, extending the lifespan of cultural elements that are detrimental such as violence or the collapse of families thanks to the rise in welfare.

Another essay discern the origins of slavery not just in America but as a whole. It notes how the anti-slavery movement achieved widespread influence due to the technological advances and power of the British Empire as it spread throughout Europe, the Middle East, Africa and Asia. The major point of the article was the firm reminder that racism was not the reason for slavery but a byproduct of it.

Sowell further blows apart racism by indicate examples of prejudices within the same ethnic backgrounds: how blacks who lived in the pre-antebellum north were widely respected until after the war, when many blacks began migrating after them. And it was scarcely just blacks, but also German Jews living in America who rushed to “culturalize” the influx of Eastern European Jews. Or how the local Catholic churchs worked to “culturalize” Irish immigrants, ultimately helping to make the “Irish need not apply” signs in cities disappear. Sowell makes a reminder that it is the failure to celebrate and learn from successes which hinders advancement, while political agendas are advanced by noting failure and using them as excuses for intervention.

The essay about the Germans was an enlightening piece of information that ties itself to some of the earlier pieces I’ve read, particularly The Economic Consequences of the Peace by John Maynard Keynes. Specifically, the peace discussed at the end of World War I was a reminder of the kind of actions took against Germans which resulted in a backlash later on. Germans have been persecuted throughout history, and many misconceptions have arisen from a lack of clear understanding of their culture. It is one that celebrates education, similar to many Jews do as well. In fact, it should be noted that the two cultures were so inclined that German-Jewish marriages were quite common. The essay details the ascension of the German nation against the backdrop of economically competing countries and the dispersement of Germans throughout the world. Perhaps the most important note is that it is the loyalty to German culture and not the home country that has enabled German success (particularly in beer production throughout the world). Furthermore, the book offers historical points of the general ignorance of the German people about the holocaust during its occurance, until the truth was revealed.

Perhaps the best essay was the one entitled “Middle Man Minorities”. This essay detailed not just Jews, but minorities within countries who have found outstanding financial success as middlemen, be them as merchants, diplomats, negotiators and so on. These individuals saw a market for their services and used it. Oddly, it seemed that their success brewed racism against them when it was infact their ability to recognize when they could buy for a dollar and sell for two. Examples of middle men minorities also included the Armenians, the Ibo tribe, Germans living in Russia, Chinese living in other parts of Asia and so forth. Racism was merely the byproduct of jealousy for their economic successes.

Our Philosophy

Justita

What is justice?

JUSTICE
–noun
1. the quality of being just; righteousness, equitableness, or moral rightness: to uphold the justice of a cause.
2. rightfulness or lawfulness, as of a claim or title; justness of ground or reason: to complain with justice.
3. the moral principle determining just conduct.
4. conformity to this principle, as manifested in conduct; just conduct, dealing, or treatment.
5. the administering of deserved punishment or reward.
6. the maintenance or administration of what is just by law, as by judicial or other proceedings: a court of justice.
7. judgment of persons or causes by judicial process: to administer justice in a community.
8. a judicial officer; a judge or magistrate.
9. (initial capital letter) Also called Justice Department. the Department of Justice.

Justita, the symbol of justice, wears a blindfold to indicate her unbiased views. She sees not race, not gender, not sexual orientation. She sees nothing. There are only the facts, the weight of arguments upon the scales that determine whether one side or the other is heavier with the truth.

To not be biased. To not give into partisan squabbling and over zealous beliefs. That is what we should strive to do at all times. To not accept ignorance.

C.S. Lewis once mentioned that just about everyone is aware of the golden rule. ‘Do unto others as you would have done unto yourself,’ but it is not that they need to learn the lesson, but simply be reminded of it from time to time. It is easy to create a standard and lose track of it in the rush to find the answers. Thus, sometimes posts like this one need to be written. To remind a person to steady themselves and not be lost on a road of desperately trying to prove one’s beliefs necessarily correct.

As such, I am not making the bold and unfounded claim that The Scales is undoubtedly “fair and balanced,” but that it will try harder to be such.

Further Reading:
Irrationality

A Sick System? part II

Sicko, by Michael Moore

Tonight, I decided to try something new in examining the health care system, and decided to reach across the usual channels and try a more controversial source of information in Michael Moore’s 2007 documentary (or mockumentary, depending on whether you’re on the receiving end). Like almost anything, it had it’s share of excellent points with controversies that require more factual examinations. Sometimes, it will tell the truth, while other times, it will only present the lighter side of a truth. Moore provides a few dozen examples, but is light on figures, preferring empathy to statistical examinations, although it did possess some facts worthy of inspection.

Positive aspects of the film involved examining some of the benefits of alternative health care systems. One of Moore’s best points was how when we see something good, we reach across and take the idea. It was true, America often borrows excellent ideas for our own use. And he was certainly right to examine the systems of Canada, the UK, France and Cuba to draw upon a basis of ideas for our health care system. And the system certainly seemed effective.

But what was the catch? Some negative aspects involved whether the full story was given a chance, which it wasn’t. One particular aspect which caught my eye was when Moore brought up the bottom line: Taxes must be outrageous. Hence, Moore wanted to take a look at the living standards of a French family. They owned a great home, two cars and had children. Their combined income (converted) was $8,000 a month, against a mortgage of $1575 a month. But again, Moore never answered the original question of how bad the taxes were.

A part of me also wondered why there weren’t more legal battles to drive down the cost of health care. There seemed some, but not highlighted in the movie. Simply touched upon by some of the people Moore interviewed, but never examined in any detail.

Other aspects of the film fluxed forth to highlighted a very positive view of universal health care, but blaming politicians for the problems. At one point, Hillary Clinton was viewed extremely favorable by Moore, but then turned around and attacked her for failure to live up to her original word.

I brought up the Wikipedia article on the movie to take note of potential flags in the movie. Facts that fell through were highlighted, but some were confirmed or praised.

The difficulty in health care reform ultimately lies (and this is regardless of whether it is a Republican or Democratic effort), in changing the overall system and not just the existing insurance. Issues such as a shortage of doctors make attempts of reform difficult. And not only does this effect just the medical profession, but touches upon difficulties in education for our physicians, for example. The roots of the problem likely come from several factors, making the problem more deep than anything that money alone could solve.

Rather than make this a one part note, it will be two parts. The movie is complete, but several deleted scenes were left untouched. Also, this note is something of an initial reaction. The movie will have to be examined again after a good night’s sleep.

Interrogation Vs Torture

The Seal of the CIA

There have been several debates and articles regarding whether the methods used by the C.I.A. were torture or interrogation. Many of these sources simply regurgitate the material with their own spin attached, but the memos themselves, written during the Bush Administration, have been made public under President Obama.

Therefore, attached below are the memos in PDF format. Finding the original memos proved a little difficult using search engines, hence they’re stored below for easier find.

August 1st, 2002: Letter to John Rizzo, General Counsel CIA from Jay Bybee, Assistant Attorney General

May 10th, 2005: Letter to John Rizzo from Steven Bradbury, Acting Assistant Attorney General (1st of 2)

May 10th 2005: Letter to John Rizzo from Steven Bradbury (2nd of 2)

May 30th, 2005: Letter to John Rizzo from Steven Bradbury

Thanks to NPR for the links. The original news article can be found here.

Walking the Razor, Multi-Purpose Research Note

NAACP

There is no easy way to walk on the delicate line of race without somehow insulting someone. We don’t like to hear that there’s a difference between a white person and a black one. A hispanic or an asian.

Yet affirmative action still persists in portions of the nation under Title VII of the Civil Rights Act. For years, America’s corporations, universities and public service departments have jumped hoops for our administrations in order to satisfy quotas for employing and educating minorities in the U.S. Some critics (and members of my team) have expounded that affirmative action has come and gone. But news of affirmative action has begun to resurface.

Make no mistake, there are individuals from minorities who easily possess the merit for what they achieve. But the racial gap in test scores remains, and with that despairing differences in achievements between races. With those differences comes pressure. Pressure on the universities to accept more students regardless of their qualifications, even if their scores were not deserving. Pressure on cities to promote police officers and fire fighters regardless of merit to higher positions. Pressure on companies to hire, even at risk to themselves.

Thomas Sowell

Thomas Sowell published an article this morning compounding that many who have defaulted on their mortgages and put our economic system at risk in the first place were minorities- that based on their credit worthiness, they should not have been given loans. And yet political pressure, perhaps a lingering shadow of affirmative action, gave rise to at least a portion of our economic crash. Examining the government’s involvement in the debacle is a worthwhile endeavor.

As I read Backfire by Bob Zelnick, my awareness of the policies of affirmative action saddened me. Stephen Levine stated that if morals were how the world should be, economics was how it actually was, and the circumstances Zelnick expounded upon made some of that painfully clear. The book was published back in 1996, but as the news sources regarding the fire fighter promotional controversy proved, it is far from dead.

Companies wanting the best employees for their services are often challenged by employment tests. These tests, as Zelnick put it, are “better indicators of people who are not qualified for a position than those who are.” Employers would much rather avoid a bad candidate than hire a good one.

But many minorities do poorly in these tests. Due to affirmative action quotas, those who succeed are highly, highly desirable to companies and educational institutes. Some of these institutes even add powerful incentives, such as minority scholarships. But many less qualified candidates were permitted in as well, and their inability to deliver their workloads harmed the performance of these companies. The combination of legal pressure from the EEOC (Equal Employment Opportunity Commission), coupled with civil rights groups such as NAACP (National Association for Advancement of Colored People) have pushed these institutions into situations where, even if qualified, racial discrimination is often reversed against caucasians to fulfill quotas, which can and does result in further lawsuits.

Again, this was back in 1996. As I understand it, much of affirmative action has come and gone. Aspects remain, but the murmuring echoes return. After all, mortgages typically go on for 30 years or so. The seeds of the mortgage crisis were planted years ago, and economists (and moreso the politicians) argue exactly when and where the blame lies.

I am scarcely a third through the book. But the depth and scope may serve as a view altering and thought stirring point against affirmative action. If anyone spots an error or over generalization, please let me know.

Just an Update…

We’re back and working hard at it.

In response to a recent article involving affirmative action, I’ve decided to reopen the book by Bob Zelnick to start studying the earlier attempts by the Clinton administration to deal with it.

I’ve also begun returning to some books on the economy and even the medical field to make better sense of the stem cell research debate- there is more to the debate than just pro-life versus pro-choice.

Aftermath: The Other Heroes of the North Hollywood Shootout of 1997

The full extent of this article requires viewing the History Channel’s coverage of the North Hollywood Shootout which occurred on February 28th, 1997. The first of four episodes is below, the other three in links beneath the video.

Part II.
Part III.
Part IV.

Also, for a less dramatized video with raw footage, check out the video here.

The basic summary of the video involves the bank robbery attempted by Larry Eugene Phillips, Jr. and Emil Matasareanu. Armed with Automatic Kalashnikovs, the two entered a gun battle with the LAPD upon exiting the Bank of America.

But one of the barely acknowledged aspects of the shootout was the story behind B&B Guns. SWAT had not yet arrived, but company president Bob Kahn provided the desperate LAPD with weaponry to give them an edge. Quoted from an article by Jim Schneider:

We were stunned to see all the great publicity about B&B Gun Sales handing out firearms to Los Angeles police officers who were taking fire from heavily armed bank robbers dressed in body armor.

Bob Kahn, president of B&B, noted, “We supplied them with five .223 semiautomatic rifles, four of which were Bushmasters, and two Remington 1187 police shotguns.”

But for his efforts, Bob Kahn does not believe he received entirely universal praise:

“The only people who bad mouthed us were The Los Angeles Times and Handgun Control,” Kahn said. “Handgun Control professed that we may have broken federal laws.

“When nine panicked officers come in and tell you five officers are down, you don’t think about breaking federal laws. The LA Times wouldn’t mention our shop by name. They said, ‘The police officers who did this may receive disciplinary action,’ which is bull. Can you imagine if somebody tried to discipline those guys! Can you imagine the press!”

Although SWAT had arrived around this time, the weapons provided by B&B guns gave the LAPD an equalizing edge against Matasareanu and Phillips. One they needed, as prior to the incident police were armed only with 9 mm handguns, .38 caliber revolvers and 12 gauge pump shotguns. All these models were incapable of effectively injuring the two gunmen, who were too well protected in Kevlar body armor and trauma plates.

But since the event, times have changed in California’s gun law battles. The Roberti-Roos Assault Weapons Control Act of 1989 worked to restrict assault weaponry, and the Kasler v. Lockyer decision of June 29th, 2000 restricted weapons classified on the Kasler List. This list also includes several of the weapons Kahn provided to the LAPD during the incident.

The effects of California’s strengthening gun laws have had a powerful impact on the B&B Gun Sales, unfortunately. According to an article by Brent Hopkins, B&B Gun filed for Chapter 7 bankruptcy and liquidated in 2002. B&B Guns indicated that the changing laws made staying in business extremely difficult.

Further Reading List:
CNN’s archived news article.

Author’s Note: I must confess to extreme difficulty in writing this article. There are painfully few news sources which covered B&B Guns’ contribution to the LAPD and the aftermath of the now perished business. It took some serious digging to get the owner’s name, the models that were provided to the LAPD, and then finding reliable resources to back up the claims.

As such, I’d like to give a huge thank you to Jim Schneider, Brent Hopkins, my teammate Dystopian Dissent, CNN, Youtube, the History Channel and the editors of Wikipedia, from whom I culled references.