Economics and the mid-life crisis have much in common: Both dwell on foregone opportunities

C'est la vie; c'est la guerre; c'est la pomme de terre . . . . . . . . . . . . . email: jpalmer at uwo dot ca

. . . . . . . . . . .Richard Posner should be awarded the next Nobel Prize in Economics . . . . . . . . . . . .

Saturday, July 23, 2005

Dealing with High Humidity in Damp, Cool Basements

We have been having extremely hot, humid weather in our area this summer. Many people find that their basements get too damp with the condensing of humidity, leading to mold, rot, and unpleasant smells. Here is some advice, courtesy of Inside Toronto [h/t to BenS]:

  1. Don't open the windows to increase the air circulation. Doing so will just let in more hot humid air, which will increase condensation and dampness in the basement.
  2. Get a dehumidifier.
  3. If the dehumidifier ices up, set it on a timer so it shuts off for about 15 minutes out of every hour, and don't run it overnight. Doing so will save on electricity use, too.
  4. Put a small, cheap oscillating fan to blow through the dehumidifier. This will increase the air flow through its coils and keep the air in your basement moving well.

Is the Moon Made of Cheese?
If So, What Kind?

On July 20th, if you wrote to Google at, this is the autoresponse you received [thanks to AlexK for the pointer; I don't know if it still works]:

If you're wondering what type of cheese the moon is made of, we wish we could tell you. Conventional 20th century belief suggested that it was made of green cheese, but recent data has disproved this theory. Diligent research by the world's most preeminent scientists suggests that it's either havarti or gouda. We recognize that a sniff-off among our talented Google users would likely resolve these scientific disputes, so we're working on patented scratch-and-sniff technology.

You didn't hear it from us, but if you get close enough to your monitor, you may be able to discern the cheese by smell.

This all transpired on July 20, the anniversary of the first manned lunar landing. See this.

Religious Intolerance in Malaysia

Arsonists have attacked the base of a small inter-faith sect in Malaysia called the Sky Kingdom.

The sect is noted for building a giant teapot to symbolise its belief in the healing purity of water, and is accused of luring Muslims away from Islam. [from the BBC, courtesy of MA.]

Friday, July 22, 2005

Why Is This Man Still at Large?

Freedom of speech is not absolute. And once it is limited, where and how it is limited become important constitutional questions. Drawing boundaries and preventing a "slippery slope" is very difficult.

Most reasonable academics prefer fewer limitations on speech, allowing competition in the marketplace for ideas to determine which ideas survive. But even the most extreme of the free market type academics will not (and should not) tolerate instigations to kill other people as acceptable under a freedom of speech defence.

So why is this man still at large? [registration required]
South African-born Sheik Younus Kathrada, who is associated with the Dar al-Madinah Islamic Society, has been under investigation for hate crimes since last October.

In sermons posted on the Internet, he referred to Jews as "the brothers of the monkeys and the swine." He said the Prophet tells them, "Oh Muslim, Oh slave of Allah, that verily behind me is a Jew. Then come and kill him."

Islamic scripture predicted an apocalyptic battle with the Jews, he said. "Unfortunately we hear too many people saying we must build bridges with them. No. They understand one language. It is the language of the sword, and it is the only language they understand."

In another lecture, Mr. Kathrada said Islam endorses offensive jihad, or holy war, to convert non-believers. "It is in order to establish security on this earth," he said. "It is so that the word of Allah will be the superior word."

All Muslims should desire to become martyrs if the opportunity arises, he said. "For one of you to be in the front row of the Muslims . . . with the mujahedeen is better than him standing in prayer for 60 years. It is inconceivable that a true believer will not desire martyrdom."
His teachings have been condemned by other Muslim leaders in British Columbia, where he preaches his hate. He is under investigation for hate crimes. But he should be either deported or behind bars.

[thanks to BenS for the pointer]

Kent Budge, Harry Potter,
and a host of invisible hands

When I wrote about the forces of competition and the heavy discounting of the latest Harry Potter novel, Kent Budge was so tickled with the title of the posting [Harry Potter and the Invisible Hand] that he started a contest:

Economist John Palmer has come up with the funniest suggestion for a Harry Potter book title that I have ever seen: Harry Potter and the Invisible Hand. I laughed so hard I hurt myself.

... Rather than leave well enough alone, I am going to give you all the opportunity to try to top John in a Harry Potter and the Lame Book Title contest. Entries should be proposed titles for the next Harry Potter book that are superficially plausible, but are also puns on some learned phrase or concept. You will receive extra consideration if the learned concept happens to be in your own field.

Winner(s) will be announced Monday. Assuming there are any entries.

I will put up my title against all challengers!

More Economists Support a Canadian-Style Pension System

Increasingly, economists in the U.S. are coming to the conclusion that a publicly provided minimal system that provides a very low social safety net, not unlike that provided by CPP and OAS in Canada, is "a good thing". Encouraging private pension planning and saving, either through private accounts or through employer accounts, is also recommended. See Tyler Cowen's postings here, citing James Glassman:

...the president's rhetoric is unconvincing. Yes, he's made the case that Social Security is headed for insolvency -- tax receipts from workers and employers won't cover benefits for retirees starting in 2018. But he has not managed to connect insolvency with his idea of personal accounts.

No wonder. These are two completely separate issues. Personal accounts won't prevent Social Security's impending bankruptcy. Personal accounts are great for other reasons: they will encourage savings, provide a more comfortable retirement, give people a nest egg they can own and increase personal responsibility. But the accounts won't solve the insolvency problem.

Bush should stop talking about these two issues -- insolvency and personal accounts -- as though they are connected.
And Tyler Cowen quotes Robert Barro here:

I once thought personal accounts for Social Security were a good idea but have changed my mind....

Overall the accounts are a bad idea...

Contributions that fund just the minimum cannot go into a meaningful personal account. People would opt for too much risk, knowing they would be bailed out if they fell short. Also, contributions that cover the minimum provide no individual return and, therefore, amount to a tax that discourages work.

Personal acounts have to supplement the minimum payout.
Also see my earlier posting on this topic here, in which I wrote:

I am not entirely optimistic about the CPP investments. If/when the markets have some serious downturns, the reserve fund will dwindle, members of the CPP investment board will come under attack, and politicians will clamour for the use of general revenues to guarantee that pensioners receive payments they had come to expect.

... My own preference is for a minimal gubmnt pension that by itself would allow a very spartan life. I think it is unconscionable not to provide people with the wherewithall to maintain a very basic lifestyle. Beyond that, we have plenty of inducements, encouraging us to plan and save more. In this sense, the Canadian Pension Plan (coupled with our Old-Age Security plan) is preferrable to the U.S. Social Security System.

Beethoven and the Beeb;
economics and the assessment

I noted in an earlier item that BBC3 had all nine Beethoven Symphonies available for downloading at no charge for a limited time. The Guardian has an assessment of the experiment, which is generally positive [thanks to JJ for the link]. There are several items in their assessment that are confusing, though.

Roger Wright, the controller of Radio 3, said it was "clear that people had been coming to Beethoven for the first time" through the Beethoven downloads. This was discernible from the fact that the symphonies nos 1 and 2 had a high take-up compared with no 3, the Eroica, a much more famous work.
I usually miss something, but how do these data support this conclusion?

Beethoven's downloads
1 Symphony No 6 (Pastoral): 220,461
2 Symphony No 7: 185,718
3 Symphony No 1: 164,662
4 Symphony No 9 (Choral): 157,822
5 Symphony No 2: 154,496
6 Symphony No 8: 148,553
7 Symphony No 5: 139,905
8 Symphony No 4: 108,958
9 Symphony No 3 (Eroica): 89,318
Total: 1,369,893
The real reason Symphony #6 had the most downloads because there was a great deal of hype and publicity about the programme before Symphonies 6-9 became available, but after Symphonies 1-5 were no longer available. I'd guess that Eroica received the fewest downloads mostly because fewer people were aware of the availability of the downloads when it was up.

And put this in the remember-demand-curves-are-downward-sloping book:

To put another perspective on the success of the Beethoven downloads, according to Matthew Cosgrove, director of Warner Classics, it would take a commercial CD recording of the complete Beethoven symphonies "upwards of five years" to sell as many downloads as were shifted from the BBC website in two weeks.

... Mr Cosgrove said: "I would be worried if the BBC repeated the experiment. We would take an extremely dim view if it happened repeatedly." But, he added: "It's caused quite a bit of controversy - but it has also provided us with an amazing piece of free market research. I don't think anyone had any idea in their wildest dreams that there would be this level of response. Yes, the downloads were free - but if charged at a commercial rate that would have been a huge amount of revenue."
Yes, Mr. Cosgrove. And if charged at a commercial rate, there would not have been nearly as many downloads. What is the price elasticity of demand for Beethoven Symphony downloads as the price goes above zero? I expect it is fairly high.

Digression: JJ, who sent me the Guardian piece, offers this brilliant insight:
Nothing personal, but I think it's completely nuts that British residents are paying for this service. Utterly barmy. Maybe the BBC should just send £10 notes abroad instead.

Thursday, July 21, 2005

Justice Roberts?

My friend, BenS, refers to The New York Times as "The Times-Guardian" because they both seem to have elitist, interventionist and pro-Palestinian tendencies. He was not at all impressed with their editorial about John Roberts, George W. Bush's nominee to be the next Justice of the U.S. Supreme Court. Here is an excerpt from that exremist, scare-mongering editorial:

One of the most important areas for the Senate to explore is Judge Roberts's views on federalism - the issue of how much power the federal government should have. The far right is on a drive to resurrect ancient, and discredited, states' rights theories. If extremists take control of the Supreme Court, we will end up with an America in which the federal government is powerless to protect against air pollution, unsafe working conditions and child labor. There are reasons to be concerned about Judge Roberts on this score. He dissented in an Endangered Species Act case in a way that suggested he might hold an array of environmental laws, and other important federal protections, to be unconstitutional.
Ben's reaction:

The NY Times-Guardian would prefer a non-extremist with an unblemished moral record like Ted Kennedy.

Ethanol Use Increases the Demand for Oil?

That's what David Pimental says. He's the one on whose research I based an earlier posting, Ethanol Nonsense. I received several negative comments about that posting. Well, here's another, based on more recent research (link via The Emirates Economist):

The researchers considered such factors as the energy used in producing the crop (production of pesticides and fertilizer, running farm machinery and irrigating, grinding and transporting the crop) and in fermenting/distilling the ethanol from the water mix.

For ethanol production, the study found that:

  • Corn requires 29 percent more fossil energy than the fuel produced.
  • Switch grass requires 45 percent more fossil energy than the fuel produced.
  • Wood biomass requires 57 percent more fossil energy than the fuel produced.

    For biodiesel production, the study found that:
  • Soybean plants requires 27 percent more fossil energy than the fuel produced.
  • Sunflower plants requires 118 percent more fossil energy than the fuel produced.
  • As the Emirates Economist says,

    So why does it exist at all? Because it is subsidized by the U.S. government. Why? Because political parties are buying votes, in this case from farm states. But in the end what does it do? It is so uneconomic that not it doesn't even displace some of the U.S. demand for fossil fuels, but instead increases that demand. A very stupid policy.

    Slate has a very good summary of their work. My friend, JohnH says this about ethanol:
    1) I'll bet [pro-ethanol studies were] done by engineer-types who haven't included the external costs of producing the ethanol itself. For example, the plant west of Chatham, built with your money and mine, is a toxic nightmare.

    2) Even the political disinformation used to justify the "very stupid policy" is stupid. The claim that an ethanol plant will save farmers by raising ag prices is ridiculous. Surely even a country-wide initiative to build ethanol plants wouldn't raise them. (A nice econometric exercise!)

    3) Why do the media simply ape this junk? Why haven't they caught on to reality and made that the news?

    This is all just another dismal example of failure of public choice. I think I'll go read Dilbert.
    And yet, see this. It reads like more stuff from mediots who get sucked into bad planning and bad economics.

    More Evidence That Eating Chocolate is Good for You

    We have heard before that eating chocolate, especially dark chocolate, is good for us. Here is more evidence:

    The study, published by the American Heart Association, joins a growing body of research that show compounds found in chocolate called flavonoids can help the blood vessels work more smoothly, perhaps reducing the risk of heart disease.
    It was a matched small-sample study that nevertheless yielded statistically and clinically significant results:

    Blumberg and colleagues at the University of L'Aquila in Italy studied 10 men and 10 women with high blood pressure.

    For 15 days, half ate a daily 3.5 ounce (100 gram) bar of specially formulated, flavonoid-rich dark chocolate, while the other half ate the same amount of white chocolate. Then each group "crossed over" and ate the other chocolate.

    "White chocolate, which has no flavonoids, was the perfect control food because it contains all the other ingredients and calories found in dark chocolate," Blumberg said.

    "It's important to note that the dark chocolate we used had a high level of flavonoids, giving it a slightly bittersweet taste. Most Americans eat milk chocolate, which has a low amount of these compounds."
    I confess. I much prefer a standard Hershey or Cadbury milk chocolate bar to any of that fancy-schmancy 76% cocoa dark chocolate bitter stuff. Ian Klymchuk would undoubtedly agree.

    And of course there is a trade-off between weight gain and other problems that might arise from consuming the calories and sugar in comparison with benefits from consuming the flavonoids.

    Wednesday, July 20, 2005

    Victimization and Misinformation

    I know there are many moderate, fair, open-minded Muslims (including several of my all-time favourite students). This is not directed to or at them. The quotation below is from "In their own words : how [some] Canadian Muslims are responding to the London bombings". Please, even if you don't follow the link(s) back to the original(s), take the time to read these two paragraphs:


    From the quoted statements by Canadian Islamic organizations transpires non factual victimology. The announced wave of anti-Muslim violence in the aftermath of 9-11 and other Islamist terrorist attacks has failed to materialize. In fact, according to Statistics Canada, Canadian Jews remain the population group most likely to be targeted by hate crimes, antisemitic crimes accounting for 25% of reported hate crimes in 2001 and 2002. Anti-black crimes rank in second place at 17%, while anti-Muslim crimes hover around 10% along with homophobic crimes. Anti-Muslim backlash this is not. Yet Canadian Islamic organizations go to great lengths in order to instill a climate of fear and suspicion towards Canadian authorities and society at large among Muslims by publishing, for example, thoroughly unscientific reports on alleged abuse by RCMP officers’ interrogations of Muslims who might have valuable information on terror suspects or terror suspects themselves. The climate of fear some Islamic organizations create among Muslims serves the purpose of legitimizing their role as self-proclaimed representatives of the Muslim community, while alienating Muslims from society at large, thus opening the door to inwardness and possibly a radicalization of the minds.

    The disinformation carried by Canadian Islamic and Arab websites goes a step further with the use of Quid bono (who stands to gain), a poor analytical tool for understanding a complex world. The Quid bono mentality exemplified here is typical of societies where information is state-controlled and thus distrusted. This, however, not being the case in a country such as Canada or Britain, one can only conclude that the quoted writers and their publishers are willfully spreading lies about "staged" terrorist attacks allegedly conceived in order to justify the "Muslim holocaust in the making" as one writer put it. Paradoxically, while denying Islamic involvement in the London bombings, some of these writers offer a rationale for it. This attitude bears resemblance to the contradictory responses to 9-11 in the Middle East, where people jumped for joy at the news of the attacks, while claiming no Muslim was sophisticated enough to carry out such an attack. Hence, the Quid bono rationalization which cast blame on Israel and the USA for perpetrating the 9-11 attacks in order to allegedly justify military action against Muslim countries. Such literature, written in part by radical Islamists themselves, serves to alienate and radicalize its readers by leading them to believe a huge, diabolical conspiracy is being implemented to wipe them off the face of the earth, which, no doubt, is what partially motivated the four Britain-born Muslims to turn against their fellow countrymen on July 7 2005.

    The quotations and citations from the article leading up to this quotation are very disturbing.

    [I would like to thank whoever sent me this link, but I've lost the original message. It might have been MA]

    Harry Potter and the Invisible Hand

    Numerous bookstores have been discounting the latest Harry Potter book by up to 30% and more. As Brian Ferguson notes, this is exactly the effect one would expect from a competitive market with easy entry:

    It's at the retail level that the expected profits aren't being made, and that's because the retail market is highly competitive. The market level demand for Potter is undoubtedly highly inelastic, but at a suggested retail price of $40 plus dollars for a kids book, parents, especially young, lower income parents, are going to be very sensitive to price differences. The retailers are competing with each other. Set a price much above what your competitors are charging, and you're going to see your customers streaming into their stores. It's the textbook perfectly elastic demand curve for a perfectly competitive firm in action. The fact that supermarkets are getting in on the game means that the easy entry condition is satisfied, at least when you define the market not as the market for kids books but as the market for Harry Potter and the Half-Blood Prince.
    You should read his entire piece for his detailed thoughts and analysis.

    My Favourite Movie - Evolution of a Concept

    Tyler Cowen at Marginal Revolution began this thread, and Ted Frank at Lagniappe "picked up the baton". Ted, in turn, suggested that I post on the topic. My tastes and age are different, so you'll see quite different movies listed here. I have no idea about the precise dates when these movies became my favourites.

    1956 - The Court Jester with Danny Kaye

    1958 - No Time for Sergeants with Andy Griffith

    1963 - Tom Jones

    1964 - Hard Day's Night

    1968 - The Graduate

    1973 - American Graffiti

    1976 - Blazing Saddles

    1978 - National Lampoon's Animal House

    1980 - The In-Laws [warning: the 2003 version is horrid]

    1983 - On Golden Pond

    1987 - Three Days of the Condor

    present: a toss-up between On Golden Pond (I'm reaching the age that this movie, despite being hilarious, has become painfully significant) and Three Days of the Condor (I love the intricacies, even though they are implausible).

    As you can see, I'm not much of a movie buff. And to be quite honest, I still enjoy all the movies on this list.

    Other bloggers, in reverse alphabetical order, from whom I would be interested in seeing the evolution:

    Tuesday, July 19, 2005

    The Ukraine:
    Don't Be Optimistic

    King Banaian has raised some very poignant issues about the changes (and lack of changes) in the Ukraine. Here is just a brief summary of some of them (but, seriously, read the whole thing, especially since it is replete with links to other sources and the links did not transfer with my copying of this brief quotation):

    I've written earlier this year that the Tymoshenko cabinet has not moved forward on economic reforms. Anders Aslund sounded the alarm this May. He notes that Tymoshenko has engaged in pure populism, increasing taxes and giving public sector workers and pensioners 60% raises. Inflation is on the rise. Ariel Cohen last week amplifies the point that property rights are routinely violated in Ukraine. It has a socialist privatization minister (take a moment to get your mind around that concept) who thinks we've had enough privatization.

    Seat belts vs. Air bags

    Steven Levitt has a good summary of his research results at the Freakonomics blog [link reached via Marginal Revolution]:

    ...let me ask you a question: if you could only have one or the other, would you go for the seat belt or the air bag.

    It turns out the answer is easy, and my views on this one are much less controversial than on car seats. With Jack Porter, a professor at Wisconsin, I wrote a paper published four years ago that looks at the effectiveness of seat belts and air bags for adults. We found that wearing a seat belt reduced the chance of death by 60-70 percent across all crashes. We estimated that air bags reduce the death rate by 15 percent in frontal crashes, but don't help in partial frontal, side, or rear crashes. (The benefits we found for adults in seat belts were higher than most previous research, and the results on air bags were lower than in most earlier research. But there is nobody who knows the data who would prefer an airbag to a seat belt if it was an either/or choice.)

    The bottom line is that to save a life with a seat belt costs $30,000; to save a life with an air bag costs $1.8 mm by our estimates. This makes seat belts an incredibly effective safety innovation. While in comparison, air bags look bad, indeed in the scheme of things $1.8 mm to save a life is pretty good by regulatory standards.
    I expect that one thing left out of the statistics is that airbags reduce the number of suicide attempts from running into trees and bridge abutments, especially suicide attempts by people who want their deaths to appear to be accidents, for insurance purposes. You can always drive with your seatbelt undone, but disabling an airbag is more difficult. I have no idea about the size of this effect, but if your car has an airbag, you can't kill yourself this way as easily this way.

    Of course you can still do so by pulling out in front of a train or truck (if your car doesn't have side airbags or curtains), but many people contemplating suicide don't really want to inflict that on the driver of another vehicle.

    Housing, Again.
    Waiting for the Bubble to Burst

    Peter Schiff presents some fairly compelling arguments that
    1. we are in a housing bubble, and
    2. this bubble is going to burst worse than any previous housing bubble. [thanks to JJ for the link]

    Here are his explanations:

    One reason few expect housing prices to collapse is the mentality that homeowners need to live somewhere and as such will be reluctant to sell their residences. This argument ignores that fact that so many of today’s homebuyers do not occupy their properties as primary residences, and that relatively attractive rentals provide homeowners with viable, none-ownership alternatives for shelter. However, a more in-depth analysis reveals that contrary to prevailing rhetoric, housing speculation is not only rampant, but also far more pervasive than the data suggests, perhaps even more widespread than was the case with tech stocks during the NASDAQ bubble.

    ... the mere fact that owners occupy their houses as principle residences does not necessarily remove such properties from the category of speculative investments. For example, 58% of recent California homebuyers financed their purchases using ARMs (with percentages in pricier counties exceeding 80%). The primary reason given to justify such mortgages was owners’ intentions to resell the properties in relatively short periods of time. Such buying is clearly speculative, regardless of the speculator’s intention to occupy the property. Given high transaction costs and low relative rents available in markets where such mortgages are most pervasive, absent the expectation of rapid price appreciation, such short-term buyers would clearly be better off renting.

    Also, the fact that so many buyers are using interest-only, or negative-amortization mortgages, suggests even greater degrees of speculation. ... The only way interest-only buyers build equity is though price appreciation. In other words, they are the ultimate speculators.

    In fact, so intoxicating is the expected payoff from home ownership, that the incentives to lie to qualify for mortgages have never been greater, and as it so conveniently happens, easier to do. Trendy no-documentation mortgages allow almost anyone to buy a house, regardless of employment status, income, financial condition, or credit history. The fact that purchases can also be financed with zero down, means that speculators can gamble with no risk what-so-ever should prices fall. Also, the availability of cash-out refinancing means that owners can press their bets while simultaneously taking their winnings off the table.

    Given such incentives, is it any wonder that housing speculation is so rampant? Should we be amazed that when reckless lenders offer buyers can’t lose bets, with huge expected payoffs, that so many want a piece of the action? The fact that the majority of today’s homebuyers are actually speculators in disguise, suggests that when the trend turns, prices will drop precipitously. Far from holding on to their homes, as even most housing bears suggest, owner/speculators will sell in droves, or worse, simply walk away from their bets, leaving lenders and tax payers to cover their losses.

    Living in a small town in Mid-western Ontario means I don't see much of a bubble in my community. Here, prices may have risen by 10% over the past two years, if that. Given the transaction costs, that type of price increase is not enough to induce rampant speculation the housing market here.

    "Whoever Kills Innocents Is Not a Muslim"

    From the Khaleej Times via the Emirates Economist:

    ABU DHABI — A prominent UAE preacher denounced yesterday as infidels Muslims who carry out attacks against innocent civilians around the world, including the perpetrators of the London blasts.

    “Do these people not see the results of their actions? They have turned people against us ... and made them link the name of Islam with terrorism,” Sheikh Hamdan Musallam Al Mazruhi said in his Friday sermon.

    “Therefore, we should say it out loud that whoever kills innocent people ... is not a Muslim and Islam is innocent of him ... We are astonished at those people who justify these acts and see them as jihad in the name of God and declare themselves an authority for Muslims,” he said.

    “Those who do that are infidels,” he said.

    The preacher said “Islam is a religion of mercy and peace.”“How does it help Islam, when the blood of civilians is shed around the world, like in Iraq, Afghanistan, New York, Madrid, Bali, Casablanca, Algeria, Saudi Arabia, Qatar and lately in London at the hands of those killers and criminals ... who are falsely linked to Islam,” he said.

    Geez, I hope this guy is correct and that he has some influence. Unfortunately it seems that not all Muslims agree with him.

    Monday, July 18, 2005

    Will the PEI Gubmnt Start Subsidizing Air Canada?

    Air Canada is upset that the gubmnt of PEI has offered subsidies to WestJet and Northwest to provide service to Charlottetown from Trono and Detroit, respectively.
    "Despite numerous discussions and meetings with PEI officials, including the Premier, over the past few months, we were unable to come to an agreement that would have levelled the playing field and enabled Air Canada to maintain its year-round service between Charlottetown and Toronto," Air Canada spokeswoman Laura Cooke said.
    Now that the gubmnt of PEI has begun subsidizing WestJet and Northwest, Air Canada wants to belly up to trough, too. I don't much blame them, especially since the provincial gubmnt is subsidizing their direct and indirect competition. Too bad the gubmnt of PEI didn't use some basic economics before offering the subsidies.

    The likely outcome is the after negotiations, PEI will also offer subsidies to Air Canada. It could, of course, withdraw the subsidies from WestJet and Northwest....

    Wake me. I must be dreaming....

    "Therapism" -- Additional Evidence That People Respond to Incentives

    "The counselors needed clients far more than clients needed counselors."

    Have you ever noticed that after some highly publicised castastrophe, there is an army of people from the "I'm okay, you're not okay" segment of the population who desperately want to go to the site of the catastrophe to help out? Part of their desire to go there may be altruistic, part of it may be ghoulish curiosity, and part of it may be a response to financial incentives. These and other incentives are explored in the book One Nation Under Therapy: How the Helping Culture is Eroding Self-Reliance by Sally Satel & Christina Hoff Sommers.

    As with any book, I strongly recommend you read the reviews at for the many different opinions people have about the ideas put forward by Satel and Sommers. But I also strongly recommend the review by Theodore Dalrymple in The New Criterion. Here are some excerpts:

    A few days ago I attended a talk by a leading member of the British psychiatric bureaucracy. It was his proud boast that he and his colleagues had persuaded the government that hospitals and health authorities should have to explain why they refused psychiatric assistance to anyone who had asked for it. The idea that some people might actually be harmed by the desired but nevertheless ineffective and unnecessary psychiatric assistance was completely beyond his comprehension. He evidently believed in a neo-Cartesian dictum: I want, therefore I need.

    It is not difficult to work out that such an attitude would serve the financial interests and appetite for power of the so-called caring professionals. The psychiatric bureaucrat also cited in his talk a frequently quoted figure about the proportion, 70 percent, of prisoners who had “mental health problems”—among them, of course, unhappiness at being locked up. That slippery phrase “mental health problems” was meant to imply, though it could not prove, that a giant apparatus of care was necessary to cater to the 70 percent. When it comes to therapy, evidently, there can never be enough.

    ... According to therapism, everyone who has ever witnessed anything unpleasant, or experienced loss or humiliation (which is to say, the great majority of humanity), is at risk of subsequent mental illness unless he expresses his feelings volubly and often, preferably as directed by a mental health worker. As the authors point out, there is no evidence that this is so—quite the contrary. As appetites grow with the feeding, so emotions grow with the expression. In fact, the evidence is very strong that most people are resilient, and that resilience is self-reinforcing. If, however, you persuade people that they are weak and fragile, that is what they will become.

    At stake is our whole conception of what it is to be human. The common-law tradition is that everyone is responsible for his actions unless the contrary can be proved. Therapism, which has already subverted law to a considerable extent, believes that wrongdoing is itself a symptom.

    ... Therapism has caused a decline in the quality of our culture. People are now engaged in a kind of arms race, feeling obliged to express their emotions ever more extravagantly to prove to themselves and other just how much and how deeply they feel. This leads to the peculiar shrillness, shallowness, and lack of subtlety of so much of our culture.

    Therapism has also corrupted large numbers of people. The assumption that people are easily and permanently damaged by various traumas has led many of them to act the part for the sake of receiving compensation.

    ... Particularly disturbing for believers in therapism was the fact that, after 9/11, the population of New York was not so traumatized that it required counseling en masse, though counselors descended on the city en masse, like bluebottles on a corpse. This would have been funny had it not been so macabre. The counselors needed clients far more than clients needed counselors.

    [h/t to BenS]


    This is almost embarrassing.

    I've posed as being terribly anti-elitist. And now I'm very pleased to have been added to Kip Esquire's Elite Eleven. He has some very nice things to say about this blog. His comments mean a great deal to me because A Stitch in Haste reveals that Kip is clearly a very intelligent and well-informed person with considerable insight.

    Marriage: a slightly libertarian perspective

    Brian Ferguson has a long posting about a number of topics. This little nugget is buried near the end, and I'm afraid many of his readers might miss it:

    The libertarian in me could support having the government get out of the "marriage" business altogether, with the concept of "marriage" to be replaced, for legal purposes, by a concept of civil union, which would primarily be an economic relationship, covering such things as rights of inheritance and survivorship, and assignment of entitlements under pension and health plans. Marriage would then be the province of religious bodies and would have no legal meaning, referring instead to a service in which the blessing of the creator, however envisioned, would be invoked for a couple entering into a union. The nature of the couples eligible for such blessing - homosexual or heterosexual - would be a matter for the members of individual faiths to decide, and the government (including human rights tribunals) would have no say in the matter.

    And the Smithian in me is pretty sure that the more the government and the courts get involved in such things, the more likely they are to make a complete mess of them.
    I note, once again, that he misspelled "gubmnt".

    Update: For more, please see the thoughtful posting by Kip Esquire at A Stitch in Haste.

    Sunday, July 17, 2005

    Rough 'N' Ready Pension Calculator

    This little pension calculator might be of interest to Canadian readers who are considering retirement within the next ten years or so [thanks to BenS for the link].

    It spits out expected income from Old Age Security [OAS], Canadian Pension Plan[CPP], Employee Pension Plan, and Registered Retirement Savings Plan [RRSP] sources, all in current dollars, with some flexibility for you to specify expected interest rates.

    It is pretty basic, but it is also quite helpful for people like me who assert we are rationally ignorant about the finer points of retirement planning.

    Curmudgeonly Reviews

    Yesterday morning, Ms. Eclectic went to a grocery store in a nearby town. Even here, in rural Ontario, the small-town store had the latest Harry Potter novel on sale, for $15 off the list price. She bought two copies: one for herself and one for our son's family.

    Unlike her, unlike my son, and unlike most of you, I have never read a Harry Potter novel. I have never watched a Harry Potter movie. I'm sure I'm missing something wonderful in the minds of many, but for some reason, I don't care. I'm not into novels and movies about kids and sorcerers and mysticism or whatever.

    Also, I have never read nor seen a movie involving the Hobbit or The Lord of the Rings. Same thing: the overall topics do not interest me.

    Recently, I made the effort to read Dan Brown's two big sellers, Angels and Demons and The Da Vinci Code. My reaction? ehhhhhhhhhhh~~~~~~. I'm maybe a bit glad I read them because everybody talks about them, and they weren't bad, but the plots are similar; and while the details are okay they're overdone.

    My objections to these books are not at all like those of a co-blogger at The Western Standard. It's just that my tastes run more to "airport novels".
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