Global Yarning

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Two interesting opinions on aspects of the climate change debate on wsj.com today. The first covers the unmistakable change toward more guarded assertions on the science of climate change in the IPCC’s latest report: Second Climate Thoughts. Less alarmism is good, even if the responsible parts of the discussion were buried in the document after a lengthy summary containing juicy alarmist headlines. At least some honest inquiry has begun to influence the IPCC.

The second wsj piece discusses the bias against traditional energy sources holding sway at U.S. colleges and universities. It laments the failure of those institutions to direct students toward fields having anything to do with fossil fuels, despite the lucrative nature of careers in that area: How Climate Change Conquered the American Campus.

Limited Liability: Elixer or Fascist Monstrosity?

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Can Libertarians support limited liability for corporate shareholders with a clear conscience? Limited liability attached to corporate ownership is a wholly distinct form of property right granted by the state. As a result, many Libertarians view it as an “artificial” or “unnatural” right, casting the corporate form of organization as an institutionalized rent-seeker’s bonanza. However, limited liability can arise via private contract even without formal recognition of a separate form of property by the state, and there are strong arguments in favor of limited liability as an economic catalyst. Moreover, certain legal dimensions of property ownership are more consistent with limited liability than are often admitted by detractors. Preserving limited liability for corporate shareholders now may be more important than ever, given the way that exposure to tort actions has expanded over time.

The following articles illuminate some arguments in favor of limited liability:

Megan McArdle: Be Glad That Corporate Liability Is Limited.

From a Libertarian/Austrian perspective: Corporations and Limited Liability for Torts.

Gender Gap Claptrap

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The gender wage gap disappears after controlling for voluntary choices made by women and men regarding occupation, emphasis on family time and duties and/or personal preferences. These decisions often have sociological roots, but they are private decisions in the first instance and not amenable to engineering via regulatory action. For example, controlling for just one factor, marital status, accounts for 75% of the gender difference in average wages. In the post linked above, Mark Perry at Carpe Diem thoroughly debunks the wage gap myth.

It is already illegal to pay equally-situated men and women different salaries. Yet it is just too difficult for some politicians to resist using the difference in average wages as an excuse for regulating private employment decisions and wages. The pernicious effects of this kind of legislation are discussed in ‘Paycheck Fairness’ Will Lead to Fewer Paychecks, Less Fairness. It’s particularly interesting that the “Paycheck Fairness Act” would expose private employers to class action lawsuits over wage differences. Needless to say, trial lawyers are enthused.

The Tragic Obamacare Adventure

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Obamacare: Some high-risk individuals have gained cheaper health coverage under the ACA. Some previously uninsured individuals will now have coverage. But as a consequence, direct harm has been caused to other individuals, and the financial costs have been massive. Just take a look here. The positive outcomes could have been accomplished with much less strife, but that’s another post. Here, I’m merely taking inventory of the abject failure that is Obamacare:

28 delays and extensions: Obama has done more to repeal Obamacare than the GOP could have hoped to accomplish themselves, (but these actions are of questionable legality). That’s the good news.

Only 14% Of Obamacare Exchange Sign-Ups Are Previously Uninsured Enrollees.

The Administration conducted a wholly dishonest campaign to “sell” the law to the public (“if you like your plan you can keep it”), and the dishonest PR spin continues.

Waived mandates for the President’s cronies.

Roughly 5M lose their individual coverage.

Big premiums hikes (30% in CA, and often higher elsewhere), with strong likelihood of more increases for next year due to adverse selection on the exchanges.

Networks under Obamacare have been thinned in an attempt to reduce costs. Will you really keep your doctor?

Full-time positions become part-time positions (this is likely to resume as the now-delayed employer mandate approaches).

Web site failures impose private costs of untold hours on would-be applicants.

Massive implementation costs, including an often demented ad campaign on the taxpayer dime.

Massive subsidies inflate the federal deficit.

A panoply of new taxes.

Prosperity Exposed

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This Brookings research by Gary Burtless reveals lessons about changes in incomes in the U.S. that may be surprising to some. These changes relate to quintiles of the distribution, NOT to migration of individuals across quintiles. The data do not show stagnation in the middle and lower end of the income distribution. Non-cash sources of income have grown rapidly relative to total income. The changes show that income at the top is quite volatile, and income at the low end has been insulated from shocks by transfer payments. 

Redistributionists should love this data in many ways, but I suspect this information will be passed over by the left to avoid diluting their message that more redistribution is needed to achieve social justice…  always more.

Is Invention Self-Breeding?

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The Next Age of Invention, by Joel Mokyr in City Journal, is a nice antidote to the many neo-Luddite doomsayers lurking within the social sciences. Some highlights (for me) were his discussion of some of the ways in which national income accounting understates the benefits of new technologies, reasons why we might be poised for dramatic advances, the trend toward (and variety of) potential “small” innovations, and technological “bite-back” and how it spurs additional improvements. Last but not least, this article was fun for me because Mokyr takes on my former thesis advisor! He does not discuss the mechanisms by which the benefits of future innovations will be diffused, which is somewhat controversial, but I have no doubt that they will be diffused widely with time.