Joe Scarborough continues to get dumber

This morning while interviewing super super smart Ivy League guy Jeffrey Sachs, Scarborough said that Democrats are trying to rebuild an economic bubble through government spending, while Republicans are trying to rebuild the bubble with low taxes that will "get more money out there and pump up consumerism".

What? OK, maybe he is technically right. There probably are some Republicans out there that think tax cuts are about giving people more money to spend. But as a self described "small government conservative", he should know that the conservative argument for low taxes has nothing to do with "getting money out there".

In addition to the moral argument for low taxes (private property and keeping the fruits of one's labor), the economic argument for keeping taxes low is about minimizing disincentives to work, save and invest.

How does he not know that? Scarborough has been working at MSNBC way too long.

[Update]
Karl Rove made his debut guest hosting the Rush Limbaugh program today and talked about the importance of making the moral argument against tax hikes:

We live in a country that values individual enterprise, personal responsibility and individual freedom. The more the government takes out of your pocket the less we have of all three of those things. - Karl Rove

The recession as a "recalculation"

Forget the money multipler, C+I+G, and monetary velocity. According to Arnold Kling, economic activity is not about spending, it's about "sustainable patterns of specialization and trade." He explains:

Here is a simple pattern of specialization and trade: Suppose that all of us eat grain and fruit, which we could grow for ourselves. If some of us have land better for fruit trees, while others have land better for growing grain, then specialization and trading can pay off. It is inefficient to waste good tree land by growing grain on it and to waste good grain land by planting trees on it. Instead, economic activity gives all of us more to eat

So if economic activity is not about spending, then a recession is not about a lack of spending. So what is this recession really about?

The economy was suddenly caught in an unsustainable pattern of production, which involved too much housing construction in the “sand states” of Florida, Nevada, and California as well as too much financial activity related to mortgages and mortgage securities. The market needs to undertake a recalculation in order to deploy workers in a new, sustainable pattern of specialization and trade.... The process involves gradual, decentralized trial and error. Firms need to be launched by entrepreneurs, who will make risky investments in employees. The failure rate will be high, but eventually the successes will have a cumulative effect that brings about more economic activity.

And the policy implications?

If anything, it seems likely that government support for unsustainable patterns of production would probably make the market's recalculation problem more confusing.....On the whole, the best way to help the process of market recalculation and the creation of sustainable patterns of specialization and trade may be for government to get out of the way.

Please, read the whole thing here.

Allen West on the NYC mosque

I was getting all squishy on the issue of the Ground Zero mosque, but Lt. Col. Allen West has put me straight:

The individuals who hijacked two airplanes and flew them into the World Trade Center towers shouted, “Allahu Akhbar”. The individuals who will attend the mosque would offer up like praise of “Allahu Akhbar”. The individuals who detonate suicide vests, behead school teachers and headmasters, throw acid on little girls trying to attend school, and fire rockets into Israel shout, “Allahu Akhbar”.

I do not support the building of a mosque at ground zero. It is not about Muslims, it is about a totalitarian, theocratic-political ideology with an imperialistic objective which I will not allow to claim victory in my Country.

Read the post over at NRO here.

Law of unintended consequences

Remember this debate about Spirit Airlines' decision to start charging for carry-on bags, and Charles Schumer's effort to outlaw the practice? Here is what I said:

Spirit Airlines is proposing a fee for carry on baggage, and says that their ticket price will be reduced by about the same amount as the fee. This makes perfect sense - a traveler who walks on with no carry on luggage probably costs much less than someone who tries to jam a large suitcase into an overhead bin. I imagine the extra cost from additional boarding time alone, over the course of thousands of flights, is astronomical.

Well, the policy went into effect on August 1st, and I flew on Spirit on July 29th, three days before the policy was instituted, and flew home on Spirit Airlines yesterday, August 4th. This was what happened on the way home after the new policy was instituted:





I can't believe I hadn't thought of this, but when you require passengers to pay for carry on bags, the number of people that have to go through the baggage check-in line increases substantially. The wait time was an hour. To fix this problem, the airline is going to have to hire more people for check in, which will increase their costs. Otherwise, they are going to be losing customers not because of any carry-on baggage fee, but because of long wait times. No, I can't prove that this was the reason for the lines. Maybe it was because it was August, which is the busy season for the Jersey Shore, but I have to believe that this was at least a contributing factor, and another example of the law of unintended consequences.

Maybe Chuck Schumer won't have anything to worry about after all. Maybe the marketplace will work it's magic and this will not become the industry norm.

Tax cuts and small businesses

Chris Matthews: The tax increase is on individuals, not businesses.

Paul Ryan: Most small businesses are pass through entities, and pay tax at individual rates.

President Obama: Very few small businesses are owned by individuals with over $250K of income.

John Boehner to President Obama: Yes, but over half of all small business income will get hit by the tax increase.

WSJ: The small businesses not making any money wouldn’t be affected, but the ones succeeding out there would.

I would also like to see what percentage of small business employees work in businesses where the owner has income over $250K.

Chris Matthews is just not very smart

Congressman Ryan embarrasses the host of Hardball. Actually, Matthews embarrasses himself.



[More thoughts]

Does Matthews really not know that most small businesses are taxed at individual tax rates? And on his criticism that Republicans are not willing to offer specific cuts to the budget, does he know who he is talking to?

Some lite poolside reading

Yesterday, I was at our neighborhood pool, and there was a guy there reading Hayek's The Road to Serfdom. I only wish I had been able to take a picture.

This kind of thing is the left's worst nightmare.

Shirley Sherrod Timeline

There has been a lot of confusion regarding the timeline of Andrew Breitbart's Shirley Sherrod video and the subsequent coverage by Fox News Channel and other media outlets, so I have attempted to piece together the following timeline which I believe is correct:

Monday morning: Andrew Breitbart releases video on Biggovernment.com.

Monday afternoon: USDA Secretary Tim Vilsack issues this statement: "There is zero tolerance for discrimination at USDA, and I strongly condemn any act of discrimination against any person... We have been working hard through the past 18 months to reverse the checkered civil rights history at the department and take the issue of fairness and equality very seriously". Shirley Sherrod is driving home and is asked by a USDA official to resign because "you are going to be on Glenn Beck tonight".

Also, the NAACP releases a statement saying they are "appalled by her actions" and that her "her actions were shameful", even though only they possess the entire un-edited video.

Foxnews.com had posted a story sometime that day, but the story has still not been discussed on the Fox News Channel. According to the Los Angeles times: "At an afternoon editorial meeting Monday, [Fox News Channel Senior Vice President Michael] Clemente urged the staff to first get the facts and obtain comment from Sherrod before going on air, according to internal notes from the meeting that were provided to The Times. 'Let’s make sure we do this right,' he said."

Monday evening: Beck does not discuss the story on his 5 PM broadcast. O'Reilly plays the tape during the last 15 minutes of his show and says she should resign, a statement for which he later apologizes. Hannity covers the story, as well as Gretta Van Susteren. According to mediaite.com, "it was also referenced by a guest on Larry King Live, and Anderson Cooper did have a brief segment as well on CNN."

Tuesday morning: According to mediaite.com, all three cable networks lead with the Sherrod video. Mediaite.com also points out that "On Tuesday, FNC covered the story...39 times... MSNBC covered it 21 times, [and] CNN mentioned Shirley Sherrod 63 times."

Tuesday afternoon: Beck covers the story for the first time and defends Shirley Sherrod, suspecting that the quote was taken out of context, stating, "Now here's a possible actual example of someone taken completely out of context and they immediately get rid of her."

Wednesday: NAACP releases the entire videotape, and says they were "snookered" by Fox News, even though they released their statement before the story was discussed by anyone on the Fox News Channel. Administration apologizes for firing Sherrod.

For more on this, check out the mediaite.com story.

Food Inc

Last week I watched the critically acclaimed documentary Food Inc, and for a number of reasons, it was disappointing. The early parts of the movie were promising, particularly when it argued that the source of many of the problems in the food industry was government subsidies and an unhealthy collusion between Washington DC and the food industry. But when the movie concluded, the solutions proposed by the filmmakers ignored that problem, and instead encouraged viewers to support even greater government involvement in the food business.

But the highlight of the film for me was this quote from Gary Hirshberg, the chairman and CEO of the organic yogurt producer Stonyfield Farm. My understanding is that he is a left-wing environmental activist, but in this quote, he sounds more like Thomas Sowell or John Stossel:

The irony is that the average consumer does not feel very powerful.They think that they are the recipients of whatever industry has put there for them to consume. Trust me, it’s the exact opposite. Those businesses spend billions of dollars to tally our votes. When we run an item past the supermarket scanner, we’re voting.

Lowry and Rand Paul -- The Summit

From NRO's The Corner:

He dropped by the office yesterday. A few observations: 1) He wants to win this race and do the things necessary to make that happen; 2) He's smart and has thought through issues to a much greater extent than the average Senate candidate; 3) He clearly thinks we have no business being in Afghanistan anymore, although he's very reluctant to come out and say it. At one point he even seemed to suggest he doesn't want to give his personal view of the war out of respect for the Constitution (it's not the role of Congress to micro-manage wars); 4) There's a cockiness to him, although he seems to realize that and its potential pitfalls. He basically says he made the decision to go on the Rachel Maddow show for his infamous appearance in a fit of arrogance after his big primary win; 5) He'd be an asset to conservatives in the Senate in the fights over the size to government to come — and a major pain-in-the-neck for the Senate GOP leadership. I suspect he'll make Jim Bunning look tame.