Category Archives: News

Jay Richards: eight common myths about wealth, poverty and the free market

I have a key that will unlock a puzzling mystery
I have a key that will unlock a puzzling mystery

Have you read Jay Richards’ book “Money, Greed and God?” Because if you haven’t, he’s written a series of articles that summarize the main points of the book.

The index post is here.

Here are the posts in the series:

  • Part 1: The Eight Most Common Myths about Wealth, Poverty, and Free Enterprise
  • Part 2: Can’t We Build A Just Society?
  • Part 3: The Piety Myth
  • Part 4: The Myth of the Zero Sum Game
  • Part 5: Is Wealth Created or Transferred?
  • Part 6: Is Free Enterprise Based on Greed?
  • Part 7: Hasn’t Christianity Always Opposed Free Enterprise?
  • Part 8: Does Free Enterprise Lead to An Ugly Consumerist Culture?
  • Part 9: Will We Use Up All Our Resources?
  • Part 10: Are Markets An Example of Providence?

Parts 4 and 5 are my favorites. It’s so hard to choose one to excerpt, but I must. I will choose… Part 4.

Here’s the problem:

Myth #3: The Zero Sum Game Myth – believing that trade requires a winner and a loser. 

One reason people believe this myth is because they misunderstand how economic value is determined. Economic thinkers with views as diverse as Adam Smith and Karl Marx believed economic value was determined by the labor theory of value. This theory stipulates that the cost to produce an object determines its economic value.

According to this theory, if you build a house that costs you $500,000 to build, that house is worth $500,000. But what if no one can or wants to buy the house? Then what is it worth?

Medieval church scholars put forth a very different theory, one derived from human nature: economic value is in the eye of the beholder. The economic value of an object is determined by how much someone is willing to give up to get that object. This is the subjective theory of value.

And here’s an example of how to avoid the problem:

How you determine economic value affects whether you view free enterprise as a zero-sum game, or a win-win game in which both participants benefit.

Let’s return to the example of the $500,000 house. As the developer of the house, you hire workers to build the house. You then sell it for more than $500,000. According to the labor theory of value, you have taken more than the good is actually worth. You’ve exploited the buyer and your workers by taking this surplus value. You win, they lose.

Yet this situation looks different according to the subjective theory of value. Here, everybody wins. You market and sell the house for more than it cost to produce, but not more than customers will freely pay. The buyer is not forced to pay a cost he doesn’t agree to. You are rewarded for your entrepreneurial effort. Your workers benefit, because you paid them the wages they agreed to when you hired them.

This illustration brings up a couple important points about free enterprise that are often overlooked:

1. Free exchange is a win-win game.

In win-win games, some players may end up better off than others, but everyone ends up better off than they were at the beginning. As the developer, you might make more than your workers. Yet the workers determined they would be better off by freely exchanging their labor for wages, than if they didn’t have the job at all.

A free market doesn’t guarantee that everyone wins in every competition. Rather, it allows many more win-win encounters than any other alternative.

2. The game is win-win because of rules set-up beforehand. 

A free market is not a free-for-all in which everybody can do what they want. Any exchange must be free on both sides. Rule of law, contracts, and property rights are needed to ensure exchanges are conducted rightly. As the developer of the house, you’d be held accountable if you broke your contract and failed to pay workers what you promised.

An exchange that is free on both sides, in which no one is forced or tricked into participating, is a win-win game.

On this view, what you really need to fear as a consumer is government intervention that restricts your choices in the marketplace, or makes some choices more expensive than they need to be (tariffs).

If you care about poverty, it’s often tempting to think that it can only be solved one way – by transferring wealth from the rich to the poor. But that is a very mistaken view, as any economist will tell you. The right way to create prosperity is by creating laws and policies that unleash individual creativity. Letting individuals create innovative products and services, letting them keep what they earn, making sure that the law doesn’t punish entrepreneurs – that incentivizes wealth creation. Fixing poverty does not mean transferring wealth, it means giving people more freedom to create wealth on their own. Free trade between nations is an important way that we encourage people to create better products and services that what they have available in their own countries.

Economists agree on the benefits of free trade

Who could possibly disagree with free trade? Well, many people on the left do. But economists across the spectrum of ideology (university and private sector and public sector) agree on the benefits of free trade.

Harvard economist Greg Mankiw explains what most professional economists agree on.

Excerpt:

Here is the list, together with the percentage of economists who agree:

  1. A ceiling on rents reduces the quantity and quality of housing available. (93%)
  2. Tariffs and import quotas usually reduce general economic welfare. (93%)
  3. Flexible and floating exchange rates offer an effective international monetary arrangement. (90%)
  4. Fiscal policy (e.g., tax cut and/or government expenditure increase) has a significant stimulative impact on a less than fully employed economy. (90%)
  5. The United States should not restrict employers from outsourcing work to foreign countries. (90%)
  6. The United States should eliminate agricultural subsidies. (85%)
  7. Local and state governments should eliminate subsidies to professional sports franchises. (85%)
  8. If the federal budget is to be balanced, it should be done over the business cycle rather than yearly. (85%)
  9. The gap between Social Security funds and expenditures will become unsustainably large within the next fifty years if current policies remain unchanged. (85%)
  10. Cash payments increase the welfare of recipients to a greater degree than do transfers-in-kind of equal cash value. (84%)
  11. A large federal budget deficit has an adverse effect on the economy. (83%)
  12. A minimum wage increases unemployment among young and unskilled workers. (79%)
  13. The government should restructure the welfare system along the lines of a “negative income tax.” (79%)
  14. Effluent taxes and marketable pollution permits represent a better approach to pollution control than imposition of pollution ceilings. (78%)

Socialist economic policies don’t work because they are making policies that are based on economic myths. We know that these myths are myths because of economics is a mathematical science, and because we have tried good and bad policies in different times and places. We have calculations and we have experience to know what works and what doesn’t work. If you want to help the poor, you have to respect what economists know about how wealth is created. The solution is not to “spread the wealth around”, it’s to encourage people to create more wealth by inventing things that people freely choose to buy.

If you made it this far, I have a fabulous parody video about the perils of tariffs and the benefits of free trade, made by Remy. He’s a libertarian, but that just means we don’t listen to him about foreign policy and morality. Only fiscal policy.

Starbucks barista alleges she was fired for not wearing company “Pride” t-shirt

Daily Caller:

A former Starbucks barista alleged that she was fired for her unwillingness to wear a company “Pride” t-shirt for religious reasons, according to a federal lawsuit.

Betsy Fresse was allegedly fired from the Glen Ridge, New Jersey Starbucks in August 2019 after she had inquired about “Pride” shirts that were in the store manager’s office in June 2019, according to the lawsuit filed on Nov. 19. The lawsuit noted that Fresse is a practicing Christian who believes marriage is between a man and woman and didn’t want to wear a shirt that violated those religious convictions.

“The law mandates that every person be free from discrimination based on their sincerely held religious beliefs including in the workplace,” Fresse’s lawyer, Demetrios K. Stratis, told The Daily Caller News Foundation in a statement. “Here, Starbucks failed to comply with the law, and terminated my client because she would not betray her faith, a faith which defines who she is as a person.”

“That is actionable and wrong and Starbucks must be held accountable,” he continued.

After Fresse inquired about the shirts and before she was terminated, she received a call from Starbucks’s Ethics and Compliance Helpline, according to the lawsuit. The company representative specifically asked Fresse why she didn’t want to wear the “Pride” shirt.

She explained that it was because her “religious beliefs prevented her from doing so,” the lawsuit stated.

On Aug. 22, 2019, she received a notice of separation informing her that she had been fired. The notice explained that she was fired for “acting in violation of Starbuck’s Core Values.”

[…]The lawsuit also said that Fresse “holds no enmity toward individuals who ascribe to the LGBTQ lifestyle and/or make up the LGBTQ community.”

A friend of mine who works for a Christian company gave me a $25 gift card from Starbucks last year. I never used it. I simply won’t do business with this company. They’re secular left fascists, and they don’t respect American values like free speech and religious liberty. I take stewardship of my money very seriously.

Facebook “fact-checker” Politifact forced to retract “false” rating against Candace Owens

Why do people think that CNN are biased leftist clowns?
Why do people think that CNN are biased leftist clowns?

I think that it’s safe to assume that every single “fact check” written by Facebook partners is false news, written by partisan Democrat journalists. Enough of them are false that this should be the starting assumption. This time, Politifact got caught giving a false rating of a conservative, and had to retract it.

Daily Wire:

Conservative author and commentator Candace Owens challenged left-leaning fact-checking site PolitiFact, a partner with Facebook, over a “false” rating — and won.

Not only did PolitiFact remove their “false” rating and retract an article on why Owens’ video was allegedly false, but the site offered an added “correction” admitting their fault.

Owens’ video, which was posted on Nov. 12, offered commentary on the 2020 presidential election, and was captioned, “Joe Biden is literally and legally not the President-elect. So why is the media pretending he is?”

The video was hit with a “false” rating, and, as noted by Owens, theoretically, every single person who shared the post was alerted by Facebook that they had shared “false” content.

“Weeks ago, [Facebook] censored a post of mine which truthfully stated that [Joe Biden] is NOT the President-elect. So I got lawyers involved,” she said Saturday via Twitter. “Conclusion? [PolitiFact] uncensored the post & admitted that they LIED by rating my post false. The fact-checkers are lying for Democrats.”

“At 8 Months pregnant, I unfortunately cannot fight on the ground alongside patriots like I am used to, but I am taking every measure to fight these communists in the court room,” Owens said in a follow-up post. “It is my goal to expose these lying ‘fact-checkers’ one by one. [Joe Biden] is NOT the President-elect.”

The BLEXIT founder told The Daily Wire on Saturday that she reached out to PolitiFact on Nov. 20 with legal representation and immediately heard back, with PolitiFact admitting their error.

Owens said she was not further briefed on the supposed “error” and that she felt the retraction wasn’t enough; she wanted PolitiFact to admit publicly that they falsely fact-checked her.

“I wanted to show that these fact-checkers just lie, and they usually go unchecked because most people don’t have the money, don’t have the time, and don’t have the platform to go after them — and I have all three,” she said.

With pressure from Owens’ legal representation, PolitiFact issued the correction, which she shared with the public on Saturday. That was a win. And another “major win,” she said, was PolitiFact essentially admitting “that Joe Biden is not the President-elect.”

Owens, who’s currently suing fact-checkers from USAToday and Lead Stories, explained to The Daily Wire that she knew she had to reach out with legal representation if she wanted to get results with this latest false fact-check. She said that in her experience, when she’s tried to appeal fact-checks through the system, she’s been stonewalled.

“These people are sitting back thinking they’re the gods of tech; opinion-checkers, they’re censorship lords,” the conservative said.

I wrote about Politifact’s record of “fact-checking” here.

I’d like to see these fake-news “fact-checkers” sued until they have nothing to eat but grass and leaves. They’re lying secular left fascist scum. We should go after them for the good of free speech and the Republic. They don’t belong in America, they’d fit in better in North Korea. They are anti-American and anti-human-rights.

Republicans did extremely well in House of Representatives and state legislatures

It's not over till the Supreme Court lady rules
It’s not over till the Supreme Court lady rules

Some good news from The Federalist.

In all the excitement among objective journalists for Joe Biden’s declared victory, reporters are missing how extraordinary the Democrat’s performance was in the 2020 election. It’s not just that the former vice president is on track to become the oldest president in American history, it’s what he managed to accomplish at the polls this year.

Candidate Joe Biden was so effective at animating voters in 2020 that he received a record number of votes, more than 15 million more than Barack Obama received in his re-election of 2012. Amazingly, he managed to secure victory while also losing in almost every bellwether county across the country. No presidential candidate has been capable of such electoral jujitsu until now.

While Biden underperformed Hillary Clinton’s 2016 totals in every urban county in the United States, he outperformed her in the metropolitan areas of Georgia, Michigan, Wisconsin, and Pennsylvania. Even more surprising, the former VP put up a record haul of votes, despite Democrats’ general failures in local House and state legislative seats across the nation.

He accomplished all this after receiving a record low share of the primary vote compared to his Republican opponent heading into the general election. Clearly, these are tremendous and unexpected achievements that would normally receive sophisticated analysis from the journalist class but have somehow gone mostly unmentioned during the celebrations at news studios in New York City and Washington, D.C.

The massive national political realignment now taking place may be one source of these surprising upsets. Yet still, to have pulled so many rabbits out of his hat like this, nobody can deny that Biden is a first-rate campaigner and politician, the likes of which America has never before seen. Let’s break down just how unique his political voodoo has been in 2020.

I sense that he is being sarcastic.

More:

Biden is on his way to winning the White House after having lost almost every historic bellwether county across the country. The Wall Street Journal and The Epoch Times independently analyzed the results of 19 counties around the United States that have nearly perfect presidential voting records over the last 40 years. President Trump won every single bellwether county, except Clallam County in Washington.

Whereas the former VP picked up Clallam by about three points, President Trump’s margin of victory in the other 18 counties averaged over 16 points. In a larger list of 58 bellwether counties that have correctly picked the president since 2000, Trump won 51 of them by an average of 15 points, while the other seven went to Biden by around four points. Bellwether counties overwhelmingly chose President Trump, but Biden found a path to victory anyway.

And more:

In 2020, The Cook Political Report and The New York Times rated 27 House seats as toss-ups going into Election Day. Right now, Republicans appear to have won all 27. Democrats failed to flip a single state house chamber, while Republicans flipped both the House and Senate in New Hampshire and expanded their dominance of state legislatures across the country.

Fakebook introduces new algorithm to promote far-left news sources

Fakebook, Google, Youtube, Twitter purging conservative speech (Source: The Stream)
Fakebook, Google, Youtube, Twitter purging conservative speech (Source: The Stream)

The Federalist:

Fakebook purposefully throttled specific news outlets after the election, limiting the distribution of posts from certain pages and accounts under the guise of combating “false and misleading claims” about election results and fraud. The New York Times reported the censorship increase Tuesday.

The New York Times reported the big tech company relies on a “secret internal ranking system” called news ecosystem quality scores (N.E.Q.) to determine which journalism the company will allow to circulate on the platform. Fakebook CEO Mark Yuckerberg reportedly expanded the N.E.Q.’s algorithm presence following the election to “make sure authoritative news appeared more prominently.”

Sources such as CNN, The New York Times, NPR, and others benefitted from Yuckerberg’s changes, receiving more traffic and distribution on the site while others lost page views and reach. Fakebook’s chief product officer Chris Cox bragged about the company’s decisions and reportedly said he was “proud of how the company had applied labels to election-related misinformation, pointing users to authoritative information about the results.”