Tag Archives: Economics

News

MUST-HEAR: Jennifer Roback Morse on contraceptives, divorce, cohabitation, SSM and ART

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Dr. Jennifer Roback Morse
Dr. Jennifer Roback Morse

I often tease women for being too focused on happiness and feelings, but Dr. J isn’t like that at all. She is all about economics, incentives, and moral boundaries. She thinks about the big issues. She once chastised me in an e-mail for being too emotional. I think she has had it with the feelings-based arguments from the socially-liberal left.

This lecture does not repeat much from her previous lectures.

Anyway – DO NOT MISS THIS LECTURE!

The MP3 file is here. (93 minutes, 43.5 Mb)

Keep in mind that this speech was given to Wisconsin Catholic seminarians, so there is a lot of rah-rah Catholic stuff. I’m an evangelical Protestant, so I just smile when she talks about that. At least there was no Mary in it. Yay!

SUMMARY

Contraception:
– contraception does not reduce the abortion rate
– contraception is bad because it makes sex a recreational activity
– contraception fails, which leads to the need for abortion
– 80% of abortions are done on unmarried women
– teenagers do not think that contraceptives will FAIL for them
– they don’t understand that the probabilities is PER ACTION – more actions increases probability
– the more you rely on something that has a small chance of failure, the more chance you will get a failure
– more sex, means more chances for a person to get a failure
– older women are naturally less fertile, so they skew contraceptive effectiveness figures higher
– contraceptives are most likely to fail for the young, the poor and the unmarried
– contraception means that women cannot ask men to promise to marry them before sex
– the pressure for a man to marry if the woman gets pregnant is gone
– the presumption is that the woman will have an abortion
– women who want to get married are at a disadvantage to get male attention now
– because men will prefer women who are willing to have an abortion if they get pregnant
– when people argue for these social changes, they don’t accurately assess consequences
– they think that they can have the happiness-making freedom without damaging anything else
– they think that no incentives will be created so that others start to act differently
– example: no-fault divorce – there were terrible consequences that were minimized by the social engineers

Divorce:
– people who wanted this believed myths in order to get the happiness-making freedom for the adults
– they said that divorce would be less harmful for children than if the parents stayed together
– they argued for no-fault divorce because they wanted happiness and didn’t care about children
– in a low conflict marriage, it is better for children if the parents stay together
– in a high-conflict marriage, it is better for children to divorce
– but for high-conflict divorce, you could have gotten a divorce for cause
– what people pushing no-fault divorce really wanted was to divorce to pursue happiness elsewhere
– there is also a financial incentive to divorce for no reason – alimony, child support, property
– but divorce really disrupts the lives of the children
– the VAST MAJORITY of divorces are in low-conflict situations
– the social norm was that low-level conflict meant that you stayed married for the sake of the kids
– a pregnancy after a re-marriage is devastating to children of the first marriage
– not being able to have a normal relationship with both biological parents is devastating to children
– what often drives people into co-habitation is the fear of screwing up their own marriages
– pro-divorce people want women to re-marry afterwards to provide kids with a “father-figure”
– the presence of a stepfather increases bad behavior in the kids, as well as risk of abuse
– but actually, stepfathers spend little time with kids, and draws mother away from the kids
– biological fathers spend the most time with the children
– disciplining the children is more complex with a non-bio dad
– normally, dads wants the kids to behave, and moms want the children to be happy
– often, the woman will forbid the father from disciplining the children
– the father will just drop out of parenting completely when his authority is not respected

Co-habitation:
– social engineers understate the risks of co-habitation and overstate the risks of marriage
– but research shows that co-habitation makes no positive contribution to marriage
– feminists love to say that marriage is very risky, but without comparing it to alternatives
(feminists don’t like marriage because of the “unequal gender roles”)
– when compared with the alternatives, like co-habitation, marriage is better on every measure
– feminists say that married women do not report abuse in marriage, that’s why marriage LOOKS better
– but murders HAVE TO BE reported, and co-habitation results in NINE TIMES more murders than marriage
– children are killed FIFTY TIMES more with co-habitation with an unrelated adult than with 2 bio-parents
– the live-in boyfriend is the culprit in 85% of these cases

Same-sex marriage:
– alternatives to marriage change rules and incentives, it is NOT the same thing as marriage
– necessarily, one of the parents will not have a close relationship with one bio-parents
– social engineers say that mothers and fathers are interchangeable – but they are different
– SSM undermines the presumption of paternity, and substitutes state-ordered parenting
– the public purpose of marriage is to attach mothers to fathers, and parents to children
– SSM elevates private purposes for marriage over and above the public purpose of marriage
– SSM will lead to fathers being marginalized from the family
– the state will have to force people to equate SSM and natural marriage

Artificial reproductive technology:
– it is the next substitute for marriage
– highly educated career women do not have to prepare for a husband to get a baby
– her behavior through her life changes because she doesn’t have to care about marriage

News

Should government unions get inflated salaries and pensions during a recession?

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First, the raw facts from Fox News.

Excerpt:

The battle in Madison has become the epicenter of a national fight between newly empowered small-government conservatives and Democrats backed by government worker unions.

The grassroots political operation of President Obama, who on Wednesday denounced the austerity legislation as an “attack on unions,” has swung in behind the government workers. Organizing for America, the activist organizing wing of the Democratic National Committee is helping keep the pressure on Republican lawmakers who plan to pass the legislation today.

Members of the Service Employees International Union, the most influential union in national Democratic circles, have also joined the fray in support of the government workers. The SEIU is helping man an around-the-clock occupation of the central halls of the state capital.

Tea Party groups, meanwhile, have planned a counter demonstration for Saturday at the capitol in support of the measure, raising the prospect of a clash between the activist groups.

Thousands of union activists have tried to shut down the process at the statehouse, which swung to the GOP in the 2010 elections. The efforts to block access to the state Senate and disrupt debates have been described as “mostly peaceful,” though union groups have expanded their protests to the homes of individual lawmakers.

Nine protesters have been arrested so far for disorderly conduct.

The holdup in the vote is due to the fact that the Democratic members of the Senate are on the lam, denying Republicans a quorum and the chance to vote. The Democrats are holed up at a resort just across the Illinois border, putting them beyond the reach of Wisconsin law enforcement agencies that could otherwise compel at least one Democrat to appear in the Senate so a vote could take place.

So far, the hideout seems to be backfiring. Moderate Republicans who had been on the fence over the legislation are denouncing the shutdown as undemocratic.

The lower chamber of the legislature may take up the bill today if Senate Democrats remain in hiding.

The measure would increase the contributions of public employees to their own retirement and medical benefits. The plan, put forward by new Gov. Scott Walker, R-Wisc., would have public workers make equal contributions to their retirement funds (teachers currently contribute $1 for every $56.94 from the state) and increase workers’ share of health insurance premiums to 12.6 percent. Teachers in most districts currently pay less than 5 percent of their insurance costs. The national average for workers is 27 percent.

This is important because Ed Schultz and Rachel Maddow are lying about the facts. But what do you expect from MSNBC?

Here’s McCain’s latest from the American Spectator. (H/T Hyscience)

Excerpt:

Quin Hillyer’s observations about the Obama-led “thugocracy” illustrate the yawning chasm between the intimidation tactics of the Left and all the prattling about “civility” liberals dished out last month.

The still-greater chasm is the economic gap between the striking government employees and the taxpayers who pay their salaries. Stephen Hayes of the Weekly Standard points out that the average teacher in Wisconsin receives $77,857 in total compensation, when the value of their generous benefit package is added to their salaries. Given that the median household income in Wisconsin is just above $50,000 (and the typical household has more than one wage-earner), this means that the striking teachers are earning substantially more than the people whose taxes pay their salaries. Furthermore, the basic bone of contention between them and Gov. Walker is his plan to make them contribute a larger share toward their pension and health benefits.

Michelle Malkin has more eye-opening facts about the economic realities of the Wisconsin strike. It is obvious that if voters and taxpayers pay attention to the facts, Walker wins and the strikers lose, as I said this morning:

The unemployed, the under-employed and regular folks trying to pay their bills aren’t likely to have a lot of love for people who (a) have jobs, (b) work at taxapayer expense, (c) get paid more money than the average taxpayer, and (d) go on strike because they don’t want to pay a dime toward their own generous benefits.

The thuggish behavior of the left-wing unions, supported by Barack Obama, has even radical leftists from Time and the Washington Post crying foul.

Larry Kudlow of CNBC has more.

Excerpt:

Wisconsin parents should go on strike against the teachers’ union. A friend e-mailed me to say that the graduation rate in Milwaukee public schools is 46 percent. The graduation rate for African-Americans in Milwaukee public schools is 34 percent. Shouldn’t somebody be protesting that?

Governor Walker is facing a $3.6 billion budget deficit, and he wants state workers to pay one-half of their pension costs and 12.6 percent of their health benefits. Currently, most state employees pay nothing for their pensions and virtually nothing for their health insurance. That’s an outrage.

Nationwide, state and local government unions have a 45 percent total-compensation advantage over their private-sector counterpart. With high-pay compensation and virtually no benefits co-pay, the politically arrogant unions are bankrupting America — which by some estimates is suffering from $3 trillion in unfunded liabilities.

Exempting police, fire, and state troopers, Governor Walker would end collective bargaining over pensions and benefits for the rest. Collective bargaining for wages would still be permitted, but there would be no wage hikes above the CPI. Unions could still represent workers, but they could not force employees to pay dues. In exchange for this, Walker promises no furloughs for layoffs.

Indiana Gov. Mitch Daniels is also pushing a bill to limit the collective-bargaining rights of teachers for wages and wage-related benefits. Similar proposals are being discussed in Idaho and Tennessee. In Ohio, Gov. John Kasich wants to restrict union rights across-the-board for all state and local government workers. More generally, both Democratic and Republican governors across the country are taking on the extravagant pay of government unions.

Why? Because taxpayers won’t stand for it anymore.

Neil Simpson comments:

Let me get this straight: Union-loving Dems shirk their duties and leave the state?  And what, exactly, is bad about that? (That’s horrible behavior on their part of course, but if they leave and don’t come back that would be swell.)

Unemployment is stuck at 10% — which means non-union unemployment is much higher — and they think this will improve their reputations?

Poorly performing teachers close at least 15 school districts to go fight for their entitlements?  Yeah, that’ll garner a lot of sympathy.

I have been super busy at work and working weekends, so I haven’t been covering this story as much as I should be. But like Neil, I am extremely excited about this. I picked two winning issues for the GOP in 2012: School choice reform and de-funding abortion. Those are two issues that fiscal conservatives and social conservatives agree on. I’d like to now add two more issues to the list: a federal right-to-work law (can work without having to join a union) for ALL employees – public and private, and reforming public sector pensions to be in line with private sector pensions.

We have to go after Democrat special interest groups hard and stop them for collecting all of this private sector taxpayer money. Social conservatives should support this because unions are notoriously pro-abortion and anti-marriage. We need to stop giving them taxpayer money to fund their left-wing political activism.

News

Why are Egyptians wealthier in America than they are in Egypt?

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Walter Williams
Walter Williams

This is from Walter Williams, my second most favorite economist after Thomas Sowell.

Excerpt:

Why is it that Egyptians do well in the U.S. but not Egypt? We could make that same observation and pose that same question about Nigerians, Cambodians, Jamaicans and others of the underdeveloped world who migrate to the U.S. Until recently, we could make the same observation about Indians in India, and the Chinese citizens of the People’s Republic of China, but not Chinese citizens of Hong Kong and Taiwan.

[…]Much of Egypt’s economic problems are directly related to government interference and control that have resulted in weak institutions vital to prosperity. Hernando De Soto, president of Peru’s Institute for Liberty and Democracy (www.ild.org.pe), laid out much of Egypt’s problem in his Wall Street Journal article (Feb. 3, 2011), “Egypt’s Economic Apartheid.” More than 90 percent of Egyptians hold their property without legal title.

De Soto says, “Without clear legal title to their assets and real estate, in short, these entrepreneurs own what I have called ‘dead capital’ — property that cannot be leveraged as collateral for loans, to obtain investment capital, or as security for long-term contractual deals. And so the majority of these Egyptian enterprises remain small and relatively poor.”

Egypt’s legal private sector employs 6.8 million people and the public sector 5.9 million. More than 9 million people work in the extralegal sector, making Egypt’s underground economy the nation’s biggest employer.

Why are so many Egyptians in the underground economy? De Soto, who’s done extensive study of hampered entrepreneurship, gives a typical example: “To open a small bakery, our investigators found, would take more than 500 days. To get legal title to a vacant piece of land would take more than 10 years of dealing with red tape. To do business in Egypt, an aspiring poor entrepreneur would have to deal with 56 government agencies and repetitive government inspections.”

Poverty in Egypt, or anywhere else, is not very difficult to explain. There are three basic causes: People are poor because they cannot produce anything highly valued by others. They can produce things highly valued by others but are hampered or prevented from doing so. Or, they volunteer to be poor.

Some people use the excuse of colonialism to explain Third World poverty, but that’s nonsense. Some the world’s richest countries are former colonies: United States, Canada, Australia, New Zealand and Hong Kong. Some of the world’s poorest countries were never colonies, at least for not long, such as Ethiopia, Liberia, Tibet and Nepal. Pointing to the U.S., some say that it’s bountiful natural resources that explain wealth. Again nonsense. The two natural resources richest continents, Africa and South America, are home to the world’s most miserably poor. Hong Kong, Great Britain and Japan, poor in natural resources, are among the world’s richest nations.

What is necessary for wealth is a capitalist economy, that emphasizes the rule of law, private property, judicial restraint, limited government, etc. Egypt has none of those, and that’s why Egypt is poor. India and Chile used to be like Egypt, but then they revamped their societies to be more like America. Now India and Chile are more prosperous. Economics is not rocket science.

Capitalism creates wealth, and raises the standard of living of the poor and the wealthy. It doesn’t matter what rung of the social ladder someone is on – as long as they can keep what they earn, instead of having it redistributed by socialists, then they will work hard to create something of value to share with others. Poverty is caused by economic ignorance.

More Walter Williams stuff here, and more Thomas Sowell stuff here. These are the clearest-thinking economists operating today.