Obama continues U.S. trade war

According to the Financial Times:

The US will impose tough new duties on Chinese steel piping imports, raising tensions with its biggest trading partner and emerging geopolitical rival.

With Chinese piping imports worth $2.8bn in 2008, the case is the biggest against China brought before the International Trade Commission, a US trade body, but follows other US actions to counter a flood of goods that Washington claims China is exporting at below market prices.

Friction between the US and China has been building this year after disputes over tariffs on tyres, cars and chickens. China denounced a move by the US earlier this year to tax imports of Chinese car and light truck tyres as a “serious act of trade protectionism”.

Something is seriously wrong when China denounces protectionism and the U.S. defends it.

China kind of frightens me

Police officers stand alongside new cars provided by government to ensure public security over the new year holidays. (Photograph: Reuters)

The Unintended Consequences of ‘Green’ Traffic Lights

Oswego Police Dept./ April 6, 2009

Several U.S. cities have switched to LED traffic lights because they last longer, burn brighter and use 90 percent less energy than incandescent bulbs. Unfortunately, “green” traffic lights also emit less heat leaving them unable to melt snow, a serious problem across the Midwest.

In April, Lisa Richter was making a left turn on green in Oswego when she was struck by a vehicle traveling the opposite direction, killing her instantly.

Authorities say Richter, 34, might still be alive if not for an unintended consequence of green technology — the LED traffic signal facing the other driver was obscured by snow. Oswego police Detective Rob Sherwood called the snow-covered energy-efficient signal “a contributing factor” in the crash.

“If the light had not been covered, I personally feel the accident would have not occurred,” he said.

“Green” light manufactures have already said they could add “a heating element to LED signals,” but that would simply diminish the signals’ energy savings.

Who ever said China was communist?

From the Telegraph:

In another sign of Asia’s ascendancy, and of its growing economic and political union, duties will be dropped on everything from steel to rubber and shoes to electronics.

China hopes that the zone will quickly rival the European Economic Area and the North American Free Trade Area and provide new outlets for its goods in the face of Western protectionism.

Duties will be scrapped on 90pc of goods traded across China, Indonesia, Malaysia, Singapore, Thailand, Brunei and the Philippines. Over the next five years, tariffs will also be removed on trade in Cambodia, Laos, Vietnam and Burma.

Should We Israelify Airports?

The Toronto Star recently published a fascinating article on the ‘Israelification’ of airports (via Andrew Sullivan), referring of course to Israel’s infamous airport security methods. The article is defiantly worth reading.

“Do you know why Israelis are so calm? We have brutal terror attacks on our civilians and still, life in Israel is pretty good. The reason is that people trust their defence forces, their police, their response teams and the security agencies. They know they’re doing a good job. You can’t say the same thing about Americans and Canadians. They don’t trust anybody,” Sela said. “But they say, ‘So far, so good’. Then if something happens, all hell breaks loose and you’ve spent eight hours in an airport. Which is ridiculous. Not justifiable.

“But, what can you do? Americans and Canadians are nice people and they will do anything because they were told to do so and because they don’t know any different.”

Congressional Legislation: Number of Pages

From Carpe Diem:

Quote of the Day

“While it might surprise many ecologists to hear, capitalism is itself the ultimate form of conservationism. Capitalists seek to conserve resources, not because of sentimental feelings about nature or the earth or whales or worry about the well-being of future generations, but simply because every drop of oil, every ton of ore, every shipment of wood saved is a cost reduction and money in the pocket.”

~ Steven E. Plaut

Five Questions for a Keynesian

Steven Horwitz, the Charles A. Dana Professor of Economics at St. Lawrence University, has five questions for a Keynesian:

1. Why did Keynes think savings was bad if when people save through financial intermediaries they give control over resources to the banking system, which in turn will lend that out to firms to create capital and new jobs?

2. How does government spending create jobs and wealth if the resources that government spends must ultimately come from the private sector, through taxes or reduced borrowing due to government borrowing more (or inflation), and the private sector would have spent it either on consumption directly or on investment through savings anyway?

3. If one of the problems of the housing boom is that we put too many resources into housing and finance, how will a Keynesian government spending package know where that spending should have gone instead?

4. Keynes frequently wrote about the importance of the uncertainty of the future and the way that made things difficult for private investors and for the connection between savings and investment. Why doesn’t that same uncertainty prevent governments from knowing exactly how much and where they should be spending in a recession, especially because markets have prices and profits as signals to help entrepreneurs navigate that uncertainty while government bureaucrats do not have similar signals?

5. Given the enormous role that government interventions played in causing the current recession, from the expansionary policies of the Fed to GSEs like Fannie and Freddie, to misguided regulations in housing and banking, why should anyone believe that the same government actors will know how to solve it?

For the answers to these and other questions, be sure to read Professor Horwitz’s interview with Free Market Mojo.

A Positive Step for the Organ Trade

Allow me to begin this post by briefly defending its title. Upon considering the classification of organ transplants as a “trade” or business, most people would either argue that organs are not traded but rather donated, and/or that any organ trade that does exist is a black market activity. Both of these reactions would be groundless.

Organ transplanting is a business, and a lawful one at that. Unfortunately, the actors most essential to the organ trade (the individuals donating their organs) go unpaid. While the doctors, nurses, technicians, and administrative personnel are all compensated at market value – even though the demand for even the doctors is far below the demand for the actual organ donors. In addition, the recipients of the organs are, essentially, receiving life without having to fully compensate the responsible parties.

To be sure, I am not attacking organ recipients or the medical industry in general. But it is disgraceful that significant sums of money are changing hands without any going towards the most essential actors – the donors.

Recently, however, progress has been made in Israel. Ever the bastion of innovation, Israel has changed its law so that organ donors are now given priority should they require an organ transplant (HT Freakonomics). The change was brought on by the shortage of organ donors in Israel. Granted, the moral and practical answer to the shortage would be to allow individuals to sell their organs on an open market, but this change is at least a significant step in the right direction.

The arguments against the amendments to the law center around the “need” of individuals who are not organ donors. The question then arises of how one person’s need is translated into a moral obligation on the part of his fellow citizens. The answer is that, outside of any personal code of morality, a need on the part of one individual or group never creates a corresponding obligation on the part of another. No reasonable argument can be made for treating need as a virtue, and any government enforcement of that bankrupt morality is the equivalent of a state-imposed religion.

Not only is a legitimate organ trade morally permissible, but it should be encouraged. Organ donors essentially give the gift of life, and the fact that our society forbids compensation of that sacrifice is a travesty. Worse yet, prohibitions on organ trafficking infringe on individual freedom, with the effect of causing needless deaths of those who desperately need healthy organs.

Are Unions Good for the Economy?

Zogby Interactive recently asked likely voters across the U.S. if unions are good for the economy. 38% percent said “yes” while 49% said “no.” 13% were unsure.

This is not what interested me in this, of course Americans should be split on their opinions of unions.

Zogby broke down the respondents into subgroups, including those who “never shop at Wal-Mart,” are “NASCAR fans,” and who “consider themselves members of the investor class.”

Subgroup analysis shows that groups more likely to think that unions are good for the U.S. economy include liberals (76%), Democrats (68%), African Americans and Hispanics (65%), respondents who are union members or who have family members in a union (57%) and people who never shop at Wal-Mart (60%). Groups that are more likely to think that unions are not good for the economy include conservatives and libertarians (88%), Republicans (83%), people who shop at Wal-Mart at least once a week (69%), respondents who consider themselves members of the investor class (59%), NASCAR fans (61%) and born-again Christians (62%).