The Gouge on Price Gouging

By Mike Cronin

In military slang, the word gouge can mean information or intelligence. For example: One person tells another a trick or hack for getting a task done quicker. The second person might say “thanks for the gouge.”

On the other hand, people are very much not thankful for what they perceive to be the price gouging happening in Houston and the rest of the Hurricane Harvey impact zone.  Loosely defined, price gouging is when a vendor radically raises their prices, as often occurs in and near disaster zones. Potential customers believe such vendors to be vultures, capitalizing on the misery of others.

But is that what is really going on?

In a recent Facebook post, A group called  “Educate the People” shared pictures of a convenience store billboard showing gas prices over $8.00 per gallon, and a case of bottled water going for nearly $45.00.  The caption beloe the pictures read “Heartless Capitalist Texas Store Owners.”

“Educate the Public” indeed! It’s not heartless. If millions of people are trying to “get out of Dodge,”(or stockpile at the last minute) because a disaster is imminent or in-progress, then supply trucks aren’t going into Dodge. When that happens, the things we normally take for granted are suddenly in much more demand, soon to be much scarcer, and thus suddenly much more valuable. When the demand for something skyrockets, but the supply is shrinking, the price must skyrocket as well. It sucks if you want to buy the thing that has quadrupled in price (so you have some to spare), but if you genuinely need it for survival, there just might still be some available because the people who merely wanted it weren’t willing to fork over the cash. It may seem like the store owner is profiteering, but consider: The store is still open and doing business when everyone else is trying to flee or hole-up!

If the store owner left his prices at the normal level (or was forced by the government to do so), he’d be out of stock in hours – or even minutes, with no routine resupply on the calendar. What is he, or his customers most in need, to do then?

The purveyors of “Educate the Public” should consider taking some remedial economics lessons instead of pandering to a generation of Americans who are being taught that they are entitled to something just because they think they need it.

To save them some time, here are the applicable points:

Price, cost, and value are not the same thing; however, in a functional system of mutual trade to mutual benefit, they are closely related. If the thing is becoming scarcer because the gap between supply and demand is increasing, the price will go up as a message to the consumer that the scarcity of the thing has increased.

When some force, usually in the form of government, compels a vendor to ration items, or to limit prices, the system is no longer about mutual exchange to mutual benefit. It has become dysfunctional, shredding the relationship between price, cost, and value. The price of an item no longer communicates the scarcity to the consumer. This increases the risk that hoarders and black-marketeers will buy up all the stock in a short amount of time, leaving the shelves bare, and leaving people in crisis with far fewer options. This will in turn lead to more desperation and lawlessness, not less.

In short: price gouging is not evil, though radically increased prices may shock and offend our sensibilities during a crisis, lulled as we are by generations of living in the stability of the largest economy in the world. On the other hand, anti-price gouging and rationing laws just might be evil, because they create more harm than they cure – by causing or exacerbating  shortages in the guise of mollifying the unthinking and easily offended.

BAD MEDICINE: A DEBATE ON QUORA

Mike Cronin (M.C.):

Yes:

  1. Everyone has the right to life, but not at the expense of other’s rights, such as their right to dispose of their time, skills, knowledge, and materials as they see fit.
  2. Socialized medicine, AKA “universal healthcare,” violates those rights by demanding that others must pay for my care (or vice versa), and it violates the rights of providers by coercing them to to give said care to me at government prescribed rates vice market rates, which means: at a loss.

The Same Old Arguments…

By Mike Cronin

I have been accused of being a conservative. I am not, though I could more easily ally with conservatives than with liberals, and I find conservatism less objectionable than liberalism.  Here is my take on the tenets of each movement.

Progressivism/Liberalism/Socialism: A corrupt philosophy that promises…what, exactly? A “more just, verdant, and peaceful world?”  Some of its key tenets:

Greedy politicians can protect us from “selfish” business people.

Wealth is not created by productive effort; it is magically distributed unfairly and must therefore be redistributed until it reaches some undisclosed ratio to be determined by the (greedy) politicians mentioned above. Similarly, outcomes are not the products of input, but of luck. In order to achieve equality, those with better luck (i.e. more wealth/higher income) must give to those with worse luck until parity is achieved.  The “fortunate” are to be penalized for productivity, while the “less fortunate” can, of course, be forgiven for certain criminal activities meant to register their displeasure or to make the transfer (as long as the greedy politicians gets their cut).

Group identity is more important than individual rights – so you can gain synthetic sympathy proportionate to the number aggrieved populations you can “identify” with. For example, if you’re merely female, or of a minority race, you are just a run-of-the-mill potential Progressive. On the other hand, can you identify as a minority, transgendered, homosexual, handicapped, low-income, single-parent, Muslim illegal-immigrant? Hallelujah! Mazel-tov! (But be careful – if you become too unique, then you’re an individual, a pity party of one, and therefore the enemy.)

Free speech only exists for the benefit of fellow Progressives – and includes the power to force everyone else to listen. Publicly-funded broadcast systems are built for this purpose.

The purpose of government is to shape society. The law must be interpreted to reflect the rule of the majority over the minority (especially the minority of one – the individual). To that end, public schooling exists to create a mass of people smart enough to operate machines, but not skilled enough in the arts of critical thinking to question their shepherds. School choice, charter schools, private schools, homeschooling, and merit-based teacher advancement threaten the agenda, so they are to be resisted. Since they do exist, we must spend more on public schools to counter their influence.

Reality is a collective illusion created in the minds of the masses, so morality is pliant and facts don’t matter.  We’ll fund science that promotes our agenda, and quash science that does not. If we all wish for and work towards the same Shangri-La hard enough, evil and inequality will go away!

In contrast…

Conservatism is a movement that seeks to preserve (or restore) what it perceives to be the founding principles of the country. To that end, the actions of the conservative movement suggest the following Conservative tenets:

Conservative politicians are “right,” all other politicians are evil.

Wealth is created by productive effort. The most productive among us are “blessed.”  The government will help them “give back.”

Individual rights are more important than group identity…unless we are talking about the right to do something immoral, like using illegal intoxicants or engaging in prostitution.

Some free speech that opposes conservative values can be tolerated, but only late at night, or behind a pay-wall, or in a walled-off part of the store, or in special zoning areas…while some publicly-funded places, such as schools and courthouses, are legitimate venues to promote Judeo-Christian values.

That the purpose of government is to shape society, and the law should promote Judeo-Christian morality, not just protect individual rights. To that end, schools must be allowed to promote religious concepts.

Reality was made by God, and the Lord works in mysterious ways. Science is the realm of Progressives/Liberals/Socialists – our political enemies, so it often contradicts Biblical truth and is mostly to be discounted…unless it can be used to refute our leftist colleagues.

My World View, Pt. 1

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By Mike Cronin

Every so often it helps to re-examine one’s goals and purposes.  My goal and purpose for this blog is to help others learn to look at the world through the lenses of reason and liberty.  Sometimes that means offering dry descriptions of how things are vs how they ought to be, other times it means promoting an independent viewpoint on a hot-button political issue. No doubt I have appeared to be a right-wing radical to someone on the left, while I might seem to be a leftist to the right-winger. To others, it might seem like I’m simply sitting on the fence and refusing to take sides.

I have never claimed to be unbiased.  In fact, I have described my bias on more than one occasion, but I haven’t ever really described my full worldview.  I thought I might do so now:

It starts with reality. As Ayn Rand said: “Existence exists, and only existence exists.”  Carl Sagan said that the cosmos is “all that is, all that was, and all there ever will be.”  The evidence that existence exists is axiomatic:  If it did not exist, there would be no one to ponder its nature – there would be no nature.

Speaking of nature: Humans are part of nature. Everything humans have ever made, from bone tools and mud huts to spaceships and iPhones, and every action humans have ever taken, from procreating to mass destruction, is ipso-facto natural. That is not to say it is good or bad.

Evil exists.  There are good people and bad. Context matters: good people are sometimes capable of bad things, and evil people may sometimes perform a benevolent act.  Hitler might have treated a pet well, for instance…but that cannot begin to atone for the fact that he inspired and led the industrialized murder of millions. Because Hitler was human, his actions were natural…but because he failed to credit whole segments of humans with having any humanity, he dehumanized himself. He became a monster of natural, not supernatural origin.

Nor was he the only one. Stalin. Pol Pot. Mao Tse-tung. Saddam Hussein. Every era of history has its brutal dictators and ruthless rulers who don’t hesitate to bathe in the blood of millions.  The rational failing of all of these monsters is their inability or refusal to recognize the worth of other humans as humans, or to even recognize other individuals as human at all.  They have actualized the ultimate expression of collectivism: the subsuming of the individual human being into a collective. Collectives that can be branded sub-human and disposed of at whim.

Humans have been ruled by such men as could take control of the levers of power since we were clans of hunter-gatherers.  Every so often, a breakthrough would occur and the building blocks of civilization were laid, even if technology advanced at much more stately pace. The Mesopotamians or other earliest civilizations gave us agriculture and the division of labor.  The Egyptians gave us paper and the concept of a massive library to store the sum of human knowledge.  The Greeks gave us the concepts of reasoned philosophical debate, and democratic and republican forms of government, and more.  The Arabs gave us Algebra, the concept of zero, and names for many stars we see in the night sky. The Persians or their predecessors gave us Indo-European languages, the wheel, chess (probably by way of India), and more. Largely unbeknownst to the west, the Chinese developed many of these same foundations earlier, or at roughly the same time, as their Western counterparts.

All throughout history, threads bind early developments to later ones.  The Greek concepts of democracy and republicanism found a circuitous path that eventually led to the founding fathers and the Declaration of Independence, the Constitution, and the Bill of Rights…and the United States of America. An imperfect country, established with imperfect, yet eloquent documents, written by imperfect, yet remarkable men…the first country ever founded on the basis of an ideal: recognition of individual rights, liberty, and the rule of law, protected by a government chartered for that sole purpose. Imperfect though it is, via the combination of the freest form of government, ample natural resources, and the best geographical location, the US rose to become the most dominant economic and military power in the world, and to raise the standard of living for more people than any other nation, empire, or civilization in human history. That much power attracts pathological personalities –both to wield it, and to destroy it.  Thus it became inevitable that the US would make enemies. No matter how benevolent the US might be or might have been, our very existence as de-facto world hegemon is a threat to those who aspire to great power, such as Hussein or Osama bin Laden. To wit: something like 9/11 was inevitable.

As beautiful as the founders’ vision of the US was, the implementation of their vision was flawed from the start by four major areas of dysfunction, which I examined in five posts in 2014.

Slavery was chief among those, as it was incompatible with the spirit of the Charters of Freedom.  Our earliest Congress partook of the same sin as Hitler, if perhaps to a slightly lesser degree and without the nationalistic zeal: they justified slavery by willfully neglecting to grant the status of “human being” to slaves. It took nearly 3/4 of a century from the founding to end slavery, and nearly 200 years to reverse most of the direct damage of that failure. We are still dealing with the indirect damage to this day.

This is not to say that things can be put right by going the other direction. Dehumanizing and hating whites, especially white, middle class males, cannot free the long-dead slaves of times past, nor can it improve the lot of the descendants of slaves living today. Holding inter-generational grudges leads to incessant conflict – such as that between the Israelis and Palestinians, which is but a proxy for the much older conflict between Arabs and Jews.

How can we overcome the pain of the past without inflicting all new pains now and in the future?  More on that next week.

Another Crack at Illegal Immigration

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Mike Cronin

This is a revision of my post dated November 23, 2014.

President Trump has partially fulfilled one of his most controversial campaign promises.  Earlier this week, he signed an executive order to build a wall along the Mexican border, and his administration floated the idea of a 20% tax on Mexican imports to pay for the construction.  The mainstream media is predictably up in arms.

While I am encouraged by Mr. Trump’s attention to the illegal immigration issue, I find myself in disagreement that a wall is the right solution – but not for the same reasons as the crowds of critics assailing the president.  I’ll explain in a bit, but let’s untangle the knot a little first:

If you are an elected Democrat, the illegal immigration “problem” is: how to make it legal for illegal immigrants to vote? There are millions potential voters out there who cannot legally participate in national elections. How to solve that problem? Adopt narratives that simultaneously paint the illegal immigrants as victims who need rescuing and those who see things differently as racists. Then legalize the immigrants (or some portion of them) somehow, and/or prevent the passing of laws that require voters to produce a photo ID proving their eligibility.

If you are in one camp of elected Republicans, the illegal immigration problem is that there are millions of potential Democratic voters out there who might vote illegally or who might become legal voters at the stroke of a pen. How to solve that problem? Adopt narratives that illegal immigrants are by definition criminals just for being here, and who steal jobs from American citizens, who vote illegally, and who cost us a lot of money in “stolen” benefits and entitlements.

If you are in another camp of Republican lawmakers, the problem of illegal immigration is that you are fearful of alienating constituents of Latino or Hispanic origin, so you go along with Democrats on immigration issues.

If you are in yet a third camp of elected Republicans, the illegal immigration problem is that you receive significant campaign funds from donors who employ illegal immigrants, so you also tend to vote along Democratic lines on immigration.

If you run a manual-labor intensive business that can’t afford to pay the minimum wage, paying an illegal immigrant in cash under the table is an attractive option.

If you are a desperate person from Mexico or an impoverished country to our south, getting to America for the opportunities and freebies is an attractive option.

If you are a cunning and morally flexible person, exploiting the stream of immigrants headed north is an attractive option.

I believe the real problem with illegal immigration is: too much government.  Here’s what I mean:

  1. Our federal and state governments blatantly disregard current immigration law via policies like “Catch and Release,” “sanctuary cities,” and the “Deferred Action for Childhood Arrivals” directive (i.e. President Obama’s executive order that established the so-called “Dreamers”). Our federal government maintains at least two federal police agencies (Immigration and Customs Enforcement and Customs and Border Patrol) charged with enforcing those same laws. In so doing, our lawmakers are essentially telling our protectors: “Your written job description says ‘enforce the law,’ but your real job is just to have a job so that I can tell voters I did my job by creating your job.” How dysfunctional is that?
  2. In addition, our current immigration law is too byzantine and restrictive. Currently, it’s fairly easy to visit the US, but unless one can claim to be one of the “Three R’s” (Related to a citizen, Rich, or Remarkable), it is extremely difficult to attain a green card or citizenship.

I think Mr. Trump’s actions show promise for resolving the dysfunctional aspect of immigration enforcement, but a wall is too dystopian, sinister, and unnecessary. Functional enforcement policies and increased presence all along the border will reduce the flood of illegal immigrants to a trickle. On the other hand, the bureaucratic burden to those aspiring to remain here longer than a visa allows still remains to be addressed.

So how do we solve such a multi-faceted problem?  With a multi-pronged strategy that is consistent with limited government:

  1. Enforce existing law
  2. Control the border via increased presence
  3. Update the law to minimize bureaucracy and maximize freedom – by addressing all of the competing interests and reducing or eliminating the motivations that lure our government into violating its own laws:
    • Make it much easier to become a legal “permanent resident” and moderately easier to become a citizen. This benefits immigrants wishing to live and work here permanently, and it would benefit lawmakers in both parties who represent immigrant constituencies.
    • Create a migrant worker visa AND migrant worker wage scale & tax status. This legitimizes hiring migrant workers and paying them less-than-minimum wages. This would benefit migrant workers by making it legal (and safer) to do what they are already doing, and it would benefit industries that can’t be profitable paying the regular minimum wage to unskilled workers. It will be perceived and promoted as a threat to citizen minimum-wage earners…but that is another Gordian knot – which I addressed here.

“…A lot of Dumb Things.”

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By Mike Cronin

The latest kerfuffle in the culture wars has put Dirty Harry in the camp of Donald Trump.  In the latest issue of Esquire magazine and in other recent comments, actor Clint Eastwood laments political correctness and the attention given to some of Mr. Trump’s brasher statements.  (He did not officially endorse Trump.)

One need not support Mr. Trump, (or any other candidate) to find political correctness troubling.  The First Amendment to the Constitution charges the government to protect our right to speak freely. This is an intolerable condition to control freaks who just know that their ways and opinions are right and everybody’s lives would be better if we just obeyed them. Political correctness seeks to accomplish by peer pressure and social sanctions what cannot be legally done by government: the limiting of personal expression.

Last week’s post was bout the spotty availability of formal training in logic and critical thinking in America’s educational institutions.   The purposeful omission of such fundamentals from curricula smacks of an elite trying to restrict entry to their ranks.  Now add political correctness to the mix.

According to Merriam-Webster online, political correctness is “conforming to a belief that language and practices which could offend political sensibilities (as in matters of sex or race) should be eliminated.”

Bottom line: giving offense should be eliminated.  We can’t have dissent. Do not speak freely. Protect everyone else’s feeling, but don’t have any non-conforming thoughts of your own.

Don’t look at the value of the dollar.  Don’t examine public education.  Don’t question the dysfunction of maintaining an immigration enforcement enterprise while rewarding illegal immigration. Don’t peer into the doings of your city, county, state, or federal government. Don’t read the Declaration of Independence, the Constitution, or the Bill of Rights. Don’t ask probing questions.

Do not give offense. Don’t see the hypocrisy and irony of being offensive in the name of eliminating offensiveness, being racist in the name of eliminating racism, and churning out myriad petty laws in the name of reducing crime.

Do not think for yourself. Don’t find the insanity in trying to stimulate the economy by taxing real wealth out of it then pumping funny money back in. Don’t be self-reliant; rely on your elected rulers to use the power of government to steal from your more productive friends and neighbors and give some of the loot back to you.

Go with the crowd. Run the machines. Consume. Watch the latest reality show/sitcom/talent contest/news crisis on cable/satellite/internet.  Go find some Poke-mon.

The Battle Begins. How Will you Fare?

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By Mike Cronin

Barring a “black swan” event, the race for president is down to Trump vs. Clinton.  Who will you vote for, and why?  Will you even vote?  Will your vote matter?

There are so many marginal factors that can shape an election, but there are some basic election fundamentals that seldom get explained.

First: From 1932 to 2012, the average voter turnout has never been higher than 63% or less than 49%.  That means on average only a little over half of the eligible population votes in any given presidential election.  Of the half that votes, roughly 32% are dyed-in-the-wool liberal Democrats and will always vote for the Democrat candidate.  Roughly another 22% of the half that votes is comprised of hard-core conservative Republicans who will always vote for the Republican candidate.  These groups are the “base” for a given candidate/party.  Once you exclude the 54% of voters that are going to automatically vote D or R in any given election, the real battle takes place over the remaining half of the half of Americans who are going to vote. Expressed another way: Presidential elections hinge on the lever pulls of slightly less than 25% of the adult population!

It gets better.  Where those 25% reside is crucial.  If a majority of them reside in states that are overwhelmingly likely to vote a certain way, their votes aren’t going to mean very much.  Conversely, if the bulk of those independent voters reside in states that could go either way (the so-called battleground states), their votes could wield enormous influence!

Are you one of the independents or third party members who vote but don’t blindly punch holes for any party’s candidate (or against the other party’s!)?  Where do you live?  Will your vote count?

If you are, how will you make your decision? Party loyalty isn’t your thing, so what does it for you?  Unfortunately, some will waste their votes on frivolous criteria such as the looks, race, or gender of the candidate, or on candidate’s oratorical prowess.

To do justice to our system and not waste my vote, I’ve developed a small list of criteria that I can rate each candidate against using a survey technique called a Likert scale.  Here it is:

Rate each candidate on how you believe they would:

Honor the Oath of Office and abide by the Constitution & the laws of the land Fail Marginal Mediocre Good Exemplary
Appoint Supreme Court Justices that will uphold the Constitution Fail Marginal Mediocre Good Exemplary
Command the armed forces and employ military force only to counter serious threats to the United States Fail Marginal Mediocre Good Exemplary
Act with integrity & honesty, and demonstrate character Fail Marginal Mediocre Good Exemplary
Govern transparently Fail Marginal Mediocre Good Exemplary
Reduce dysfunction and corruption in the Executive Branch Fail Marginal Mediocre Good Exemplary
Work to reign in government spending, promote capitalism and demonize socialism Fail Marginal Mediocre Good Exemplary
Work to audit, and possibly end, the Federal Reserve Fail Marginal Mediocre Good Exemplary
Work to end, or at least lessen and simplify, the income tax Fail Marginal Mediocre Good Exemplary
Overhaul the immigration system to allow maximum freedom to enter and remain in the country  consistent with preventing criminals, terrorists, and other bad actors in and without yielding an automatic electoral advantage to any party Fail Marginal Mediocre Good Exemplary

Obviously, you might prefer different criteria than what I’ve settled on, but whatever thoughtful criteria you select can still work.  Once you establish your criteria and rate each candidate, score them thus: 1 point for each Fail, 2 points for each Marginal, 3 points for each Mediocre, 4 points for each Good, and 5 points for each Exemplary. Total up the scores and vote for the candidate that earns the highest marks.

Still, there is at least one other major contextual factor that is seldom examined during presidential elections: Congress.  We can elect a president based on the most cogent criteria, but if he or she must deal with a Congress skewed to the opposing party, it is likely they will face high resistance to carrying out their plans or their mandate.  Even if he or she gets to work with a same-party Congress, your candidate could still find it hard to make headway if, like Donald Trump, they come from outside the beltway political establishment.

There is a simple (not easy!) fix to that: Help your presidential candidate get a sympathetic, same-party Congress to work with!