In today’s edition of The Heartland Daily Podcast, Managing Editor of Environment & Climate News H. Sterling Burnett speaks with Michi Iljazi. Iljazi is the communications and policy manager for the Taxpayers Protection Alliance. The Taxpayers Alliance has a subsidiary called SolarSecrets.org which is dedicated, in their words, to “shining a light on the darker side of solar power.”
Iljazi points out that the U.S. benefited immensely from the creativity, innovation and prosperity-generating power of the free enterprise system. Yet corporate welfare and corporate cronyism are eclipsing genuine capitalism and threatening innovation and prosperity — and the solar industry is right in the center of the corporate handouts. The Taxpayer Alliance’s new study, “A House of Cards: Solar Energy’s Subsidy-Based Business Model,” in particular shines light on how much the solar industry has received in subsidies over the past five years and how much money it is losing every year. In addition it exposes the sleazy business practices of one company in particular, SolarCity?
If you don’t visit Somewhat Reasonable and the Heartlander digital magazine every day, you’re missing out on some of the best news and commentary on liberty and free markets you can find. But worry not, freedom lovers! The Heartland Weekly Email is here for you everyFridaywith a highlight show.
Subscribe to the email today, and read this week’s edition below.Consumers Win as SC House Votes to Repeal Certificate of Need Regulations
In a victory for health care consumers, the South Carolina House of Representatives voted nearly unanimously to roll back certificate of need regulations limiting competition and choice in health care. READ MORE New NAEP Scores Show America’s Schools Still Failing
Heather Kays, The Heartlander
“It’s appalling that not even 30 percent of our nation’s 8th graders are proficient in subjects like civics and history that are so fundamental to our nation’s founding and democracy,” said Kara Kerwin. “If we don’t act now and take bold steps to empower parents and accelerate the pace at which they have access to opportunities that dramatically change their children’s learning outcomes, we will not be able to move our nation forward.” READ MORE From Rome: Heartland Brings Climate Realism to the Vatican
Jim Lakely and others
The Heartland Institute sent a delegation of scientists and policy experts to Rome to ensure Pope Francis and others attending a Vatican summit on global warming heard from climate realists and not just alarmists. To our surprise, our presence generated world-wide press attention. READ MORE Featured Podcast: From Rome: Podcast with Christopher Monckton
Jim Lakely talks to Monckton about what he learned inside the walls of the exclusive climate summit — including his encounter with United Nations Secretary-General Ban Ki-Moon; the shockingly one-sided presentation of the science to Vatican officials; and the remarks of Peter Raver, an author for the UN’s IPCC who not only noticed Heartland’s presence in Rome but expressed his dismay that our contingent might have any effect on the proceedings. LISTEN TO MORE Heartland Is Hiring!
Do you believe in smaller government and more individual liberty? Do you believe free markets solve social and economic problems better than government planning? The Heartland Institute might have just the job for you! We’re looking for eager self-starters to manage several important projects that will have a real impact on policy in this country. READ MORE From Rome: A Message for Pope Francis
Paul Driessen, Somewhat Reasonable
Heartland Policy Advisor Paul Driessen writes a powerful essay to Pope Francis warning him that fossil fuel restrictions and renewable energy mandates – in the name of stabilizing planetary climate that has never been stable – would perpetuate Third World poverty, disease, and death. READ MORE There’s No Such Thing as “Too Much Stuff”
Richard Ebeling, Epic Times
Heartland Policy Advisor Richard Ebeling critiques a Wall Street Journal article alleging the world is “awash” in too many goods. “There have been few fallacies as fundamentally absurd and so frequently pronounced as the notion of economic ‘bad times’ due to general gluts of too much production in comparison to a presumed limited demand.” READ MORE
UN Backs Coal Power for the Poor
H. Sterling Burnett, The Heartlander
The United Nations’ Green Climate Fund refused during its March meeting in Songdo, South Korea to explicitly ban fossil fuel projects, backing away from the war on coal being conducted by the World Bank and the Obama administration. The International Energy Agency welcomed the UN’s decision to fund coal power in developing countries, citing the important role coal plays in helping many people in developing countries to escape poverty. READ MORE Bonus Podcast: Why Bitcoin Is Different, and the Difference It Makes
Jeffrey Tucker, the chief liberty officer and founder of Liberty.me and a Heartland policy advisor, says Bitcoin exists and operates differently than almost anything in human history. Existing outside of national and geopolitical boundaries, Bitcoin’s system rewards users’ donation of computer time, using those extra processor cycles to ensure and verify the accuracy of the entire currency system. LISTEN TO MORE Are Government Housing Policies Responsible for Inequality?
Wendell Cox, New Geography
House prices have doubled, tripled, or more relative to incomes, as regulators have banned or seriously limited new housing on the urban periphery. Younger households have been unable to afford houses as older households have watched their wealth increase. READ MORE Most Polls Shows Americans Still Split Along Partisan Lines on ‘Obamacare’
Gene Koprowski, Somewhat Reasonable
Americans are almost evenly split in their opinions concerning Obamacare, with 43 percent of those polled reporting a favorable view and 42 percent reporting an unfavorable view. Sixty-five percent of Republicans reported a very or somewhat unfavorable view while 70 percent of Democrats reported very or somewhat favorable views. READ MORE Invest in the Future of Freedom!
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Modern industrial society commenced with the use of coal and oil to power factories, trains, ships and agriculture and to generate electricity. With abundant energy, prosperity increased, and people could save enough to support leisure, education, culture and environmental concerns.
But the dark greens have a dream to dismantle all this, and return society to the hunter/gatherer era.
In an unguarded moment Maurice Strong, a leader of the international green movement, said:
Isn’t the only hope for the planet that the industrialized civilizations collapse? Isn’t it our responsibility to bring that about?
Greens have thus gleefully spread the global warming scare to justify a massive political war on hydro-carbon fuels. Timothy Wirth, ex-President of the UN Foundation, spilt the beans:
We’ve got to ride this global warming issue. Even if the theory of global warming is wrong, we will be doing the right thing in terms of economic and environmental policy.
To mask their real aim of de-energising modern industry, they continually promote “alternative energy”.
The only alternatives to coal, oil and gas for stable, reliable and economical grid power are nuclear energy, and in favourable locations, hydro or geothermal.
Nuclear power could be one of our cheapest and safest energy sources. However greens have opposed and denigrated it for decades, and erected such bureaucratic and financial hurdles that it is seldom considered in most pampered western societies.
They are in favour of hydro, providing it does not disturb one fish or frog on their favourite river.
But they continually spruik the benefits of wind and solar power.
Wind/solar can be useful in some mobile or remote locations, and for some people with deep pockets who wish to become independent of the grid. But being totally unable to supply 24/7 grid power, they need reliable backup (or massive batteries) for about 75% of their rated capacity. Once we subtract the energy and resources needed to build and maintain the towers/panels, plus the roads and transmission lines, plus backup/batteries and then run it all intermittently, the whole-of-life net-contribution of wind/solar to energy supply or emission reduction is negligible or negative.
Another dark green leader, Amory Lovins of the Rocky Mountains Institute, said:
It would be little short of disastrous for us to discover a source of clean, cheap, abundant energy, because of what we might do with it.
Green energy policy promotes this dictum by supporting “Nothing that Works”.
If there ever was an issue to unite all parents, teachers, and any educational stakeholder—which ultimately includes all of us—it should be student privacy. Yet, lawmakers on both the national and state levels have failed to develop meaningful legislation to protect student data and parents’ rights.
The gutting of the Family Educational Rights and Privacy Act by both the Bush and Obama administrations has left children and parents in a vulnerable position. As a result, some organizations and individuals are making it their mission to raise student privacy issues and push governments to protect sensitive information about children.
The most recent skirmish was over the Pearson testing company monitoring social media posts regarding Common Core-aligned PARCC testing in New Jersey. Pearson contacted the New Jersey Department of Education (NJDOE) over a Twitter post the company found objectionable. NJDOE then contacted the school district of the student who posted the tweet, and the student removed the post. Parents were understandably furious.
“This issue is both a free speech and a privacy issue,” said Leonie Haimson, executive director of Class Size Matters and co-chair of the Parent Coalition for Student Privacy. “Pearson has good reason to suppress any discussion of its exams, which have been shown to be very low quality in the past.”
“Parents are upset across the spectrum,” said Julia Rubin, a volunteer for Save Our Schools NJ. “Nobody knew what was going on. Not just that they were monitoring. I think it’s the idea that they are monitoring in coordination with the NJDOE. NJDOE then went to the district.”
Rubin says students were not told they couldn’t talk about the testing at all; they had only been told they couldn’t take photos of the tests.
“I put a lot of the blame on the NJDOE,” said Rubin. “This type of behavior may lead to an environment where students are afraid to talk about the standardized tests at all.
“You get to a point where students don’t know what is and is not allowed, which means you might not say anything,” Rubin said. “That definitely infringes on the free-speech rights of these students.”
Haimson and Rubin both question how realistic and plausible it is to keep students as young as eight from speaking about testing that takes place over the course of a month. Many parents and activists say they feel students should be able to speak about the tests, including talking about questions and content after the taking the tests, unless the students are cheating.
“[Pearson representatives] provided staggering information about the personally identifiable information that districts upload to the Pearson testing system, as well as ‘device and response’ information they gather during test administration,” said Rachael Stickland, co-chair of Parent Coalition for Student Privacy.
According to Stickland, among the information collected during PARCC testing is data on economic status, race, and ethnicity, whether a student has migrant or immigrant status, whether a student is homeless, and even whether a student has ever been expelled or not.
“Pearson told our state board that any student data they collect belongs solely [to] the state and that they, Pearson, are expressly limited in their contract with the State of Colorado to ‘use’ student data only under specified terms,” said Stickland. “I would like to know if there is a provision in the contract that allows Pearson employees to access student-level information in their database to identify individual students with the intent to locate those children. If so, this puts children at great risk of identity theft as well as other vulnerabilities. If not, how will the Pearson employees be disciplined for unauthorized access to student records?”
Haimson, Rubin, Stickland, and many other parents and activists are demanding better laws to protect student data and allow students the freedom to speak openly about the tests they are taking. It’s the job of legislators to listen to their constituents, and they have a moral responsibility to protect children in their states. Both state and federal laws need strengthening to do so.
The Pontifical Academy of Sciences has released its climate document “Climate Change and The Common Good” which may be the Encyclical on climate issued by Pope Francis this June.
Pope Francis is making a grievous mistake entering the debate on fossil fuels causing catastrophic global warming due to live-giving combustion gases carbon dioxide. History has not forgotten the Church’s 17th century involvement with science caused the Inquisition in 1633 to force Galileo Galilei to recant the Sun was the center of our universe instead of the Earth. Galileo was held in house arrest until his death in 1642. The consequences of the Church’s actions may have set astronomy back a few years; but did not lead to calamitous future for the planet. In 1992 the Vatican formally announced its mistake in condemning Galileo.
April 22 was Earth Day that was hijacked by environmental groups who want to use it to promote their agenda of forcing the abandonment of the earth’s abundant, inexpensive, and geographically distributed fossil fuels of coal, oil, and natural gas. Their reasoning is carbon dioxide from using fossil fuels is causing catastrophic global warming (climate change). Nothing could be further from the truth.
Abundant energy is needed for achieving Earth Day’s goal. It takes energy to produce clean water and dispose of sewage. Fossil fuel energy is preferable for transportation than animals used in the past that despoiled roads. Fossil fuel supported energy is far cleaner and healthier for heating and cooking than wood and dung used in the past. Electricity is preferable for lighting than whale oil or candles use centuries ago. The list goes on and on. All of the prosperity and good health of developed nations is attributed to fossil fuels.
Environmental groups, and now Pope Francis, want to replace fossil fuel energy sources with solar, wind, biomass (wood), ethanol from corn, other biofuels, etc. as future energy sources. These energy sources are too expensive for developing nations. In addition, these energy sources require vast land areas in order to produce significant amounts of energy. This requires destroying millions of square miles of forest land that cleans our air and water, creates oxygen, helps cool the planet, and provides recreation.
Thus Pope Francis wants to turn upside down the original goals of Earth Day and leave the planet poorer, less healthy, drudgery for a lifestyle, and lacking creature comforts. If these goals are achieved, a day will come when the Vatican renounces Pope Francis’s intervention into the global warming debate as was done on Church’s treatment of Galileo.
In today’s edition of The Heartland Daily Podcast, Research Fellow Isaac Orr and Research Fellow Bette Grande discuss earthquakes and their relationship with hydraulic fracturing. Grande also gives the listeners an inside look at the state of oil production in North Dakota as a result of low oil prices.
Anti-fracking groups are trumpeting a new study published in Nature Communications as a smoking gun proving hydraulic fracturing has been causing earthquakes in Texas and Oklahoma. However, this is another case of these groups being just informed enough on the subject to be dangerous, because the increase in earthquakes in these two states is due to disposing of the wastewater generated during the hydraulic fracturing process, not the hydraulic fracturing process itself.
The Endangered Species Act, and how the Act is being used, should be a priority both in the States and in Washington, D.C.
The Endangered Species Act (“ESA”) in its current form has been around since 1973. Supposed environmental legislation from the early 70’s (the ESA, Clean Air Act, Clean Water Act, and the EPA itself) was pushed and passed by the Nixon administration and has been the foundation for environmental activism ever since. In 1973 there were 137 species listed under the Act and by August, 2014 the number had grown to 1,560 with over 757 additional species under consideration by 2018.
Lately the ESA has been used to limit energy development, or at least make it more expensive. But it is far more than energy development that is affected. Agriculture and personal property rights are targets as well. The overreach by the federal government reaches across the country.
The ESA and the other Acts mentioned above come with impressive titles, but the results are not very impressive. The federal government has gained control of more and more private property, and worked with environmentalists to slow and stop economic development in vast areas of our country costing taxpayers millions of dollars. And after all of that, the record of saving “endangered species” is incredibly poor.
For a good background on the ESA see “It’s time to Endanger the Endangered Species Act” by Taylor Smith of the Heartland Institute.
In North Dakota, the US Fish & Wildlife Service (“USFWS”) has placed the Dakota Skipper and the Poweshiek Skipperling on the protected list of the ESA. USFWS is looking at adding the Rufa Red Knot, Sprague’s Pipit, Greater Sage Grouse, Monarch Butterfly, Sturgeon Chub and Sicklefin Chub to the protected list as well.
Based on history, protection of any of these species under the ESA will not result in actual benefits for the species, but it will increase federal government control over private property and limit authorized uses of that private property.
Once a species is protected under the ESA the federal government exerts full control over the “habitat” including a large buffer zone in which economic activity is effectively stopped. In addition, landowners face fines of $100,000.00 and jail time if they violate the USFWS rules. And, after all of that there is no evidence that the ESA actually benefits the listed species. In fact, the only evidence available shows it actually harms the species it is supposed to protect.
Sue and Settle
The ESA and the other Acts mentioned have been a financial windfall for extreme environmental groups. These groups work closely with allies in the federal government to file friendly lawsuits that the federal government promptly settles without giving property owners the opportunity to challenge the allegations. This ‘Sue & Settle’ scam works because the people directly affected by the “lawsuit” are usually unaware it is happening. By the time the case is settled it is too late. But there’s more. Because the federal agency agrees to settle these “lawsuits”, we the taxpayer get to pay the attorney fees for both sides. The extreme environmental groups are financing their efforts with our money. And their goal is not the protection of “endangered species” or the betterment of the people of the United States.
Action in ND
Many states are taking action to address legitimate endangered species issues. North Dakota has a strong history of stewardship of our natural resources and has programs in place that actually achieve the goal of species preservation. Going forward the States should work individually and regionally to develop locally based programs that work with our farmers, ranchers and businesses, not against them.
North Dakota is blessed in many ways and one significant blessing is low proportion of federal owned land in the state. Federal agencies are working to change that fact by using the ESA to “claim” private property. The situation is worse in many western states where over 50% of land is owned or controlled by the federal government.
Still, the federal government’s appetite for more land continues to grow. The ‘Cromnibus’ Bill passed by Congress last December included a provision in the National Defense Authorization Act giving wilderness designation to an additional 250,000 acres and removing 400,000 acres from commercial use.
The North Dakota Legislature just passed HB 1432 that provides the framework and resources to fight these federal land grabs. The Statute establishes a Committee headed by North Dakota’s Commissioner of Agriculture to review the actions and administrative rules from Federal agencies which have, or may have, a detrimental impact on the State’s agriculture, coal and oil & gas industries. The Legislature also appropriated funds to cover costs from “sue & settle” actions and other litigation. This legislation also allows for private donations to this fund to defray costs and assist in the cause.
All the States should stand together on the issues of state sovereignty and federalism.
Action in Washington D.C.
Congress should also take a hard look at how the executive branch is implementing the ESA and the other Acts mentioned earlier. Congress created these Acts and passed the laws that the Federal agencies are now using against State and private property interests. To the extent that agency rule making exceeds the legislative intent Congress must regain its authority.
In North Dakota, the Legislature reviews and approves the rules that agencies adopt to carry out legislative intent. Agency rules and procedures must be directly related to legislative intent and the executive branch is not authorized to make new laws by interpreting or modifying statutes.
Federal agencies are not authorized to make law, but that would come as a surprise to many farmers and ranchers. Federal agencies were intended to implement and enforce legislation passed by Congress. However, through the rule making process Federal agencies have “interpreted” and expanded legislative acts to the point that original legislative intent is unrecognizable. Whether driven by ideology, the quest for power, or both, Federal agencies have far more power and authority than was intended. Congress is the branch with the ultimate authority and it is time to reclaim that constitutional role.
If Congress wants to have an immediate and lasting impact on the economy, environmental stewardship, jobs and basic property rights it should take its role as the legislative branch seriously. It should revise or repeal the ESA, and the other Acts mentioned, develop stronger oversight of agency rules and return authority over environment and land issues to the states.
Endanger species – and endangered industries – are counting on you.
Teachers unions and other defenders of the education status quo are terrified of school choice. As a result, they frequently present misleading reports as truthful. A new report by the Center for Tax and Budget Accountability (CTBA) in Illinois is a good example. Attempting to discredit the voucher program in Indiana and school choice as a whole, the report is incomplete, full of logical flaws, half-truths, and omission of key facts.
With six union members on its board, CTBA is hardly an unbiased observer. In fact, the president of the Illinois AFL-CIO, president of the Illinois Federation of Teachers, and government affairs director of the Illinois Education Association all sit on CTBA’s board.
Such obvious bias in favor of the education status quo makes the following claim in the study utterly laughable:
“This paper will not utilize in its analysis studies conducted by organizations with a clear bias, be it provoucher or anti-voucher. It instead draws on objective, peer-reviewed analyses. The goal is to answer two key questions about the Indiana Choice Legislation as objectively as possible.”
What that translates to is this: CTBA ignored every piece of evidence that did not line up with its self-serving thesis that education choice is dangerous. CTBA completely ignored data and studies from researchers at Harvard, Princeton, the University of Chicago, the Brookings Institution, and other eminently reputable sources.
CTBA didn’t even use the most recent available data when citing a longitudinal study coauthored by Dr. Patrick Wolf of the University of Arkansas. CTBA uses 2008–09 findings, published in 2010, instead of the most recent, 2012 report. Wolf says his research found “school choice in Milwaukee has had a modest but clearly positive effect on student outcomes.”
Numerous peer-reviewed, gold-standard studies show school choice has had statistically significant positive outcomes for all children or certain subgroups, especially low-income and minority students.
“Private School Vouchers and Student Achievement: An Evaluation of the Milwaukee Parental Choice Program” was conducted by Cecilia Elena Rouse in 1997. Rouse says of the study, “I find that students in the Milwaukee Parental Choice Program had faster math score gains than, but similar reading score gains to, the comparison groups.”
A 2002 study, revised in 2006, by William G. Howell and Paul E. Peterson, “The Education Gap: Vouchers and Urban Schools,” found after two years black voucher students had combined reading and math scores 6.5 percentage points higher than the control group.
In 2008, in his study titled “School Choice as a Latent Variable: Estimating ‘Complier Average Casual Effect’ of Vouchers in Charlotte,” Joshua M. Cowen found after one year, voucher students had higher math and reading scores than the control group.
Tosha Salyers of Hoosiers for Quality Education says CTBA failed to include Indiana student achievement data in its analysis.
“A quick check of student achievement data on the Indiana Department of Education website shows that student achievement is up by every measure in our state,” Salyers said. “Since school voucher legislation was passed in 2011, we have seen an increase in ISTEP+ pass rates, graduation rates, IREAD-3 pass rates, end-of-course assessment pass rates, Advanced Placement participation, and Advanced Placement assessment pass rates. Additionally, data from the Indiana Department of Education indicate the number of A-rated schools has increased from 856 in 2011 to 1,124 in 2014, while the number of F-rated schools has decreased from 144 in 2011 to 84 in 2014.”
Contrast that with the CTBA report, which claims, “Indeed, based on the available evidence, rather than improve student performance and the overall public education system in Indiana, the Indiana Choice Legislation may actually impede student achievement specifically and harm the education system generally. At a time when public resources are scarce, it is not advisable for state decision makers to divert public education funding to programs that cannot be expected to help children learn or improve the education system.”
The studies cited above and numerous others show positive outcomes for students participating in voucher programs. The CTBA report ignores all of this evidence, instead claiming, “Subsidizing individual decisions that do not generate a public good or service—even legitimate ones well within the rights of, in this case, the parents making them—is an inappropriate use of public money.”
The reality is school choice programs are less expensive than traditional public schools, and student achievement is generally at least as good as in traditional public schools.
The cost savings of school choice help every taxpayer in the state, and choice gives parents a voice in an educational system that rarely listens to them otherwise. Vouchers, charters, and other choice programs across the country consistently demonstrate this success. That’s why thousands of families are on waiting lists to enter these programs and thousands upon thousands more are calling for greater choice.
The CTBA report doesn’t get absolutely everything wrong, but as the research makes clear, it is far from truthful. CTBA has a right to oppose choice in schools, but it shouldn’t get to choose its own facts.
In a major victory for health care providers – and patients – the South Carolina House of Representatives this week voted to end complex health regulations which have limited the expansion of hospitals in underserved, needy areas of the state for years.
Known as the “Certificate of Need” rules, or CON, the old regulations compelled health care organizations to apply for permission from the state to open new facilities, or even to buy new diagnostic or treatment equipment.
To satisfy state regulators, the expanding hospital had to prove there was demand for the new procedures to be offered, or beds to be made available to the sick.
The complex rules harmed patients’ health, backers of the repeal argued, as large hospital systems often delayed decisions through costly lawsuits, keeping competitors from opening facilities or buying equipment.
Reformer Rep. Jim Merrill (R-Charleston) and allies argued that ultimately health care decisions should be made by consumers in a free market, not by state bureaucrats or judges.
“The South Carolina House should be commended for its efforts to repeal the state’s certificate of need laws,” said John Nothdurft, director of government relations at the Heartland Institute, a public policy think tank, active in health care reform issues. “While the stated goal of CON programs is to manage health care costs, research has shown they actually increase costs for consumers by hindering competition and forcing providers to use older facilities and equipment. Health care costs are 11 percent higher in CON states than in non-CON states. “
Nothdurft said CON laws benefit existing health care providers, providing them with inappropriate influence during government vetting processes. “When a company applies to enter a new market, competitors often use the CON process to block potential competition.
As a result, CON laws raise the price of medical care by preventing new medical providers from competing with existing hospitals,” he said.
Another health care policy advisor, Matthew Glans, a manager in the government relations department at Heartland, looked forward to the next steps by policymakers in the state.
“Hopefully the Senate follows soon and South Carolinians will receive the health care options they deserve,” Glans said.
The Vatican, faithful Catholics around the world, and UN climate alarmists heard us. One climate expert for the UN — Peter Raven — even took Heartland’s name in vain inside the halls of the Pontifical Academy of Sciences where the one-day summit was held on Tuesday.
Perhaps then there is hope, then, that Francis’ upcoming encyclical will be less reflective of the unscientific alarmism of the United Nations and more responsive to reality: The globe is not dangerously warming, and the poor of the world should not be kept in poverty in service to that myth.
The members of Heartland’s mission to the Holy See brought with them a mix of expertise on the science, the policy, and the morality of putting the Catholic Church’s authority behind the United Nations’ climate agenda:
- E. Calvin Beisner, Ph.D., national spokesman for the Cornwall Alliance for the Stewardship of Creation
- Hal Doiron, former NASA Skylab and Space Shuttle engineer
- Richard Keen, Ph.D., meteorology instructor at the University of Colorado
- Christopher Monckton, chief policy advisor to the Science and Public Policy Institute (SPPI)
- Marc Morano, executive editor and chief correspondent, ClimateDepot.com
- Tom Sheahen, Ph.D., vice chairman of the Science and Environmental Policy Project Board of Directors
- Elizabeth Yore, J.D., former General Counsel at the National Center for Missing and Exploited Children in Virginia
We held two events: A Monday press conference explaining why the Pope should not put his moral authority behind the UN’s climate work, and a Tuesday luncheon featuring a deeper dive into climate science, as well as and exploration of fiscally and morally sound climate policy decisions.
Representatives from the following 11 news outlets attended:
- Associated Press
- BNA Bloomberg
- The New York Times
- The Boston Globe
- The Times of London
- The London Telegraph
- The Guardian (UK)
- National Catholic Register
- Catholic News Service
- Catholic Reporter
- EWTN (the largest Catholic network in 144 million homes)
From there, the fact that Heartland was in Rome to serve as a voice for sound science and sensible policy was picked up by hundreds (if not thousands) of news outlets around the world. A few samples:
ABBY CORNISH: Sylvia, there are those who believe the Pope shouldn’t be involved in this debate. And was their voice represented at the conference?
SYLVIA POGGIOLI: Well, not as speakers, but the – some were there as observers. They were members of the Chicago-based Heartland Institute, and they held a press conference here yesterday urging the pope not to back the United Nations’s climate agenda.
[Marc] Morano was part of a delegation of self-proclaimed “climate skeptics” led by the Chicago-based Heartland Institute, a conservative think tank, that came to Rome to challenge the symposium’s findings. Jim Lakely, the director of communications for the institute, said Monday that the delegates wanted to “prevent the pope from making the mistake” of listening only to what they believe are climate change alarmists.
The skeptical Chicago-based Heartland Institute, a conservative think tank, sent a team to Rome urging the pope not to lend his moral authority to the U.N.’s climate agenda and warning that he would just be confusing Catholics by writing an encyclical about it.
The Heartland Institute, a Chicago think tank that says climate change is not human-induced, sent a delegation to Rome to contest the premise of the conference.
Heartland member Christopher Monckton of Britain, told reporters that the pope “should listen to both sides of the scientific argument … not only people of one, narrow, poisonous political and scientific viewpoint”.
While Pope Francis discussed the challenges of climate change, a few hundred yards away, in a hotel conference room on the broad avenue that leads to St Peter’s Basilica, sceptics accused the UN and Intergovernmental Panel on Climate Change of scare-mongering on the issue.
“The Pope has great moral authority but he’s not an authority on climate science. He’s a learned man but the IPCC has got it wrong,” Jim Lakely of the Heartland Institute …
“The Pope would make a grave mistake if he put his moral authority behind scientists saying that climate change is a threat to the world. Many scientists have concluded that human activity is a minor player. The Earth has been warming since the end of the last Ice Age.”
It was the first time the Heartland Institute, which is based in Chicago and has been described by the New York Times as “the primary American organisation pushing climate change scepticism,” had travelled to Rome to try to influence a pope.
“I hope our impact on the debate ahead of the Pope’s encyclical will be very significant. There are 1.2 billion Catholics in the world and they tend to pay attention to what the Pope says,” said Mr Lakely.
Speakers at Monday’s press conference opposing the Vatican event sharply criticized the meeting and bluntly offered advice to the pope.
Monckton, who was an advisor to British Prime Minister Margaret Thatcher, started his address by quoting from the Bible at length in Latin, specifically a passage where Jesus tells Pontius Pilate he has come to “bear witness to the truth.”
“It is not the business of the church to stray from the field of faith and morals and wander into the playground that is science,” Monckton said.
The Independent (UK)
Two prominent British climate change sceptics travelled to the Vatican seeking to convert the Pope to their cause – only to be interrupted by “papal heavies” half-way through making their point.
Christopher Monckton has a lot to say about that last excerpt at this podcast. Monckton also reveals that Peter Raven of the United Nations’ IPCC kicked off the panel discussions with a six-minute denunciation of The Heartland Institute, as well as others who insist that climate policy be based on sound science.
Listen to the podcast, and more to be written later on how Heartland’s name echoed in the Vatican.
In today’s edition of The Heartland Daily Podcast, Managing Editor of Budget & Tax News Jesse Hathaway speaks with Heartland Institute policy advisor Jeffery Tucker. Tucker and Hathaway have a discussion about the history and future of Bitcoin, an alternative digital currency with which users can buy physical goods.
Tucker, the Chief Liberty Officer and founder of Liberty.me, says Bitcoin exists and operates differently than almost anything in human history. Existing outside of national and geopolitical boundaries, Bitcoin’s system rewards users’ donation of computer time, using those extra processor cycles to ensure and verify the accuracy of the entire currency system. People can then use those earned Bitcoins to buy physical goods across the globe, without having to convert from one country’s currency to another… one can even buy a ride in a helicopter in New Zealand, like he did while on vacation!
A poll by a leading health services research organization indicates that American public opinion on the Affordable Care Act – colloquially known as “Obamacare” – remains evenly divided along partisan lines.
Fifty-four percent of Republicans reported a “very unfavorable” view of Obamacare, and an additional 21 percent presented with a “somewhat unfavorable view” of the controversial law, according to this month’s Kaiser Health Tracking Poll. The survey was conducted from April 8-14, 2015.
By contrast, 43 percent of Democrats had a “very favorable opinion” of the law, and 27 percent had a “somewhat favorable” view of President Obama’s signature health reform measure.
Independent voters were statistically split on their views of the law.
Overall, the view of the American public is split as well, tied at a statistically “insignificant” point, with 43 percent of those polled reporting a favorable view and 42 percent reporting an unfavorable view, according to the poll.
Those polled indicate they want a different kind of health reform than the one Washington gave them in 2009, and whose legality is now being weighed by the U.S. Supreme Court.
“When asked about health care priorities for the President and Congress, the change that comes out on top for Democrats, Republicans and independents alike is making sure that high-cost drugs for chronic conditions, such as HIV, hepatitis, mental illness and cancer, are affordable to those who need them, with three-quarters of the public (76 percent) saying this should be a top priority,” noted the pollsters.
For Further Information, go to, http://kff.org/health-costs/poll-finding/kaiser-health-tracking-poll-april-2015/
Photo courtesy of The White House.
In ruling the Internet to be subject to common carrier consumer protection law, the Obama FCC’s recently passed Open Internet Order applied common carrier privacy law (Section 222) to Internet telecommunications as part of the FCC’s unilateral efforts to modernize communications law for the 21st century.
The Obama FCC’s Open Internet Order also ruled that the Internet now encompasses the Public Switched Telephone Network (PSTN) and that an IP address is the functional equivalent of a telephone number.
Thus, logically it could follow that information that’s considered legally private in the telephone world now could be considered legally private in the Internet world.
This central consumer protection question should come up this week as the FCC hosts a Section 222 public workshop to explore the FCC’s “role in protecting the privacy of consumers who use” the Internet.
What is Section 222?
It is a common carrier provision of the Communications Act entitled “Privacy of Customer Information.”
It creates a legal duty for those using telecommunications to protect the confidentiality of a customer’s proprietary network information or “CPNI,” and to not use CPNI for its “own marketing efforts,” without the “approval of the customer.”
Practically, CPNI is a customer’s most sensitive private communications information, i.e. with whom they communicate, when, how much, and from where they communicate.
America originally had a monopoly vertically-integrated communications provider, AT&T, so Section 222 originally protected consumers’ privacy throughout the whole communications ecosystem.
In 1984, when a court-ordered break-up created AT&T Long Distance and seven local phone Baby Bells, they all continued to be subject to section 222’s protection of customer private information.
However, since prior FCCs classified the Internet as an unregulated information service, and not common carrier telecommunications, Section 222 no longer legally applied on the Internet.
That begs the big question: what does it mean for consumer privacy now that the FCC has reclassified Internet telecommunications as a common carrier service subject to Section 222?
The FCC’s action means that customers may now own their Internet CPNI again and that all those entities which want to collect and monetize consumers’ Internet CPNI going forward may legally have to ask a consumer for express consent to use their private CPNI.
What’s the case for an FCC Do Not Track List?
First, the FTC’s Do Not Call List has proven very popular with consumers, because it provides a simple and convenient mechanism for consumers to opt out of receiving unsolicited telemarketing calls.
Roughly three quarters of Americans have chosen to guard their privacy by putting their phone numbers in the FTC’s National Do Not Call Registry.
If the FCC made available a similarly simple and convenient mechanism for Americans to choose to opt out of unsolicited tracking of where they go on the Internet, it is likely over half of Americans would sign up for a national FCC Do Not Track list.
That’s because a 2010 Zogby national poll of two thousand Americans commissioned by my research firm Precursor found strong bipartisan support (79%) for a Do Not Track list modeled after the successful FTC Do Not Call List.
In addition, the FCC justified its assertion of common carrier regulatory authority over the Internet in part to protect consumers and their privacy using section 222.
An FCC Do Not Track List arguably could turn out to be the single most popular part of the FCC’s otherwise unpopular Open Internet Order.
Second, an FCC National Do Not Track List could offer consumers equal protection under the law.
Why should Internet privacy communications protections apply to only some parties’ communications, but not others that use Internet calling, messaging, chat, texting, video conferencing, browsing, or location services, given that, the FCC has ensured consumers enjoy the protections of 911 emergency services over Internet communications no matter what technology is used?
If the FCC considered net neutrality to be sufficiently important to be applied universally to all technologies, why would the FCC not consider consumer privacy protection to be sufficiently important to apply universally to cover all communications?
A national Do Not Track List could create equal treatment for functionally equivalent communications.
It would also create a competitive level playing field by equally applying the same universal communications privacy standard of securing express advance consent for anyone that seeks to use and monetize a consumer’s private CPNI.
In addition, applying Section 222 selectively – ruling that only one kind of Internet company that has telecommunications access to consumers’ proprietary CPNI, ISPs, has to protect CPNI, could be found arbitrary and capricious in court.
Surely the FCC would have to justify in court why only ISPs present a CPNI privacy risk, by showing that no other Internet company offering communications services presents a similar privacy risk to ISPs.
Applying Section 222 selectively would be obviously nonsensical, like building a house for consumers’ privacy protection, but building no walls, only installing blinds where windows might be.
Lastly, why should Internet companies enjoy the protection of common carrier law, but not have any of the consumer protection responsibilities or legal obligations of common carrier law?
For over twenty years Internet companies have enjoyed the blanket liability protection of Section 230, a common carrier provision of the Communications Act.
Internet companies routinely profess that they could not operate as a business without the Section 230 common carrier provision that immunizes Internet companies from liability for what their users may do on their communications platforms, products or services.
If Internet companies believe their businesses are due common carrier protections, how can they reasonably object to their customers also being due statutory common carrier privacy protections?
In short, the FCC should create a National Do Not Track List to protect consumers’ privacy.
That is if the FCC believes in consumer privacy protection, consumer choice, and that their assertion of Title II common carrier authority over the Internet will withstand court challenge.
How the FCC implements Section 222 will speak volumes about the FCC’s priorities.
Will the FCC choose to protect consumers’ privacy, or to protect edge companies, who use and monetize consumers’ most private location information without their express consent?
[Originally published at Precursor Blog]
Eight years ago, I was deeply honored to be invited to participate in the first papal conference on climate change, the Pontifical Council on Climate Change and Development. To my great and lasting regret, I was unable to participate.
Now a new Pope is leading a new climate conference, and I’d like to humbly offer my thoughts about some factors he should consider as he leads the discussion.
Science is critical to understanding why and how our climate changes — an issue, contrary to popular belief, that’s still a matter of open debate. However, science provides no insight into how individuals or governments ought to respond to any particular threats or benefits possibly arising from climate change. These are normative matters.
As a result, the ideas of religious leaders and moral philosophers are valuable in considering how we should respond to what science tells us about climate change, or at least what normative matters we ought to consider.
Pope Francis has decided to make battling climate change an important papal cause. On the surface, this seems an appropriate endeavor for the Church. As the leader of the largest Christian denomination in the world, he is charged not just with saving souls but also with alleviating the suffering of the world’s least fortunate and with leading the Catholic Church to make the world a better place.
Moral imperatives and public policies should be grounded in the best-available science. Unfortunately, based on what I’ve heard Pope Francis say about climate change, he has been badly misinformed and led astray.
The Intergovernmental Panel on Climate Change, on which the Pope appears to rely in great part, is just what its name implies, a governmental panel with leaders chosen by, the course of research directed by, and what gets reported to the media determined and edited by (or in conjunction with) politicians, not scientists.
From the outset, the deck was stacked, since the politicians who created the IPCC did not charge it with determining what causes climate change, but instead limiting it to studying possible human causes of climate change. Unsurprisingly, the direction of the enterprise dictated the outcome. The IPCC dutifully reported human greenhouse gas emissions, not nature, were causing global warming.
The IPCC conclusions rely on climate models, but as Max Borders pointed out in a recent essay, “Models are not evidence.” Models present simulations of complex processes, and when model projections diverge from the evidence, they, not the evidence, should be discarded. The IPCC’s models offer scary projections of melting polar ice caps, species going extinct, more frequent and intense hurricanes and droughts, diminishing winters, crop failures, and continuously rising temperatures, yet the actual data show none of these predictions has come true. Indeed, often, just the opposite is occurring. Crops yields are setting records, as is the Antarctic sea ice extent. Winter temperatures and snowfall show no sign of abating, and global temperatures have stalled for 18 years despite rising greenhouse gas emissions.
Those pushing for bans on fossil fuel use think too many humans are the environmental problem. Many of them worship the creation, not the Creator. The same people pushing the pope to join the fight against climate change support forcible population control programs such as those operating in China. That is not a Christian position.
The climate policies the IPCC pushes are absolutely the worst possible policies for alleviating poverty around the world. Laws that end up denying people access to relatively inexpensive, abundant, and reliable fossil fuels are a death sentence for millions around the world. Caring for the poor, truly promoting their needs, requires more, not less, energy use.
In his book The Moral Case for Fossil Fuels, Alex Epstein makes one of the most cogent statements concerning what the Pope needs to know about the relation between climate and people:Climate is no longer a major cause of deaths, thanks in large part to fossil fuels.… The popular climate discussion has the issue backward. It looks at man as a destructive force for climate livability, one who makes the climate dangerous because we use fossil fuels. In fact, the truth is the exact opposite; we don’t take a safe climate and make it dangerous; we take a dangerous climate and make it safe. High-energy civilization, not climate, is the driver of climate livability. This is the message I would like to see Pope deliver at his climate summit. [Originally Published by The American Spectator.]
An environmental declaration issued yesterday by the Vatican does not meet hyped media expectations. The media — and many on the political Left across the globe — were expecting a joint declaration with the U.N. on the topic of sustainability. However, the final declaration was issued only in the name of the Pontifical Academy of Sciences and the Pontifical Academy of Social Sciences. The declaration bears only the seal of the Pontifical Academy of Sciences, not the U.N. logo. The document indicates that it was “prepared by” Jeffrey Sachs, the pro-abortion advocate from the U.N., and by Peter Raven, also of the U.N., as well as clerical representatives of the Vatican. The declaration itself comes in at just under 320 words. “Religious institutions can and should take the lead in bringing about the change in attitude towards Creation,” the declaration reads. The declaration also refers to “generations yet unborn” and “generations yet to be born” and the need to preserve God’s creation for these future generations.
There is a sizeable “summary” after the declaration. The declaration does not in its own text offer a definition of the words “sustainability” or “climate change, but it does declare that climate change is “likely” caused by “unsustainable consumption by 15 percent of the world’s population.”
The declaration calls for the development of new technologies that will lessen man’s reliance on coal, oil and gas, and also calls nations of the world to collaborate to “mitigate” any damage done to the Earth’s ecosystems.
The message seems to be consistent in tone with what the church has said on prior occasions regarding the environment.
“The order of creation demands that a priority be given to those human activities that do not cause irreversible damage to nature, but which instead are woven into the social, cultural, and religious fabric of the different communities. In this way, a sober balance is achieved between consumption and the sustainability of resources,” said Pope Benedict XVI, in his Message to the Director General of the Food and Agriculture Organization for the Celebration of World Food Day, October 16, 2006.
On another occasion, a general audience on August 26, 2009, His Holiness Pope Benedict XVI, said this:
“The deterioration of nature is… closely connected to the culture that shapes human coexistence: when ‘human ecology’ is respected within society, environmental ecology also benefits. The Earth is indeed a precious gift of the Creator who, in designing its intrinsic order, has given us bearings that guide us as stewards of his creation. Precisely from within this framework, the Church considers matters concerning the environment and its protection intimately linked to the theme of integral human development.”
Pope Francis is considered a liberal by many on the Left, including the media, and Pope Benedict was perceived as a conservative. Thus, their statements are given different weight, and construed accordingly, though the statements are quite similar in content and in calls to action. Interestingly, however, though the Left and the media have during recent years reported, and opined, that the Vatican would reverse its stance on traditional issues, like abortion, divorce, and homosexuality, this has not been the case. Their emotional expectations, which fail to take into account the context of church history, and the continuity of its teachings, on the environment seem to be meeting the same fate as those on other issues which touch on science, anthropology and morality.
Many articles in the New York Times, Mother Jones, Reuters, and other liberal media outlets don’t even bother to obtain comments from the Vatican, but instead rely on remarks fed to them by the U.N., and act as their faithful stenographers.
The link to the text of the declaration and summary follows, as well as a URL to previous statements by Pope Benedict on the environment.
The Vatican’s climate conference took place today, April 28, in Rome. The Heartland Institute’s Jim Lakely was there, along with a contingent of scientists and experts in theology and climate policy that included Lord Christopher Monckton, who obtained press credentials from the Vatican.
Lakely talks to Monckton about what he learned inside the walls of the exclusive climate summit — including is encounter with United Nations Secretary-General Ban Ki-Moon; the shockingly one-sided presentation of the science to Vatican officials; and the remarks of Peter Raver, an author for the UN’s IPCC who not only noticed Heartland’s presence in Rome, but expressed his dismay that our contingent might have any affect on the proceedings.
Monckton’s take: The United Nations climate officials are afraid to debate the science, afraid to present a balanced picture of the climate, and are afraid of The Heartland Institute.
Listen to this important podcast!
State legislators in Oklahoma are moving forward with a proposal to transform the management of Medicaid. The legislation was put forth by state Rep. Glen Mulready and state Sen. Kim David, and is said to represent a “significant reform” of the state’s Medicaid system. The goal: making the tempting federal Obamacare funding less alluring in the future, according to the Oklahoma Council on Public Affairs (OCPA).
Medicaid is the fastest-growing part of Oklahoma’s state government spending, and, due to this trend, total state spending on health care currently exceeds total spending on education in the state.
One of the chief objectives of reform put forth in the bill, HB 1566, is to better coordinate care among providers in order to improve the health outcomes of individual Medicaid beneficiaries — individual people, with unique health needs and circumstances. The long-term objective is transitioning many of those patients out of Medicaid and on to private insurance.
Oklahoma’s Medicaid system is currently a strict fee-for-service arrangement, with little focus on responsible health behavior by the individual, an admittedly shortsighted policy that has “led to severe cost overruns,” according to the OCPA.
States across the country are reforming their Medicaid systems to control cost overruns, including Illinois, which may cut $1.5 billion in Medicaid funds this legislative session, the governor’s office has announced.
For further information, go to, http://www.ocpathink.org/post/medicaid-reform-urgently-needed
Likely the least regulated private economic sector going into the Age of the Barack Obama Administration – at least at the federal level – was the Internet. Which is largely why the Web has become an ever-evolving, free speech-free market Xanadu.
This Administration views this is a tremendous failing – that they are rushing to rectify.
There has been much examination of the ridiculous Network Neutrality grab – where the Feds will now slam down onto the Net the ridiculous tax and regulatory superstructure that is 1930s landline telephone laws.
Let’s look at the other.
How’s that for federalism? Where in the Constitution is the federal government empowered to do that?
Why are there twenty states with laws limiting their local governments from getting into the broadband business?
Reason 1: Government stinks at doing…well, just about everything.
The federal government is over $18 trillion in debt. It clearly stinks at doing…well, just about everything.
Twenty states watched local governments throughout the nation fail spectacularly over and over again at being Internet providers. Often residents of entire states end up on the hook to bailout the failed local government attempts. So these twenty decided to pass laws to limit the damage.
The only question is – what are the other thirty states thinking?
The Administration, of course, steamrolled the states showing eminently good sense.
Government getting into the Internet business is an egregiously bad idea in at least two other ways.
Reason 2: Government is the referee – and playing for the opposing team.
Far and away the biggest impediments to private Internet providers being Internet providers – are local governments.
Local governments and their public utilities charge (Internet Service Providers) ISPs far more (for building rights) than these things actually cost. For example, rights of way and pole attachments fees can double the cost of network construction….
These (government) incumbents – the real monopolists – also have the final say on whether an ISP can build a network. They determine what hoops an ISP must jump through to get approval.
This reduces the number of potential competitors who can profitably deploy service.… The lack of competition makes it easier for local governments and utilities to charge more for rights of way and pole attachments.
It’s a vicious circle…(A) system of forced kickbacks….(also) includ(ing) ISPs…building out service where it isn’t demanded, donating equipment, and delivering free broadband to government buildings.
Think about these local governments – which hold the intrinsic fate of every private Internet provider in their greedy, giant hands – also competing with them as Internet providers.
Think the government shakedowns are bad now? Think its hard to get the government to grant you permission to do business now? Wait until the government is trying to sell what you’re trying to sell.
And government can ultimately do this:
The Postal Service (USPS) has a legal government monopoly on delivering first-class mail…. (Prospective competitors) are required by law to charge a high minimum price and cannot undercut USPS rates.
Reason 3: Government is taxing private providers – and using that money to fund competitors to these private providers.
Imagine if Office Depot could tax Office Max – and use that money to fund Office Depot.
Nearly every local government taxes Internet providers (I’d bet it’s every – I’m playing a safety). Which means Internet providers that pays taxes to local governments that are in the Internet provider business – are funding competitors to their businesses.
All of this is a lot of things. It certainly ain’t fair – and it certainly ain’t additionally competitive.
For these reasons – and many, MANY more – governments should as always rigorously adhere to the Yellow Pages Rule:
If you can find it in the Yellow Pages, the government shouldn’t be doing it.
[Originally published at RedState]
You may not have noticed it when out buying things in the marketplace in the context of your personal budget, but according to the Wall Street Journal (April 24, 2015) the world is awash with too much stuff. We seemingly have too much of, well, almost everything: too many raw material commodities, too much capital, and too much labor. The world, claims the Journal, is suffering from global gluts.
If this were true, rather than anguishing over such a “horn-of-plenty” we should be shouting hosanna to the heavens. It would mean that we were in or at the threshold of a “post-scarcity” world, that is, more than enough of everything we would need to produce all of everything that we want. Hallelujah, economic utopia has come!
Global Gluts and Keynesian Panaceas
Instead, the authors of the Wall Street Journal piece lament that there is not enough “aggregate demand” to bring into employment this bounty of riches. Seemingly, we are either not willing or able to buy it all up, even though there are few in both wealthy and poor countries that would say, “Sorry, I already have enough of everything I could want.”
In a lengthy text and a series of charts, the Wall Street Journal authors say that the world has too much oil, too much coal, too much iron, and too much cotton as examples of the global raw material plenitude. Interest rates are low because the supply of savings and capital are excessive in amount. And there is a surplus of workers so large in relation to employers’ demand for labor that wages are being kept depressingly down.
In true standard Keynesian fashion, the writers wish that government deficit spending could serve as the cure-all for the world’s insufficient aggregate demand for the planet’s potential output. But, alas, due to past budget deficit indulgences too many governments have accumulated too much debt to freely borrow and spend more.
This has left the economic fate of the world in the hands of central banks to manipulate interest rates and pump in huge quantities of paper money to get the globe humming at potential output and full employment. But interest rates in many countries are already at historic lows and in spite of a tidal wave of money creation they have not been able to do their magic of generating prosperity through inflation.
There have been few fallacies as fundamentally absurd and so frequently pronounced as the notion of economic “bad times” due to general gluts of too much production in comparison to a presumed limited demand.
Man Runs Toward a Horizon of Desire, and Never Reaches It
One of the most elementary understandings about human nature and in the study of economics is that human wants are infinite. No matter how satisfied we may be, there are always ends, goals, and purposes always still before us. So no matter how successfully we improve and add to the qualities and the quantities of the things we use as means to fulfill out ends, there are always more or new ends or goals that capture out interest and fancy.
Like aiming at a point on the horizon, no matter how long and how fast we try to reach it, it always recedes into the distance before us. We humans are imaginative and creative creatures, always coming up with new purposes and wants to set our hearts to wanting and our actions to attempting to achieve. Even if it’s only trying to “keep up with the Joneses” next door whose successes and material improvements act as a stimulus for ourselves.
Each individual has various goals he would like to achieve. To attain them he must apply various means to bring those desired ends into existence through production. But man finds that, unfortunately, the means at his disposal are often insufficient to satisfy all the uses he has for them.
The Reality of Scarcity and Man’s Pursuit of Gains from Trade
He faces the reality of scarcity. He is confronted with the necessity to choose; he must decide which desired ends he prefers more. And then he must apply the means to achieve the more highly valued ends, while leaving the other, less valued, ends unfulfilled.
In his state of disappointment, man looks to see if there are ways to improve his situation. He discovers that others face the same frustration of unsatisfied ends. Sometimes he finds that those others have things that he values more highly than some of his own possessions, and they in turn value his possessions more highly than their own.
A potential gain from trade arises, in which each party can be better off if they trade away what they respectively have for what the other has. But how much of one thing will be exchanged for another? This will be determined through their bargaining in the market. Finally, they may agree upon terms of trade, and will establish a price at which they exchange one thing for another: so many apples for so many pears; so many bushels of wheat for so many pounds of meat; so many pairs of shoes for a suit of clothes.
Trade becomes a regular event by which men improve their circumstances through the process of buying and selling. Appreciating the value of these trading opportunities, men begin to specialize their productive activities and create a system of division of labor, with each trying to find that niche in the growing arena of exchange in which they have a comparative production advantage over their trading partners.
As the market expands, a growing competition arises between buyers and sellers, with each trying to get the best deal possible as a producer and a consumer. The prices at which goods are traded come more and more to reflect the contributing and competing bids and offers of many buyers and sellers on both sides of the market.
Goods Trade for Goods, Through the Medium of Money
The more complex the network of exchange, the more difficult is the direct barter of goods one for another. Rather than be frustrated and disappointed in not being able to directly find trading partners who want the goods they have for sale, individuals start using some commodity as a medium of exchange. They first trade what they have produced for a particular commodity and then use that commodity to buy from others the things they desire. When that commodity becomes widely accepted and generally used by most, if not all, transactors in the market, it becomes the money-good.
It should be clear that even though all transactions are carried out through the medium of money, it is still, ultimately, goods that trade for goods. The cobbler makes shoes and sells them for money to those who desire footwear. The cobbler then uses the money he has earned from selling shoes to buy the food he wants to eat. But he cannot buy that food unless he has first earned a certain sum of money by selling a particular quantity of shoes on the market. In the end, his supply of shoes has been the means for him to demand a certain amount of food,
This, in essence, is the meaning of Say’s Law. The nineteenth century French economist, Jean-Baptiste Say, called it “the law of markets”: that is, unless we first produce we cannot consume; unless we first supply we cannot demand. But how much others are willing to take of our supply is dependent on the price at which we offer it to them.
Right Prices Move Goods and Balance Markets
The higher we price our commodity, other things held equal, the less of it others will be willing to buy. The less we sell, the smaller the money income we earn; and the smaller the money income we earn, the smaller our financial means to demand and purchase what others offer for sale.
Thus, if we want to sell all that we choose to produce we must price it correctly, that is, at a price sufficiently low that all we offer is cleared off the market by demanders. Pricing our goods or labor services too high, given other people’s demands for them, will leave part of the supply of the good unsold and part of the labor services offered unemployed.
On the other hand, lowering the price at which we are willing to sell our commodity or services will, other things held equal, create a greater willingness on the part of others to buy more of our commodity or hire more of our labor services. By selling more, our money income can increase; and by increasing our money income, through correctly pricing our commodity or labor services, we increase our ability to demand what others have for sale.
Sometimes, admittedly, even lowering our price may not generate a large enough increase in the quantity demanded by others for our income to go up. Lowering the price may, in fact, result in our revenue or income going down. But this, too, is a law of the market: what we choose to supply is worth no more than what consumers are willing to pay for it.
This is the market’s way of telling us that the commodity or particular labor skills we are offering are not in very great demand. It is the market’s way of telling us that consumers value others things more highly. It is the market’s way of telling us that the particular niche we have chosen in the division of labor is one in which our productive abilities or labor services are not worth as much as we had hoped. It is the market’s way of telling us that we need to move our productive activities into other directions, where consumer demand is greater and our productive abilities may be valued more highly.
Money Hoarded Does Not Prevent Market Balance – at Right Prices
Can it happen that consumers may not spend all they have earned? Can it be the case that some of the money earned will be “hoarded,” so there will be no greater demand for other goods, and hence no alternative line of production in which we might find remunerative employment? Would this be a case in which “aggregate demand” for goods in general would not be sufficient to buy all of the “aggregate supply” of goods and labor services offered?
The answers had already been suggested in the middle of the nineteenth century by the English classical economist John Stuart Mill in a restatement and refinement of Say’s law of markets. In an essay titled “Of the Influence of Consumption on Production” (1844), Mill argued that as long as there are ends or wants that have not yet been satisfied, there is more work to be done.
As long as producers adjust their supplies to reflect the actual demand for the particular goods that consumers wish to purchase, and as long as they price their supplies at prices consumers are willing to pay, there need be no unemployment of resources or labor. Thus, there can never be an excess supply of all things – a “glut” relative to the total demand for all things.
But Mill admitted that there may be times when individuals, for various reasons, may choose to “hoard,” or leave unspent in their cash holding, a greater proportion of their money income than is their usual practice. In this case, Mill argued, what is “called a general superabundance” of all goods is in reality “a superabundance of all commodities relative to money.”
In other words, if we accept that money, too, is a commodity like all other goods on the market for which there is a supply and demand, then there can appear a situation in which the demand to hold money increases relative to the demand for all the other things that money could buy. This means that all other goods are now in relative over-supply in comparison to that greater demand to hold money.
To bring those other goods offered on the market into balance with the lower demands for them (i.e., given that increased demand to hold money and the decreased demand for other things), the prices of many of those other goods may have to decrease.
Balanced Markets Require Market-Determined Prices
Prices in general, in other words, must go down, until that point at which all the supplies of goods and labor services people wish to sell find buyers willing to purchase them. Sufficient flexibility and adjustability in prices to the actual demands for things on the market always assure that all those willing to sell and desiring to be employed can find work. And this, also, is a law of the market.
Free market economists, both before and after Keynes and the Keynesian Revolution, have never denied that the market economy can face a situation in which mass unemployment could exist and a sizable portion of the society’s productive capacity could be left idle.
But if such a situation were to arise, they argued that its cause was to be found in a failure of suppliers to price their goods and labor services to reflect what consumers considered them to be worth, given the demand for various other things, including money. Correct prices always assure full employment; correct prices always assure that supplies create a demand for them; correct prices always assure the balancing of the market.
Government-Caused “Gluts” and Imbalances
The apparent “gluts” of commodities, capital and labor that the Wall Street Journal reporters see hanging over the global markets and which they forlornly wish governments could “cure” through more deficit spending are, in fact, the relative imbalances, distortions, and misdirection of capital and labor brought about by years, if not decades, of government fiscal, monetary and interventionist policies that have created many of the problems we now face.
They are the residues of housing booms and investment bubbles caused by earlier interest rate manipulations and money creation that artificially misdirected capital, labor and resources into unsustainable activities, given consumers and savers real preferences to demand various goods and save portions of their incomes as the basis for sustainable investment patterns.
Unemployed labor has far more to do with government interventions that impose labor market rigidities and non-market wage levels that over-price too many wanting work from successfully finding it. Anti-competition regulations and restrictions, and high and distorting tax policies prevent reasonable and profitable uses of capital in the service of actual consumer demands rather than political intrigue.
The low rates of interest in many of the leading economies of the world have nothing to do with mythical market-created “gluts” of savings and capital. They are the result of constant and continuous monetary expansion that has undermined the virtual existence of market-based rates of interest to know the reality of actual savings preferences of income earners and the profit-guided investment choices of borrowers based on the actual availability of scarce investable resources for the undertaking of capital projects.
A Changing World Means Changing Market Relationships
Overlaying the spider’s web of government intervention, and fiscal and monetary misdirection is a real change through which the world is passing: a transformation of the global economy.
The poverty-stricken “third world” of the Cold War era has become the “developing nations” of the last thirty years. Poor countries are becoming richer; agricultural and resource-dependent countries are industrializing and modernizing. National economies are increasingly interdependent participants in the international global marketplace of production, commerce and trade.
Significant changes in the patterns and forms of the international division of labor are and will continue to go on for decades to come. New niches of specialization for the older industrial and commercial countries will be an inescapable part of this increasingly world economy and global society, as the developing countries find new places for themselves at the global table of supply and demand.
This will partly manifest itself as discovery of relative “surpluses” of capital, labor and resources in some parts of the world, as other places are seen to have relative “shortages” of them, given the current patterns of supply and demand, and the relative structure of prices and wages for consumers goods and the workers and capital goods that are to serve and reflect the shape and direction of changing world-wide consumer demands.
What makes this global transformation “messy” and imbalanced in various ways is precisely the fact that governments in both the older industrial countries and in the younger modernizing nations are imposing their political power in different ways to shelter “threatened” industries and jobs in one part of the world, while using interventionist tools to give anti-free market benefits and advantages to privileged interests in other parts of the world.
But regardless of the “dirty market” aspects of this globalizing process, it has nothing to do with presumed market-caused, worldwide gluts. It is nothing more than the inevitable short-run imbalances of different supply and demands in a changing world that would sort themselves out soon enough, if not for the dead hand of government intervention, fiscal distortion and monetary manipulation that creates many such imbalances and prevents their normal readjustment precisely by hindering the competitive market and the price system from setting it right.
[Originally published at Epic Times]
On the occasion of the Vatican’s workshop on global warming, sustainable development and human trafficking, it may be appropriate to remember Pope Benedict XVI’s message of January 1, 2010 celebrating the “World Day of Peace,”
Pope Benedict expresses his opposition to mindless exploitation of nature without regard to future generations, but he also expresses the need for a balanced approach that respects the special place of human beings in the world. In particular, note this passage (all unusual spellings are stet):
Nor must we forget the very significant fact that many people experience peace and tranquillity, renewal and reinvigoration, when they come into close contact with the beauty and harmony of nature. There exists a certain reciprocity: as we care for creation, we realize that God, through creation, cares for us. On the other hand, a correct understanding of the relationship between man and the environment will not end by absolutizing nature or by considering it more important than the human person. If the Church’s magisterium expresses grave misgivings about notions of the environment inspired by ecocentrism and biocentrism, it is because such notions eliminate the difference of identity and worth between the human person and other living things. In the name of a supposedly egalitarian vision of the “dignity” of all living creatures, such notions end up abolishing the distinctiveness and superior role of human beings. They also open the way to a new pantheism tinged with neo-paganism, which would see the source of man’s salvation in nature alone, understood in purely naturalistic terms. The Church, for her part, is concerned that the question be approached in a balanced way, with respect for the “grammar” which the Creator has inscribed in his handiwork by giving man the role of a steward and administrator with responsibility over creation, a role which man must certainly not abuse, but also one which he may not abdicate. In the same way, the opposite position, which would absolutize technology and human power, results in a grave assault not only on nature, but also on human dignity itself.
I especially like the fact that Pope Benedict refers to the “human person” and not “humanity” or some broader abstraction. Catholic social thought, having emerged in an age when nearly universal slavery and grinding poverty were considered the natural order of things, has strong themes of respect for the individual rather than the clan, class, or nation, the positive values of “exercising dominion” over the earth, “tilling it and keeping it” (Genesis 3:17-19), and yes, even entrepreneurship. This pro-freedom theme is a major reason the religion spread around the world in record time.
See Orlando Patterson’s wonderful book, Freedom in the Making of Western Civilization, for a full discussion of the positive role of Christianity in the history of human freedom.
Catholics who would put “sustainability” ahead of human freedom are out of step with the most important teachings of their faith.