paul ryan vs. david brooks

[Ursa Majoris]

all these replies and not one has anything to do with the ryan/brooks exchange. oh well, I thought it was pretty interesting.

I read it and you are right, it was interesting.

[Yukon Cornelius]

The first paragraph proves to me that guy has never been to a TEA party gathering. Yes some of the people that would like to claim the mantle of leadership within the TEA party hold some of those ideas, but the TEA party has no leader. Most are split 50/50 on the war, I've seen very little racism and when I've seen it has been denounced by those that witnessed it. The TEA party does not have religious or moral undertones unless you count trying to get people to be self sufficient as a moral objective. If anything it strives to protect civil liberties. For the most part it is a bunch of people that want a smaller less intrusive government. Sure there are some fringe people that might have another agenda but they are a very small minority.

Michele Bachmann look her up

[Yukon Cornelius]

I find that the labs are also a quality puppy.

[Azazello1313]

paul ryan's co-author in the first piece, arthur brooks, also rejoins

 

I resist the conflation of the free enterprise agenda with the GOP. I would like to see the free enterprise culture embodied in the philosophy of both parties. Sadly, I see a lot of statist impulses on both sides of the aisle. . . .Congressman Ryan and I are not anti-government. On the contrary, we are looking for ways to stop the rapidly expanding state from destroying its own legitimacy.

 

power-hunry politicians will ruin damn near anything if they are given a free hand.

[Ursa Majoris]

power-hungry politicians will ruin damn near anything if they are given a free hand.

So will business if given the same free hand.

[Perchoutofwater]

So will business if given the same free hand.

 

At least businesses employ people and produce something.

[Ursa Majoris]

At least businesses employ people and produce something.

Yep. Therefore we should eliminate regulation so that we can all get salmonella more often, have our savings accounts decimated, be electrocuted by cheap shoddy products and ripped off for crappy health care.

[Yukon Cornelius]

Yep. Therefore we should eliminate regulation so that we can all get salmonella more often, have our savings accounts decimated, be electrocuted by cheap shoddy products and ripped off for crappy health care.

ah the good old 1890's

[Perchoutofwater]

Yep. Therefore we should eliminate regulation so that we can all get salmonella more often, have our savings accounts decimated, be electrocuted by cheap shoddy products and ripped off for crappy health care.

 

Your hyperbole is getting old. You need to come up with something new.

[Ursa Majoris]

Your hyperbole is getting old. You need to come up with something new.

You see this every day. Companies will cut every corner they can to increase profit. For every example of companies stymied by government regulation, I can show you an example of a business ripoff, including all the ones I mentioned.

Edited September 20, 2010 by Ursa Majoris

[bushwacked]

At least businesses employ people and produce something.

 

Your hyperbole is getting old. You need to come up with something new.

 

 

[bpwallace49]

When the free market oversteps its bounds and starts ripping off consumers with inflated bubbles and creates situations for Bernie Madoff to come in and fleece people there is an upswelling of populist anger to "do something about it" and better police/regulate these industries. Most of the time the gubmnet screws it up by not having the first idea of what they need to do to better "police" the companies that are naughty.

 

The answer isnt more regulation.

 

the answer isnt more unrestrained profit-mongering-at-all-costs free markets.

 

The answer is more responsible, ethical utilization of the free market by companies so that gross behavior doesnt result in a knee-jerk reaction and almost BEG the gubmnet to step in to protect the consumer. Without the gross behavior, the gubmnet has no NEED to demand from citizens to step in and clumsily try to right the ship.

 

If companies acted ethically in the best interest of the people that they expect to buy their products in the first place maybe we wouldnt have the violent see-sawing of giving the political puppets the power to step in.

 

"Here is where Perch comes in gives an example of how his company gives out free kittens every Tuesday to needy orphans, he feeds the masses with only a loaf of bread and 3 fish, and how he voluntarily donates all his profits to fundraisers . . . this is meant for every OTHER business in the US Perch, not Shangri-La Construction where unicorns and butterflies congregate every day."

[Perchoutofwater]

When the free market oversteps its bounds and starts ripping off consumers with inflated bubbles and creates situations for Bernie Madoff to come in and fleece people there is an upswelling of populist anger to "do something about it" and better police/regulate these industries. Most of the time the gubmnet screws it up by not having the first idea of what they need to do to better "police" the companies that are naughty.

 

The answer isnt more regulation.

 

the answer isnt more unrestrained profit-mongering-at-all-costs free markets.

 

The answer is more responsible, ethical utilization of the free market by companies so that gross behavior doesnt result in a knee-jerk reaction and almost BEG the gubmnet to step in to protect the consumer. Without the gross behavior, the gubmnet has no NEED to demand from citizens to step in and clumsily try to right the ship.

 

If companies acted ethically in the best interest of the people that they expect to buy their products in the first place maybe we wouldnt have the violent see-sawing of giving the political puppets the power to step in.

 

"Here is where Perch comes in gives an example of how his company gives out free kittens every Tuesday to needy orphans, he feeds the masses with only a loaf of bread and 3 fish, and how he voluntarily donates all his profits to fundraisers . . . this is meant for every OTHER business in the US Perch, not Shangri-La Construction where unicorns and butterflies congregate every day."

 

Wasn't Madoff a case where people thought the sector was regulated, and the regulators failed the people. So often big government gives people a false sense of security and they don't do their own due diligence, then when the government fails and a crook takes advantage, rather than crucifying the crook, people want more regulation, never mind the false sense of security that regulation gives causes part of the problem to begin with. The same could be said about the banks too.

 

I'll ignore the petty remarks at the end of your statement, as insulting you would only bring me down to your level.

[tosberg34]

I'll ignore the petty remarks at the end of your statement, as insulting you would only bring me down to your level.

 

Yeah, BP's pretty full of himself.

[bpwallace49]

Wasn't Madoff a case where people thought the sector was regulated, and the regulators failed the people. So often big government gives people a false sense of security and they don't do their own due diligence, then when the government fails and a crook takes advantage, rather than crucifying the crook, people want more regulation, never mind the false sense of security that regulation gives causes part of the problem to begin with. The same could be said about the banks too.

 

I'll ignore the petty remarks at the end of your statement, as insulting you would only bring me down to your level.

 

Wasnt insulting you Perch, just trying to head off a long winded explanation of "well at MY company . . ." that was almost guaranteed to follow .. .

 

Madoof ttok advantage of investors with a scam. A scam that was so popular he was regarded as a person to be ADVISING the SEC. An example of how that big ol scary gubmnet was over its head in trying to regulate an industry that had repeatedly over-stepped its ETHICAL and MORAL bounds in the past.

 

See how this starts? Free markets have little to no regulation. Free markets act badly and NOT in the best interests of the citizens of the US. The gubmnet gets pressure from the CITIZENS to regulate and oversee the businesses. Businesses complain about gubment regulations. and so on, and so forth.

[Jimmy Neutron]

Wasnt insulting you Perch, just trying to head off a long winded explanation of "well at MY company . . ." that was almost guaranteed to follow .. .

 

Madoof ttok advantage of investors with a scam. A scam that was so popular he was regarded as a person to be ADVISING the SEC. An example of how that big ol scary gubmnet was over its head in trying to regulate an industry that had repeatedly over-stepped its ETHICAL and MORAL bounds in the past.

 

See how this starts? Free markets have little to no regulation. Free markets act badly and NOT in the best interests of the citizens of the US. The gubmnet gets pressure from the CITIZENS to regulate and oversee the businesses. Businesses complain about gubment regulations. and so on, and so forth.

 

Madoff is scum and so are the government regulators that ignored reports of his massive scam. Madoff is where he belongs and hopefully the people he ripped off are a litle more wise with their investing. "If it's too good to be true," "caveat emptor" and all that.

 

Government does a miserable job monitoring anything, whether it's keeping Mexicans from sneaking into the country, keeping food and drugs safe or keeping a watchful eye on financial institutions. Bad businesses will be weeded out over time - not without pain, but I think that paid would be more endurable than the weight we bear under hugh government intrusion.

[Azazello1313]

Wasnt insulting you Perch, just trying to head off a long winded explanation of "well at MY company . . ." that was almost guaranteed to follow .. .

 

Madoof ttok advantage of investors with a scam. A scam that was so popular he was regarded as a person to be ADVISING the SEC. An example of how that big ol scary gubmnet was over its head in trying to regulate an industry that had repeatedly over-stepped its ETHICAL and MORAL bounds in the past.

 

See how this starts? Free markets have little to no regulation. Free markets act badly and NOT in the best interests of the citizens of the US. The gubmnet gets pressure from the CITIZENS to regulate and oversee the businesses. Businesses complain about gubment regulations. and so on, and so forth.

 

what a lame red herring. madoff was a fraud. everyone agrees that fraud of that ilk should be illegal, vigorously prosecuted, and protected against to the extent the government can. to say he is emblematic of a free market economy is like saying charles manson represents 1960s music.

[CaP'N GRuNGe]

what a lame red herring. madoff was a fraud. everyone agrees that fraud of that ilk should be illegal, vigorously prosecuted, and protected against to the extent the government can. to say he is emblematic of a free market economy is like saying charles manson represents 1960s music.

 

If only they'd have let him be a Monkee...

[Ursa Majoris]

Bad businesses will be weeded out over time - not without pain, but I think that paid would be more endurable than the weight we bear under hugh government intrusion.

If we poll the ex-employees of Enron, will they agree?

[Deathpig]

If we poll the ex-employees of Enron, will they agree?

 

Maybe, maybe not. Using that same logic, how would the thousands of dead Americans from the 9/11 attack feel about having a Muslim community center built on the site of their deaths? See! I can play this stupid game too!

 

Would all the people working for public companies across the entire United States agree that losing (or having severely hampered) stock option compensation as a result of Sarbanes-Oxley agree (or, for the companies that sucked up the expense, their shareholders that have to deal with the hit to the bottom line)? Probably.

 

How about the people affected by the smaller companies and start-ups that remain private instead of going public (and, in turn, limiting the potential upside for those employees), in part due to Sarbanes-Oxley? They'd probably agree too.

 

How about the employees of AIG who saw their company lose one level of credit rating and explode from regulatory process that suddenly demanded hundreds of billions of dollars of collateral for them to process their normal daily transactions? I'm sure they'd agree.

 

 

I don't think anyone is looking for absolutely no rules, no holds barred, unchecked free-roam capitalism. There's a level of oversight necessary to prevent degenerate cases (monopoly/cartel situations, basic environmental protections, consumer safety, etc.), but the answer to every problem isn't massive regulation. The response to this is for companies to either move more and more overseas to avoid all the petty regulation and nonsense or to trim operations to align with the new paradigm. I can't recall many (if any) situations where adding a ton of regulation made businesses desire to expand (unless the regulation itself was a red herring, which you could maybe make the argument the rise of CDS correlated with the higher hypothetical scrutiny of auditors and securities analysts from Sarbanes-Oxley). You can't make the situations worse and worse for businesses and then wonder why they want to do their business elsewhere or narrow their scope/focus.

[Azazello1313]

I don't think anyone is looking for absolutely no rules, no holds barred, unchecked free-roam capitalism. There's a level of oversight necessary to prevent degenerate cases (monopoly/cartel situations, basic environmental protections, consumer safety, etc.), but the answer to every problem isn't massive regulation. The response to this is for companies to either move more and more overseas to avoid all the petty regulation and nonsense or to trim operations to align with the new paradigm. I can't recall many (if any) situations where adding a ton of regulation made businesses desire to expand (unless the regulation itself was a red herring, which you could maybe make the argument the rise of CDS correlated with the higher hypothetical scrutiny of auditors and securities analysts from Sarbanes-Oxley). You can't make the situations worse and worse for businesses and then wonder why they want to do their business elsewhere or narrow their scope/focus.

 

I've posted this before, but the fundamental problem, as I see it:

 

As Hayek pointed out, knowledge that is important in the economy is dispersed. Consumers understand their own wants and business managers understand their technological opportunities and constraints to a greater degree than they can articulate and to a far greater degree than experts can understand and absorb.

 

When knowledge is dispersed but power is concentrated, I call this the knowledgepower discrepancy. Such discrepancies can arise in large firms, where CEOs can fail to appreciate the significance of what is known by some of their subordinates. I would view the mistakes made by AIG, BP, Freddie Mac, Fannie Mae, and other well-known companies as illustrations of this knowledge-power discrepancy in practice.

 

With government experts, the knowledge- power discrepancy is particularly acute.

 

As we have seen, the expectations placed on government experts tend to be unrealistically high. This selects for experts with unusual hubris. The authority of the state gives government experts a dangerous level of power.

 

And the absence of market discipline gives any errors that these experts make an opportunity to accumulate and compound almost without limit.

 

In recent decades, this knowledge-power discrepancy has gotten worse. Knowledge has grown more dispersed, while government power has become more concentrated.

 

The economy today is much more complex than it was just a few decades ago. There are many more types of goods and services.

 

Consumers who once were conceived as a mass market now have sorted into an everexpanding array of niches. In the 1960s, most households had one television, which was usually tuned to one of just three major networks. Today, some households have many televisions, with each family member watching a different channel. Some people still watch major networks, but many others instead focus on particular interests served by specialty cable channels. Still others watch very little TV at all.

 

This increased diversity of consumer tastes in a world of tremendous variety makes the problem of aggregating consumer preferences more difficult. It becomes harder for government experts to determine which policies are in consumers' interests. For example, is a national broadband initiative going to give consumers access to something they have been denied or something that they do not want? The advances of science are leaving us with problems that are more complex. As fewer Americans die of heart ailments or cancer in their fifties and sixties, more of our health care spending goes to treat patients with multiple ailments in their eighties and nineties. Given the complexity of each individual case, it seems odd that health care reformers believe that government can effectively set quality standards for doctors.

 

In business, performance evaluation of professionals is undertaken by other professionals who are in the same work group, observing their workers directly, and who understand the context in which the professionals are working. Even then, performance evaluation and compensation-setting are challenging tasks. In health care, proponents of government "quality management" propose to evaluate the decision-making of professionals and adjust their compensation on the basis of long-distance reports. Taking into account the knowledge-power discrepancy, this notion of quality management from afar is utterly implausible.

 

Financial transactions have gotten extremely complex. Some critics blame the use of quantitative risk models and derivative securities.

 

However, removing these tools would not remove financial risk, and in many respects could make it more troublesome.

 

One consequence of modern finance is that it exacerbates the knowledge-power discrepancy.

 

It is as futile for financial regulators to try to track down all sources of risk as it is for security agencies to try to keep track of all possible terrorist threats.

 

How can we deal with the knowledgepower discrepancy in government? It would be great if we could solve the problem by increasing the knowledge of government experts. Unfortunately, all experts are fallible.

 

If anything, expert knowledge has become more difficult for any one individual to obtain and synthesize. Analysts of the scientific process have documented a large increase in collaborative work, including papers with multiple authors and patent filings by groups and organizations. Scientists tend to be older when they make their key discoveries than was the case in the first half of the 20th century.

 

When he was an executive at Sun Microsystems, Bill Joy said, "No matter who you are, the smartest people work for someone else." Joy's Law of Management applies to government at least as much as to business. There is no way to collect all forms of expertise in a single place.

 

Instead, the way to address the knowledge- power discrepancy is to reduce the concentration of power. We should try to resist the temptation to give power

 

read the whole thing

[Ursa Majoris]

Maybe, maybe not. Using that same logic, how would the thousands of dead Americans from the 9/11 attack feel about having a Muslim community center built on the site of their deaths? See! I can play this stupid game too!

Indeed you evidently can. I expect the Muslims who died would be less bothered. This might be the most outstanding non-sequitur here for.....well, a long time.

[wiegie]

How about the employees of AIG who saw their company lose one level of credit rating and explode from regulatory process that suddenly demanded hundreds of billions of dollars of collateral for them to process their normal daily transactions?

you want to explain this in more detail (particularly how the regulatory process is to blame)? (Note: regulations did not force Goldman-Sachs to make the collateral calls that they did; nor, to the best of my knowledge, did regulations force AIG to agree to subject themselves to such collateral calls if their credit rating was downgraded. Now, perhaps you could blame mark-to-market which led to AIG having to write down assets, which in turn led to their credit ratings being downgraded, but that is pretty lame. AIG knew what rules they were subject to (which really weren't many in the activities that caused them to fail) and they just plain messed up.)

[Deathpig]

you want to explain this in more detail (particularly how the regulatory process is to blame)? (Note: regulations did not force Goldman-Sachs to make the collateral calls that they did; nor, to the best of my knowledge, did regulations force AIG to agree to subject themselves to such collateral calls if their credit rating was downgraded. Now, perhaps you could blame mark-to-market which led to AIG having to write down assets, which in turn led to their credit ratings being downgraded, but that is pretty lame. AIG knew what rules they were subject to (which really weren't many in the activities that caused them to fail) and they just plain messed up.)

 

I can't because I'm wrong. My initial understanding of this was the collateral calls were derived from a regulatory process but they technically aren't (and, truth be told, AIG was screwed anyway for three of four other reasons so it's not really the best example in the first place). My bad.

[Ursa Majoris]

I can't because I'm wrong. My initial understanding of this was the collateral calls were derived from a regulatory process but they technically aren't (and, truth be told, AIG was screwed anyway for three of four other reasons so it's not really the best example in the first place). My bad.

Mad props to you for manning up and admitting being wrong. Doesn't happen much around these parts.