What Obama Can Learn From Gilligan’s Island
If you take an Economics 101 class in college at some point you are going to encounter what is called “Crusoe Economics”. Crusoe economics teaches basic economic principles by creating a very simple economy, one in which there is only one actor, namely Robinson Crusoe. With President Obama planning a major jobs speech in the upcoming week it got me to thinking what he could learn from such a simple economy. It seems to me that Obama’s economic team could use some help on basic economic principles, as everything he’s tried so far hasn’t really worked out. Having never read Robinson Crusoe, however, I will use another group of famous castaways that I (and I bet, Obama as well) is very familiar with. Namely, Gilligan’s Island.
Imagine we drop Obama right into the middle of Gilligan’s Island. Right away he’s faced with an enormous unemployment problem. In fact, unemployment is at 100%. At the moment, everyone is just standing around. What can Obama do?
Consulting his Keynesian economic playbook, he immediately sees the need for an economic stimulus plan. But how can he do this? He has no money, as government has no money of its own. Thinking quickly, he quickly taxes the Skipper by literally taking the shirt of his back. In an act of even greater Harvard cleverness, he decides to create a “Green Job”. He hires Mary Ann to create a flag for the island made from the Skipper’s shirt. Mary Ann gets to work and at least temporally the unemployment rate drops. But very quickly the job is done and the environmentally friendly flag is hoisted. Obama looks around to see what the results from his actions are, and realizes things are actually worse off than before. The flag, although it looks nice, doesn’t really help anyone. What’s worse though is that everyone is now eyeing him suspiciously, worried Obama may try and steal the shirt from their back! And this doesn’t even mention the fact that the Skipper is now walking around shirtless, which isn’t pleasant for anyone.
Undaunted, Obama thinks back through his multi million dollar education and decides that what the island needs is some regulation. Promising to pay him next week, he hires Gilligan to be the islands first environmental inspector. Flush with his new and unspecified authority, Gilligan starts to harass the Professor, who has been trying to turn the radio into a transmitter. Gilligan has no idea what the Professor is trying to do, so he makes a series of arbitrary rules and attempts to impose them. The Professor, who is having a tough enough time turning the radio into a transmitter, just gives up.
With new regulations not helping, Obama hits on a new plan. He need to increase taxes on the wealthy! And whose wealthier than the Howell’s! Everyone knows they brought great amount of cash on the 3 hour tour, for some reason. He starts to give speech after speech telling the rest of the castaways how he plans to impose taxes on millionaires and billionaires. The result? The Howell’s didn’t become rich by being dumb. They can see where this is headed. When no one is looking they decide to hide their wealth near the cave at the back of the island. Whatever wealth they do have is now unavailable to the castaways.
Obama is exasperated. He’s tried everything he knows how to do and yet the island’s unemployment rate remains stubbornly stuck at 100%. He walk forlornly to the shade of one of the many coconut trees on the island and sits down. What can he do?
And that’s when the miracle happens.
Free from his hectoring, the castaways get to work. Gilligan goes to the lagoon and starts fishing. The Skipper starts to gather the material needed for new huts. Ginger and Mary Ann start to gather coconuts in order to make coconut pies. The Professor gets back to work fixing the radio with the hope of turning it into a transmitter. The Howell’s, not really being the manual labor type, get their money from the cave and hire others to do little tasks for them. Very quickly, the island has gone from 100% unemployment to a booming economy.
From under his coconut tree Obama rubs his eyes in disbelief. How is this possible? When he tried to direct people everything fell apart. But now, left to their own devices and without his meddling, things are humming.
And that’s the lesson that Gilligan’s Island economics presents for Team Obama.
Strip everything away, what is the prime mover that actually gets an economy going? Anything the government does can only be done if it first takes away from someone else. The government, or Obama, in this little tale, is never a wealth generator. Wealth is only generated when someone you’ve never met or even heard of decides to create a product or service that someone else is willing to pay for. To the extent that a government helps this or hinders this goes a long way in determining how well an economy does, whether on Gilligan’s Island, or a nation as a whole. Politicians like to put on a grand show like the mighty Wizard of Oz, proclaiming how their policies are indispensable to the nation’s well being. In reality, though, this is a sideshow put on for the sole purpose of getting elected. When it comes to real wealth creation, governments have very little to do with it at all.
Top Down vs Bottom Up Thinking – The EPA
An article on new EPA recently caught my eye, as I think it nicely demonstrates how the top down governing style operates vs the bottom up method.
The Washington Post article by Ezra Klein discusses how the EPA is about to pass a whole host of new regulations which may result in many coal powered power plants from being shut down. As you might imagine, industry groups say it is going to be a disaster, whereas the EPA says everything is going to be fine.
Ezra also points out that the nonpartisan Congressional Research Service is highly skeptical of any “train wreck” predictions.
Whose right?
The top down (or French style) style places its faith in experts such as the CRS in deciding questions like this. It sees no problem in imposing regulations nationwide in one swoop.
The bottom up (or English style) assumes it doesn’t have all of the information before it. Any guesses it makes as to the impact of such a decision are just that, guesses. The bottom up way to deal with this decision is to not make it at all at the national level. In the America this means individual states should be allowed to pass regulations such as this as they see fit. This is the way you test ideas and get a real sense as to the value of said regulations. If state A passes it and everything is great and real benefits can be seen, other states will follow. If it doesn’t work out, obviously, other states won’t.
The bottom up style, by assuming it doesn’t know everything, is much more willing to test things in the real world. The top down style relies on theories and guesstimates, and is not nearly so concerned with the results. Whatever happens, the top down bureaucrats are usually too busy planning their next big idea to be bothered with looking at the past results of their previous plans.
Related articles
- Oh goody! More EPA regulations (thedaleygator.wordpress.com)
A Quote I’m Sure Mark Steyn Would Agree With
Currently I’m working my way through Mark Steyn‘s “After America”. On another blog (The Hyacinth Girl) I found this great quote from Malcolm Muggeridge. I think it encapsulates what we’ve been doing to ourselves across the western world quite nicely. I’m sure Steyn would agree with his sentiments whole heartedly.
”So the final conclusion would seem to be that whereas other civilizations had been brought down by attacks of barbarians from without, ours had the unique distinction of training its own destroyers at its own educational institutions and providing them with facilities for propagating their destructive ideology far and wide, all at the public expense. Thus did Western man decide to abolish himself, creating his own boredom out of his own affluence, his own vulnerability out of his own strength, his own impotence out of his own erotomania; himself blowing the trumpet that brought the walls of his own city tumbling down. And having convinced himself that he was too numerous, labored with pill and scalpel and syringe to make himself fewer, until at last, having educated himself into imbecility and polluted and drugged himself into stupefaction, he keeled over, a weary, battered old brontosaurus, and became extinct.”
Related articles
- MARK STEYN: Lessons For Us From London In Flames. “Big Government debauches not only a nation’s fi… (pajamasmedia.com)
- ED DRISCOLL INTERVIEWS MARK STEYN about Steyn’s new book, After America, which picked a good week to… (pajamasmedia.com)
Going Over The Falls – The Folly of Benevolence
Neil Reynolds has written a nice article on “The folly of benevolence”. His basic point is that benevolence is a virtue when practiced without coercion and separate from the state. As soon as you make it a right, those that demand quickly outstrip those that provide. His image of the canoeist who simply has to give up fighting the tide as the waterfall approaches is all too indicative of most western societies today. It’s an article that’s worth reading, particularly given the recent London riots etc.
Obama’s Magical Misery Bus Tour
Obama’s bus tour is an example of just how nervous Team Obama is about their election chances. To start campaigning now, and then to deny it, when it’s obvious to everyone what you’re doing, is stunning.
I also don’t think it will work. In fact, I think it’s impressing on people why Obama is not up to the job.
America is looking for leadership. When you’re President, this is what you have to demonstrate, and what Obama has consistently not shown. To go on a bus tour and then announce that you’re going to have some sort of plan later in September is just pathetic. You’ve been president for the past 3 years. How do you think this helps you?
By stepping down from the Presidency to campaign puts him on the same level as the other Republican candidates who are running. This weakens him. The Republican candidates are campaigning because they want his job. Obama already has the job. He needs to prove that he’s worthy of keeping it with action. Campaigning at this point is a waste of time.
Here’s my favorite line he’s given, from the New York Times:
“It’s time to put country first,” he said, recycling a line used by his Republican opponent in the 2008 presidential race, Senator John McCain of Arizona.
Put country first? Is he serious about this? Then why not present his own budget and deficit reduction plan? If he thinks taxes needs to be raised, campaign on which specific taxes should be raised. If he’s in favor of entitlement reform, then explain how you’d do it and why. This is what leaders do.
The American people are looking for a Commander in Chief, but so far all they’ve seen from Obama is a Campaigner in Chief. It’s just not good enough.
Hurray! The Return Of The Royal Canadian Navy And Air Force
Recently it has ben announced that the Canadian government is going to be restoring the names of the Navy and Air Force. Henceforth they will again be known as the Royal Canadian Navy and the Royal Canadian Air Force. I couldn’t be more thrilled. I’d like to attempt to articulate why.
First is a big reason, which is really a defense of the monarchy and the role it plays in Canada.
Looking around the world what systems of government really work? For my money there really is only one that has proven itself overtime, and those are the Anglo American systems. Commonwealth nations such as my own Canada, New Zealand, Australia etc have shown the unique ability to evolve overtime minus revolutions, dictatorships, and a whole lot of blood. One of the primary reasons for this is that they allow for intermediate institutions to exist which are able to exercise authority within the society without any official political power. Institutions such as community groups, faith and family are examples of this. In Canada, the monarchy plays this role as well.
The crown is central to the Canadian constitutional order and provides a link to a glorious history which includes such events as the Magna Carta. Beware the ruler who promises to sweep aside such institutions for the sole purpose of beginning anew. If you doubt this check out the Cultural Revolution in China or the French and Russian revolutions, to name a few.
But let’s stay focused on Canada for a moment. Remember when Prime Minister Harper prorogued parliament? People were lining the roads, holding simple home made signs protesting Harper’s contempt for democracy. There was talk of the governor general getting involved and know it all smarty pants like Jon Stewart on The Daily Show made fun of it. Look at those goofy Canadians holding their signs! They have to consult with a representative of the Queen? Aren’t they an independent country? Yuck, yuck, yuck. On one level it was kind of funny, until you actually turn on your brain and think about it for a second. What we had was a crisis dealing with the legitimacy of the government and we were able to sail through due to the power and authority of an ancient institution. In most other countries these thing are settled with machetes and people being shot in the head. What the Jon Stewart’s of the world miss is that working societies are a delicate balancing act involving many different actors and factors. Arbitrarily removing one of them seldom ends well. The American War of Independence is one of the few where it did work, but that is the exception, not the rule.
For me, here’s the bottom line. For all its imperfections, Westminster democracy has delivered an unglamorous stability in countries the world over. Central to this system is the monarchy. It has historical weight and is incredibly valuable as a symbol of unifying, non-political authority. You can’t create something like it out of thin air. By restoring the names to the Royal Canadian Navy and the Royal Canadian Air Force the government is paying respect to it.
On another level it is a reminder it is a reminder of the glorious history and traditions that all Canadians are heirs and beneficiaries to. During the Second World War, when the days were the darkest and most desperate, it was the Royal Canadian Navy and Air Force that stood in the breech. The original decision made in 1968 to rename the Royal Canadian Navy “Maritime Command” was an act of cultural vandalism. What occurred then would have been no different if they had renamed the Royal Canadian Mounted Police the National Police Force or something. One has a rich tradition and resonates with Canadian history. The other is as banal as “Happy Holidays”.
I’ve read some grumblings that they don’t like this decision because they don’t like the Monarchy. Why, in this day and age, they ask, should one group of people be put on a pedestal above everyone else?
These people are completely missing the point. First of all, as noted above, the monarchy has served Canada well. The second point is that the monarchy actually represents the average Canadian on the political stage. Have you ever wondered why the Prime Minister bows to the Queen? Symbolically, it is a recognition that the office of Prime Minister is transient in nature. When he bows before the Queen he is actually bowing before the people. Prime Ministers come and go. Canada, as an idea, lives on.
When countries have a proud history that history should be celebrated and remembered. It binds a nation together and provides a firm foundation in the present on which a future can be built. You don’t celebrate your history by obliterating it. This action is a small but important step in restoring one of the proud institutions in Canadian society.
On a side note here’s a fun fact for you. The army will not be called the Royal Canadian Army because Canada follows British tradition which holds that the navy and the air force are commanded by the Queen but the army is a collection of independent regiments that serve the sovereign but are not part of the Royal Canadian Forces.
Click here for a great editorial on the significance of this change.
Related articles
- Canadian forces ‘royal’ once more (bbc.co.uk)
Is Anyone Else Getting Tired Of Warren Buffet?
Warren Buffet has penned yet another one of his tiresome”Tax me, I’m rich” articles in the New York Times. Some questions I wish Mr. Buffet would answer, but never seems to get around too:
- Please stop talking in general about tax increases. You’re a smart guy, what exactly is the Warren Buffet tax plan? Which taxes would you increase and how much would you expect the government to get from it?
- What does he think of the experience of Andrew Mellon, Secretary of the Treasury under Calvin Coolidge? When taxes were high, the number of people reporting high incomes and thereby the REVENUE to the government also decreased. When taxes were cut, rich people were willing to take money out of tax-exempt securities like state and local bonds and invest it (and have it taxed). For more information on this, see this article: http://www.appeal-democrat.com/articles/tax-101800-mellon-facts.html
- Right now, America has a real unemployment problem. Does Buffet think more jobs will be created by him investing in companies, or the government?
- When Obama had majorities in both houses, was Buffet urging him to increase taxes then? If not, why not? If so, why did Obama not act then? What’s changed? Does he think it’s because of genuine concern about the economy, or is the whole thing just an exercise in class warfare designed to aid Obama’s flagging re-election chances?
- Why doesn’t he just send how ever much he thinks he owes to the government right now? No one is stopping him. He could even do it as an example to the nation. These are the taxes that I think I should be paying, here you go.
I think it’s this last point that bugs me the most. If he seriously thinks the American economy would be better off with government taking more of his money than him investing it in new businesses, then go ahead and do it. But of course, he doesn’t. Why? I suspect articles like this are more about making himself feel good as opposed to actually helping. If he wanted to help, he’d help. I wish he’d get back to investing in new businesses as opposed to writing self indulgent articles like this. That’s what would really help the American economy.
PS – Over at Ricochet Diane Ellis has a great post on how Warren’s seemingly selfless talk have benefited him in the past. There’s a reason most of the financiers on Wall Street are big Obama fans. Crony capitalism anyone?
Obama: The Hollow Colossus
It’s amusing to me to read and watch as lefties discover just what an empty shell Obama really is.
Here’s Cenk Uygur from the Huffington Post
Jennifer Rubin, a rightie, provides much the same analysis from a different perspective.
Here’s Jennifer Rubin’s take from the Washington Post
In the end what they’ll all realizing is what I’ve thought from the beginning. With no record of accomplishment Obama was able to present himself as being all things to all people. Voters could project their wants and desires onto him, seeing whatever they wanted to see. This has been the secret of Obama’s whole career. Doing nothing as he wafted up like a feather to ever higher positions. This, of course, has all come to a crashing halt. You can’t vote “present” when your president.
The Madness Of Al Gore
As global warming fades from the public conscious as an issue many of it adherents are just plain loosing it. First among these is that glorious gasbag, Al Gore. Recently, he gave a speech in which he claimed that climate skeptics are peddling “Bulls–t”.
As I’ve stated earlier (in my post comparing climate scientists to astrologers) I think the main reason climate change is falling apart as an issue is because it proponents simply haven’t proven that they know what they are talking about. Claiming that you can model something as amazingly complicated as the Earth’s climate is an act of profound arrogance, in my opinion. If you say you can do that, you need to prove it. Simply saying “I’m an expert” isn’t good enough. Until climate scientists do this, they are little better than astrologers. Go play with your constantly changing computer models and leave the rest of us alone.
What I find amusing though is how utterly unaware Al Gore seems to be in his own role in destroying global warming as an idea. When you live a luxurious lifestyle, flying on private planes, taking your yacht out for a cruise, etc, you give off the impression that your really not serious. Mr. and Mrs. middle class rightly conclude that if you’re not prepared to walk the walk, why should they? If Al Gore can have a carbon footprint larger than some countries, they shouldn’t feel too bad about having two cars and a three bedroom house.
Is Universal Suffrage A Good Thing?
Bill Flax has a great article in Forbes questioning the value of universal suffrage. His basic point is that the reason that all democracies have failed in history is because they reach a point where people find it easier to vote themselves benefits, rather than earning it for themselves. America’s founders knew this to be true which is why they set up a constitutional republic, rather than a democracy. The basic principle is if you’re not paying into the system, why should you get to vote how the goods are divvied up?
Some of the comments to this article were pretty interesting. I found those that opposed his ideas to be quite hysterical and not really dealing with the issues he raised. The most eloquent was the comment below:
An admirably frank call for class war and the full entrenchment of contemporary oligarchy! I wish that most oligarchs — especially those who control media empires and prefer to hide behind a facade of populism — were so publicly bold in stating their real opinions. Then the often disguised conflict between oligarchy and democracy could be better clarified, and there might be some slim prospect of reducing the gross inequalities of wealth and education that stand in the way of an intelligent democracy.
The only way you learn anything in this world is to discuss things with people you don’t agree with. This is why I posted this reply to the above:
Hi Douglas,
Clearly you don’t agree with what the author wrote. I find your point of view interesting and would appreciate it if you dealt with the issue he raised. Namely, as the founding fathers knew, democracies don’t last in the long run. The reason why this happens is that invariably a sizable part of the population learns that it is easier to vote themselves benefits then to actually earn them through productive work. Politicians are all too eager to cater to this group as it is the easiest way to elected. As the saying goes, “When you rob Peter to pay Paul, you can always count on Paul’s vote.” In the long run this cannot last as you need people to be productive and to produce good and services that others actually want. When you don’t have that the whole system starts to fall apart. This is why the founding fathers didn’t set up a democracy, they set up a constitutional republic. Do you disagree with the founders? What is wrong with my analysis above? What is wrong with the proposition that if you’re not paying into the till, you shouldn’t get to vote on how it is divided up? I’d really appreciate your insights.
Will Douglas respond? I can only hope.
One other thing. The article also had a great Bastiat quote:
“The state is the great fictitious entity by which everyone seeks to live at the expense of everyone else.”
So true.
