Hayek Versus Keynes

The video “Fight of the Century: Keynes vs. Hayek Round Two” (via Econstories.tv) allows us to discern one reason why reporters side with the forces of large government.

Hayek’s corner man is von Mises, while Keynes strangely has Say (Galbraith must have been off skiing). Hayek clearly wins the round on points, scoring blow after unanswered-blow. The only point which Keynes bests Hayek is at the lip. Keynes’s ‘stache is bold, serious, starched, Bismarckian. It makes John Bolton’s walrus-like appendage appear anemic. Hayek’s fuzz is half-hearted, cutoff too soon, a foreign interloper. As a soup-strainer it is a failure. Hand that man a glass of milk!

But Hayek doesn’t even break a swear in the battle over the public ledger. Even though Hayek wins the fight proper, it is Keynes’s gloved hand the referee lifts at the end, not Hayek’s. Why?

It’s obvious that the fight was organized by some Don King-like entity, the outcome decided in advance by the connected, made men who depend on bailouts, payouts, and regulations foist on the other guy; the connected who move in and out of the government that feeds them. But why do reporters tout the loser?

Ego. The reporters throng around the man whose theory gives their lives meaning. Oh, sure, there are plenty of other reasons, like indoctrination in college and ignorance of economics. But no less important is self-esteem. I mean, the larger is government, the more important the reporter’s job, thus the more magnificent his opinion of himself.

Caution: the video is set to poor music. The lyric is clever, but the beat grates: it is, however, tolerable. The noise which accompanies the credits must have been a mistake uncorrected in production. Be ready to hit mute.

The fight isn’t over. There are more rounds to come, as evinced by this morning’s editorial in the Wall Street Journal, which reminds us of Mr Obama’s Keynesian thinking:

First came $168 billion in one-time tax rebates in February 2008 under George W. Bush, then $814 billion in spending spread over 2009-2010, cash for clunkers, the $8,000 home buyer tax credit, Hamp to prevent home foreclosures, the Detroit auto bailouts, billions for green jobs, a payroll tax cut for 2011, and of course near-zero interest rates for 28 months buttressed by quantitative easing I and II.

Scratchy growth, loose money, a tanking dollar, boasts—boasts– of “Leading from behind”, and inflation coming. Are we ready for five more years or this, or just one?

Government outlays: The Canadian Experience — Guest Post by David Ipperciel

In the post “Taxing the Rich Always Fails Eventually,” Briggs states that, “It is rational to believe that these years [of decreasing deficits] will continue to be infrequent.” I believe this to be the case only if one’s world is restricted to the US. However, when looking at the experience from other countries like Sweden or Canada, a different conclusion arises.

The following graph shows the Inflation-adjusted Outlay Per Capita up until 2007 for the Canadian federal government (constant 2007 dollars).

Canadian output per capita

The same situation can be illustrated with the debt to GDP graph, wich peaked around 75% in 1995, and moved below 30% in the following years:

Canadian output per capita

The situation is similar in Sweden, where debt to GDP peaked in 1995 around the same levels, followed by a dramatic turnaround (the graph starts in 1880 and shows the GDP debt ratio):

Sweden GDP per capita

Briggs’s graph starts in 1900, whereas my graph starts in 1961. Prior to 1961, there is no reason to expect a situation much difference from the US: government started with modest goals and modest tax grabs, with peaks during the two World Wars followed by peacetime corrections, in a general uptrend as the state become more omnipresent. The interesting story is what happens after the 1991 recession. While the US outlays continue to push higher, Canadian outlays not only stabilize, but even move lower. What happened?

Outside public outcry and tax hikes to pay for the increasing debt, the first real blow come from Moody’s downgrade of Canada’s foreign debt in 1994, which lost its AAA rating. Then an article from the Wall Street Journal shook Canadians’ perceptions of themselves: the article had called Canada an honorary Third World country because of their out-of-control debt. Something had to be done, and the government reacted swiftly: government spending was cut by 20% and 40,000 public jobs were eliminated.

The political landscape also changed: the conservative Mike Harris was elected in Ontario (the largest province with 38% of the country’s population) in 1995 on his “Common Sense Revolution” platform, which called for large tax and spending cuts, and the elimination of the province’s huge debt. One provincial government after the other voted for balanced budget laws.

In order to implement that initiative, contingent reserves were set up as buffers to make sure spending did not surpass income. Establishing conservative estimates of revenues was seen as sound fiscal planning. Year after year, the surplus came out larger than the government forecast. This situation lasted until the last financial crisis, but there is no reason not to believe that Canada will not regain fiscal balance in the near future.

The Canadian situation shows that governments can change the tide when pushed to the wall. Often, an excuse is needed to enact these changes. The Standard and Poor’s rating agency put the US debt on negative outlook this month, with a potential downgrade in the next two years. Will that bring about the needed changes? Will the unavoidable tax hike push the population to the edge and lead to change? The future is always hard to predict, but one thing is certain: the possibility for change exists, and the experience from Canada (and Sweden and probably other countries we know little about) is there to show it.

A Citizen’s Top Style Choices

In a hurry this morning. The Wall Street Journal ran a long interview with tailor Ethan Newton who, we learn, is moving to Hong Kong. Mazel Tov to him. After detailing this news, the paper asked Newton questions about his style. My answers follow (this is to save the WSJ the efforts of following up with me).

What are you wearing right now?

A blue-and-yellow-over-beige windowpane linen jacket, a baby-blue and white striped spread collar lightweight cotton shirt, and a pair of 10 oz. double-pleated off-white linen cuffed pants. Tan belt and nondescript tan loafers. Hat is a linen cap as my Panama is not yet in my hands.

And now for the truth, since that is what I wore yesterday: coffee-stained t-shirt and very worn boxers purchased from that eminent sartorial establishment K-Mart.

What’s the one thing you’ll never wear?

Any 60s-colored light-weight trousers tight enough to unambiguously reveal whether I am a Cavalier or Roundhead.

What do you put on when you’re just hanging out?

Firehouse or canvas slacks, brown shirt (cotton or linen), ancient bomber jacket, brown brogues, and, depending on the weather, brown fedora or cap. You’ll always eventually regret dressing down in public.

What’s the most expensive piece of clothing you’ve ever bought?

Newton paid US$7,184 for a bespoke suit. I am a humble scientist, so my suits are an order of magnitude less.

What will your next purchase be?

A box of CAO Brazilia, which will compliment and complement my new Panama.

Worst fashion mistake?

Being cheap and thinking, “It won’t matter.” It always does.

Best buy?

At Daffy’s in New York, a gray-brown single-breasted, notch lapel classic cut (not a sack and not “European”) Super 120s, indestructible suit. Only suit bought off the rack that was cut perfectly for my shape; no alterations needed. That suit walked right out of the 1930s by way of 2002. There was only one and it was a 41L. I have never been able to find another by the same maker.

Favorite suit maker/fashion designer?

Many, particularly spoken of in this (and other) threads at Fedora Forum. The shop Paul Stewart, which favors more body-conforming cuts, is a reliable guide, whereas Brooks Brothers, which features dull and unflattering sack suits, is not.

Least favorite?

Nearly everything “fashionable” from the 1960s and 1970s, and anything that stinks of hip.

Favorite jeweler

None. Except for wedding rings and watch (see below), men should minimize jewelry.

Favorite tailor

Joe “My Tailor” Hemrajani. Bespoke suits for $650 (and way on up). This is not a lot of money if you consider that you will keep this suit for a decade or even longer, perhaps 500-600 wearings, which is one flat dollar per outing. It will be of classic style, made to fit you not some anonymous, short-armed, dunlapped Mr Average.

Hemrajani tours various countries from time to time, taking measurements and pictures of clients, then returns home where labor and material is cheaper. Highly recommended.

Favorite jeans

None. The last pair of jeans I wore I borrowed from my father when he needed assistance heaving and hoeing. I live in a small apartment and have no maintenance or landscaping duties.

Favorite suits

I’ll echo Newton here: those that fit me. If you have to sacrifice, always choose a better cut over better cloth. Well fitting suits made of synthetics will beat ill fitting ones made of the best wool.

Tuxedo style?

Same as Newton: classic, subdued, bow tie. The whole should be unnoticeable; viewers should be drawn to your face, the suit itself should fade away and be forgotten. Tuxedos are worn for occasions, not fashion.

Favorite thing in your closet?

Brown, beaver-felt, wide-banded fedora, cut for my misshapen skull. Both dressy and utilitarian.

Favorite watch

Don’t wear one. I note that watches are no longer called that, because you cannot sell a “timepiece”, “chronometer”, “chronograph”, “chronométre”, or “timing instrument” for a mere fifty bucks. If you are dressing to show off, you are not interested in style, but in aggrandisement. Simpler to carry a banner which advertises your net worth.

Favorite sunglasses

Cheap pair picked up in San Francisco. Have somebody of good judgment decide for you by standing 8 to 10 feet away.


Good grief! Honest sweat.


The misspelled name of my best friend from my boyhood. I can’t imagine what else this might be.


This must be yet another crude euphemism for our morning activities (it comes from an old joke, favored by my father: “Engineers work it out with a pencil”).

Running shoes

Since I am never chased, I never wear them.

Mode of transport

Walking. I do not, and have not, owned a car for some thirteen years. I am very green.


Ancient flip model which falls under the class “dumb phone.” It makes and receives calls and sinks when dropped into bodies of water, but dries nicely. That is all it does.


The only choice for the real man: Linux. Currently Ubuntu 10.10, running a mix of Gnome and KDE. Also—and I swear this is true—Fedora.


Bach, Telemann, Mozart, Artie Shaw. Harry James, Louis Armstrong. You get the idea.

E-book or old book?

The same: physical books and classics on my Kindle. I refuse to pay for e-book licenses because (a) I want to own my books outright, (b) I do not want to re-buy or lose my books when I either lose or break my reader, or when the reader becomes obsolete.

SETI Goes Deaf

The Allen Telescope Array run by SETI—Search for Extra-terrestrial Intelligence—has been forced into hibernation because of the lack of money (Mercury News story). The electronic ears will remain planted on Mount Shasta, but their juice will be turned off.

From now, and unless somebody rich with stars in their eyes comes to the rescue, we won’t know if ET is calling and we’ll have to rely on our nation’s annual crop of out-of-focus photographs of sightings and hypnosis-recalled memories of abductions to verify that there is sentient life elsewhere in the universe.SETI

Not everybody is sad about SETI’s setback. There have long been complaints from white-shoe science firms, which all have the flavor that “SETI isn’t real science.” The argument is that since SETI listeners haven’t proved that there are aliens to listen to, then there are no evidence that aliens are calling. This is a valid argument, but it is tautological. Of course SETI doesn’t know if there is anybody out there: if they did, then they wouldn’t have to search!

Besides, there is evidence that other life exists: us. We, who are nothing special, evolved over a (rough) five billion-year period in a universe which is about two-and-a-half times that. Further, wherever we look on this rock, even in the most (to us) inhospitable places, life thrives. And since, as Carl Sagan did not say, there are billions and billions of other planets throughout the universe, and since physics appears (somewhat?) invariant in the best and worst neighborhoods, it is likely life evolved elsewhere. So why not look for it?

Trouble is, SETI listeners have the mathematics of communication theory working against them. Hidden in the arcana of that set of equations is a theorem which shows that the more efficient the mode of communication, the more the signal resembles noise. This is easy to get a feel of. Ordinary text and speech are filled with redundancies and extraneous effluvia. Strip that out and and all that is left is the core of an idea which, when transmitted, looks a lot like noise. That makes discriminating between signal and noise difficult or impossible.

If the aliens that are out there are more sophisticated than we, and if they still feel like chatting, then eavesdropping on their conversations is unlikely. Any communications we intercept from advanced aliens would have to be purposefully directed. But if the aliens are superior in smarts, they might not be especially interested in ignorant just-out-of-cave-dwellers like us (have you seen what’s on TV lately?). There are so many unknowns here that we cannot say with any certainty that there are definite signals to be found. That is, even if other, more-advanced life exists, there might not be anything for us to hear (or the search may take thousands of years).

Then again, there might be other life in other places, but none of it may be as advanced as we are. It is at least plausible to suggest that humans are the first sentient species in the universe. So it is possible that other species might hear us. However, our species is not old, especially when considered as a fraction of the age of the universe, and it has just been in the last 100 years or so that we have learned to communicate.

Proof of our existence is available in a sphere surrounding Earth with a radius of about 100 light years, but it is weak, sorely weak in strength. Space is vast, vaster than our federal deficit, so vast that the distances between objects is difficult to imagine. 100 light years is nothing; it is just around the block. Nobody has had time to hear us yet.

Is it worth funding SETI? Sure, for an individual and not a government, but only for the bragging rights. One justification oft heard is that the discovery of other life “Will change the way we view our place in the universe.” This is rot. Finding ET won’t change anything. For one, there are already millions convinced that ET is here and been meddling with human affairs (how do you explain Obama’s missing birth certificate?). The number of UFO reports after SETI verifies will skyrocket.

Everybody else will assimilate the news so fast that the only shock will be on the faces of the atheists who had hoped that proof of extraterrestrial intelligence would force the religious to abandon their beliefs. Once people realize how next-to-impossible it is to travel to or from the signal’s origin, the news of ET’s existence will be pushed off the front page as soon as a celebrity commits some gaffe; which is to say, within a week.

Slaughter Better Than Disease In Controlling Global Warming, Researchers

If you had to guess, which of these would you think would be a better control for global warming: Genghis Khan or the Black Death? Before answering, consider that both were responsible for removing a significant chunk of humanity from the surface of the planet (and interning it underground). The logic is that since it is people who cause global warming, fewer of these pests means less global warming.

Most ordinary citizens pick the Black Death, if only because of the name, which is scarier than the Great Khan’s. And when it was in its youth, the infamous disease wiped out nearly a third of Europe plus a significant chunk of the Asian Subcontinent. Altogether, the Bubonic plague, the official alias of Black Death, killed about 100 million, a toll which rivals even militant socialism (a.k.a. communism). genghis khan battles global warming

But Julia Pongratz of the Carnegie Institution’s Department of Global Ecology compared the bodies piled up by the Black Death with those massacred by Genghis Khan and found that those who fell by the sword took more carbon with them than those who met their demise by disease. Why?

Genghis Khan and his Mongol hordes had an impact on the global carbon cycle as big as today’s annual demand for gasoline. The Black Death, on the other hand, came and went too quickly for it to cause much of a blip in the global carbon budget.

More particularly, “During high-mortality events, such as wars and plagues, large areas of croplands and pastures have been abandoned and forests have re-grown, absorbing carbon dioxide from the atmosphere.” Stated less euphemistically, fewer people means less carbon dioxide injected into the atmosphere, the poisonous gas responsible for climate chaos.

What made the Mongol invasion so great wasn’t just that it killed so many net-carbon increasers, but that it lasted so long, more than time enough to allow trees to take the place of the slaughtered. Khan himself didn’t live forever, of course, but his well-trained hordes pushed on towards Europe for just over a century. A healthy forest can be grown in that time.

The Black Death also lasted about a century, and while it killed twice as many people as did Genghis and his followers, it didn’t kill with the same efficiency as the Mongols. The plague would wander into a populated area and, depending on its mood, would take a out a few here, a few there. It was picky, choosing its victims haphazardly, almost as if it didn’t take itself seriously. The problem was that it left too many alive in any one spot, and those survivors, being only human, decided to celebrate their success of not being killed by engaging in some vigorous breeding by the warm glow of fireplaces. Fireplaces using wood from—you guessed it—nearby forests.

Contrast that with Khanian behavior. The Mongols would ride to town, surround it, encourage its occupants to surrender and be killed in an organized, efficient manner. Or, if the town’s occupants were recalcitrant, the Mongols would lay siege and then kill everybody in a sloppy, disorganized way. It was a take-no-prisoners, kill-everything-in-site attitude either way.

The good thing about this, according to Pongratz, was that when the hordes pushed on towards their next set of victims, they left only silence behind. And barren (freshly fertilized) ground covered in tree seeds—seeds which were able to grow into forests which sucked CO2 from the air, thus cooling the planet.

According to a summary of Pongratz’s work, “Genghis Khan’s bloody conquests scrubbed 700million tons of carbon from the atmosphere as depopulated land returned to forest.” Al Gore was the Nobel Peace Prize for a lot less than that!

The Mongols killed only half as many as the Black Death, but by removing these folks contiguously, “there was enough time for the forests to re-grow and absorb significant amounts of carbon.” In fact, the amount of carbon socked away on the “re-growth on depopulated lands” was “equivalent to the world’s total annual demand for gasoline today.”

The potential uses for Pongratz’s research are obvious. “Based on the knowledge we have gained from the past, we are now in a position to make land-use decisions that will diminish our impact on climate and the carbon cycle.” We now know that we can’t rely on disease to solve our global warming problems. Other solutions must be explored.

Men’s Fashion

Happy Easter! As you don your new bonnets and climb into your finest to celebrate, provided here in one spot are all articles on men’s fashion.


Stunning New Book! Hats For All

How can you tell which kind of head enjoy? If as you walk down the street mothers draw their children closer, young ladies gasp, and men move to cover their wallets, you are a long-oval. Otherwise, you’re probably normal-oval.

The Etiquette Of Hats (For Men)

Beaver fur is preferred over rabbit or some other lesser creature. Beaver is more supple, sheds rain better, and is prettier…Never be cheap in hat or shoes! It always tells.

General Clothing

Top 10 Men’s fashion rules

Rule 1: Dress for the job! All other rules flow from this one. It’s the most obvious, but also the most abused.

Men’s Fashion Advice: Pocket Squares

The younger you are, the less of your pocket square should show. If you’re in your twenties, you haven’t yet earned the right to be cavalier. Conversely, the older you, the freer you can be with showing silk.

Horrible College Fashion: Both Professors And Students

At the beginning of the semester, a veteran professor told me to pay attention to the students’ dress. She said that in the first week, all the females would be primped, painted, and pretty, and that the males would be wearing “their best t-shirts.” But by Thanksgiving, even the females would come class directly from bed, clad in either pajamas concealed by coats or the same sweatsuit.

Top 10 Women’s Fashion Rules

I’ll give one example of such signaling. A female asked me to read over an email that she was going to send to another female. The subject was of political importance. I began to read the email aloud. “Sally…,” I said, for this was the opening, but I was stopped immediately by the writer who said, “Is that too strong?” I didn’t understand: wasn’t Sally the intended recipient? She was. But the writer said to me, “Whenever I am happy with somebody I always start with something like ‘Hi Sally’, but if I am very angry I leave off the ‘Hi’.”

Don’t Blame Me. I Don’t Have Free Will

Try this argument on for size: I am a smart, clever guy with an advanced degree in neurology and tenure. The brain is a biological machine. But I don’t understand how free will works. Therefore, free will doesn’t exist. Quod erat demonstratum!

That bargain-basement syllogism is akin to saying this: I am smart, etc. My automobile is an electronic/mechanical machine. But I don’t understand how my newfangled automobile runs. Therefore, my automobile doesn’t move. It only apparently carries me from place to place, though I remain still.

As asinine as these arguments are, they are convincing to some. For example, Jonah Lehrer, author of How We Decide and of the Wall Street Journal article, “Our Social Networks, Ourselves: Does free will even exist? Scientists are finding that we’re much more predictable than we think.”

Lehrer was able to write—but wait a minute; let’s be clear what is who and who is what. The label “Jonah Lehrer” sits above the article, but this label cannot be a person, a thinking entity with free will. It is instead a deterministic meat-machine that had no choice but to put together the string of words that found their way to print. Some of those words were these:

Although we can’t help but believe in our autonomy—free will is a fiction we need—this latest research suggests we’re not nearly as free as we typically assume.

The output “free will is a fiction we need” is evidently is a message to other meat-machines that if they thought they were thinking, they were mistaken. In fact, they cannot be “they”. If there is no free will, there is no “I”, no “we”, “you” is absent, and “they” is a misnomer. There are only objects.

Since this is so, those of us who claim to have free will can only wonder why the meat-machine Jonah Lehrer seeks to convince other meat-machines that their thoughts are not their own, but merely uncontrollable mental impulses. Has this Jonah Lehrer meat-machine somehow become a “he”, an entity with free will, a machine that was able to escape his biological limitations to become something other? A being that can look down on the rest of the machines and try to comfort them?

How did “he” manage this if he did not have free will? But perhaps it is merely a meat-machine after all, and those words have no meaning, they are just strings of letters and words, epistemologically blank. If there is no free will, it had no choice but to pen this string. Just as “I” have no choice to say these words.

But enough. The absurdity is evident. The only questions are why intellectuals like Lehrer come to believe they don’t exist (their meat exists, of course, but not their selves), and why they feel (for clearly there is a “they” to feel) they have to convince others that they don’t exist.

Lehrer cites “research” for why he says there is no free will. For example, work which shows, “Moods are also contagious. When a person is happy, nearby friends are 25% more likely to also be happy, according to research from Harvard Medical School. These viral emotions can even spread via online networks, such as Facebook and Twitter.” Harvard!

And how about this stunner: “According to the data, if a person becomes obese, the likelihood that one of his or her friends will become obese increases by 57%.”

In other words, if you tell a joke, your listener is “25% more likely” to be cheered, and if you hang around people who eat as you do, and those people are fat, you stand a good chance of packing on the pounds, too. Golly.

These and the other trivial facts Lehrer mentions as evidence that free will is a fiction were long known, of course, and known by every living soul. But they had never before been published in a medical journal by neurologists who were able to tie in Rudyard Kipling-like yarns about why what was obvious to all really meant we had no control over our own destinies.

Since your free will is absent, or severely stunted, you have no choice but to mimic the behavior of those nearest you. That is what those statistics purport to show. But left unanswered is the obvious question: who is making those close to you act as they do? Do they have free will? How do new behaviors begin?

Being able to guess your weight within 50 pounds by knowing only your zip code, or forecasting new movies you will like given recommendations by those with similar cinematic tastes are not monumental achievements in predictive science. And they are certainly not indicative that we don’t have free will.