Economics

It is easy to get distracted by all the forebodings in the news today, so I want to offer Discovery Institute friends a “read” that will re-inspire you and also assert some of the personality and philosophy that I hope animates this organization and its fellows. It should encourage a different version of Independence Day enthusiasm as it is quintessentially American.

My Uncle Berlin B. Chapman was raised literally a hundred years ago in the hills of West Virginia, put himself through college and Harvard Graduate School (Phd.), and taught history the rest of his life in Oklahoma–producing some of that region’s first histories. He once told me that in his opinion “the greatest commencement address” ever made was “Acres of Diamonds,” by Baptist preacher and Temple University President Russell Conwell. I asked Uncle Berlin for the gist of it–that the opportunities in life are found in one’s own backyard–and was more or less satisfied with that truism. But I finally got around to reading a version of the address itself today because I wanted to recommend it to a young political friend of mine. Read More ›

The Obama Administration is frustrated that the kids getting government financed school lunches are not eating them. Huge piles of uneaten foodstuffs are being thrown out daily. Worse, a Congressional Committee has learned that there is black market among the kids for salt and pepper, since Michelle Obama is trying to keep these dangerous chemicals out of the food our youth consume. The situation has grown so bad that some parents are sending their kids to school with their own lunches. That of course should be prohibited and the contraband seized as evidence by the Justice Department. Other parents–even poor ones!–are taking their kids out of school and feeding them lunch at home. Why, that’s almost un-American. Kids eating lunch Read More ›

Nursery flowers watered with drip irrigation in Israel

Here is a series of connected articles that explain Israel’s innovations in drip-irrigation (much discussed also in George Gilder’s The Israel Test), drought resistant crop development, desalinization, squeezing water out of dew and creating winter-fed cisterns like the Nabateans used 2000 years ago in the “rose red” city of Petra. Read More ›

From the riots in Baltimore to the ballooning food stamp rolls, we witness in human terms the feebleness of the economic recovery. In front of the government and candidates for office should be the question, how to find good paying jobs and lifetime careers for people who have been socially promoted through public schools and maybe even college and now find themselves unemployed or under-employed? There are 92,000,000 unemployed adults in the country, many of them young, who have just dropped out of the economy. They may have few skills that employers need. Or they just never did very well in obtaining contemporary work skills, so they are not competitive with, say, highly motivated tech workers from overseas. At Microsoft the bosses expect excellence, not just good-enough. If you don’t make the cut, the job goes to someone in India or from India. Either way, many Americans lose.

Or, again, we encounter the really nice, smart, self-directed young person who was told to follow his or her bliss and then took the college courses that sounded cool, rather than those that would prepare them for the hard-knocks-life after school and when the tuition loans come due. They are looking around now, stuck and bewildered.

Those in the tech world, such as our former colleague Bret Swanson, writing for the U.S. Chamber of Commerce foundation, are absolutely right to insist that the slow growth economy will not lift the society as a whole. What Mitt Romney and the GOP was trying to say in 2012 was that encouraging entrepreneurs would create the new businesses, and hence opportunities, to help tighten the labor market and raise wages. Speaking yesterday at Heritage Foundation’s Resource Bank conference in Bellevue, WA, venture capitalist Matt McIlwain of Madrona, LLC in Seattle described the folly of enacting “net neutrality,” effectively a government take-over of the Internet. The free Internet may have killed some jobs, but it also has been the greatest source of new jobs in the past generation. Imagine if the government had regulated it as it has done the phone companies!

The Wall Street Journal editorial page today (behind a pay-wall) is also right in observing that the people making money in this economy of low interest rates and high regulatory barriers to innovation are largely in the financial world,lawyers doing mergers and deal makers with government contacts.

Such is the real rigging of the the economy, and it causes the very inequality that the left uses to demand more leveling. In reality, the real problem with inequality is not too many real business people getting rich, but that we have a lot of people who are not getting ahead because they have arrived in their ’20s with slim prospects or have lost jobs and are unable to match the requirements of new ones. Yes, there are minimum skill jobs opening in food, entertainment, health services (from massage therapy to senior care)–in short, anything that can’t be handled cheaper and better by lower price workers overseas or by a robot in America. But there aren’t enough of those jobs. Read More ›

Discovery Sr. Fellow George Gilder and other “elders” of the privatized Internet era expressed their alarm over drive by the FCC and Obama Administration to put Internet innovation under federal regulation in the name of “Net Neutrality”. They want an “open Internet” instead.

The Daily Caller said, “Tech elder George Gilder, a futurist author and co-founder of the Discovery Institute, told TheDCNF that businesses have no incentive to interfere with Internet freedom. ‘Their interests are aligned with an open Internet,’ he noted, ‘and the idea that Title II can impose an open internet is just quixotic.'”

A sizable media contingent covered the “elders” presser, and noted the significance of leaders such as Bob Metcalf, John Perry Barlow, Mark Cuban and Scott McNeilly, among others, speaking out on a controversial subject. Daniel Berniger organized the event.

George Gilder advised me today that the Internet companies now represent almost half the value of the NASDAQ and that putting the FCC into the role of regulating them–using the old telephone company model of 1934–could greatly damage economic growth. “It’s Obama’s biggest socialist grab so far,” Gilder said. Read More ›

The following is a transcript of Discovery Sr. Fellow Scott S. Powell’s lecture last week at Florida Atlantic University, Boca Raton.

There have been many civilizations that have come into being over the last 6,000 years—from the ancient Mesopotamians, Egyptians, and Asian civilizations that sprang up around the Euphrates, Tigress, Nile, Indus and Yellow River valleys, to the more recent and advanced Greek and Roman civilizations, which have more directly shaped Western civilization. While each of these civilizations made their own contributions to progress during the times in which they flourished, none of them unleashed the kind of economic development and entrepreneurial productivity witnessed in the first two hundred years of the American civilization.

As a starting point, it is worth considering the basics. The tools brought by the first colonists that arrived in the new world and settled in Jamestown, Virginia in 1607, and then in Plymouth, Massachusetts in 1620, were primitive. They were the same basic rudimentary tools of sustenance—such as shovels, axes, hoes and ploughs—that previous civilizations had also used.

But something happened in America that sped up progress beyond what had ever happened previously in human history. What I would like to do is identify some of the key human characteristics and arrangements that helped the American economy take off and create a revolution of upward mobility and prosperity — one that became a model that has benefited other countries around the world who adopted similar ways. Next, we’ll consider some of the main reasons why and how this extraordinarily beneficial system has come under criticism and why it continues to be on the defensive despite its success. Then, we’ll look briefly at the competing alternative—socialism—with particular attention to understanding whether it is a viable alternative. We will open it up for discussion and perhaps wrap it up by my touching on some of the things that could be done to restore some balance and appreciation of the system and institutions which have provided so much material well-being. Read More ›

FREE MARKET REVOLUTION DISCUSSION Thursday, April 9 5-6 p.m. Florida Atlantic University Boca Raton, FL Building SO, Room 300 For more information or to RSVP, contact Dr. Marshall DeRosa, Professor of Political Science, FAU: derosa@fau.edu.

The Hobbit Party, by our colleagues Jonathan Witt and Jay W. Richards, has been named one of the top books of 2014 for Christians. Kevin DeYoung, a Reformed church spokesman, lists a surprisingly catholic (small “c”) Top Ten selections. Of The Hobbit Party, DeYoung writes, “More people should be talking about this book. It’s full of excellent background information on Tolkien and the worldview that shaped his creation of Middle Earth. Even LOTR enthusiasts will see things they hadn’t seen before.”

For three decades there have been two issues that politicians regarded as so thorny they were best left alone: health care and immigration. The moving parts in each subject are complicated, and feelings run so strong that Presidents and Congresses long decided to speak only in general terms on the topics and otherwise leave them alone. Now we have seen what happens when one party (call it the President Obama party) decides to impose a health care solution. The clean up is still going on five years after passage of the misnamed Affordable Care Act and it will continue long into the future. Even more so, sadly, immigration. Fortunately, some critics are bringing up one of the veiled aspects of Read More ›

The Thanksgiving holiday is a perfect occasion for reading The Hobbit Party by Jonathan Witt and Jay Richards, both of them Discovery fellows. It’s an amusing and sage guide to Tolkien’s philosophy as applied to modern times–to economics, for example. The distinguished Catholic priest/cultural guide, Fr. C. John McCloskey does the book proud in Catholicity.com. .