Social Justice Destroys the Prospects of the Downtrodden

“What if the teachers of that era had been imbued with the present day conception of fairness? Where would my schoolmate and I be today? On welfare, in prison, perhaps at a halfway house if we were lucky; and would that not have been an injustice? To take individuals capable of independent, self-supporting and being self-directed women and men with pride in their own achievements and turned them into dependents, clients, supplicants, mascots?”

What we commonly refer to as social justice, Thomas Sowell calls cosmic justice. In the above video he gives his take on the damage that is caused by the quest for equal outcomes.

This is one of my favorite speeches of his because it speaks to the way in which these typically liberal policies which sound helpful, are actually harmful by being enabling. You know, there was once a time when Italians, Jews, Irish, and Asians were all very heavily discriminated against in America. How did these groups largely overcome that? It wasn’t by government handout. The simple fact is, that if you want to give a person or persons the ability to rise above discrimination, you have to give them economic freedom which will enable them to not be dependent on anyone who would choose to discriminate against them.

Capitalism On Earth Day

I may never truly understand most millenials. Their propensity to consume, consume, consume, and then blame others for their problems in life is agonizingly perplexing to me. Their comfort with debt is something I don’t think I will ever attain, nor do I want to. The impacts of consumption beyond merely the financial hit me hard today. As you know it is Earth Day, a day which provides a good excuse for us to stop our otherwise busy lives and reflect on our surroundings. I didn’t have anything special planned today, so I set off early in the morning with my dog to explore some of the back country in our newly home state of Oregon. Moving up from Southern California, the beauty here puts me in awe. Southern California is beautiful in its own right with its warm sandy beaches, unique desert landscapes (said to have inspired Dr. Seuss, who resided in La Jolla), and awesome sunsets. The landscape in Oregon is of a completely different world; lush greenery as far as the eye can see, waterfalls and flowing rivers and giant thick forests of trees.

Well, for the most part anyways. While out on my walk this morning I was forced to realize just how many of these trees are being cut down. It’s a little sad to see these beautiful hillsides cut down into barren landscapes, with only two foot tall trunks in remembrance of the beautiful giants that once populated this land. This disappointment must be tempered by the realism that people require shelter, and most people will desire more than just basic structures and living appointments. It is true that there are other ways of obtaining these things than cutting down trees; other building materials which may be more environmentally friendly. I am no expert on this subject, but perhaps you are.

That is where free market capitalism comes in to play. It seems that so many people have forgotten the power that we hold as consumers. Maybe it’s because they have given in to marketing and feel that the things they buy are in fact needs and not wants. This can easily be proven false; but with a very few exceptions, if you choose not to buy from a given company, they will cease to exist, but you will not. So on this Earth Day 2018, remember that if you want to make a difference for the environment, it’s as simple as putting thought and care into your purchasing habits. Stop buying crap you don’t need that only temporarily increases your happiness (this is called hedonic adaptation, which I’ll expand on in a later article), and choose to buy items made from sustainable materials sold by responsible companies whenever possible, or buy more things second hand. By doing this, you are exercising your power as a consumer and making your voice heard in a way which, if ignored, is done so only at the peril of those companies who choose to do so.

How Government Created Wage Inequality

It’s a popular maxim of the left today that wage inequality is out of control in the United States, and you know what? They’re right. The latest statistics show that CEO’s make somewhere along the lines of 300 times more than their employees, on average. This figure certainly sounds astounding, and there are lots of arguments for why this is such a terrible injustice. I’m not going to discuss the merits or perils of inequality today, but rather I’ll focus on how we arrived at such a staggeringly high disparity in wages.

For as long as there have been CEO’s running companies with employees, there has been a wage gap. The fact that as you move up the company hierarchy, your compensation increases is something which I will venture to say most people find to be normal and not morally reprehensible in and of itself. Rather, I believe that the outrage at this wage disparity appears after people see how large that gap actually is.

In the mid 60’s the average CEO made 20 times what their employees made, and in the mid 70’s they made almost 30 times what their employees made. These disparities continued to gradually increase, and by 1989 CEOs were making almost 60 times what their employees made. So the growth in this disparity had been occurring for quite some time, and then, as now, the non-CEOs of the world were becoming discontented with this disparity.

When Bill Clinton was elected in 1992, he promised to tackle this issue. He planned to achieve this by not allowing companies to write off salary expenses if the salary was over $1 million per year. It was a soft government control that on the surface sounded reasonable. After all, they aren’t preventing a company from paying their CEO whatever salary they deem fair, but simply eliminating the taxpayer subsidization of such high salaries.

It didn’t work.

Not only did it fail to slow the growth of the wage gap, but it likely resulted in even more unexpected damage to shareholders and American innovation. At the beginning of Clinton’s term, average CEO compensation was at $4.9 million, after his bill passed average CEO compensation skyrocketed to $20.3 million, meaning that the average CEO compensation at the time was nearly 400 times that of their employees!

2018-04-03 12-05-07_CEO Pay Continues to Rise as Typical Workers Are Paid Less _ Economic Policy Ins

How is it possible that Clinton’s bill, intended to shrink the wage gap, had actually had the opposite effect? It’s simple. When the rule changes regarding tax write offs and high salaries were implemented, CEOs began taking less in salary, and more in stock options. If the stock performed well, they got paid out in huge bonuses. This did two things, 1) it incentivized CEOs to value short term stock gains above all else, and 2) it created competition among executives, as their earnings were now required to be made public. CEOs never really cared how much more they were making than their employees, but they sure as hell cared if they could be making more money as a CEO elsewhere.

The first result of this legislation is particularly damaging, because it not only grew the wage gap, but it damaged the long term profitability of American companies, jeopardizing millions of American jobs while CEOs made short sighted decisions to optimize the lining of their own pockets. Money that had previously been invested in R&D was now being used to boost dividends and short term stock performance.

There are other hazards to this short term viewpoint as well, such as the dramatic rise in cost of the Epipen treatment. In 2014, a company called Mylan offered a stock grant worth up to $82 million dollars to their top five executives if their earnings and stock prices met the companies’ targets by the end of 2018. If the company did not achieve these targets, the executives would receive nothing. Almost immediately, the price of the Epipen treatment doubled; and with a government granted monopoly on the product, consumers were left out to dry.

There’s an old expression about the way in which the road to hell is paved. While I have no doubt that inside the government their are workers who are good and decent human beings, genuinely seeking to improve the world around them, these actions almost always have unintended consequences.

 

Housing Prices, or Why to Get the Hell Out of California

Having given my notice at work I find my motivation to continue working hard waning each day. In an effort to do things other than work at work I decided to compare the housing market between Salem, OR and San Diego, CA. While I already had a good feeling for what the difference was since I spend a lot of time monitoring various housing markets, I found this comparison pretty interesting, and if you find yourself with some extra time on your hands, you might find it interesting as well.

I decided to look up what kind of housing you could buy for $300,000-475,000 in San Diego, CA. As you may have guessed, most of the options in that price range, especially at the low end were condos. The first single family home (SFH) that showed up (when sorted by price) was this gem:

Note that besides the lovely condition (read with sarcasm), it is a whopping 663 sq ft (more sarcasm).

The next SFH which comes up is this one, which is somehow even smaller than the last one!

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Again, does it even count as a house when it’s this small? At least this one has a large lot

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Still tiny, but at least it’s clean and up to date inside. Notice the emphasis on how rare it is to find a SFH in San Diego for under $350,000. And the outside/lot leaves a lot to be desired…

 

This house is kind of cool in a weird/wacky way, but now we’re down to 472 sq ft! For a house!!

The SFH’s are rare in this price range and sprinkled amongst condos and apartments. The few that do exist continue in this manner of tiny home, rarely exceeding 650 sq ft. At this point I began to wonder if I would find a SFH that measured even 1,000 sq ft before hitting the $475,000 price cap I had imposed on my search.

Aha, I found one!

Although they claim this house is in San Diego, I’m skeptical. This looks more like a house I would expect to see South of the border.

Now, lest you think it’s all doom and gloom, here is the first SFH that actually seems… livable

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For $400k, this doesn’t seem terrible, though the lack of pictures makes it hard to tell.

Holy moly! I finally found one. Now here’s a house that I would actually consider moving into, and at $425,000 we could even afford it. Though it is a little depressing to know that all that money is buying a house that is only 1100 sq ft.

Between this last house and the $475,000 price cap there were actually a small handful of SFH’s which I would consider to be move in ready, and which got as big as 1700 sq ft. None of these houses had any real property to speak of, and I didn’t spend any time evaluating the safety of the neighborhoods, which in San Diego can actually vary quite a bit. So… that’s not terrible. My fiancee and I could certainly afford it, especially while we’re both working. But now, let’s compare home prices in Salem, OR.

Immediately you are confronted with a plethora of SFH’s, including this one which starts off the list. In excess of 2500 sq ft, and on nearly an acre of land. You may or may not like all the wood inside the house, but this house is in totally livable condition, far from the dilapidated slums that were to be found in the mid $300k price range in San Diego.

In fact, let’s do an apples to apples comparison. The first SFH I found in San Diego was listed at $315,000. For the same price, this is what you’ll get in Salem:

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The first house I deemed livable in San Diego was listed at $390k. Here’s what you get in Salem for that price.

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And for the final comparison, the first house I deemed to be something I would actually want to move into in San Diego was listed at $425k. Let’s see what that kind of money gets you in Salem.

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A very nice home, and at 3400 sq ft, probably more space than we would ever need. I’ll stop here because this is getting a little long winded, but I would like to point out one more thing which is difficult to convey through the text here. In San Diego, I had to struggle to find even those few homes which were in decent condition in my searched price range. In Salem, there were pages and pages of results with very cool and nice looking houses within that range; there is absolutely no shortage of affordable and nice housing there.

This doesn’t even touch on the the other fiscal benefits of living in Oregon versus California such as no sales tax, property taxes and assessment fees which are lower in absolute dollar amounts, and lower prices on seemingly everything including fuel (about a $1 per gal price differential) and vehicle registration (Oregon charges $80 every two years vs. the ~$300/yr I paid in California).

I’m not ignorant to the fact that there are certain intangibles which may explain the price differential. San Diego generally has more exciting stuff happening and more places of business to frequent than Salem does. There’s also that sunshine/lack of rain, and beaches thing that people seem to be so crazy about. But I don’t surf and when I go to the beach, I prefer a setting like Sunset Cliffs where I sit somewhere scenic and look at… the scenery, as opposed to laying out in the sun and playing volleyball or whatever. On the other hand, I do enjoy snowboarding, camping where there are big trees and bodies of water that don’t contain salt or large waves, and mountain biking. So, I think this is the right move.

The Danger of Identity Politics

Identity politics inflict great damage on those individuals who belong to marginalized groups. Unfortunately for them, both sides of the political spectrum run entire political campaigns on identity politics, rather than any identifiable political ideology and Americans gobble it up.

We could, for instance, take a stand that free speech is an important ideal; one which is worthy of fighting to protect. Instead, what we see across the political spectrum is that free speech is worth protecting only when it doesn’t make someone feel bad. On the left this commonly shows up in the case of mandating that people use gender pronouns which they may not even be aware exist; on the right, this same sensitivity to free speech has most famously reared its head in the disapproval of kneeling during the national anthem. If we recognize that freedom of speech is necessary for the voluntary exchange of ideas and the perpetuation of our freedom, it should also be recognized that we must defend this ideal regardless of whether we like what another person is saying. If you dislike someone’s message steps can be taken to counter it, and disapproval of the message can be portrayed even while acknowledging that that individual has the right to say those things which you disagree with.

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Similarly, an actual ideology would be that police brutality is bad and violent force by the police should be reserved for use in situations only where it is absolutely necessary to protect themselves or innocent citizens. I would imagine few people would find these ideas objectionable, and an even greater number of people might even ardently agree with them. Identity politics however, does not allow for such a universally applicable idea to exist. Identity politics insist that we must explicitly decry excessive use of force against only particular groups of people, rather than taking the broader stance that excessive use of force against everyone is bad. To make the latter claim is to somehow discredit the suffering of the identitarians’ selected group; a group which they will typically claim is the most proportionately disadvantaged in whatever cause they are fighting for.

While this is wonderful logic for capturing emotion, and winning political favor and elections, in actuality it serves to perpetuate the damage against marginalized groups of people. The reason for this, while it may not be immediately apparent, is rather simple. Let’s continue with the police example. Members of the identity politics movements in this arena (BLM and others) believe that they are fighting for a very noble cause, and I don’t necessarily disagree with that assertion. In reviewing the actual effects of their movements though, I see little that has been accomplished besides creating further divisiveness in this country. By pitting one group against another, they create the scenario where anyone who doesn’t take up their fight finds themselves backed into a corner. These people then naturally become defensive as they feel they’re being attacked. Those engaging in this form of identity politics are telling everyone who doesn’t participate that by doing so they are morally corrupt, this, in my experience, has never been a successful persuasion tactic.

Now let’s pretend that instead of associating this belief with a particular social or ethnic group some number of Americans took up the stance that the use of all excessive violent force was bad. I again pose the challenge to find anyone who disagrees with that original statement. You might find differing opinions of what constitutes excessive force, and that’s fine, it opens the door for a healthy and rational debate. Without the alienating effects of the identity politics based stance, a large scale disapproval of excessive force and the associated voluntary collective efforts to stop it would result in the toning down of violent force used by the police and this change would, by statistical necessity, benefit the group or groups who are most heavily a victim of said excess force. By the mere fact of proportionality, African Americans, and other groups of people who are most often on the receiving end of excessive force would see the largest improvement in their condition, while rich whites and others who never or very infrequently experience this, would see almost no change in their condition, because there would be nothing to change.

 

Hypocrisy Part I

The basic fundamental flaw in modern progressive thinking can be summed up exactly by their stance on gun control, wherein they feel that only police officers ought to have guns on the one hand, while also loudly proclaiming that police are corrupt, racist and cannot be trusted on the other. Of course, their explanation for this logic is simple. The racist and corrupt officers should be relieved of duty, and only good police officers should be left on the force to protect us. This is a fine sentiment, but it is not based in any sort of reality. Firstly, because a sense of what is good moral behavior is relative, and secondly because it is simply not possible to monitor that closely and predict the future behavior of any human being who desires to take the job as a police officer. There is a more robust system, as Milton Friedman puts it,

“The important thing is to establish a political climate of opinion which will make it politically profitable for the wrong people to do the right thing.”

A Nation Which Seeks to Conquer All, Will Conquer None

Martin Luther King Jr. was an extremely eloquent and intelligent man, far ahead of his time in many ways. Besides the equal rights he fought for here at home he had much wisdom to impart regarding America’s foreign affairs as well. Since his passing America has only increased their meddling in the affairs of foreign nations, most of whom present no immediate threat to the safety of the United States. This pre-emptive war presents possibly the greatest risk to the safety and well being of America. Stretching resources which could be used here at home or in case of actual defensive needs and creating enemies by imposing our will on those who do not seek it.

Some of my favorite excerpts as well as the recorded speech follow:

“As I have walked among the desperate, rejected, and angry young men, I have told them that Molotov cocktails and rifles would not solve their problems. I have tried to offer them my deepest compassion while maintaining my conviction that social change comes most meaningfully through nonviolent action. But they ask — and rightly so — what about Vietnam? They ask if our own nation wasn’t using massive doses of violence to solve its problems, to bring about the changes it wanted. Their questions hit home, and I knew that I could never again raise my voice against the violence of the oppressed in the ghettos without having first spoken clearly to the greatest purveyor of violence in the world today — my own government.”
“I speak as a citizen of the world, for the world as it stands aghast at the path we have taken. I speak as one who loves America, to the leaders of our own nation: The great initiative in this war is ours; the initiative to stop it must be ours.

This is the message of the great Buddhist leaders of Vietnam. Recently one of them wrote these words, and I quote:

Each day the war goes on the hatred increases in the heart of the Vietnamese and in the hearts of those of humanitarian instinct. The Americans are forcing even their friends into becoming their enemies. It is curious that the Americans, who calculate so carefully on the possibilities of military victory, do not realize that in the process they are incurring deep psychological and political defeat. The image of America will never again be the image of revolution, freedom, and democracy, but the image of violence and militarism (unquote).”