Gas Prices

I'm sure we're all extremely grateful for the gas prices being so low, but what does this say about the economy?

interesting link: http://www.npr.org/templates/story/story.php?storyId=97350133

I suggest listening to the audio link, it's very insightful to the current economic situation in light of the dropping oil prices.

The Ten Principles of Economics.

The Rap Version. Please go listen. And, of course, learn.

And don't forget to read. Quiz 1/5.

Writing Project

I've postponed this week's writing project until after the chapter 5/6 test. So, go study.

The Tragic Case of Cory Maye

If you'd like to know more about Cory Maye's story, check out Radley Balko's reason magazone article on the case here. Then watch the reason.tv video about the case here.

For a much more thorough examination of the entire case - and for a clear look at the power of a single blogger - check out Radley's awesome blog here (the posts on that section go from most recent at the top to earliest toward the bottom).

And of course, bring in whatever you can to help Cory's kids have a nice Xmas.

I, Pencil

Leonard Read's remarkable story can be found here. Please read it before Friday; the test will include "I, Pencil."

Essay Contest

Here's a contest you might be interested in. Again, it's courtesy of FEE.

Against Energy Independence.

Here's a great article on the folly of "energy independence." It comes courtesy of one of the best places to learn economics, the Foundation for Economic Education's periodical, "The Freeman."

Remember the lesson of this article the next time you hear a politician promise energy independence. What they're really promising you is higher prices at the pump, and a lower standard of living. Thanks, but no thanks.

Feels like

nobody has posted in a while...

I find it interesting that Sarah Palin doesn't actually know the job of the Vice President, stating: "[T]hey’re in charge of the U.S. Senate so if they want to they can really get in there with the senators and make a lot of good policy changes"

WRONG! [and what excellent syntax...]

Just when she FINALLY answers a question, she gets it wrong... ughhhh

But I think Biden answered similarly on the question

Additional thoughts?

Liveblogging the Presidential Debate

Some of you asked about it, so I wanted to remind everyone that I'll be liveblogging the debate tonight with two very funny friends of mine over at www.thestalwart.com. Click here to go there now.

"How Markets Use Knowledge"

Everyone: go here and click on the first link. It's a PDF file by class favorite and George Mason University economist Russ Roberts, and it will help you understand and process what we're discussing in class. There's also an HTML page if for some reason you can't get PDF files.

Enjoy!

(P.S. Have the Hayek piece finished by tomorrow's class).

A very cool article on the bailout.

A must read, actually.

Newburn, or should I say IDEAPROVINCE!!?

I enjoyed the constant satire through the debate tonight. I say Obama won the debate. Counter opinions??

Causes of the mortgage meltdown.

Courtesy of the Independent Institute.

Spontaneous Order: Mackerel as money in prisons

Fascinating read in the Wall Street Journal.

The Best Explanation of the Current Economic Crisis.

Courtesy of Will Wilkinson and economist Arnold Kling on Bloggingheads TV.

Cato!

Gettin' some press; gettin' gettin' some press ...

COMPARATIVE ADVANTAGE PRACTICE!!!

Everyone - EVERYONE! - in class must - MUST - for a grade - go to this website and play this game - both the basic and the advanced games - until they are intimately familiar with the principle of comparative advantage. Go there ... now.

One of the world's greatest intellectual treasures.

Julian Simon will make you see the world differently. I had to read his books to learn his stuff.

You can learn it from a video.

I still highly recommend Simon's books.

On the government bailout of the mortgage industry...

We should probably be talking about this in class, but we have to learn to crawl before we can run. Anyway, if you want to get a feel for what's going on re: the government and the mortgage industry, check out these links:

Tyler Cowen

Tyler Cowen again

Cato on the bailout

Walter Williams

George Will

Mercatus Center on Fannie Mae and Freddie Mac

Sebastian Mallaby

Voting and Opportunity Costs.

I like the discussion on voting going on, and I'll add a few cents. Chris wants a test for voter eligibility; Gabby feels like she isn't knowledgeable enough to cast a ballot.

Both are interesting thoughts, which raise an economics point. If there's a test to vote, then potential voters would presumably study to pass it. That means they're not doing other things, such as spending time with friends and family, or exercising, or learning a trade, or working and producing wealth. Given the vanishingly low marginal benefit of any given vote, is it efficient to demand that 200 million people give up their time in order to pass the test? Demand curves slope downward, of course, and if we raise the cost of voting we can expect less of it. Fine by me, but I wonder if that was Chris' intention. Besides, who designs the test? Who gets to determine what the "basics" are. If I had my way, only those who demonstrate an understanding of basic economics would be allowed to vote. Should logrolling and public choice critiques be on the test, or is it sufficient that one knows who, say, George Washington is?

Re: Gabby's point. Of course, learning about the candidates and their positions takes an awful lot of time. If rational people make decisions at the margins, and make decisions based on the marginal costs and benefits of an act, what does economics say about taking time to study up on political candidates?

Meanwhile, Economics...

A few weeks ago, I went to Publix right as they were closing. A bakery employee was stuffing desserts into a large plastic bag. My mom asked, "Those are going to a shelter, right?" and the employee replied that they were going to the dumpster. I asked why they didn't just mark down the cakes, pies, and cookies in order to make as much money as possible. She said "Publix doesn't mark down." How stupid! I immediately thought of the examples of the last seat on a plane and in a movie theater; I tried as best as I could to explain why it would be smarter to sell it cheaper at the end of the night, but the baker stood befuddled.

Now, tonight, as I was eating my Hitchcocks "brownie bites," I noticed that the container was marked "Reduced Price for Quick Sale." The brownies, which are usually three dollars, were marked half price (that's a dollar fifty, kids!) and were quickly snapped up by my mother. Someone at this local supermarket is more rational than the Publix giant! Mr. Hitchcock must be a marginally thinkin' man.

Who Should (and shouldn't) get to vote?

The example of the eleven-year-old and the thirty-five-year-old was a great point to back up Chris's argument, but how often does it happen that a pre-teen knows a great amount about politics beyond what their parents tell them? This child quite possibly could have been coached to say what she said (or not?), and it is more likely than not that she had outside or advanced education on the subject that other students would not have had access to. I definitely think that it's possible for a child to be independent enough to learn about politics and form their own opinions, but it just doesn't happen enough to allow all of them to vote.

However, I do realize that some American adults can be even less knowledgeable about government. Many people in the United States couldn't even pass the INS test. I'm not sure how effective passing a test in order to vote would be. And who would decide what "basic knowledge of government" would be? A good amount of the voting population has very little knowledge (or none at all) about the political process, and creating a test to eliminate ignorant voters would skew the results (and tremendously reduce the amount of voters) of an election. Politically ignorant people are just another demographic of this country--you can't deny them a fundamental American right.

If this were a perfect world, then everyone who wanted to vote would be educated enough to make an intelligent decision, and all minors would understand politics. Politicians would actually explain the issues they plan to deal with, instead talking in circles (for fear of losing a voting population). Voters would then know the reasons why they vote (or not vote) for certain candidates, instead of simply voting on superficial ideals. But this is not a perfect world, nor a perfect system, so unless circumstances can change greatly, lowering the voting age (or abolishing it) could quite possibly make things worse. Since I am not eighteen until December, I will be unable to vote in this election. I have decided that I am glad that I cannot vote, because I feel that I am not yet knowledgeable enough about politics to make the right decision for myself. I know that I need to be further educated on government (hence next semester's class) and do more research on politics specifically. This is not to say that the voting age as of now is perfect, but I feel that many teenagers are like me and do not fully understand politics. Some don't even care about it. Even though I am sure that there are some teens that are enthusiastic about government, many still have to reach a certain level of maturity before they can make the decision to vote.

Voting Age

Back in the primary season, I was watching the news when a girl of about the age of 11 or so came on and started to talk about her experience interviewing Mitt Romney the night before. She was then asked about her feelings regarding foreign policy, and her articulation was absolutely impeccable. Not only were her sentences pretty, but they had a deep insight to the issues at hand. I was stunned and inspired.

Later that day, my neighbor of 35 years of age decided to come over to talk to my mom about the Iraqi Conflict. (I refuse to call it a war since Congress didn't) She said things like:

"I'll be glad when we kill that Saddam Hussein after what he did on 9/11."

Keep in mind that this is a year after Saddam Hussein was executed.

Essentially, she knew absolutely nothing of the world or the issues surrounding it, which is absolutely fine. I don't believe all of us should be political experts or trained debaters. My point is simply this:

Should the voting age be so shallow as to deny the extremely well informed 11 year old reporter and accept the completely ignorant 35 year old woman?

My personal opinion is absolutely not. I think there should be a test on basic governmental knowledge that one would have to pass in order to vote. But that's just me...

Let's see what you have to say.

Response to comments...

I would like to clear any confusion caused by my article (some unintended consequences). I noticed Mr. Newburn posted the following comment:

"I'm having trouble seeing the "moral" distinction between marijuana and alcohol. Could you elaborate, Travis?"

My beliefs on this is there is no "moral" distinction between marijuana and alcohol. Both of these drugs when consumed in large amounts will cause you to do things that you would of never done (thats why I would never drink) since it messes up your decision making abilities. The only reason I put in the quote about how people would get drunk to cope with the depression was because thats what they did to get through the depression. Was it right? No, by all means, but thats what they did back then.

Also back on the comment on my article "Not a Perfect World." In responce to the question...

"If greed is the driving force for so much good, why do you think it's immoral?"

...well, it is because of my beliefs as a Christian that greed is a sin and immoral.

The economic study guides

So, Ja'Layne and I have attempted to do the Study Guide and Page 57&58 assignment. Neither of us really understand it, and Josh is no longer here to explain it to us, so it's really hard to complete it. We were wondering if we could go over it in class tomorrow. The one day of teaching it thing doesn't make it understood.

An absolutely must-read post.

Courtesy of the very smart Roderick Long (via Wilkinson).

Don Boudreaux's wonderful letter to a politician.

No one is better than Boudreaux at stripping away the pomp and circumstance of government and exposing it for what it really is. This letter is a great example.

What should the drinking age be?

According to my old Cato colleague, and all-around brilliant genius smart-guy Will Wilkinson, there shouldn't be a drinking age at all. Care to disagree?

For those who support the drug war.

Would Cindy McCain be better off in prison, or in the White House as First Lady?

Ah, Hayek.

"The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design."

I love that sweet little man.

Read this.

Right now.

What is the "right" profit for gas stations?

And why does Bill McCollum think he knows the answer?

No One Wins a Drug War

As far as the issue of the legalization of drugs, I am completely in agreement with the author. Whether it is tobacco or alcohol or some narcotic, drugs will harm people's lives regardless. And whether it be from some shady dealer on the street or from the local CVS (or Walgreens), people are going to get their drug of choice--and they are going to pay whatever price to get it. So why spend tax dollars on the Drug War to lock these people up? If they are a waste of space, then let it be their own responsibility (and fault), not the government's. Travis made an excellent point about the alcohol prohibition of the early 20th century, but I see no difference between that issue and this. Don't drugs also "help" people get through hard times, just as alcohol did during the depression? People will choose their poison accordingly.

Now, Cole's statements regarding drugs and race are a little bit more controversial. I do understand that more African-Americans are checked and incarcerated because of drugs, but this does not mean that minorities are more responsible for the drug problem than whites. I believe the author failed to mention the "methed-out whites" of suburban America. Every race has its problems; it just may be that law enforment chooses to zero in on the minorties, where it is a more obivous problem. In inner-cities, African-Americans and Latinos are probably more likely to be arrested for drugs because they find dealing the easiest way to make a living. If there were more education, along with legalization, this problem would diminish.

I think that the remedy for this "drug problem" is not punishment, but prevention and treatment. Legalizing drugs would actually make them safer, because firms for drug distribution would form, forcing standards to be created. The spread of disease and crime caused by drugs would also diminish. This is not to say that "cracked-out" people would stop committing crimes, rather the instance of this would be less likely.

I do not think that legalization would stop the drug use in America, but I think it would bring a more desirable outcome than the current situation. Drugs are still as available (if not more available) than they were twenty years ago. There will always be a demand, but the decision that must be made is how effectively this demand will be supplied.




Drugs are really bad.

Leagalize the drugs.

I, personally, agree with the author on the issue of drugs. I think they should be leagalized. People are going to do them whether they are legal or illegal, and there is nothing we can do to stop them besides let them first handed see what drugs do to people. Eventually, these drugged out people will drive themselves 6 feet under, and, as harsh as this may sound, it's not a bad thing. As my man Darwin once said, Survival of the fittest. By legalizing drugs, it will just clean out the gene pool and weed out the idiots. As for the race thing, there are just as many white people doing cocaine and lord knows what else as there are minorities. Sadly, I believe, that racism will never fully die down. However, by leagalizing drugs, it will stop those racial actions. In my opinion, it is a complete waste of tax dollars to imprison some heronie dealer. The big bad dangerous heroine dealer...how scary. Let them make there own mistakes and pay for the consequences. When it comes to the point that they start harming the public, then maybe the law can be called upon.

**I would like to add that I don't do drugs, so please don't say I want them legal to do them. I find them completely disgusting and they make me cringe.

Response to the Article...prohibition...

In responce to the article reffering to "prohibition," I believe the author is reffering to a parallel to the "drug prohibition" and alcohol prohibition in the early 1900's in the US. During the prohibition era, alcohol was illegal causing organized crime to explode in the country over the new industry of smuggling illegal liquor to the public. In responce to this, the US government ended prohibition but put a tax on all liquor while making it illegal for private production of liquor. This resulted in a reduction in crime since liquor made by big companies could be sold for less than smuggled liquor, putting gangs out of business. The author believes that if the US government would end the current "drug prohibition" it would produce a similar result. Personally, I don't think it will work exactly like the author plans since there is a big difference between weed and alcohol, and I disagree with it on a moral level since illict drugs will not benefit society at all (at least alcohol helped Americans get through the great depression even though I myself don't drink or plan to drink at all).

response to Newburn's blog

Okay, so I read that article Newburn posted, and at first, I thought the author was going against drugs. But, then I got to the end of the article and read this;
"I represent Law Enforcement Against Prohibition, an international organization of sworn antidrug warriors who know that we must end this prohibition in order to legalize and regulate all drugs, thus wresting control from the cartels and street thugs who prey on children. Ending this prohibition is a singularly potent civil rights issue. It is a remarkable movement, led by both white and minority law enforcement officials."
By "ending this prohibition," does the author mean that he/she wants to rid of the laws that forbid marijuana, cocaine, etc? That’s what I got out of it. And if this is true, then what the perdition? The author went on by saying that the "minorities" were imprisoned more, so by legalizing these drugs, are they just wanting to have less of them in jail? This would also alter peoples incentives, and everyone will be smoking and shooting that arm candy because it would be legal!

On the Drug War...

What do you guys think of this article?

Today...

So, today I took the ACT plus writing and the plus writing essay prompt dealt with how teachers could reduce student tardiness. What kind of incentives should they use? I discussed how effective incentives are and also about their unintended consequences.

Let's just say I appreciate the usefulness of this class.

In class movie

I can't find the actual movie that we were watching in class. Does anyone have the link?
Breanna

Class discussion.

Today in class, we had a very deep discussion about killing innocent people and about Bush signing the executive orders to send troops to Pakistan if Bin Laden is there. My personal opinion is that for once Bush actually did something correct. Our military has had so many opportunities to capture, even kill Laden; however, each time, there is an interference. I believe if Pakistan were truly an ally of the United States, they would have no problem having U.S. troops on their soil, especially since Laden is one of the hardest men for the U.S. to capture. At this point in time, I also believe, it would be acceptable to take a few innocent bystanders lives. As I see it, if Laden is in their city, country, where ever he may be, and the people do nothing about it, they are risking their own lives. It's a little thing the law likes to refer to as "guilt by association." If Bin Laden is there, and those people don't do anything about it (try to kill him or run him off), I believe they have every right to die if the U.S. gets tipped that he is located there. As Mr. Newburn pointed out, the more we back off, the more incentives he gains to protect himself. If the troops refuse to shoot because of civilians, the unintended consequences may be that Laden constantly surrounds himself with women and children. This man is extremely evil. The longer he stays alive, the more likely it becomes that another attack like 9/11 will occur. I say that if the U.S. sees him in a crowd, attack. If the U.S. gets reasonable proof he is in Pakistan, march through, with or without permission, and take him out once and for all!

10 gallon gas limit?

So, Ja'Layne informed me that there is going to be a 10 gallon gas limit as of today. Apparently the prices are supposed to shoot up tomorrow as well. They say they are doing this to avoid a panic being created. Is this because of the hurricane? It has me a little bit worried. We know it's true, Ja'Layne's dad was only able to put 10 gallons in his truck at a Newberry gas station. So, can anyone elaborate on this?

My thoughts about the Video in Newburn's

For the past two days in Newburn’s class, we’ve been watching a video on 9-11. I’m not sure the name of the video, but after watching only half of it, I’ve learned so much. I had no idea that attacks on the United States, that were planned by Osama, had even happened! Yea, I never really watched the news when I was younger, but it amazes me that someone could have so much hatred towards a country. I’ve never had that much anger towards anyone my entire life. Of course, I didn’t grow up in the Middle East, nor do I have the same beliefs as they do, but it’s hard for me to understand how someone sane could ever do such a thing.

AHH! I dont get it!

Are they just not sane? Or do their beliefs really beleive that by attacking the United States, that we would pull our troops out of their coutnry?

Whatever, Im done expressing my thoughts.

Greed continuation

Greed has many forms: lust, envey, and gullnoty. But greed is basically wanting too much where it deprives others of those needed items or resources; however, how can we find a distinction between the two concepts of greed being a constructive or destructive force? Look at the bussiness man who sells you a product that improves your life in some way. Now is he greedy? Yes, but he also makes you more better off. Then look at the government taxing you. It is like what Mr. Newburn said, " a guy putting a gun to your heat and saying give me your money!" When the government taxes us, dose our lives improve because of it. Yes and no to that statement, because the government provides services to the general public but also spends tax dallors on projects that in no way bentift us and sometimes makes our lives wrost.

Greed is Needed

Greed to me is something that is natural and is needed for an economy to prosper. It is was ultimately, in my opinion, drives an economy. Without the return of something for work people wouldn't have the incentives to anything.
Greed is the reason for many of America's accomplishments, such as advanced technology and new products. These things wouldn't have came about unless the reason for creating these things would benefit them. These things are what has bettered the nation and the people as whole.
Basically, without greed we wouldn't have the living standards we do today, nor the products that make our lives easier. Greed will continually be the driving force of the economy.

Greed

Even though, we hate to admitt that greed, thought of as a social evil, actually turns the wheels of production and the capitalist economy in which we live. "Why would I work all day just to help another person I do not in any way care about or may not even like?" Well if I disire to make money I might just cooperated with this person if it is in my best interest. Yet, the gree that prossess mankind may compell us to make products and provide services that bentifical to our fellow man. Like Adam Smith said, " Its not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to thier own interest.." Thus, we find that greed in a sense is constructive and necessary, and inspires us to cooperate more in the world economy, becuase of the simple disire to get ahead and obtain something for ourselfs. The only way we can do this is by servicing our fellow men. So a question we must ask: "What exactly is this odious word, Greed?

Greed

how good is greed?

I believe that greed is a beneficial thing that helps us better all as a whole. Greed pushes people to go out and get more. Greedy people are in fact the people who have more. We are all greedy in some way, whether it's for money, power or just to get something we want. A lot of people say that greedy people are horrible and mean, but it's the greedy people that supply us with the things we have? Many people like coffee. Juan Valdez became a huge figure in the coffee business by making mountain ground coffee. We all enjoy the coffee we love because Valdez wanted to make money and become powerful.
The evil men in the black suits that everyone calls ruthless and powerful gives us our jobs. they are greedy, but it's their greed that give us the jobs we have, that puts the food on our tables and help us support our families. When we hear the word "greed" we think of some mean spirited person trying to get the most they can out of life an the people around them. But the real definition of greed is an excessive desire to acquire or possess more than what one needs or desires, especially with respect to material wealth.
All in all, greed leads our economy and our lives. We cannot live without greed. Greed motivates us to do the best we can, just because we want to be higher and have more power than the next man. Greed isn't as bad as everyone thinks when you really break it down. We don't live in a perfect world, and we wouldn't live much of a life at all if we didn't have a little greed to get us through the day.

Relevent sites:
http://moneychanges.blogspot.com/2008/02/greed-and-haphazardness-truth-about.html
http://findarticles.com/p/articles/mi_m3870/is_16_19/ai_113939155
http://www.beliefnet.com/story/109/story_10952_1.html

I Must Be Tired...

Here are some websites I found and forgot to post: <http://www.reason.com/news/show/38333.html> <http://articles.familylobby.com/495-healthy-greed-and-philanthropy.htm> You may agree or disagree.

Charities Bad, Greed Good

Although my somewhat engrained “values” make me tend to be against the greediness of bloodsucking businessmen, I have to admit that logic forces me to realize that the concept of greed being “good” is actually true. When company bigwigs decide they want more money it leads to higher production and better prices of whatever they produce. This not only creates jobs, but also satisfies more consumers.
If we could all just look past the societal pressures towards philanthropy, we would see the long term affects of “greed.” There are differing opinions of the balance between giving and taking money when you are already wealthy, but if the CEOs and wealthy people of this nation would invest their money, it would benefit everyone in the long run. Take, for example, the lifeguards of Orlando—which ones were better at saving lives? The paid lifeguards simply had the incentive to do their job correctly. I think that this can apply to the whole of charities. Although this may make some people’s skin crawl, I now think that charities may be hurting the very cause they are trying to help.
If only it were true that all people help others without thinking of themselves. This simply doesn’t happen. Capitalism has to take place in order for things to work out the way we all want them to. I never really understood the concept of “not giving” until this realization: self-interest drives the economy forward. This, in turn, drives society forward.

When is Greed to much?

Greed is all around us. Many people have different views on the subject, they either feel that it is good or that self indulgence is bad. But really if you think about it is it not greed that drive this country and its citizens to flourish and succeed? Or is the whole concept of it wrong, such as in Stossel's piece when the CEO purchased of a $100,000 pizza oven?

From the beginning of our nations history successful people have thrived do to, what most would call greed. But what is greed but the want to make ones self better off. So I ask you how is it bad to be "Greedy", don't all of our fellow Americans want to be better off then the next guy. I know I do.

But at the same time i can understand why the "lower man on the todum pole" could be upset that the CEO of his company just bought a 3 million dollar yacht and he was just laid off from his job. So my question to you is when is the need for success and more money to much? When does it become greed?

here are some links:

http://www.wsu.edu:8080/~taflinge/socgreed.html

http://abcnews.go.com/2020/Business/story?id=130457

Greed

As much as I want to say that greed is a bad thing and that people are good and could support each other without economic incentive, I know that the opposite is true. Without greed, our economy would fall to pieces. We can see through countries trying Communism in the past that this economic strategy is just a failure waiting to happen. (Except China, but come on everyone knows that their "Communism" is a fraud.) Greed is what makes people work harder. If everyone received the same amount of money but some people did not work as hard as others for their pay, everyone would just do the minimum amount of work acceptable. Who would want to go to school for eight years (or more) to be a doctor or lawyer if they were going to be paid the same amount as a sales clerk? No one. It's not worth it.

Greed is not only the backbone of capitalism, it is the motivation for pretty much everything in life. Of course, it is not always called "greed". Sometimes greed is known as "determination" or "striving to be the best". An example of this that we are familiar with is trying to receive college scholarships. Most of us are applying for them now, and I know that I am looking for as many as possible. Without scholarships, college is impossible for me. Does trying to receive as much money for college as I can make me greedy? I don't think so. I think that I have worked hard throughout school and I deserve to be rewarded for this work with the opportunity to continue my education without putting my family into debt. Another example of "greed" can be found in our newest American Hero. When Phelps brought home 8 gold medals from Beijing, was he being "greedy"? Of course not! He was just determined to do the best that he could do to represent our country. You don't share Olympic medals. Just like (I know this is going to sound horrible) a person should not be forced to share money that they work hard to make. This is not to say that people should not be compelled out of the goodness of their hearts to give to those less fortunate. I am a huge believer in charity and volunteer work. It also does not mean that people should just horde all of their money or spend it on ridiculous luxuries, like a $100,000 pizza oven.

If we lived in a perfect world, it would be easy to say that everyone should share what they have. But, unfortunately, life is not a kindergarten class. If people did not look out for their own interests, nothing would be accomplished and no advancements would be made. Greed is a necessary evil in our world because it encourages people to work, and to work harder than others so that they can have the things they desire. This competition creates a more efficient world for all of us to live in.





Relevant Links

1. http://findarticles.com/p/articles/mi_m0JQP/is_369/ai_n6142144
Repetitive, but still pretty good.

2. http://www.realclearpolitics.com/articles/2008/03/greed_ails_us_economy.html
Pretty much the opposite of what I think but you should always read both sides of the story.

Oh, By The Way...

Here are some helpful websites

http://en.wikipedia.org/wiki/Invisible_hand/
The "invisible hand" in a nutshell

http://www.philforhumanity.com/Greed_is_Good_and_Bad.html
Basically somes up the pros and cons of Greed in the economy and in society

Only in a Perfect World

I would like to start out this blog simply with this, I disagree with greed on a moral standpoint, but greed is what drives the “invisible hand” in a free-market economy. Whether we like to admit it or not, greed is the primary force behind a healthy economy in a non-perfect world. For example, in a perfect world, everyone would work to help out their fellow man and everyone would benefit from “specialization.” Unfortunately, there are the couple of selfish people who don’t want to be “team players” and have found out they could benefit from taking advantage of their fellow neighbor. In economics, this is called an “unattended incentive.” Once everyone starts figuring out that they can do the same thing, they lose the incentive of hard work and the economy ultimately collapses (just like communism). As I stated before, in a perfect world an economy would flourish when everyone looks out for one another, but the same thing goes that if everyone followed the Ten Commandments, we would not need a government in “a perfect world.”
This is what brings us up to our imperfect world. What happens when everybody becomes selfish, a.k.a. greedy? Simple, adjust to an economy that uses the incentive of greed to benefit the economy. The solution? A market economy. As the theory behind the “invisible hand states” in a story about London, nobody really cares if there is enough bread coming into the city, the only thing the baker cares about is making money. How does he do this? By making sure his customers receive bread in order to make a profit for himself. In actuality, he could care less that you come from a low-income family or you are best friends with the president, if you are going to pay him, that’s all that matters. As we can see, greed is what holds a capitalist economy together, like mortar in a block home. The thing that’s ironic about the whole deal is this, by being selfish you are actually helping out your fellow man like in the analogy of the baker and his customers. Go ponder over this for a while.
As I stated before, I still believe greed is bad and is one of the seven deadliest sins (glutany) and I have to disagree with those who object to charity. I do believe if you are bringing in a surplus of money, you shouldn’t be greedy, but use your talents (your “specialization”) given to you by God and use them for good. For example, many of you agree that just giving does not aid in the long run, but investing in charities such as missionaries and other organizations that go out in rural third-world countries and teaching poor communities the needed skills for survival, this does help them in the long run and it does make you feel good on the inside. Like the old saying “give a man a fish, and he will eat for a night, but teach a man to fish and he’ll eat for a lifetime.” As we can see, even though our economy is held up by the pillars of self-interest, we still need to balance it out with a little giving and not let money and greed take a hold of our lives.

Positive/Negative Greed?

Perhaps we're not distinguishing between Positive [Productive] Greed and Negative [Unproductive] Greed?

Or maybe that's just the Governmental Greed Vs. Private Greed?

I dunno...

www.myspace.com/moscowsonfire

Greedy People Make Markets.

The first time that I watched that movie "Greed" by John Stossel, I didn’t really understand the whole idea of it. I use to think that to be greedy was a bad thing. But in the past few weeks, since we started taking AP Economics, I’ve learned that even I am quite greedy. I want the most I can get out of anything. Yes, it would be nice if I, or any business man, would "give" loads of money to the needy, but in reality, that money wouldn’t help them as much as it would investing it somewhere else where it could help them even more in the long run.
Some people may disagree and say that greed is a bad thing, but look at your country! It’s based off of greed. Everyone is greedy. McDonald’s is one of the biggest fast food restaurants in the world. They are considered to be "greedy", yet millions of people still eat their food; however, when a business man makes a couple million dollars, he is called greedy and hated. Perhaps people are just jealous of the man who is successful and makes millions of dollars of his product?
Another thing that people usually don’t understand about greed is that it makes everyone better off. The man who invented the printer didn’t wake up one morning and decide to make the world a better place by inventing the printer. He woke up one morning and wanted to make some money! Now, thousands of people are employed because of this greedy man and everyone one who owns a printer is better off. People need to understand that greed is only human nature and makes our world what it is today.

http://www.greenchair.net/articles/greed-is-good.htm
http://www.experiencefestival.com/greed

Greed-The backbone of the capitalist economy

Prior to today's viewing of the John Stossel video, I never really viewed the capitalist economy being ran strictly on greed; however, I now see why this deadly sin is so vital to the success of an economy. Greed allows consumers to purchase decent goods at a "reasonable" price because of the numerous competitors that are just as eager to take the money from that same person. As Thomas Sowell elaborates in his article, it takes hard work to become greedy, for someone, somewhere, has to want to pay this greedy person that high salary.

Some unintelligent people may say "it takes away from me." In reality, however, it doesn't. It is better for everyone because it keeps the prices low. Without greed, there would be no motivation to produce the products that one needs to survive, and to produce those products with good quality and appropriate prices. The business could care less how severely someone needed a new pair of shoes. They care about the money that the person is using to purchase their product and how it will benefit them. Without greed, production has the potential to decrease, thus decreasing the high living standards. Greed keeps people working together and producing at a faster, better rate.

Dave Carlson explains that the love of money is not what makes one evil; it is how far they will go to get that money. Occasionally, greed can lead to tragic and chaotic events, but without it, how much would be accomplished? If the economy solely relied on compassion to take care of it, most likely, it would fall to pieces. There is not a single person who is not greedy, for if they weren't, they would have nothing at all. The capitalist nation depends on greed for its survival. One shall judge it as they may, but in the end, they are just as greedy as all Americans, for if they weren't, they wouldn't reside in this capitalist nation.


http://www.realclearpolitics.com/articles/2007/01/the_greed_fallacy.html -Thomas Sowell

http://www.greenchair.net/articles/greed-is-good.htm -Dave Carlson

Greed is Good?

I believe that was the second time I have seen that particular movie, and I still have a hard time discerning which view taken is right. On the one hand, there is a small group of wealthy corporate businessmen who seem to really benefit from how our economy works. The example of the Vanderbilt house or of Bill Gates simply proves that. There is almost always a general benefit for everyone in the corporation, but the wages of workers is shadowed by what the CEOs are making.

On the other hand, greed drives people to improve the quality of their product or to find faster ways to produce. In simple terms, greed creates competition between companies, which means the consumer will get the best possible quality item. Everyone works for their own personal interest, whether to gain money through a transaction or to gain a product through it. The problem is, how does a person decide when someone is being too greedy, or if that is even possible.

So I guess in some situations, greed is a great, even invaluable characteristic to have. People who are driven to create something because their existence depends on it will probably make an item of good quality. I think the greatest point made in the entire video was that if people worked or traded just for the love of their heart, then very little work would get done. At the end of the day, people are more concerened about themselves or their families than the consumer, and if that means greed is good, then I would have to agree with it.

Zuelke:

Don't worry about Chapter 3 this week. We're going to learn about 9/11 this week. We'll get back into the material next week.

The Social Responsibility of Business

The Stossel video asked some questions about what obligations, if any, businesses have beyond making as much money as they can. Here's an interesting debate among some CEO's and economists about what the social responsibility of business should be. And here's Milton Friedman's original article on the same topic (a must read).

The Tradition of Spontaneous Order

If you recall, we used the path near the Criminal Justice room as an example of a useful "invention" that was the "product of human action, but not of human design." In economics we call that "spontaneous order." To get a better grasp on that concept - which is an extension of the invisible hand phenomenon discussed in the Stossel video today (remember how beef gets to New York from Texas) and in the "I, Pencil" story - check out Norman Barry's "The Tradition of Spontaneous Order."

Incidentally, this essay was originally published by the greatest organization in the world, the Institute for Humane Studies. IHS gives thousands in scholarships every year, sponsor internships in DC and elsewhere, and they put on absolutely AWESOME, week-long seminars that are totally free and will leave you smarter than everyone else you know. If you're at all interested in the ideas we talk about in class, and you want to learn A LOT more about them from people a lot smarter than I am, check out IHS seminars.

Chapter 2 Review

Skip Number 10; it's ridiculous.

Chapter 2 Review

Has anyone looked at question 10? I think it's a little impossible to do. Ja'Layne and I are just going to skip it, anyone else going to as well?

George Will on government magic.

George Will is the best columnist in the country. You should read everything he writes. Start here.

SWAT Raids on "Suspected Protesters"

This will become more relevant next semester when we study the 4th Amendment, but: what do you think of this?

Useful Links.

Hi, kids. Yes, it's Friday night, and yes, I'm posting to our class blog. I care THAT much about your AP success and, more importantly, your understanding of fundamental economic concepts.

Toward that end, you'll note that I have added some "useful links" on the right side of the page. Each of these is a very interesting blog or website from an interesting, smart person from whom you can learn quite a bit. You will be expected to read each of these blogs consistently (i.e., every few days). Pay particularly close attention to Marginal Revolution and Cafe Hayek. Those blogs are written by real economics professors, and are updated every day.

Have a good weekend! Enjoy reading Menger, Hayek, and the others. I'll see you Tuesday.

Welcome, kids!

Welcome to the class blog. You should have received an invitation in your "email" that allows you to "post" on this "blog" (short for "web log," which is like an online journal). This is what it will look like when you "post." So, start "posting." Of course, your "posts" should relate to economics and current events. With that caveat, feel free to run wild with your opinions.

Since this is a semi-public forum, I should add: please write as well as you can, and edit your posts as often as possible. Proper grammar, punctuation and clarity of thought are all appreciated.

This "blog" (short for "web log," which is like an online journal) should also be considered a forum for debate. If a classmate or I "posts" something with which you disagree, let 'em hear it with another "post," or in the original "post's" comments section.

So get after it and make me proud. Like each of you does every single day in class.

--Mr. Newburn