Friday, October 05, 2018

Infrastructure as a legacy

Leftists are notoriously interested only in the distribution of goods and services. They virtually ignore the process of producing goods and services.  They seem to think that goods and services drop down upon us like manna from heaven.  It is precisely that insouciance that makes socialist countries poor.  They just don't know how to arrange wealth creation efficiently so hamper it rather than fostering it.

And they seem to think the same about infrastructure such as roads, hospitals and schools  They give no thought to how those things come to be so and are very poor at providing them.  People who need the latest medical procedures don't go to Russia.  They go to the USA.

I think however that it is highly relevant to think about the origins of our infrastructure.  It didn't get there by accident and its distribution is not random.  Some countries have better infrastructure than others. So who provided that infrastructure and who owns it?

A very large part of our infrastructure was put there by our ancestors.  They built the roads and buildings which we use today.  And the ownership varies.  Some is in private hands and some in government hands. But in an important sense it is a legacy to all of us today bequeathed to us by our ancestors.  Some of it is best in private and and some is regarded as best in government hands but we all benefit from it enormously.  Our entire modern life depends heavily on what we have collectively inherited from the past.  We didn't build the road we drive on or the hospitals and schools that we use.  We come into the world with most of what we use already laid out for us by our ancestors

Not all that we use will be inherited of course. But it will be the development of an inheritance. It might be a new road we drive on and a new school we attend.  But the building of that road and that school will have depended on all sorts of things from the past -- tools, techniques, machinery and the product of blast furnaces -- that have steadily evolved first in the hands of our ancestors and then in our hands.

So it seems to me that the physical facilities of our country that we use are just as much a legacy as is money left to us in a relative's will.  They were not produced by accident but were the product of work and ingenuity -- and we ourselves continue to build on those foundations.  We too enable the provision of infrastructure -- mainly through our taxes in the modern world but sometimes directly

I for instance have had a considerable presence in the real estate industry. I often took on semi-derelict buildings and organized their renovation.  Since I live in a capitalist country I did it entirely for my own private profit and did indeed earn significant income from my activities.  I have long ago sold the properties concerned and have money in the bank instead.  But the important point is that the properties I took on are now upgraded and will  be in that upgraded state when I die. I took existing things from the past and built on them to make them into better things.  That will be a legacy I leave when I die.  I will have left the infrastructure better than I found it and others will benefit from that.

I am aware that what I have just been saying sounds very much  like Obama's famous claim, "You didn't build that", so I think I had better do a little bit of differentiation.  He was of course right in pointing out that all we do depends in many ways on the work, past and present, that others do or have done. But what significance he saw in that is a bit mysterious. The most I can make of it was that he thought businesses should be thankful to the government and be humbled by its wise provisions.  By contrast, I would argue that the government is just another tool we have set up for achieving desired results. And I would argue that it is largely our ancestors we should thank for the infrastructure we daily rely on.

But what about immigrants?  Do they have any right to what is in fact our legacy?  They have not inherited anything  from our country or brought much, if anything, to it.  I think it is clear that they do to an extent steal our legacy.

That is particularly clear in the case of Australia.  Recent governments have allowed a large "refugee" influx and that does harm us.  Our roads are now more congested, our public hospitals can barely cope and our schools are overcrowded and short of good teachers.  Such is the demand for teachers created by the active wombs of refugees that teacher standards have had to be lowered to near oblivion. Students with almost any High School pass are being accepted into teachers' colleges.  And on top of that we have to feed the "refugees".  Only a minority find employment and become self supporting.

But for various reasons good and bad our governments keep letting the refugees in and in so doing dilute that assets we all have to work with. With not a care in the world our governments have given away a significant part of our inheritance.  I think it should stop.  I don't think our government should give away what is the right of those of us who were born here.

So what do I propose?  A just policy would be to allow into our country only those who have paid for the privilege.  Citizenship could be bought.  And the proceeds would go to the construction of new infrastructure that would cope with the expanded population.

That's not going to happen, of course, but greater selectivity of some sort would certainly be fairer than the present system.  The less our inherited assets are handed to others the better.  I personally would be selective by allowing in only outsiders who are similar to the majority population  -- essentially other people of European origin.  They at least had ancestors who worked hard and effectively to improve their given environment so could help continue our ongoing work of improving our facilities, infrastructure and environment -- JR


Amazon's Real Motivation for Raising Wages

A month ago, the socialist senator supreme, Bernie Sanders, introduced the Stop BEZOS (Stop Bad Employers by Zeroing Out Subsidies) Act, which would tax large corporations at a rate equal to the amount of federal benefits their employees receive from the government. Never mind Sanders's own personal wealth or Amazon owner Jeff Bezos's status as one of the socialist archenemies of Liberty — the bill was an effort to mobilize Bernie's voters this fall.

So it's no surprise on a couple of counts to see Amazon raise its internal minimum wage to $15 an hour. Good for Amazon ... except there's a catch.

Bezos, the world's richest man, gets a little breathing room with his fellow socialists for appearing virtuous, tamping down criticism of working conditions and unionization efforts at Amazon-owned Whole Foods, while also squeezing his competitors as the labor market tightens. A booming Amazon, now with more than $1 trillion in market cap, can — and probably should — afford to pay its workers more, but its local, "mom and pop" competitors don't have the profit margins to do likewise.

If this was just good old-fashioned market competition, it would be one thing. But Bezos didn't stop with his own action. No, like any "good" Big Business mogul, he's also getting in bed with Big Government, simultaneously announcing that Amazon will lobby to raise the federal minimum wage from $7.25 to $15 an hour. All the while, Bezos's Washington Post can make the media case for a higher minimum wage.

Amazon did essentially the same thing by leading the way advocating for an Internet sales tax. Its massive infrastructure could handle the added burden, so why not foist it onto smaller competitors to damage their bottom line?

As for the minimum wage itself, we've always argued that the true minimum is $0 an hour — employers will hire fewer workers if those workers are more expensive to employ. Washington, DC, of all places, has at least partly conceded this reality. The Democrat-run city council of DC, where Hillary Clinton beat Donald Trump by 86 points, took the first step in repealing Initiative 77, which gradually raises the minimum wage in the district even for restaurant servers and bartenders to $15 an hour plus tips. Restaurant workers actually opposed the wage hike. Sometimes a modicum of economic sanity can prevail even in leftist bastions.



Trump trade deals with Canada, Mexico, South Korea and Japan keep "America first" promise, isolate China

Everyone knew the North American Free Trade Agreement (NAFTA) was a bad deal. President Obama knew. Hillary Clinton knew. President Trump knew. But only President Trump was willing to use our leverage to push our neighbors to the negotiating table and work out a strong, better deal for the U.S. While previous presidents pandered to other nations in the name of globalization, Trump is pursuing bilateral trade relations which are more likely to put American first and get our workers back on the job.

NAFTA resulted in significant job loss as manufacturing sectors moved to Mexico, wages in the U.S. stagnated while working conditions in Mexico deteriorated as well.

While many American political leaders seemed to agree the deal was bad, former President Barack Obama never followed through on his campaign promise to renegotiate the deal — a promise he made repeatedly in Aug. 2007, Nov. 2007, Dec. 2007, Jan. 2008, and Feb. 2008. Similarly, in July 2016 Hillary Clinton denounced the deal saying it “had not lived up to its promises” and promised to rework it.

Instead, Obama pursued the Trans-Pacific Partnership (TPP) — a deal that included Canada, Mexico, Singapore, Brunei, New Zealand, Chile, Australia, Peru, Vietnam, Malaysia and Japan — and which would have continued displacing U.S. workers and allowing other countries to lead the rules of trade. Obama’s globalist approach worked so hard to bring 11 other nations to the table, it left the U.S. behind. In Jan. 2017, President Trump withdrew from the TPP and plotted a different course.

By renegotiating NAFTA, President Trump has set a new course of smaller, individual trade agreements that work in the U.S. and our partner’s interest. This is already evidenced by the U.S.-Mexico-Canada Agreement (USMCA). For what the agreement lacks in a catchy acronym it seems to make up for in substance.

The deal will require 75 percent of duty-free car content be produced in the region with 40 percent being produced by $16-an-hour labor, this will bring manufacturing back to the US while helping Mexican workers who currently make cars for less than $4-an-hour.  U.S. farmers are also expected to see a boost in production as harmful limitations on dairy imports by Canada have been dropped in the new deal.

Following President Trump’s meeting at the United Nations last month, Japanese Prime Minister Shinzo Abe agreed to begin formal trade negotiations with the Trump Administration. This move has been praised by the U.S. Chamber of Commerce and the National Cattlemen’s Beef Association.

Japan was originally part of the TPP, but since Trump removed the U.S. from that deal, Japan can now work with the U.S. directly to form a deal that actually benefits both countries, particularly in the auto industry. According to the White House, the agreement will “For the United States, market access outcomes in the motor vehicle sector will be designed to increase production and jobs in the United States in the motor vehicle industries…”

David Gossack, vice president for Asia at the Chamber of Commerce explained, “As the world’s third largest economy, Japan is one of the most important export markets for American goods and services. These new discussions should help put U.S. businesses on a level playing with our foreign competitors and address longstanding issues between our two nations.”

These bilateral agreements allow each country to get more of what they want than large, multinational agreements.

Last month President Trump signed another trade agreement with South Korea. President Trump explained during the Sept. 24 press conference, “The new U.S.-Korea agreement includes significant improvements to reduce our trade deficit and to expand opportunities to export American products to South Korea… These outcomes give the finest American-made automobiles, innovative medicines, and agricultural crops much better access to Korean markets.”

As part of this agreement, South Korea will also double the number of US cars sold within the country annually.

President Trump also recently announced India is wishing to engage in trade negotiations as well, in order to produce a bilateral agreement with the U.S. Trump has described this as a part of an increasingly broad plan to foster individual relationships with countries. Trump is also moving forward with bilateral trade talks with Brazil.

These agreements play a strategic role in combatting the attempts by China to dominate global trade.

In recent years, China has led the One Belt One Road initiative to connect 70 countries across Asia, Europe, and Africa via trade and infrastructure development. What has been deemed the “new silk road” threatens U.S. global economic dominance, but these bilateral trade agreements provide countries with a more profitable and stable path forward with the U.S. rather than China.

Combined with President Trump trade pressure, the new trade deals put China in a bind. He has placed an additional $200 billion in tariffs on Chinese goods. China retaliated with $60 billion, but the U.S. only exports $135 billion to China, meaning China is almost already out of ammunition.

In an attempt to cheapen exports as a means of offsetting the tariffs, China has decreased the value of the yuan 8.8 percent since the beginning of the year, from $0.159 per $1 U.S. dollar to $0.145.

Americans for Limited Government (ALG) vice president of public policy Robert Romano explained, “Coupled with China announcing a general reduction on certain tariffs, China’s responses so far have been largely defensive and pretty weak. Devaluation and tariffing a limited number of U.S. imports, they’re running out of bullets. President Trump has exposed a major weakness of China’s export-dependent economic model that could compel Beijing to cave and ultimately come to the negotiating table. While Trump’s critics were moaning about a trade war, the President has been carefully ratcheting up pressure to achieve trade concessions, and it is working. The trade deals with Japan, South Korea and now Mexico and Canada signal that they see which way the wind is blowing.”

White House economic advisor Lawrence Kudlow predicts the G20 summit in Buenos Aires will be a good opportunity for China to come to the negotiating table. Kudlow explains, “The great hope here is that China will come to the table and start playing by the rules.” He noted talks thus far have been “unsatisfactory from our point of view.”

President Obama was willing to allow the U.S. to do worse in order to let other countries succeed, Trump proved that bilateral trade agreements can allow everyone to win, even China, that is, if it wants to do a deal.

As for the USMCA and South Korean trade deals, those still need to be passed through Congress, and this will require strict scrutiny to ensure the deal is the best it can be. Americans for Limited Government President Rick Manning explained, “President Trump continues to keep his promises and on first blush, the USMCA looks like a better deal. However, the devil is always in the details, which deserve full scrutiny during the Congressional approval process.”

During the TPP debate, Congress went against the wishes of groups like Americans for Limited Government, which opposed “fast track” legislation in 2015 alongside Trump prior to his campaign announcement, legislation that allowed trade deals to pass both chambers of Congress with a simple majority vote, unlike the two-thirds Senate threshold required for treaties.

Congress went along with it, and now the trade authority extends to President Trump, and he’s taking advantage of it. Now that it has been done, a simple majority can pass USMCA once its details can be verified as favorable.

Officially certifying the USMCA will significantly reduce the damage caused to the American people during the reign of NAFTA and better unite North America. Following this model, President Trump can bring the entire international community together via individual, mutually beneficial trade agreements. The logic is simple: when every country commits to improving themselves, the world improves. This strategy has already proved more impressive than the failed promises of the Obama administration.





For more blog postings from me, see  TONGUE-TIED, EDUCATION WATCH INTERNATIONAL, GREENIE WATCHPOLITICAL CORRECTNESS WATCH, AUSTRALIAN POLITICS, and Paralipomena (Occasionally updated),  a Coral reef compendium and an IQ compendium. (Both updated as news items come in).  GUN WATCH is now mainly put together by Dean Weingarten. I also put up occasional updates on my Personal blog and each day I gather together my most substantial current writings on THE PSYCHOLOGIST.

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