Economic Cycles

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Comeback Post

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It’s been a long time hasn’t it? I’m going to try my best to give a little update on everything that’s happened in the last month, so expect this post to be more rambling and incoherent than usual.

In terms of music, I’ve been digging into my old CD cases and uncovering some lost gems. CDs (yes, CDs) that I rocked on the regular in high school have been getting fresh spins in my car. In other words, I’m partying like it’s 1999. So what have I been rocking? Here’s a small list: Blink 182’s Cheshire Cat, both Bigwig records, Good Riddance, Operation Ivy, Poison the Well’s Opposite of December (which does NOT hold up over time), Past Mistakes, Strung Out’s Twisted by Design, DeLaHoya, The Break, No Use for a Name’s Making Friends, Digger’s Powerbait, and some other punk rock classics that escape me at the moment.

As far as TV goes, Briks and I have been suffering through AMC’s The Killing each Sunday night. God what an awful show. The only reason we keep watching is the fact that we’ve invested so much time in the show already and it’s a murder mystery, which we’re suckers for no matter how poorly executed. In case you haven’t been watching, I’ll give you a quick run down of what the show’s all about. Think of all the cop cliche’s you have ever heard. Add to that cliche’s about Seattle’s weather (it’s constantly pouring down rain). And finish it off with a god awful storyline about a mayor’s race we could give a shit less about. Oh, and a local high school girl was killed and we still don’t know who did it.

Ok, books time. I just made an Amazon order because I broke my cell phone case the other day. I’m unaware of any other venue that sells HTC Android cases as cheap as Amazon does. $5 cell phone case? Yeah, I’ll take it. So in addition to a couple really cheap cases, I ordered a couple books I’ve had my eye on. I will be receiving Adapt: Why Success Always Starts With Failure by economist Tim Harford. Tim is known in economics circles as one of the few economists who can write really well. Another economist who knows a thing or two about writing is the great Walter Williams. Walter recently came out with two books. One was an autobiography that eventually I’ll read and the other is a economics book on race and discrimination. I ordered Race and Economics: How Much Can Be Blamed on Discrimination? There are few economists better than Walter Williams, and there are no economists better than Walter on issues of race.

What about libertarianism? Well, is there a better time in history to be a libertarian than right now? Obama has solidified George W. Bush’s third term with more undeclared, unconstitutional (and hardly covert) wars, more civil rights busting surveillance state controls, an official American citizen assassination list, and more executive branch secrecy. Don’t believe me? Just read the news. Or Glenn Greenwald. You’d have to be the most hardcore partisan loyalist to refuse to admit that the two parties are actually one party. And yes, there are many of you out there.

Let’s get to a little home life. I’ve had the smartest friend I’ve ever had and literally the first friend I ever had Mike visit me at the beginning and the end of his trip to Colorado. He flew in for a friend’s wedding held coincidentally at the Boettcher mansion on top of Lookout, and ended up hanging out and staying with us a couple of days. What a great surprise! There is no one on earth I can more nerdy with than Mike. I’ll miss that when he’s gone.

Economics? I guess I sort of covered that in my books section. But I’ll say this as well. Go read Mises.org and learn something.

And now to granddaddy of them all: cycling. I don’t want to get into all the gory details on this post but I will give the Cliff’s Notes version. After taking 6 full weeks off the bike to rest and rehab my knee, I started testing my knee out early this month with a few short, easy rides. After a couple of weeks of testing and increasing my volume, we decided to start getting me training again. So last week I met with my coach and outlined my comeback plan for the end of the season. I officially started training 2 weeks ago and will race again at the end of June up in Wyoming at the Dead Dog stage race. I obviously won’t be fit by then but it will be great to get back in the ol’ saddle and race a bit. By the time August rolls around, I should be fit again and ready to do well at the AFA state road race championship, Rist Canyon race, and finally the Steamboat Springs stage race. Definitely looking forward to those.

In other bike news, thanks to all my stretching, PT, and chiropractic care, I am tons more flexible now with miles of new range of motion. Therefore, I feel extremely comfortable and loose on my bike. So George and I decided to stretch me out a cm and drop me down 1.5 cm’s. It feels soooo good. But I’m still slow at the moment, which is frustrating. I feel like a million bucks, but I can’t push 200 watts without huffing and puffing.

I’d like to end with a public mid-year resolution to get back into regular blogging again. I’ve been so distracted with trying to get my cycling back in order that I’ve neglected this outlet. I had to put it on hold while I was mentally broken because of my knee. I’m back now though. And I’m ready to start training and writing regularly again. Wish me luck.

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Written by jlongo12

May 29, 2011 at 7:49 am

The Not So Wild Wild West

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The western expansion of the United States has a fairly well accepted narrative: namely that it was “wild” and more violent than life on the east coast during the 19th century. This, like many other legends and folklore, is completely untrue. If you look at the data, the west was less violent than the settled east coast during the same time period. Yes, there were fights with Indians and some hangings, but not to the extent that most people imagine. In fact, the violence people imagine was a result of the government’s expansion into the western territories. When government moved in and started throwing its weight around, violence escalated and intensified. Is it any wonder why? Indians did not take kindly to having their land stolen by the federal government. And settlers did not take kindly to having their institutions messed with. After government arrived, rent-seeking was the norm.

Western expansion serves as a case study of the emergence of law and order in a geographic region untouched by government. Do property rights, law, order, and peace spontaneously emerge like our price system does? The clear answer to this question is yes, thanks to Terry Anderson and Peter Hill’s work.

I just finished reading Anderson and Hill’s The Not So Wild Wild West: Property Rights on the Frontier. I highly recommend reading the book if the idea of emergent order seems crazy to you. If reading a 200 page book on such a subject sounds daunting or dry, then read this short essay version titled “An American Experiment in Anarcho-Capitalism: The Not So Wild Wild West.” It’s only around 20 pages long and has many of the same nuggets of evidence and theory.

So what’s the short of it? The short of the theory is quite simple: when a certain resource or good reaches a certain threshold of value, institutional entrepreneurs create property rights. The book is chock full of history and evidence of this happening over and over again as settlers expanded west: horses, water, land, crops, etc. Entrepreneurs figured out how to efficiently maximize a resource’s value by creating property rights with an adequate enforcement mechanism. They pre-contracted with others before herding cattle north in groups of 10 to 20 herders. They evaluated the water supply in the western states and came up with a variation on the old English water rights doctrine. They made efficient rules on how to claim land. Trade posts and supply chains were formed along well traveled routes north and west. And the list goes on. All of these market creations happened without any formal backing of any formal government. It wasn’t until the U.S. government started impeding on property rights – both through expropriating Indian land and reconfiguring the institutions that made law and order so efficient – that violence and conflict arose in the west. As the settlers well understood, violence is a zero sum game. Trade is not. Therefore, when YOU bear the costs of violence, the optimal move is to trade (like settlers did with the Indians before government arrived). When you can offload the costs of violence onto others via taxation and regulation, violence becomes less costly and the incentive to trade lessens. Hence the government’s expansion west was the spark that ignited violence and conflict.

The only part of the book I took any issue with was a small part towards the end where the authors attempted to apply the same framework of the west to developing countries nowadays. Much of that was well done, except for the part about intellectual property. They made it seem like if developing third world countries could just create and enforce IP laws, they’d grow much faster and quickly become first world. I completely disagree. But my anti-IP law rants are for another post. All in all, Anderson and Hill’s work was thorough and quite convincing. They provided a ton of data, both empirical and anecdotal, to back their claims. And unlike Hayek and Mises, the writing was clear and at a generally consumable level. Give it a read, you won’t be disappointed.

Written by jlongo12

January 4, 2011 at 5:58 pm

Posted in books, economics