David R. Henderson  

Giving Thanks

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I dedicate this post, as I did The Joy of Freedom: An Economist's Odyssey, "to the unknown civilization that is growing in the world."

On this Thanksgiving Day, I feel thankful for many things. First, my daughter came home today from San Francisco and I always love being with her. My lovely wife, daughter, and I had a nice quiet turkey dinner with apple and pumpkin pie.

I'm also thankful that I live in what is still a pretty good country. I have my criticisms--a lot of them, as regular readers of this blog know. But my criticisms are mainly of government and of those who want to maintain and/or increase government's power over us. My day-to-day dealings with people are almost always good. And even when I get in potential conflict situations with other people, which is rare, I'm thankful that I've developed the tools over about the last 55 years to deal with them.

I'm thankful that I decided to become an economist. It led me to move to the United States, go to UCLA, become a resident alien (antennae and all), and become a U.S. citizen. And for that decision to become an economist, I thank the person who told me, when I was 19, that I was smart enough to do it: Harold Demsetz.

Also, my becoming an economist and, being a Canadian, saving in a typical year 15% of my gross income, has made my family relatively wealthy. It has allowed me to retire while still in relatively good health so that I can do other things. And, as I've told many others, if my wife and I had one third of our wealth, we would still be wealthy: we would still have two pretty good cars, a nice house, if not in California, and the ability to buy good food.

I'm thankful that there's a Thanksgiving Day. It's a way of making oneself slow down, visit family, and take stock.

Finally, I'm thankful to our thoughtful readers who are engaging in the exciting project of thinking through the consequences of economic freedom and of government control.


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CATEGORIES: Economic Philosophy




COMMENTS (10 to date)
TMC writes:

Very nice sentiments! Happy Thanksgiving.

p.s Thanks to you - I enjoy your writings.

David R Henderson writes:

Thanks, TMC.

Chris Wegener writes:

I am glad you had a Happy Thanksgiving.

You raise a point which I would like you to expand upon. You say you criticize the expansion of government power and campaign for a smaller and less intrusive government. I can understand this sentiment and we quibble at the margins.

You, as far as I can tell, rarely criticize or remark upon the constant expansion of Corporate power and individual wealth. As far as I can tell almost all of the problems we face in our country stem from the uncontrollable expansion of corporate power and the considerable control over Congressional action that wealthy people exert as well as the increase of rent seeking and the erection of barriers to increased competition.

I wonder if you could explain this dichotomy to me.

Regards,
Chris

David R Henderson writes:

@Chris Wegener,
I am glad you had a Happy Thanksgiving.
Thank you, Chris. I hope you did too.
You raise a point which I would like you to expand upon. You say you criticize the expansion of government power and campaign for a smaller and less intrusive government. I can understand this sentiment and we quibble at the margins.
My take from your past comments on this blog is that we are not quibbling at the margins. Can you point me to where you have advocated a reduction in government power?
You, as far as I can tell, rarely criticize or remark upon the constant expansion of Corporate power and individual wealth.
That’s not true. I often comment favorably on the expansion of individual wealth. I don’t think it’s constant--it rises in fits and starts--but it does happen.
I have commented negatively on the expansion of corporate power where that power arose from government favors. I’m pretty sure, for example, that I’ve commented negatively on the power that the Export-Import Bank gives to Boeing and other exporters. I also think I’ve commented negatively on the power that state and local governments give to professional athletic teams. I’ve commented negatively on many others, but those spring quickly to mind.
As far as I can tell almost all of the problems we face in our country stem from the uncontrollable expansion of corporate power and the considerable control over Congressional action that wealthy people exert as well as the increase of rent seeking and the erection of barriers to increased competition.
There’s where we clearly disagree and not just on the margins. We agree that there have been barriers to increased competition. One of the main ones has been restrictions on immigration. But my impression is that it’s not mainly wealthy people, certainly not wealthy by U.S. standards, who are pushing for these restrictions. Donald Trump seems like the exception: he’s wealthy and he is pushing for these restrictions. But, as you know, I have commented negatively on this.

Chris Wegener writes:

@David R Henderson

Can you point me to where you have advocated a reduction in government power?
I admit that I mostly react to your comments when I disagree.

Like you I am strongly opposed to the public funding of any sports or corporate building by state or local governments. I agree with your opinion that there should be much fewer licencing of commercial activities. (Hair dresser, flower stores, etc.)

I am still reworking my opinion of zoning regulations. I am not ready to to completely throw them out but the status quo is clearly sub optimal. I am informed by my experiences in living in two places, one, Montana, that essentially has no zoning laws, and California which has too many and those created in 1946 which was unprepared for the growth of the city and the explosion of cars.

When I say individual wealth I am speaking of the explosion of wealth in the top 1 percent of Americans. The control they exert over corporations and the government has led to some extraordinarily bad results. The ability to break the historical bond between productivity and wage grow which has lead to a thirty year stagnation in real median income leading to an explosion of household debt as people try and maintain the illusion of continuing prosperity. The ability of corporations to force all legal recourse into binding arbitration with the resulting effect of eliminating any control over bad behavior. I could go on but I am interested in your willingness to ignore these effects.

Regards,
Chris

David R Henderson writes:

@Chris Wegener,
I admit that I mostly react to your comments when I disagree.
Fair enough.
Like you I am strongly opposed to the public funding of any sports or corporate building by state or local governments. I agree with your opinion that there should be much fewer licencing of commercial activities. (Hair dresser, flower stores, etc.)
I’m glad we agree on this, Chris.
I am still reworking my opinion of zoning regulations. I am not ready to to completely throw them out but the status quo is clearly sub optimal. I am informed by my experiences in living in two places, one, Montana, that essentially has no zoning laws, and California which has too many and those created in 1946 which was unprepared for the growth of the city and the explosion of cars.
As you’ve probably guessed, I’m on the no zoning end of the spectrum. I think restrictive covenant can handle most of the problems. Also, check out my earlier review of Rothstein’s The Color of Law for some of the harmful racial consequences of zoning.
On your last paragraph, that style of argument is one I’ve seen before and I’m working on a separate blog post on it because I think it’s of more general interest.

Seth writes:

@Chris W -- So, I'm just curious, from your point of view, is the problem a powerful Congress that can provide corporations with rent-seeking and barriers to competition or do you see corporate power as a separate issue from an expansive government?

Mark Bahner writes:
As far as I can tell almost all of the problems we face in our country stem from the uncontrollable expansion of corporate power...

Interesting! Now that Thanksgiving is over, let me think of some of the biggest problems I think this country faces. Hmmm...this is just spit-balling, because (perhaps surprisingly) I don't think of this much, but:

1) Obesity.

2) Possibility that a single individual (the President) could start a nuclear war.

3) Divergence of age-adjusted wealth.

Hmmm. I'll stop there, but I'm probably missing some other things. I don't see a lot of "corporate power" influence on those three problems. Especially #2 of course, where people have historically assumed the President would not do something crazy.

P.S. I forget who it is in Congress, but I think someone in Congress is trying to get discussion started to make sure Congress would be consulted before a nuclear war was initiated. I'm thankful for that. Better late than too late.

David Seltzer writes:

Re Demsetz. When I was at the GSB in 1971, I took his class. We talked about trading emission contracts. In 1973, I was a market-maker on the CBOE. He, along with Stigler, Brozen, Black and Fama, were enormous influences. Trading in that efficient market place made economic abstractions real. Thanks for your post. Glad you enjoyed Thanksgiving.

Chris Wegener writes:

@seth
I see the two as inextricably intertwined with corporations using lobbying and campaign contributions to extract favorable laws which are then turned into regulations that favor the Corporations and Wealthy.

I would also add this link to show one example of the manipulation of the Congressional process to benefit well connected wealth groups to preferential outcomes that everyone else than pays for.

Driver of Heralth Care Costs

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