Should the government "protect" American exporters?

When we think of "protecting" someone from something in the abstract, we're likely to visualize an innocent party being threatened with some harm. Our natural inclination is to think such protection is probably a good thing, but this creates a problem. It means that any policy which is framed as providing "protection" for someone will seem like a good thing, if we don't think carefully about exactly what that policy does. The label "protection" serves to make the policy sound laudable and to make careful thought about the actual nature of the policy seem unnecessary. Whenever a policy is marketed as providing "protection" for someone, this is a signal that we should think carefully about what the policy will actually do - we should look for an alternative way of framing it which makes clear exactly what the policy will do.

George Mason University Don Boudreaux is a master of this. Consider his recent comment on a senator's statement about "protecting" American exporters.

EXCERPTS from Boudreaux's letter:

Dear Sen. Brown:
In today’s Washington Post you declare that “Demanding that trade agreements work for American exporters isn’t protectionism; it’s common sense.”
In other words, whenever other governments dole out favors to foreign corporations at the expense of foreign consumers, you want Uncle Sam to dole out favors to American corporations at the expense of American consumers.
This isn’t common sense, sir. It’s garbage-heap economics that serves as a convenient excuse for politicians to pick the pockets of hundreds of millions of Americans for the benefit of politically influential businesses.

Black Friday: Police called after customers rush door at Toys R Us near Appleton | postcrescent.com | Appleton Post Crescent

EXCERPTS:

"Black Friday started with a black mark this year. The line of several thousand waiting customers wrapped entirely around the Toys R Us building at 4411 W. Wisconsin Ave. Thursday night. Moments before the store opened at 10 p.m., the line of those who’d just arrived and line of those who’d waited many hours overlapped.

When the doors opened, everyone rushed the door. The store’s staff quickly became overwhelmed, locked the door and called police for assistance.

A staffer repeatedly yelled, “back up” to those standing around the door. Customers who’d been waiting hours chanted “end of line” to those who’d just arrived.

Cpl. Jeff Oberg of the Grand Chute police arrived on scene and suggested the store create a barrier to control the line. Ten purple Babies R Us shopping carts were turned upside down in a row to thwart line-jumpers. Staffers reopened the doors and customers were let in 50 at a time without further incident.

“It got rough for a little bit,” said store manager Chad Wojcik around 10:20 p.m. “We’ve got it in hand now. I’ll do carts again next year.”

A brutal wind whipped temperatures below zero most of the night, testing the temper of anyone who braved standing outside Fox Cities stores waiting for bargains and doorbuster deals.

Best Buy’s traditional line of tents and huddled, waiting customers appeared considerably shorter than the length of last year’s line.

Most shoppers, however, came prepared for the cold and kept their good spirits.

Father and son Ed and Tanner Van Asten of Grand Chute arrived about 11 a.m. Thanksgiving Day to be first in line at Best Buy in Grand Chute.

“We’re all crazy,” said Ed Van Asten on those who do this grueling Black Friday ritual. “I came for my son who needed a laptop. I’ll do anything for my kids.”

His recommendation for anyone wanting to do this in the future: “Get here before noon, dress in layers and no tennis shoes.”

And forget about Thanksgiving dinner.

“Our Thanksgiving is Sunday this year,” he said.

“My bottle of water froze in the first two hours,” said Angela Krause of Sherwood, who waited in line for five hours at Toys R Us. “I have hand warmers, blankets and a sleeping bag, so I don’t notice the cold.

“It’s worth it,” she said of what she endured to get bargain priced Lego and other toys for her child.

Another veteran Black Friday shopper, Amber Kirk of Menasha, had her own formula for staying warm.

“You need long underwear top and bottom, thick socks, a blanket, lots of layers, coffee and sugar. We have a bowl of candy in the car,” she said.

Her friend Jen Fischer of Menasha, a Black Friday first-timer, was so completely wrapped in a blanket, hat and scarves that just her eyes showed, giving her the appearance of wearing a middle eastern burqa.

“I love it,” she said of her Black Friday experience. “I thought I wouldn’t. I thought I’d be cranky, but I’m not.”

Shoppers snapped up lots of 50 to 80 percent off deals at the Fox River Mall, which had a handful of stores participating in its first midnight opening. It appeared that most customers at that time were under age 30.

“The stores that are open are very busy,” observed John Burgland, mall manager, around 1 a.m.

“There’s a special adrenaline high being here at midnight,” said shopper Lisa Van Dyke of Neenah.

Tennis in Grand Central Terminal - WSJ.com

EXCERPTS:

"Only in Manhattan, where indoor tennis courts are rarer than personal garages, would anyone sign up a year in advance for an hour of tennis. And only on this space-strapped island would they pay as much as $210 an hour for the privilege.

Tennis players with thick wallets and ample foresight have already begun reserving hours at the new tennis facility that's being built in Grand Central Terminal in a space that used to house a CBS recording studio where "What's My Line?" and Edward R. Murrow's "See It Now" were filmed.

The price—depending on the time of day, between $100 and $210 an hour—will likely be the highest in the city for an indoor court, according to Anthony Scolnick who is leasing it from Metro-North Railroad. He predicts hedge fund executives, real estate professionals and others will be willing to pay that price when the Vanderbilt Tennis Club opens in September.

***

Indoor tennis in space-crunched Manhattan has never been for the middle class.

Aside from a seasonal tennis bubble a Parks Department concessionaire erects under the Queensboro Bridge, there are no public indoor courts on the island and the private ones are pricey. The Millennium UN Plaza Hotel, for example charges $110 to $165 per hour for the court there. The same amount of time costs $115 an hour for non-members at the Manhattan Plaza Racquet Club.

***
The bidding was won by Mr. Scolnick, the owner of Yorkville Tennis Club and Sutton East Tennis, both on the Upper East Side. He is a former athletic director at Hunter College. He will pay a starting rent of $225,000 a year to Metro-North.

QUESTIONS:  

1.

Rules Eased for Some Health Plans - WSJ.com

EXCERPTS:

"WASHINGTON—Amid pressure from employers, the Obama administration on Monday loosened rules for bare-bones health-insurance policies. It marks one of the administration's biggest steps to peel back regulations that big business found onerous under the health- care overhaul.
McDonald's Corp. had warned regulators it might have to drop its health-insurance plans for 30,000 hourly workers unless it got an exemption for these policies, which have low premiums but also limit payments for medical costs.
The administration's move underscores how businesses, after complaining loudly about the overhaul in the run-up to passage, are now winning a handful of modifications.
The change was part of sweeping new rules rolled out by the government Monday that will force insurers to spend a high portion of their premium revenue on medical care.
Consumers will reap some benefits. Insurers that don't meet the new standards will be forced to issue rebate checks, which the administration estimated could affect nearly nine million Americans, for a total payout of up to $1.4 billion.
The rules, codifying language in the health law, say insurers will be required to spend between 80% for smaller carriers and 85% for larger carriers of their revenue on medical care, a calculation known as a medical-loss ratio. That limits how much they put toward salaries, profit and other nonmedical costs.
Providers of "mini-med" policies, like McDonalds, which caps benefits at a low level, had objected that they would have trouble meeting those levels, in part because they have high administrative costs.
About 1.4 million Americans are covered under mini-med plans. They're typically offered by low-wage employers, who have high employee turnover and end up paying out little money in medical claims....
Democrats said eliminating plans with such limited coverage was the reason they passed the law in the first place.
But Obama administration officials said they were determined not to prompt any employers to drop their plans because of the law. "No one's going to lose their coverage," said Jay Angoff, a director at the Department of Health and Human Services.
***
"Starting in 2014, many low wage workers will shift to getting coverage inside new insurance exchanges, because that's where they can tap tax credits to offset their costs. Stricter rules for the minimum benefits that employers can offer are expected to displace the plans altogether.

Burton G. Malkiel: 'Buy and Hold' Is Still a Winner - WSJ.com

EXCERPTS:

"Buy and hold investors in the U.S. stock market made an average annual return of 8% during the 15 years from 1995 through 2009. But if they had missed the 30 best days in the market over that period, their return would have been negative.

A Keynesian Defense of QE2

This article by Alan Blinder, a highly-respected Keynesian economist and former vice-chair of the Fed, gives a good explanation of what Bernanke hopes to do with the "quantitative-easing" policy which was put into effect last week.

YouTube - Quantitative Easing Explained

This video is very amusing, and, unfortunately, largely [but not entirely] true.