It’s as if the 70’s never happened:

It’s as if the 70’s never happened:

This dispatch from a Hawaiian Live at the WTC reader (from a local newspaper article):

This year, the Legislature brushed off the objections of huge national and international corporations and major local businesses to push gasoline-price caps, a bottle bill, discount prescription-drug pricing and new regulations on health insurance rates.

Not to mention the objection of economists everywhere. Except for the bottle bill (weirdly listed as a “consumer bill”), all of these are justified on the grounds that a “near-monopoly” exists in some market or another. But no where is a source of the monopoly explained.

If the “consumer advocates” (second only to “People’s Republic” in the wildly inaccurate description contest) who push these laws truly thought that Hawaiian gas stations were making monopoly profits then they should, ta da, OPEN A GAS STATION! There’s a ton of money in it! Right? You could undercut all those evil monopolists and make a mint as motorists flocked you your station for the extra cheap gas.

Ditto health insurance. If the health insurance companies are getting monopoly rates, then band together and provide it yourself for crying out loud. The premiums would be lower and you’d make a fortune. Everyone would be better off

Free-market critics are never so silly than when they complain about what is obviously a huge opportunity to make a ton of money while doing good. Guys! Just jump into the business. You can make half a ton of money, which makes consumers half a ton better off, and gives you the rest with which to even more good. It almost makes one think that they don’t really believe their own rhetoric.

Prescription drugs are a different animal. Hawaii probably could put dramatic caps on prescription drug prices without being out the drugs. This is because a $2 pill is paying for about $.10 in manufacturing costs and $1.90 in R&D costs. But the R&D is already done. So even if Hawaii capped the price at $.15 drug companies would still find it profitable to pay for it. And Hawaii is a small enough market that the loss of potential future revenue probably wouldn’t impact the drug companies’ incentives to innovate. (All sorts of additional considerations play into this story, but none really affect the bottom line point.)

But they shouldn’t. They shouldn’t because doing so would be greedy. They would be saying, essentially, that the rest of the pharmaceutical purchasers in the country should be paying for the R&D to develop their drugs.

It’s really no different than why you shouldn’t shoplift even if you could plausibly get away with it. Society would be a much worse place if everyone tried to squeeze out the last bit of benefit for himself even if it means hurting others.

The NYT vs Thomas Jefferson

Frank Rich:

…(N)o politician in power has ratcheted up this rhetorical religiosity louder than John Ashcroft. In a February speech he declared, "We are a nation called to defend freedom — a freedom that is not the grant of any government or document, but is our endowment from God." So much, then, for that trifling document that defines our freedoms, a k a the Constitution.

The Founding Fathers (via The Declaration of Independence):

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.--That to secure these rights, Governments are instituted among Men, …

You make the call.

The Constitution was not created to define our freedoms. It defined a political entity which, it was hoped, would defend our freedoms.

Ann Salisbury offers this observation:

After the oil industry was accused on Monday of manipulating supplies to increase prices and profits, the industry denied the allegations, saying price swings were caused by other factors, such as volatile crude oil markets, unexpected refinery shutdowns and pipeline disruptions. Oh sure, the industry's explanation is possible, but is it probable? I'm not buying it.

This, well, belief, is easy to understand. It’s impossible to contradict (how can you contradict the argument that contradictory evidence is false?), and it fits the basic human need for a big, fat, ugly target to blame.
So I’m not going to try to contradict it. No, no contradiction. Just a few observations.

Price swings in commodity markets are not new. Remember last year's $3.00 a gallon gas scare?

In real terms gas is still cheaper than it has been at most times in modern (post WWII) history.

Radical price swings are not indicative of monopoly. If the oil companies had the power to monopolistically restrict supply they would logically have done it three weeks ago, too.

It’s ridiculously easy to see evil intent in everything. In retrospect everything can look planned out an obvious. A cottage industry of psychological-economic literature exists discussing how difficult a time people have with the notion of coincidence and random chance.

Politicians have an institutional incentive to find evil-doers everywhere so they can accrue power (under the guise of combating the evil-doers) to themselves.