You are browsing the archive for 2013 May 27.

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Reading Hayek on the Road to Famine

May 27, 2013 in Economics

By Joseph Salerno

Yang Jisheng, a Chinese journalist, is the author of the 2012 book Tombstone, a meticulously researched and definitive history of the Great Chinese Famine engineered by Mao Zedong from 1958 to 1962, during which 36 million Chinese perished from starvation.

In an interview with the Wall StreetJournal Mr Yang now reveals that he was greatly influenced by Friedrich A. Hayek’s classic work The Road to Serfdom , a heavily redacted version of which was translated into Chinese in 1997. Indeed Hayek had presciently written in this book, “In a country where the sole employer is the state, opposition means death by slow starvation.” Not only did Hayek’s book provide Mr. Yang with an explanation of the tragic events of his youth, it also explains the current Chinese system, which he maintains, has been completely misunderstood. The Wall Street Journal summarized Mr. Yang’s position as follows:

“China’s economy is not what [Party leaders] claim as the ‘socialist-market economy,’ ” he says. “It’s a ‘power-market’ economy.”

What does that mean?

“It means the market is controlled by the power. . . . For example, the land: Any permit to enter any sector, to do any business has to be approved by the government. Even local government, down to the county level. So every county operates like an enterprise, a company. The party secretary of the county is the CEO, the president.”

Put another way, the conventional notion that the modern Chinese system combines political authoritarianism with economic liberalism is mistaken: A more accurate description of the recipe is dictatorship and cronyism, with the results showing up in rampant corruption, environmental degradation and wide inequalities between the politically well-connected and everyone else. “There are two major forms of hatred” in China today, Mr. Yang explains. “Hatred toward the rich; hatred toward the powerful, the officials.” As often as not they are one and the same.

Hmmm, a market economy controlled by power, heavy regulations on new entrepreneurial ventures, arbitrary exercise of political power, economic cronyism, rampant corruption, the close correlation of wealth and political power? Sounds like another so-called market economy we are all familiar with.

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Source: MISES INSTITUTE

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Krugman Accused of Uncivil Behavior

May 27, 2013 in Economics

By Mark Thornton

“The gloves are off in the roiling academic dispute over the merits of austerity and the dangers of debt.”

In the latest round, Harvard economists Kenneth Rogoff and Carmen Reinhart accused Princeton economist and New York Times columnist Paul Krugman of “spectacularly uncivil behavior” and the inaccurate allegation that they refused to share data supporting their work linking heavy debt levels to subsequent slow economic growth.”

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Source: MISES INSTITUTE

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China Review

May 27, 2013 in Economics

By Mark Thornton

Here is a book review from the Wall Street Journal that gives a good picture of the past and present of China.

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Source: MISES INSTITUTE

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For International Travelers, Reviving the Fourth Amendment

May 27, 2013 in Economics

By Doug Bandow

Doug Bandow

I cross America’s borders several times a year. May was especially busy, with four foreign trips. That’s unusual, and my aging body is much the worse for wear as a result. But at least border agents may be less likely to search and seize my computer in the future.

Travelers, even citizens, enjoy few privacy protections when returning to America. In 1886 the U.S. Supreme Court ruled that border searches were exempt from the Fourth Amendment. Federal officials could look at whatever you were carrying or wearing. No evidence of wrong-doing was required.

The fact that some people are guilty is not a good reason to treat everyone as guilty.”

The issue still came up from time to time, but in 1977 the high court stated that border searches generally were considered “reasonable simply by virtue of the fact that they occur at the border.” In 2004 the Supreme Court reaffirmed the existing rule, citing the interest in protecting the nation from “unwanted persons or effects.” At the same time, the justices opined that travelers were entitled to a lesser expectation of privacy.

Nevertheless, in 1985 the Supreme Court did limit the government’s reach, ruling that “reasonable suspicion” of criminal conduct was necessary before detaining or strip-searching a traveler. Even Roy Altman, an Assistant U.S. Attorney who advocates wide discretion for border agents, called this “an understandable standard.” However, the new rule was not applied to personal possessions, even those on which privacy might be expected, such as a password-protected computer, smart phone, or digital camera.

Only once in three decades of traversing the globe have I been forced to hand over my computer and provide the password. I suppose I could have refused the latter demand, but then my computer likely would have spirited away for safe-cracking elsewhere. And though the process was offensive, I really had nothing to hide.

My computer is filled with data files containing years of boring policy articles, such as this one. The music for my iPod is saved there, but that would pose a problem only if the border guards really disliked the Bee Gees, ABBA, and Motown. There also are some travel photos, but other than a few surreptitious shots of Afghan military sites and Israeli check-points, most of them are not very interesting either.

And, in fact, the customs official only spent a few minutes puttering around—looking at what I have no idea—before …read more

Source: OP-EDS