Archive for January, 2010

Unconventional economics

Wednesday, January 20th, 2010 at 9:17 am

I was amazed to learn that finally, economists are addressing one of my major gripes about their profession. Well, sort of, in a way.

The crux of the gripe is that economists only pay attention to things that can be counted, like money. This leads them to say that homesteading “doesn’t pay.” (Or it would lead them to say that, if they paid any attention to homesteading.)

Homemakers (formerly housewives), called attention to this, many years ago. Both homesteaders and homemakers obviously work, but since they’re not paid in cash, that work doesn’t count, so far as economists are concerned.

Likewise, a homestead’s production isn’t part of a nation’s output, and homestead tools aren’t considered capital goods.

Even worse, modern industrial agribusiness (sometimes mistakenly called “farming”) is measured only in terms of dollars. There is no accounting for the loss of soil fertility, and soil itself; no allowance for the waste of water; no measurement of the social losses as farms get bigger and bigger, and the schools, churches, businesses and communities formerly supported by thousands of small family farms sink into ruin. By this reckoning a cow, chicken or pig kept under concentration camp conditions is the same as one that is properly fed and cared for — and the maltreated creature might even be “worth more” in dollar terms.

And obviously then, an economist cares not one whit about the peace of mind a homesteader might get from eating fresh food, unadulterated by biocides; the pleasures of working with the soil and animals, with nature; or the many satisfactions to be found in independent country living.

That’s why I was astounded to read that a couple of economists are studying something more abstract than dollars and bushels. No, it has nothing to do with homesteading. They’re trying to put a price on the emotional benefits of having a pro sports team in town.

This excited me because, I ask you, is being a sports fan that different from raising chickens or goats? Might economists — and then newspaper writers and others, maybe even dribbling down as far as politicians — start paying attention to the hidden benefits of homesteading?

Maybe not. It just so happens that the study concerned the Minnesota Vikings. It further just so happens that the Vikings want Minnesotans to help pay for a new stadium, with a price tag of $870 million. Conventional economics — the kind that counts only dollars — have shown that publicly subsidized stadiums almost never return what governments put into them.

But what about civic pride and the other intangible benefits of having a home team? Shouldn’t that be worth something? What about the fun of wearing fake blond braids and goofy Viking horns? Maybe even nonfans just feel good about having a major league franchise. So the people looking for $870 million turned to unconventional economics.

The number crunchers came up with something they call “contingent valuation methodology.” It measures abstracts, but provides an answer in dollars. You can’t spend those dollars, but then at least you have a basis for comparison. Or an excuse for raising a coupla million.

The study determined that the Vikings have a “welfare value” of $702,351,890, or around $500 per Minnesota household.

Maybe I’ll stop griping, now that I’ve seen how this works. I’m not sure that I want some economist telling me that the million-dollar sunset I saw the other night was only worth $513.46.  — Jd Belanger

36¢ gas, free cigarettes, and underwear bombers

Friday, January 15th, 2010 at 12:21 pm

Most young people today are aware that almost everything in the world has been changing, and fast. But I wonder if they realize just how much, and how rapidly. Actually, you don’t have to be very young to be caught off guard on this.

I’m over 70 and often tsk-tsk at changes that amaze me (or those I don’t approve of), but even I was astounded the other day when I went back through some Beyond the Sidewalks columns from 40 years ago.

I found that when I started Countryside, in 1969, a first class stamp was 6¢. Gas was 36¢ a gallon. Of course that was leaded: unleaded gas wasn’t introduced until 1976, and ethanol wasn’t even on the horizon.

Going back further, I paid $50 for my first car: a 1937 Chev. Now it costs that much to fill a gas tank.

In recent years there has been a lot of hullabaloo about smoking. Smoking was banned on airplanes, then in restaurants, then offices and retail stores. Now you can’t even smoke in some taverns, or even cigar stores! I wonder how many people know, or remember, that back in the 1950s (when I started flying) airlines actually handed out free cigarettes to boarding passengers. How rapidly some things can change, at least when you’re there to see them and take note of them.

Most of this is like the old story of the frog: toss a frog into a pot of boiling water and it will jump right out. But put it in a pot of cold water, gradually bring up the heat, and you’ll get a boiled frog. (Now we’re told it doesn’t really work that way, but it’s still a great example.)

When seat belts were first introduced in the early 1960s, as add-on equipment, of course, I was a newspaper editor who was encouraged to promote the newfangled things. Most people hated them because they were uncomfortable to sit on. (Few people actually used them, and unlike today’s retractable shoulder harnesses, the bulky belt buckles always seemed to be in the middle of the car seat.) Then they became standard equipment. First their use was “advised.” Then (in Wisconsin, anyway) going beltless warranted a $10 fine. To assuage some of the outrage, proponents agreed that you only got the fine if you were stopped for another infraction: a cop couldn’t ticket you merely for not wearing a seat belt. Everyone knew it was only a matter of time, and it was. The frog boiled.

Now consider the Christmas Underwear Bomber. It appears that virtually anyone who has any kind of voice in the matter is smug and relieved: he was foiled, and we are winning the war on terrorism. It doesn’t seem to matter that our intelligence forces were alarmingly (even ridiculously) ineffective, the terrorist failed simply because he had a jock strap malfunction, and it was ordinary citizens who stepped in to take control of the situation. But is this “winning” the war on terrorism? In fact, have any of the plots that have been foiled and/or averted since 9/11 made us any safer… or have they furthered the enemy’s goals, without us even noticing?

Bear in mind, in this type of warfare the goal is not maximum damage in terms of death and destruction, or the taking of territory, as in a “normal” war. The main goal is to mess up the enemy’s head, along with economic slow bleeding that can lead to death. Little by little, since 9/11, we have become more and more accustomed to losses of freedoms, time, money and dignity. We have become more insecure, more messed up, closer to bankruptcy, and hardly anyone notices.

As in colonial America, a small rag-tag army couldn’t hope to compete with an established, well-trained and equipped and amply funded force — on conventional terms. But look what just a handful of operatives (most of them apparently incompetent, besides), have accomplished. Does anybody even know how many productive hours have been lost just because of airport security? How many billions of dollars expended, not only on security personnel and equipment, but on confiscated fluids and everyday pocketknives? What’s the cost of all the other areas of “homeland security”?

This is time and money that could have been spent for many, many other goods and services… things the enemy doesn’t want us to spend money on because that would improve our lives and our system, which they want to destroy. It happened, and it’s continuing to happen, even when their bombs don’t detonate.

When D. B. Cooper hijacked a Boeing 727 in 1971, he became a Robin Hood-like folk hero in some quarters. There was a ballad about him, played on popular radio stations. But copycats became a nuisance, and surveillance was increased. (That simply meant metal detectors, mostly.) When skyjackers became suicide bombers, airport security got serious. With every new attack, the ante is upped.

The Underwear Bomber brought us full-body scans — more millions of hours and dollars wasted on a largely useless endeavor — for little more than the price of a few chemicals and a one-way plane ticket. No enemy of America could have come close to that with a standing army, sophisticated weaponry, and a massive budget. It would be insane to even try. But a handful of zealous militants? That’s a different story.

Yesterday there was a news item about all the old folks whose canes have been confiscated, because they contained hidden swords the owners didn’t even know were there. Today, it’s an 8-year-old boy, who has been hassled in airports for the past six years, because his name is on the government’s list. (Michael Hicks shares that name with more than 1,600 others.) But a foreigner whose father warned authorities of his religious extremism buys a one-way ticket and boards a plane with no luggage — and flies to Detroit in December without even a coat — he gets on a plane with no problem! And “we” are “winning” the “war”?

All of this affects homesteading in a very general way. But I would suggest that the same mentality applies to most of our culture today. We are suffering from a similar colossal lack of critical thinking about food production, the use of energy and other resources, and certainly economics. In most cases it’s because we have become complacent, like the frog. But it’s also because too many people can’t see back far enough to realize how much, and how rapidly, everything has changed.

The combination blinds us to the fact that things are not as they should be, or could be. They won’t improve until enough people realize that.