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Should the US Go to War with Syria?

I have planned out at least one blog post on this subject, although I may not have time before Obama actually takes action. So I just wanted to link to two posts that you can read in the meantime or in case I don’t get to it at all:

  • Humanitarian Murder: It’s a Gas” by Joseph Fetz. Here, Fetz makes the libertarian argument against war while discussing Syria in particular. He shows that “humanitarian war” is essentially a contradiction in terms. This is a very well-written piece, and I highly recommend it.
  • Presidential War Powers: The Constitutional Answer” by Thomas Woods. Woods sets out the constitutional argument against presidential declarations of war and responds to counterarguments. Really, this is your one-stop shop if you want to understand the Constitution on war powers and be ready for many, many counterarguments. Of course, these can all be found in more detail in Woods’s books.

Photo Credit: danny.hammontree via Compfight cc

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Types of Drone Strikes

1) personality strike: This is when the administration is sure they are attacking the intended target and know his identity.

2) signature strike: This is when a certain “signature” that is ostensibly common to terrorists is noticed. For example, adult men may be noticed with guns, and a strike may be ordered. The obvious difference between this type of strike and a personality strike is that the identity of the target is not known.

3) double tap: This is when a drone strike has already occurred once and a secondary strike is launched after first responders rush to the scene. Hence the name “double tap” (the first drone strike is the first tap, and the second drone strike to kill responders is the second tap).

The Minimum Wage Does Indeed Cause Unemployment

The minimum wage is being spoken about again thanks to Obama’s recent State of the Union Address. To be honest, I don’t know how people still manage to sit through the whole thing to find out what he’s saying, but kudos to them!

In his speech, Obama proposes raising the federal minimum wage from its current $7.25/hr to $9.00/hr. Why anyone would want to raise the minimum wage when unemployment is already very high is beyond me. Oh, but wait! The Department of Labor says it doesn’t cause unemployment  (HT2 EPJ).

The president’s plan to raise the federal minimum wage will benefit 15 million American workers, and have a positive effect on the economy. Still, there are some common myths about raising the minimum wage. We checked in with our Chief Economist Jennifer Hunt on the following three myths:

Myth: Raising the minimum wage reduces employment. False Minimum wage increases have little or no adverse effect on employment as shown in independent studies from economists across the country. Additionally, a recent letter by leading economists including Lawrence Katz, Richard Freeman, Joseph Stiglitz and Laura Tyson points out that “[i]n recent years there have been important developments in the academic literature on the effect of increases in the minimum wage on employment, with the weight of evidence now showing that increases in the minimum wage have had little or no negative effect on the employment of minimum wage workers, even during times of weakness in the labor market.

Myth: Raising the minimum wage will negatively affect teen employment. False Eighty-nine percent of those earning the minimum wage are 20 years of age or older, and studies have shown that minimum wage increases have had little or no adverse effect on teen employment.

Before I show why the above is incorrect, let me go through the logic of why the minimum wage does cause unemployment. I have already explained it here and here, but I will give a very brief explanation again. Many economists like illustrating the effect of the minimum wage on employment through supply and demand. If a price floor is put above a market equilibrium price, then it will cause a surplus. In the case of the minimum wage as a price floor, the wage is the price, and labor is the commodity. In other words, there will be a surplus of labor supplied by prospective workers over labor demanded by employers.

However, a simpler and even more intuitive explanation exists. The goal of most companies is to earn profits. Employers will not hire employees unless it helps them earn a profit. So if an employee contributes $8/hr, an employer will not hire that employee at a wage any higher than $8/hr. If in this example, the minimum wage is at $7.25/hr, the employer can profitably hire that worker for $0.75/hr ($8.00 contribution – $7.25 wage = $0.75 profit). If, however, the minimum wage is raised to $9/hr, then he would earn losses of $1/hr by hiring that worker ($8.00 contribution – $9.00 wage = $1.00 loss); in other words, he will not hire that worker and the worker will be unable to find a job. Therefore, the higher the minimum wage, the fewer workers that can find a job, and the higher the unemployment rate.

But what about those studies the DoL is claiming disproves my logic? Well, to put it simply, they don’t. Logic should be debated against on its own terms. If a premise is true, and valid logic is used, then the conclusion must also be true. Empiricism does not change this. Empiricism may give us reason to doubt logic and look for errors, but it does not disprove logic itself.

In addition, many empirical studies come to completely opposite conclusions. I and two classmates did an econometric study about the effect of the minimum wage on youth unemployment, comparing state by state. We found a positive correlation of 4.6 (i.e., for every increase of $1.00/hr in the minimum wage, there was a corresponding increase of 4.6% in the youth unemployment rate). This is in complete contradiction of the study they cite above.

Does my study prove that there will always be an increase of 4.6% in the youth unemployment rate for every $1.00/hr increase in the minimum wage? Absolutely not. The study is only historical. It is not predictive. Economics is the study of human action. Human action can always change. Humans can invent new ways to act. They don’t have to act exactly as they did in the past. There is no law of behavior mandating that human interactions lead to a 4.6% increase in unemployment for every $1/hr increase in the minimum wage.  Unfortunately, this is only the first of numerous problems with econometrics.

Although such studies are only historical, are they even correct? Can we undoubtedly say that the effect of the increase of $1/hr in the minimum wage was a 4.6% increase on youth unemployment? Even this we cannot be sure about. There are a myriad of variables we simply cannot account for, or would even think to account for. How do we know it was the effect of the minimum wage that caused that unemployment? What about the business cycle? Maybe certain businesses coincidentally made poor decisions. Etc. etc.

We can show whatever we want with an econometric study. The methodology is completely flawed. The correct methodology of economics, of human action, is what Mises came up with: praxeology. The causal-realist approach allows us to look at human action and understand what specific causes lead to certain effects, rather than rolling around endlessly in a sandbox saying one grain of sand does this or that when there are millions of other grains that may actually be more important.

Let’s again look at the logic and think more about the absurdity of saying increases in the minimum wage don’t cause unemployment. If that’s true, why not raise the minimum wage to $20.00? Or $50.00? Or $100.00? If we can achieve prosperity with the wave of our magic legislation wand, why not do it on a bigger scale? Because it would cause massive unemployment. When people talk about raising the minimum wage by a smaller amount, they are only talking about increasing unemployment by a smaller amount. And this is probably why econometric studies on the minimum wage come to different conclusions so often. Because what they’re measuring isn’t very large, and a lot of other factors they don’t account for may be more important.

An anonymous commentor at a blog I found today makes another very important point:

So if increasing the minimum wage does not mean jobs will be destroyed and unemployment will go up, then does the contrapositive hold true that if you lowered or eliminated the minimum wage that jobs would not be created and unemployment wouldn’t decrease?

Liberals complain non-stop about job shipped overseas since 40% of the world lives on less than $2/day. Those jobs went overseas because they are illegal to create here and pay a wage that makes economical sense.

Many individuals that realize jobs go overseas because wages are cheaper over there don’t pursue the logic all the way. The reason we lose out on many of those jobs are  because those jobs are illegal here, thanks to the minimum wage.

An increase in the minimum wage will cause an increase in unemployment, all else equal. If Obama is successful in increasing the federal minimum wage, unemployment will be higher relative to whatever level it would have been otherwise. This means that you could see the unemployment rate even go down even with an increase in the minimum wage, not because of the minimum wage but in spite of it. This is precisely why empiricism is an incorrect method for discovering causal relationships.

Keynesianism and the Current Crisis

I had heard about this major poopie by the Obama administration but had never seen it for myself till now. And it’s just as hilarious as it sounded.

So the two blue lines are the project unemployment rates with and without the proposed stimulus. Without the stimulus, the unemployment rate would go up to a jaw-dropping 8.8%, and with the stimulus it would only go up to 7%. Thank god for our wise economist overlords. Without them we would suffer unspeakable horrors of which the mere thought of has kept grown men up in the night shaking in fear.
Uh yeah, whoops, so the actual rate went to 10.1%. As Daniel Kuehn points out, there are two conclusions we can derive from this.

“1. To argue that forecasters in December 2008 did not get it right, or
2. To defend forecasters in December 2008 as presenting a viable counterfactual.”

In other words:

1) The forecasters did poor forecasting. The economic situation was actually far worse than they believed it to be. This is the argument Keynesians make after the fact, because it is the only viable route for anyone trying to maintain their beliefs. (I don’t really hold this against them, every ideology has a way to defend itself in seemingly dreadful circumstances)

2) The forecasters did correct forecasting. It is Keynesianism that is incorrect and fiscal stimuli are actually counterproductive.

While Kuehn chastises Steve Horwitz for leaving his options a little open-ended and not being perfectly clear as to which of the options he is arguing for (in the lecture Horwitz gives here), I think what Horwitz does is perfectly reasonable. After all, both are possibilities and both should be pointed out as just that, possibilities. #1 could be true, #2 could be true, or perhaps both could be true. These are simply things we cannot empirically prove.

Regardless, Bob Murphy has a typical hilarious commentary regarding Keynesianism and the current crisis here:

In this lecture, he points out the following graph in response to those that Keynesians who assert point #1 above, along with the coexisting argument that more really should have just been done from the monetary side.

Yup, Bernanke just didn’t do enough!

Obama Teaches Us How to Run a Circle around a Question

I posted this as a comment recently on EPJ in response to a video of Ben Swann interviewing Obama. Here’s a slightly edited version of what I said:

Firstly, here’s the interview I’m discussing, of which the first Q&A is what is relevant. Of course, feel free to watch the whole video if you’re interested.

So Swann asks Obama why his lawyers are fighting the judge’s orders against the NDAA’s indefinite detention clause. Obama responds:

1) His primary job is to keep the American people safe. Only next is his role to do it in a way that respects American values, traditions, and rule of law.
2) But there are people that have pledged to try to hurt Americans that they can’t try in a traditional court. It’s a complicated situation.
3) An American citizen can never be subject to that sort of detention. Congress has disagreed with him.
4) The only reason he passed it was so he could finance the military and pay the soldiers.
5) So he signed the bill saying he would never use this power, and he believed courts in the long run would find it unconstitutional.

So firstly, he doesn’t explain why we can’t try the people who have “pledged to hurt Americans” in a traditional court. If they have taken such a pledge, it would undoubtedly be easy to lock them up.

Secondly, in response to point #3 and 4, Anonymous @12:22 AM has pointed out that Carl Levin, one of the two creators of the bill, stated it was the Obama administration that wanted the power in the first place. Here’s the video of that:

Thirdly, if point #5 is true, WHY are his lawyers fighting the judge who ALREADY ruled it unconstitutional. Obama runs a complete circle around the question, in the end, completely avoiding answering it at all. Swann asks Obama why his lawyers are fighting the judge’s ruling. Obama essentially replies “I would never use the power, and the courts will rule it unconstitutional in the long run.” And the alert listener thinks “wait a second…if Obama wants the courts to say it’s unconstitutional, then isn’t it merely hypocritical to be fighting the court when it already DOES say it’s unconstitutional?” Obama’s actions speak louder than his words. Swann asks “why are you fighting the court’s orders against the NDAA” and Obama responds “I want the courts to be against the NDAA.”

????? This is akin to asking someone “why did you kill that man?” and them responding “I want him to live.”

Unfortunately, I’d venture to say 99% of Americans are not alert. Hell, for a moment there, even I thought to myself “Oh Obama isn’t so bad he just passed it so the troops can get paid, and he’s hoping in the long run the courts will find it unconstitutional.”

This man is a devious tyrant. The overused idiom “sly as a fox”is only an understatement describing the politician’s wit and charm in pleasing the average American.

For those interested, here are Swann’s responses after the fact:

Obama’s Kill List: What You Need to Know

The information contained in this post was derived from the New York Times article “Secret ‘Kill List’ Proves a Test of Obama’s Principles and Will” by Jo Becker and Scott Shane.
Here’s what you need to know:

  1. Suspects are killed by drone strikes. No trial is given, no evidence is shown, US citizens are not exempted. All this information is kept secret.  “Mr. Obama has placed himself at the helm of a top secret “nominations” process to designate terrorists for kill or capture, of which the capture part has become largely theoretical.”
  2. The list contains 15 Al Qaeda suspects in Yemen. Several are Americans. The list also contains 2 teenagers, including a girl who looks younger than 17 years of age.
  3. Renditions, military commissions, and indefinite detention have been preserved without Obama ever “showing his hand”.
    “A phalanx of retired generals and admirals stood behind Mr. Obama on the second day of his presidency, providing martial cover as he signed several executive orders to make good on campaign pledges. Brutal interrogation techniqueswere banned, he declared. And the prison at Guantánamo Bay would be closed.What the new president did not say was that the orders contained a few subtle loopholes. They reflected a still unfamiliar Barack Obama, a realist who, unlike some of his fervent supporters, was never carried away by his own rhetoric.” [emphasis mine]
  4. When told his plan to close Guantanamo was in danger, Obama refused to allow Clinton and Holder to fight for its success on Capitol Hill.
  5. The president stated he wanted situations where drones could cause possible collateral damage (killing of innocents) to operate only based on his permission.  However, this “did not significantly change the program.” In other words, collateral damage continued.
  6. All military age males are considered enemy combatants unless proved otherwise. In other words, they are guilty until proven innocent.
  7. Both Pakistan and Yemen are less stable and more hostile to the U.S. than before drone strikes started taking place in the two countries. This is only correlation, but the logic for causality is present as well.

“At their weekly lunch, Mrs. Clinton told the president she thought there should be more attention paid to the root causes of radicalization, and Mr. Obama agreed.”

What they fail to recognize is that the root cause of radicalization is very simple. It is interventionism by the United States government. It is the sanctions and drone strikes and mass murder of innocent human beings. It is the politicians’ grave error in believing that we can murder innocent individuals for some “greater cause“, some “higher purpose.” Obama is prolonging the same blunder that has described our foreign policy for the last 50 years (and perhaps longer).

Here’s Madeleine Albright, former Secretary of State, with her admission that the 500,000 children who died as a result of the sanctions we imposed on Iraq was “worth it.”

Interventionism causes long-term blowback. If 500,000 children in your nation died as a result of another nation’s sanctions, would you be upset? If one of them was your child, would you be enraged?

A vicious cycle appears: the blowback causes more and more of our civil liberties to be taken away because of the call for even more intervention.

If the information presented here doesn’t disturb you, I don’t know what would. America is rapidly transforming into a totalitarian nation. Yet millions of Americans are eagerly awaiting their chance to vote for one of two men who both will support the accelerated growth of despotism.

UDPATE 6/2/12:

Colbert says it better than I can.

The Word – Two Birds With One Drone

A Dozen Things Obama Supporters Are Basically Saying

This is based off of Tom Wood’s video A Dozen Things Non-Ron Paul Supporters Are Basically Saying, which was mainly directed at a conservative audience. This post, though, is directed toward the liberal audience that is hollering “Obama 2012” even in the face of his lies and deceit. I expect this year to be a “better” year for Obama as he attempts to pander to progressives with the election arriving in November, but a second term for Obama will be no different than the first. So here are a dozen things Obama supporters are basically saying:

1)      I am fine with the mass murder of innocent human beings by our government in countries such as Iraq, Afghanistan, Pakistan, and Somalia (drone strikes are still occurring in Iraq even though the war “ended”.)

2)      I have listened to Ron Paul’s speech in Armed Chinese Troops in Texas! and think it’s a silly argument because Obama is continuing the same foreign policy that is criticized in that speech.

3)      It doesn’t bother me that Obama attempted to stay in Iraq even after his promise to end the war there.

4)      I enjoy the fact that our politicians ignore the Constitution.

5)      I think the Patriot Act is patriotic and privacy is not a concern.

6)      The drug war is going great! Caging innocent individuals for nonviolent crimes makes sense to me! I’m a racist so it’s perfectly fine that minorities disproportionately suffer from these laws.

7)      It’s not a big deal that Guantanamo Bay is still open.

8)      I support Keynesian economic policies even though Keynesian economists did not realize there was a crisis coming until 2006 while Austrian economists predicted the crisis and started warning of a housing bubble as early as 2001.

9)      I’m not skeptical at all of “financial reform” with a president whose 2nd largest donor is Goldman Sachs.

10)   Assassination of American citizens without a trial or the release of any evidence proving their guilt is a moral government policy.

11)   A president who unilaterally begins a war in Libya without the consent of Congress and against his oath to the Constitution should have a second term.

12)   I’m fine with the idea that the president (by signing the NDAA into law) can unilaterally detain an American citizen indefinitely without ever giving them a trial. Not only would I trust President Obama with this, I’d trust President Romney, President Gingrich, and President Santorum as well!

UPDATE 3/3/12:

Two pictures I thought that fit well with this: