Wednesday, June 30, 2004

Africa: Toward Self-Inflicted Prosperity

My favorite economist, Walter Williams, has a great article about how African socialism brings despair. He shoots down myths about why some nations are rich while others are not.

"Did you learn that the United States is rich because we have bountiful natural resources? That has to be nonsense. Africa and South America are probably the richest continents in natural resources but are home to the world's most miserably poor people. On the other hand, Japan, Hong Kong, Taiwan and England are poor in natural resources, but their people are among the world's richest.

Maybe your college professor taught that the legacy of colonialism explains Third World poverty. That's nonsense as well. Canada was a colony. So were Australia, New Zealand and Hong Kong. In fact, the richest country in the world, the United States, was once a colony. By contrast, Ethiopia, Liberia, Tibet, Sikkim, Nepal and Bhutan were never colonies, but they are home to the world's poorest people."

As Williams shows, there is a correlation between free markets, higher wealth and human rights protections. He goes on to state that measures that lower trade barriers to U.S. markets - such as the Africa Growth and Opportunity Act, which Congress recently expanded - is the best way that the West can help Africa. This is true, as free trade sets up a much more equitable relationship than foreign government aid's donor and recipient setup. AGOA imports rose to $14 billion last year, a 55% increase over 2002.

My criticism of Williams's article is that it doesn't compare African nations who are on the road toward prosperity vs. ones who are not, which would be an even more illustrative comparison. For example, he could've compared Zimbabwe (which he mentions) with its neighbor Botswana. Botswana is a member of the Common Customs Area, which lowers trade barriers among southern African countries; Zimbabwe is not. Botswana's far more open economy, pluralistic political system, low individual and corporate taxation, and stability have helped it become among the world's fastest growing economies. Instead of money flowing directly into their leaders' pockets (as in Zimbabwe), 90% of Botswana schoolkids get primary education and it is a pioneer on AIDS/HIV health care.

In 1970, Botswana's per capita GDP was US$590, less than the sub-Saharan average of US$609. After three decades of relatively high economic freedom, Botswana's per capita GDP is now $9,500 while in Zimbabwe it is $2,400. A 2003 Fraser Institute (Canada) report ranks Botswana 26th on economic freedom, tied with eight other nations including Japan and Norway. A World Economic Forum report ranks Botswana as Africa's most competitive economy, which is why it's attracted $7 billion in private investment to further employ people. Botswana also has a fairly free press; well-managed diamond mining, livestock, and tourism industries; and is one of Africa's leaders on human rights. People are fleeing Marxist Zimbabwe en masse, they are not from free-market Botswana.

What would help African countries like Botswana even more is for the U.S. to eliminate or at least significantly reduce its agricultural trade barriers. In addition, corporate welfare which aids agribusiness, hurts market competition and efficiency, and artificially inflates product costs. Such a strategy enables African farmers to competitively sell their goods, and would lower food costs for U.S. consumers. Black Americans should lead the way to push more for such measures with Congress and the White House for our ancestral continent, so economic and political freedom can reign.

Tuesday, June 29, 2004

Wasteful: Marriage Promotion Funds for Welfare

The marriage promotion debate linked with welfare reform continues, with the Bush administration seeking $300 million per year for the endeavor.

Marriage clearly has benefits for children, especially black children. Research widely touts the particular importance of fathers to children's life chances. However, the best way to encourage marriage is to eliminate social welfare or, more realistically for now, tighten the restrictions. When people are forced to experience the full repercussions of their actions, they're far likelier to be cautious with their actions. Why should Person A, who lives a moral life, pay for the piss-poor choices of Person B? There's a reason why marriage rates were far higher before the "Great Society" programs in the 1960s. Social welfare isn't an enumerated duty of the federal government, per our U.S. Constitution anyway. Welfare and marriage promotion are areas best left up to the private sector, where non-profit groups do a much better job because they are freer to experiment with innovative strategies and they're closer to the people.

Thursday, June 24, 2004

Weep for John Kerry's "Poor"

Here's a Timbro survey by Swedish economists, comparing the European Union to USA. Our far more libertarian economics in action:

"In 1999 a quarter of US households were poor (with less than $25,000 pa). By this standard 40 percent of Swedish households would be considered poor. Of course, some prefer to measure poverty relatively. In this context of US poor households, 45.9 percent own their own home, 72.8 percent have a car, and 77 percent have air conditioning. Their average living space is 1,200 sq ft per household. The European average including both rich and poor is 1,000 sq ft"

If the European Union were a U.S. state it would belong to the poorest group of states. France, Italy, Britain, and Germany have a lower GDP per capita than 46 of our states. This puts the (socialist) Europeans at a prosperity level on par with Arkansas, Mississippi, and West Virginia. Only miniscule Luxembourg has a higher per capita GDP than the typical U.S. state. And this study was done before the 10 Eastern European countries joined the EU last month, which would drag its stats even more.

(Courtesy Dissecting Leftism)

Putting the Private Sector to Work in Iraq

Great article by Jack Kemp about the need for the private sector to put capital to work in Iraq, especially since a secure Middle East is in our interests. I like Jack's work because he combines free-market ideology with moral passion for aiding disadvantaged people. His work illustrates how private-sector efforts can help Iraqis help themselves, even in uncertain times.

Monday, June 21, 2004

Cynthia, Free Markets Would Make Health Care Less Expensive

Cynthia Tucker, the Atlanta Journal-Constitution's editorial page editor, recently wrote an article claiming that free markets make health care expensive. She states:

In a country where capitalism is the state religion, it's hard to get people to admit that the profit motive doesn't improve every enterprise. Americans seem to think there is no problem that cannot be solved by some resourceful entrepreneur. But we're experiencing a crisis of faith in at least one area -- health care. The soaring cost of hospitals and medicines suggests that capitalism is sometimes at odds with the common good."

This is why liberals don't excel in economics. She supports universal health care, but ignores the huge crunches that systems in Canada and France are currently facing (never mind less access to the latest health advances like in USA). With USA's high obesity rate, we can expect even worse. Tucker ignores that when government got even more involved in health care in the 1980s (giving us HMOs), supposedly to reduce costs, instead the costs shot up. She willfully ignores some facts: One, the American Medical Association works with state legislatures to limit doctors' licenses. Fewer doctors means higher doctor salaries, which means higher prices for us. Two, malpractice insurance has gotten way out of control and tort reform is needed here. Three, doctors receive almost the same training whether they want to fix broken bones or do neurosurgery, which jacks up prices for all specialties. Four, insurance companies are forbidden by law from charging fat people more money, even though they are mainly responsible for USA's health problems. This is a penalty on people who take care of our bodies, while overweight people don't pay the full costs of their choices.

A free market would induce more folks to be more preventative about their health choices or face higher premiums. Until government gets out of health care, consumers can't use their dollars to shop around for the best deals and that hurts us all.

Socialism Kills, Free Markets Feed

This photo over at Where Hip Hop and Libertarianism Meet caught my eye. I immediately thought of Zimbabwe, particularly since dictator Robert Mugabe is now backtracking on nationalizing all farmland. Sort of.

Zimbabwe, once the breadbasket of Africa, is now a basket case. It now suffers acute shortages of food, hard currency, and gasoline. The U.N. predicts the country will produce only half its food needs this year, and inflation is over 600%. Mugabe argues redistribution is needed to redress British colonialism, when much of the best farmland was "settled" by whites. Booker Rising, cognizant that white colonialists stole the land in the first place, states:

"Our formula: take the stolen land's value, how long the white families had it, and how much they've plugged into the economy. If they owe, they pay up. If the government owes them, compensate them."

Can't argue there. However, much of the appropriated farmland has gone to Mugabe's cronies or remains vacant. Blacks and whites who can run the farms (most of whom are probably supporters of Mugabe's opposition) are fleeing the country in droves. Mugabe is deploying his food policy to monitor people's vote in the upcoming "election." So food production dramatically falls while poorer Zimbabweans, who lack the flee option, continue to suffer for Mugabe's Marxist revolution.

Friday, June 18, 2004

School Choice: Moral Issue?

Blacks and Hispanics in Camden, New Jersey are fed up with their public schools. Yesterday religious and city leaders rallied on the steps of City Hall in support of school vouchers, saying it's the best option for their kids' future. The Black Ministers' Council of New Jersey head calls public schools a "fraud." The head of the National Coalition of Latino Clergy and Christian Leaders calls school choice a "moral issue" where blacks and Hispnics must unite.

School choice advocates say tax dollars should follow a child to the schools of their choice, not the school itself. They say school choice would drive reform in public education through competition. The Black Ministers' Council says what stands in their way are the Democrats, who have strong ties to teachers' unions. Advocates are right on all three counts.

Never mind a recent Newsweek poll which shows 66% of blacks and 67% of Hispanics support school vouchers. Booker Rising, a black moderate-conservative website, cites a statistic that 79% of blacks support school prayer. I don't believe in forced prayer, but I do believe in parents' right to have this educational option for their children. I'm not Muslim, but I have no problem with Mr. and Mrs. Mohammed using a voucher to send lil' Khalilah to a school that included Arabic language study and 5-times-a-day prayer. If there's not enough demand in one's hometown for a particular option, then move. While a Muslim school would have very low demand in Tupelo, Miss., it would be very popular in Detroit, Mich. Any schools that didn't meet standards wouldn't be in business for long. More innovative programs would emerge.

If left to parental choices, one would be hard-pressed to find a secular school in black communities. Schools would be tailored to our communities' needs and desires - black social gospel ethic, prayer, high discipline, a curriculum that included our achievements, high emphasis on how to take standardized tests - and not that of government. If the Congressional Black Caucus, Rev. Jesse Jackson, and teachers can send their own children to the schools of their choice, why deny Shaniqua Jackson the same right for her kid?

It is immoral for liberals to block these initiatives, as they recently did in D.C.'s pilot program (where there were twice as many applicants as slots). Yet it falls under liberals' general elitist rule: the masses are asses. Only we can decide what's best for you peons, not you.

Why Government Shouldn't Fund Stem-Cell Research

President Ronald Reagan's death from Alzheimer's disease has renewed calls for President George W. Bush to stop blocking stem-cell research. Dubya opposes it because day-old embryos get destroyed after stem cells are extracted, and it's akin to abortion to him. Nancy Reagan supports the research, as do the vast majority of Americans. Booker Rising cites a statistic that 44% of blacks agree with Dubya (even though blacks disproportionately acquire Alzheimer's in old age), who is not changing his stance.

I support stem-cell research, but not government-funded research. This is even though scientific exploration is a federal constitutional power under Article I, Section 8 of our Constitution ("to promote the progress of science and useful arts" clause). I don't buy the anti-abortion argument, as I believe the state shouldn't be involved there either. My question: if stem-cell research is the next big thing, then why isn't private industry all over it? The research and development dollars they plugged in would be more than made up by profits from medicinal cures. Could it be that it's too iffy an enterprise and they want a government guarantee?

Monday, June 14, 2004

Official Clinton Portraits to be Unveiled

Today at the White House. A black painter did the portraits, the first black to be commissioned for a presidential portrait. I assume Bubba is black in his portrait, being America's first black president and all.

Monday, June 07, 2004

Liberal Insanity About the Reagan Era (and Dubya)

On Saturday I had a very heated debate with a close friend and her husband. My friend claimed that the 1980s were "the worst decade for black folks ever!" She then went into a tirade about Reagan and linked it to the current Bush, saying they were the worst presidents ever for black folks.

Of course, I brought sanity into the conversation. I asked if that included our 30 decades under slavery, the 1870s when we were sold out in the Hayes-Tilden Compromise which ended Reconstruction, or the 8 decades suffered under Jim Crow. Surely significant black progress since Jim Crow's end -- including the '80s -- where most blacks today aren't enslaved, poor, or denied education trumps these horrible decades? Surely the presidents of these horrible decades were far worse for black folks? I then rattled off stats comparing various decades. She said no! "Because they didn't have as much power as Reagan and Bush, and they weren't nearly as hypocritical. We haven't made much progress and those fuckers owe us. Yet they cut social programs."

I brought up Thomas Jefferson's "I hate slavery but I still own and rape my slaves" stance as a key example of hypocrisy which trumps modern presidents. I brought up how liberal social programs have harmed black communities, and that we must return to our old-school personal responsibility ethic. My friend then proceeded to shout me down (can liberals ever have a civil discussion, I asked her?), called me "classist" and then abruptly ended the conversation saying that we should never discuss politics again. It got so heated that she pulled rank when I calmly disputed her points, saying "This is my house and I won't tolerate such crazy comments in it (she did apologize yesterday).

I put stuff in context and surely being free and middle-class (which is most black Americans) beats being enslaved and poor. I thought conservatives were over the top when they said that liberal thought is totalitarian when it comes to other viewpoints, but more and more I'm seeing it. Mind you, I have mixed opinions about Ronald Reagan (which I'll outline later) but liberals just can't allow common sense to overcome their hatred.

"Soul Plane" Grounded?

Actor Joseph C. Phillips has a critique of Soul Plane, an urban comedy film filled with black stereotypes. You may remember him as Denise's husband on "The Cosby Show," plus he was on "General Hospital." The conservative Republican basically outlines a libertarian response to a panel discussion where he was a participant:

"And as was the case in similar discussions 20 years ago participants were adamant that Black audiences wouldn't become so outraged over stereotypes in films like Soul Plane if we also had films in the manner of House of Sand and Fog or Sleepless in Seattle to balance them.

Markets, however, do not work like that. Balance cannot be forced into the market place. Demand must be built and the balance we would all enjoy will follow. For 20 years black audiences have demanded the same thing.

In 1997 Warner Brothers spent 31 million dollars on John Singleton's Rosewood. Rosewood is the dramatization of the true story of a black town in Florida that in 1923 was burned to the ground by a white mob bent on avenging the rape of a white woman. This is the sort of film I think Saturday's audience would agree is the kind of substantive film we would like to see more of. Rosewood opened to a paltry 3.1 million dollars and only grossed 13 million dollars by years end. The following week Columbia Pictures opened the modestly budgeted Booty Call. Booty Call made 8 million dollars that weekend and grossed 20 million for the year. The following month New Line cinema released the low budget romance (a film I enjoyed) Love Jones. Love Jones opened with 3.9 million dollars and only grossed 12 million for the year.

Eves Bayou (another film I enjoyed) opened in November of '97 with Rosewood type numbers while Players Club, like Booty Call before it, opened with more than 8 million dollars and a gross of more than 23 million for the year. Black folks - not white folks -- stood in line waiting to see Booty Call and Players Club -- just as they will stand in line Friday to see Soul Plane -- while avoiding Rosewood, Eves Bayou, Beloved and a long list of other more substantive fare like the plague.

Hollywood is not sinister! Hollywood is giving black folks what they want. My experience in Hollywood is that these folks do not like to leave money on the table. The marketing of Soul Plane along with the fact that every stereotypical image in Soul Plane is voraciously eaten up by the hip-hop culture and every rap artist currently making a video is proof of the high demand for this type of shucking and jiving. I have a sick feeling the box office results following the memorial day weekend will sadly reveal that we will be seeing much more of it."

He's right. If black folks want Hollywood to stop pumping out these "keepin' it real" flicks, then we must stop supporting such flicks. Luckily, it looks like black folks are grounding Soul Plane. It cost over $18 million to make, but has only grossed $8.3 million in its first two weeks despite a ton of publicity. Assuming its week-to-week revenues continue to drop by half, it won't make a profit.

Saturday, June 05, 2004

Social Security to Ownership Security

Jack Kemp recently wrote a column arguing that Social Security privatization will fix America's retirement system, and democratize capitalism. Unlike Social Security, people could control their own future.

He wants to move from the Great Society of entitlements to an Ownership Society, an investor nation where every worker is an owner. About 50% of Americans are already in the investor class, and I support efforts to get the other 50% on board. However, why is Kemp only going for 50% privatization? Social Security should be completely privatized.

Liberals argue against Social Security privatization because "people won't know how to invest." Typical "the masses are asses" ideology. Why not teach people how to invest? If it can be done in Chile, where such accounts are popular, it can be done in USA. Even idiots can plug their money in a bond account and outperform Social Security's stingy return.

In addition, why should Person A be penalized for making good choices because Person B doesn't make them? Relatively low retirement investment in America occurs because of few ramifications to not saving up for one's future, due to Social Security. Remove nannyism, and incentives for people to plan long-term shoot up. Or perhaps liberals oppose it because private investment accountholders tend to be more conservative voters (e.g., 21% of blacks with such accounts vote Republican, versus 9% of blacks in general)?

Kemp gets cool points for noting that Social Security's return on investment "can't deliver-averaging less than 1 ½ percent and [is] actually negative for many African-American males whose life expectancy is 8 ½ years less than white males." It also undercuts efforts to increase black wealth, where the deceased can transfer savings to their heirs to buy a home, attend college, or start a business. Luckily for us, even people like BET founder Bob Johnson and Rep. Harold Ford are pushing for privatization in black communities.