Price signals are working just fine for gas. What you're skipping is that the more money you have, the more choice you have, in deciding that you would rather cut spending on. Trying to claim something a simple as "the poor" is in itself disingenuous.
The poor include every thing from college students who can easily decide they would rather ride their bikes, to chuckle heads that should have stuck with public transit or bought a more fuel efficient car in the first place.
Does that include some people that made the best decisions they could and are now hurting because the temporary spike in fuel prices. Sure, but for the rest of the planet, higher fuel prices are the price signal that makes them change their behavior. For some that will mean they keep driving but decide to hold off and keep using something they own rather then purchase a new something. Which is yet another way to reduce fuel consumption.
The problem you quickly get into when trying to subsidize things like fuel usage is that for the majority of the middle and lower class people, that only encourages wasteful use of fuel.
Agreed. This is perhaps the most economically illiterate article I've ever seen here.
There are lots of things to criticize about economic models, but the declining marginal utility of wealth is incredibly well understood. It is the basis for the progressive income tax.
The disjunction between marginal utility and willingness to pay is also very well understood and is the basis for Food Stamps, Section 8 vouchers and a wide variety of other programs.
Oren likes to rag on economists as out of touch and mostly they deserve it. But he's smarter and better educated than this, which tells me he's just hoping his readers aren't.
The very fact that the poor *can* save money by cutting back on their driving means that the driving they decline was optional, a “luxury” if you will. The fact that they do cut down means that they value other things more. We might feel bad that those other things are food and rent, but…tear out the front page: The poor are poor.
That the rich don’t change their gasoline habits means simply that the increase in the price of gas is negligible at their level of affluence. Raise gas prices tenfold and you’ll see them start to change their tradeoffs, too. The rich are rich.
If Oren wants to get in a lather about it, I have to ask: does he think there is something innately wrong with having rich and poor? I know some people do, but I didn’t expect it from a mostly free-market economist.
I’m not sure Oren is all that into “free” markets these days. That said, given our general failure to even attempt to regulate social media’s abuse of our kids, sports gambling apps, or sites like only fans, I’m not much of a free market guy these days either.
I think Oren’s bigger problem is that he has gone to the isolationist side and really dislikes the Iran war. It’s his site, but I think that is causing him to look for reasons to push against the Iran war. Even the best of us can get a little hypocritical from time to time.
So you're not isolationist if you randomly taco tariff our longtime trading partners (but of course not our new ally Russia), tear up the TPP and trample on the rules of the WTO, pull out of the WHO, UNESCO and Paris Climate Accords, flaunt various int'l forums allowing China to assume leadership positions, abruptly cut foreign aid, threaten to pull out of NATO, intentionally alienate our closest allies, and cancel the JCPOA.
But, you earn the moniker if you split from the dear leader and oppose MAGA's disastrous Middle East war?
Isolationist is not the correct description of Don. He's a unilateralist, America Alone. Read Stephen Miller's screeds where he lays out Don's might makes right philosophy. Like most thinking of the "new" right, it's not remotely new. It's a throwback to the 19th century multipolar world marked by great power conflict, spheres of influence, high tariffs, and lotsa conflict. As I recall, it didn't end so well...
You do get that the modern globalist ideology, the whole free trade disconnected from mutual defense and shared values, is just a repeat of the disastrous colonial philosophies. That's what really ended with WW2.
France and England on paper should have been able to whip Germany's rear end nine different ways. Have you ever taken a moment to consider that in 1941, England controlled India, including modern day Pakistan and Bangladesh. Just with that alone they should have been able to rally enough fighters as well as produce all the warships, warplanes and other materials needed.
But wait there's more, England also controlled big chunks of Africa, including Nigeria and Egypt. They controlled islands in the Caribbean and off the coast of south America. Don't forget Australia and Canada as well. Then consider how France controlled it's own chunks of Africa, as well as Indochina. Add in french islands in the Caribbean and Indian Ocean.
Yet with combined subjects of over a billion people. A huge amount of resources to draw upon. the European empires had to rely on a nation made from their formers colonies to free them from the fascists.
Now take a good look at Pax Americana. We've in many ways recreated the exact some dynamic. Rather then our European vassals being able to come to our add, we have to help them fend off the Russians. In the words of the Polish president, "The 450 million Europeans need the 330 million Americans to fight the 160 million Russians that in four years haven't been able to defeat the 40 millions Ukrainians."
The reason we are increasingly facing the return of a 19th centaury multipolar world isn't because of Trump. It's because all the Globalists from Clinton to Biden, with plenty of Neo-cons along the way.
Ok, I give, even though your comparison of our former alliances with the British empire made me belly laugh out loud. So, I'll join you in lamenting how hard it's been to live in the most prosperous nation during the most prosperous period in human history. A period also devoid of major power conflict. It ain't easy bein us.
But, can y'all stop wailing about long ago excommunicated neocons? It's gotten stale, and the unwillingness to take responsibility is just doggone beta. MAGA has won, your world view now dominates. MAGA IS the establishment. You ARE the elites, you control the entire federal government. You've dominated the party for over a decade, nominated Don three times, and would nominate him again if given the chance.
Our former alliances have been eliminated. Our new friends are Russia, El Salvador, Venezuela, and an assortment of third world countries who have agreed to take our deportees for petty cash. We've successfully withdrawn from global leadership, reduced our ambition to dominating our hemisphere, and opened the door for China to assume a greatly enhanced role in geopolitics. You've won.
But riddle me this Batman. Why are you and Don so obsessed with being bailed out of MAGA's Middle East war by the feckless Europeans? I thought WE were the tough guys? Yet, Don whines incessantly that they aren't rushing to save him from the debacle he began without their knowledge. Maybe El Salvador could spare a dime? I hear Eswatini and Equatorial Guinea are infinitely more capable than our former NATO allies.
MAGA's Middle East war is the defining expression of the movement-we have no particular ideology, we're just for whatever Don tells us to be for... How else to explain why y'all have ditched your supposed defining beliefs? You're now pro Middle East war? Hasn't that been the centerpiece of your criticism of neocons? You've become, gulp, NeoMagaCons!
Lemme guess, you actually believe that MAGA's war is about eliminating Iran's nukes? The nuclear program Don told us he already "completely and totally eliminated", right before he told us they were a few weeks from a bomb, which was right before he announced we already won the war, just before he whined about Europe not bailing him out. It's so beta to criticize other countries for not doing what you're too timid to ask our own military to do.
You, Y'all, Maga, you don't know me. You keep chucking out straw man arguments. I've been and still remain a free thinking citizen that refuses to be defined by the little labels thrown about by less intelligent men.
England and France were the most prosperous nations on the planet when they got sacked by the Germans. And lost for similar reasons that America is losing ground today. Prosperous on paper doesn't mean much if the majority of the wealth being produced goes to the rich, while the cost of protecting those global supply chains and territories is pushed off onto the working class in heartland.
Meanwhile you either refuse to accept or can't remember the last election. It wasn't a choice between Kamala Harris, Donald Trump, or that other guy. You know, the guy that had a solid plan for how to completely re-write the global order such that we quit relying on and rewarding corrupt and adversarial nation like China and Russia. The guy that was going to created a new defense and trade alliance of responsible like minded allies in a way that would hold all the member states responsible for funding, building and maintaining their militaries. All while setting minimum standards for protecting our environments and human rights. Such that none of member state of this new alliance could free ride off the other members defenses, or undercut the other members economies by abusing their workers and environments.
Just like I accept that Oren has gone more towards the Isolationist camp than the America first camp. I except that Trump is only half right at the best of times. This is one of those times. Even then, sure would be nice to have someone that could do a better jobs rallying some of our allies to help out. That was never in the cards though, was it?
Keep chucking out your narrow minded, poorly laid out thoughts. Like a broken clock, you might just get something right occasionally.
I don't know if Oren or Daniel wrote the gas price thing, but it's about the dumbest article I've ever seen here. Normally, this place is pretty solid, but not today.
What it's describing is the disjunction between "marginal benefit" and "willingness to pay". In introductory econ textbooks, we (yes, I teach HS econ, among other things) we quickly gloss over this disjunction because it's very hard to explain without heavy math, but it's among the most well understood problems and one of the reason no one uses supply-demand graphs outside of Econ 1A.
This line of reasoning is so dangerous because the core problem here is what's called the "declining marginal utility of wealth" -- the more money you have the less you value the last $100 you earned. Once you start attacking prices on this basis though, it's very easy to end up deciding that the entire price system is hopelessly flawed and clearly there ought to be a better way. Which is essentially what Marx and Engels said. And it's a disaster.
In the case of a life-critical commodity (food, housing, energy) vouchers are a simple and very well understood way to provide relief for the poor without screwing up the price system any more than necessary.
I am very wary of the Chinese government, especially on anything tech. I'm also very bullish on highly educated east Asian immigrants especially Chinese to the US. A brilliant people who make great Americans. That said we should assume all students are pressured from their government to assist their state security, often enough via family back on the mainland.
One of the more interesting follows for all things China is the intelectual dark web alumni @MsMelChen an ethnic Chinese from Singapore but seemingly spends time in many places.
Nice. Oren has accurately captured one impact of MAGA's Middle East war on the less fortunate among us-the pain of the higher gas prices/inflation it has caused. Here's hoping that Don's incoherent flailing eventually gets us back to the status quo that prevailed prior to the "new" right launching its war.
In the same vein, I'd love Oren's analysis of the Trump Mobile scam, and how it comports with his professed concern over maximizing consumer welfare and economic well being. What policy prescription might he offer to protect consumers going forward?
Meanwhile, for weekend reading, read every word in Don's incessant bleats. Every. Last. Word. But, pour a stiff drink first.
My friend says, "Gee, I don't know. Maybe killing several levels of "leaders" (i.e. dictators) who have been running rings around previous administrations, and bombing tons of sites that have been developing nukes and the means of delivering them?"
Personally, I don't know that this strategy will succeed. I do know the old strategy, i.e. doing damn-all, won't.
I so love that maga has obediently morphed into zealous Middle East war supporters. NeoMagaCons, one might say? How times change...
But alas, the world isn't as simple as you suggest, and your claim that the choice is binary (doing nothing vs launching a war) is more than a tad simplistic.
In any event, perhaps you're right, and crafty ole Don has em right where he wants em. After all, the Sec'y of WAR, aka a former Fox weekend talk show co-host, has like you bragged mightily about all that we've blown up. And of course, Don has repeatedly told us we've already won. Then again, he also told us he had "completely and totally" eliminated Iran's nukes just a few short months ago, right before he told us they were now just a few weeks from a bomb...none of which is true.
So perhaps I'm right, and Don is an aging, angry, incoherent imbecile who has no clue how to finish what he's started.
So help me out. Which of the five goals that Don laid out for MAGA's war has he accomplished? And how will the inevitable deal he'll be forced to accept compare to Barack Hussein Obama's JCPOA?
Price signals are working just fine for gas. What you're skipping is that the more money you have, the more choice you have, in deciding that you would rather cut spending on. Trying to claim something a simple as "the poor" is in itself disingenuous.
The poor include every thing from college students who can easily decide they would rather ride their bikes, to chuckle heads that should have stuck with public transit or bought a more fuel efficient car in the first place.
Does that include some people that made the best decisions they could and are now hurting because the temporary spike in fuel prices. Sure, but for the rest of the planet, higher fuel prices are the price signal that makes them change their behavior. For some that will mean they keep driving but decide to hold off and keep using something they own rather then purchase a new something. Which is yet another way to reduce fuel consumption.
The problem you quickly get into when trying to subsidize things like fuel usage is that for the majority of the middle and lower class people, that only encourages wasteful use of fuel.
Agreed. This is perhaps the most economically illiterate article I've ever seen here.
There are lots of things to criticize about economic models, but the declining marginal utility of wealth is incredibly well understood. It is the basis for the progressive income tax.
The disjunction between marginal utility and willingness to pay is also very well understood and is the basis for Food Stamps, Section 8 vouchers and a wide variety of other programs.
Oren likes to rag on economists as out of touch and mostly they deserve it. But he's smarter and better educated than this, which tells me he's just hoping his readers aren't.
The very fact that the poor *can* save money by cutting back on their driving means that the driving they decline was optional, a “luxury” if you will. The fact that they do cut down means that they value other things more. We might feel bad that those other things are food and rent, but…tear out the front page: The poor are poor.
That the rich don’t change their gasoline habits means simply that the increase in the price of gas is negligible at their level of affluence. Raise gas prices tenfold and you’ll see them start to change their tradeoffs, too. The rich are rich.
If Oren wants to get in a lather about it, I have to ask: does he think there is something innately wrong with having rich and poor? I know some people do, but I didn’t expect it from a mostly free-market economist.
I’m not sure Oren is all that into “free” markets these days. That said, given our general failure to even attempt to regulate social media’s abuse of our kids, sports gambling apps, or sites like only fans, I’m not much of a free market guy these days either.
I think Oren’s bigger problem is that he has gone to the isolationist side and really dislikes the Iran war. It’s his site, but I think that is causing him to look for reasons to push against the Iran war. Even the best of us can get a little hypocritical from time to time.
So you're not isolationist if you randomly taco tariff our longtime trading partners (but of course not our new ally Russia), tear up the TPP and trample on the rules of the WTO, pull out of the WHO, UNESCO and Paris Climate Accords, flaunt various int'l forums allowing China to assume leadership positions, abruptly cut foreign aid, threaten to pull out of NATO, intentionally alienate our closest allies, and cancel the JCPOA.
But, you earn the moniker if you split from the dear leader and oppose MAGA's disastrous Middle East war?
Isolationist is not the correct description of Don. He's a unilateralist, America Alone. Read Stephen Miller's screeds where he lays out Don's might makes right philosophy. Like most thinking of the "new" right, it's not remotely new. It's a throwback to the 19th century multipolar world marked by great power conflict, spheres of influence, high tariffs, and lotsa conflict. As I recall, it didn't end so well...
You do get that the modern globalist ideology, the whole free trade disconnected from mutual defense and shared values, is just a repeat of the disastrous colonial philosophies. That's what really ended with WW2.
France and England on paper should have been able to whip Germany's rear end nine different ways. Have you ever taken a moment to consider that in 1941, England controlled India, including modern day Pakistan and Bangladesh. Just with that alone they should have been able to rally enough fighters as well as produce all the warships, warplanes and other materials needed.
But wait there's more, England also controlled big chunks of Africa, including Nigeria and Egypt. They controlled islands in the Caribbean and off the coast of south America. Don't forget Australia and Canada as well. Then consider how France controlled it's own chunks of Africa, as well as Indochina. Add in french islands in the Caribbean and Indian Ocean.
Yet with combined subjects of over a billion people. A huge amount of resources to draw upon. the European empires had to rely on a nation made from their formers colonies to free them from the fascists.
Now take a good look at Pax Americana. We've in many ways recreated the exact some dynamic. Rather then our European vassals being able to come to our add, we have to help them fend off the Russians. In the words of the Polish president, "The 450 million Europeans need the 330 million Americans to fight the 160 million Russians that in four years haven't been able to defeat the 40 millions Ukrainians."
The reason we are increasingly facing the return of a 19th centaury multipolar world isn't because of Trump. It's because all the Globalists from Clinton to Biden, with plenty of Neo-cons along the way.
Ok, I give, even though your comparison of our former alliances with the British empire made me belly laugh out loud. So, I'll join you in lamenting how hard it's been to live in the most prosperous nation during the most prosperous period in human history. A period also devoid of major power conflict. It ain't easy bein us.
But, can y'all stop wailing about long ago excommunicated neocons? It's gotten stale, and the unwillingness to take responsibility is just doggone beta. MAGA has won, your world view now dominates. MAGA IS the establishment. You ARE the elites, you control the entire federal government. You've dominated the party for over a decade, nominated Don three times, and would nominate him again if given the chance.
Our former alliances have been eliminated. Our new friends are Russia, El Salvador, Venezuela, and an assortment of third world countries who have agreed to take our deportees for petty cash. We've successfully withdrawn from global leadership, reduced our ambition to dominating our hemisphere, and opened the door for China to assume a greatly enhanced role in geopolitics. You've won.
But riddle me this Batman. Why are you and Don so obsessed with being bailed out of MAGA's Middle East war by the feckless Europeans? I thought WE were the tough guys? Yet, Don whines incessantly that they aren't rushing to save him from the debacle he began without their knowledge. Maybe El Salvador could spare a dime? I hear Eswatini and Equatorial Guinea are infinitely more capable than our former NATO allies.
MAGA's Middle East war is the defining expression of the movement-we have no particular ideology, we're just for whatever Don tells us to be for... How else to explain why y'all have ditched your supposed defining beliefs? You're now pro Middle East war? Hasn't that been the centerpiece of your criticism of neocons? You've become, gulp, NeoMagaCons!
Lemme guess, you actually believe that MAGA's war is about eliminating Iran's nukes? The nuclear program Don told us he already "completely and totally eliminated", right before he told us they were a few weeks from a bomb, which was right before he announced we already won the war, just before he whined about Europe not bailing him out. It's so beta to criticize other countries for not doing what you're too timid to ask our own military to do.
Time to man up Dan, y'all are in charge.
You, Y'all, Maga, you don't know me. You keep chucking out straw man arguments. I've been and still remain a free thinking citizen that refuses to be defined by the little labels thrown about by less intelligent men.
England and France were the most prosperous nations on the planet when they got sacked by the Germans. And lost for similar reasons that America is losing ground today. Prosperous on paper doesn't mean much if the majority of the wealth being produced goes to the rich, while the cost of protecting those global supply chains and territories is pushed off onto the working class in heartland.
Meanwhile you either refuse to accept or can't remember the last election. It wasn't a choice between Kamala Harris, Donald Trump, or that other guy. You know, the guy that had a solid plan for how to completely re-write the global order such that we quit relying on and rewarding corrupt and adversarial nation like China and Russia. The guy that was going to created a new defense and trade alliance of responsible like minded allies in a way that would hold all the member states responsible for funding, building and maintaining their militaries. All while setting minimum standards for protecting our environments and human rights. Such that none of member state of this new alliance could free ride off the other members defenses, or undercut the other members economies by abusing their workers and environments.
Just like I accept that Oren has gone more towards the Isolationist camp than the America first camp. I except that Trump is only half right at the best of times. This is one of those times. Even then, sure would be nice to have someone that could do a better jobs rallying some of our allies to help out. That was never in the cards though, was it?
Keep chucking out your narrow minded, poorly laid out thoughts. Like a broken clock, you might just get something right occasionally.
I don't know if Oren or Daniel wrote the gas price thing, but it's about the dumbest article I've ever seen here. Normally, this place is pretty solid, but not today.
What it's describing is the disjunction between "marginal benefit" and "willingness to pay". In introductory econ textbooks, we (yes, I teach HS econ, among other things) we quickly gloss over this disjunction because it's very hard to explain without heavy math, but it's among the most well understood problems and one of the reason no one uses supply-demand graphs outside of Econ 1A.
This line of reasoning is so dangerous because the core problem here is what's called the "declining marginal utility of wealth" -- the more money you have the less you value the last $100 you earned. Once you start attacking prices on this basis though, it's very easy to end up deciding that the entire price system is hopelessly flawed and clearly there ought to be a better way. Which is essentially what Marx and Engels said. And it's a disaster.
In the case of a life-critical commodity (food, housing, energy) vouchers are a simple and very well understood way to provide relief for the poor without screwing up the price system any more than necessary.
I am very wary of the Chinese government, especially on anything tech. I'm also very bullish on highly educated east Asian immigrants especially Chinese to the US. A brilliant people who make great Americans. That said we should assume all students are pressured from their government to assist their state security, often enough via family back on the mainland.
One of the more interesting follows for all things China is the intelectual dark web alumni @MsMelChen an ethnic Chinese from Singapore but seemingly spends time in many places.
Nice. Oren has accurately captured one impact of MAGA's Middle East war on the less fortunate among us-the pain of the higher gas prices/inflation it has caused. Here's hoping that Don's incoherent flailing eventually gets us back to the status quo that prevailed prior to the "new" right launching its war.
In the same vein, I'd love Oren's analysis of the Trump Mobile scam, and how it comports with his professed concern over maximizing consumer welfare and economic well being. What policy prescription might he offer to protect consumers going forward?
Meanwhile, for weekend reading, read every word in Don's incessant bleats. Every. Last. Word. But, pour a stiff drink first.
Good luck America.
Does that status quo include a nuclear Iran? Asking for a friend.
I've yet to encounter anyone who wants Iran to have a nuclear weapon. Have you?
Please explain Don's strategery for preventing that, and how it's unfolding.
My friend says, "Gee, I don't know. Maybe killing several levels of "leaders" (i.e. dictators) who have been running rings around previous administrations, and bombing tons of sites that have been developing nukes and the means of delivering them?"
Personally, I don't know that this strategy will succeed. I do know the old strategy, i.e. doing damn-all, won't.
I so love that maga has obediently morphed into zealous Middle East war supporters. NeoMagaCons, one might say? How times change...
But alas, the world isn't as simple as you suggest, and your claim that the choice is binary (doing nothing vs launching a war) is more than a tad simplistic.
In any event, perhaps you're right, and crafty ole Don has em right where he wants em. After all, the Sec'y of WAR, aka a former Fox weekend talk show co-host, has like you bragged mightily about all that we've blown up. And of course, Don has repeatedly told us we've already won. Then again, he also told us he had "completely and totally" eliminated Iran's nukes just a few short months ago, right before he told us they were now just a few weeks from a bomb...none of which is true.
So perhaps I'm right, and Don is an aging, angry, incoherent imbecile who has no clue how to finish what he's started.
So help me out. Which of the five goals that Don laid out for MAGA's war has he accomplished? And how will the inevitable deal he'll be forced to accept compare to Barack Hussein Obama's JCPOA?
You should not be a China hawk but a pro-America hawk. These may overlap but you have to justify your position on the latter.