The power company blues

Why don't they put powerlines underground? Why are they still using that archaic pole system? The American Transmission Company has some answers. However, for myself, none of them are satisfactory. They do not get to the root of the problem, which is (who could have guessed?) the government.

Since local municipalities do not allow more than one power company in an area, there is not the adequate competition necessary to provide the incentive to place powerlines underground. I generally find that almost any problem, economic or otherwise, has a root cause at the government-level.

A pet peeve

Been a while since I've posted, but I wanted to write about a pet peeve of mine. The peeve is when people talk about "rights granted in the Constitution." That's an absurd statement, and the founders would have scoffed at it. According to the founders, every person had a certain set of inalienable rights, natural rights would were wrong to ever violate. It was not up to the government to give or take away such rights. The Bill of Rights was a legal document to protect the people from having those natural rights forcefully taken away. The mere idea that any government "grants" rights is absurd.

When madmen run the country...

Gold has hit a new high. The highest in a quarter of a decade, in fact. Why? It is not over-speculation or any such nonsense. It's because our currency isn't backed by anything worthwhile, unless you consider the promises of the political class to hold value. Because it's backed by nothing, people abandon the dollar at times when the value seems most at risk.

The value could be at risk for any number of reasons. Perhaps investors feel the Fed is going to undergo an inflationary barrage, increasing the money supply and lowering the value of the dollar. They don't call the new Chairman "Helicopter Ben" for nothing. He is definitely a known supporter of "moderate" inflation to prevent deflation. Also, the looming showdown with Iran over nuclear weapons could be another factor. A war would require the confiscation of new revenue, and Bush has shown reluctance to tax. Why not print?

When madmen run the country, why have faith in the madmen's currency? A valuable lesson: buy gold.

Test-Drive Your Dream Job

Tired of you day job? I discovered this company via Slashdot. Vocation Vacations is a sort of like an unemployment agency. They specialize in finding you a job, but your dream job. Got a week of vacation at work? Take it and Vocation Vacations will hook you up with a mentor in your profession of choice to give a chance to see what that job is like first-hand. Now, not only can you hire a company to find you a menial job, you can hire them to find you a wonderful job. Isn't entrepeneurship wonderful?

Breaking college football news

Woah! BIG, BIG college football news! Apparently, Reggie Bush's family has been living in a home owned by a sports agent for the past year. This is huge. Reggie Bush is one of the greatest running backs to play college football. He led USC to championship games. He was unbelievable. He's the number one draft pick. If this isn't swept under the rug (which it seems it likely will) it could rock the college football world. Not only that, it would probably make the past three years of USC's games forfeit. Wow.

The Right Idea

China is currently operating under an umbrella of no effective copyright law. Since the Chinese government is unwilling, as of right now, to expend the time and money to enforce these legal monopolies, companies are being forced to actually compete in order to grab market share from pirates.

Looks like Warner Home Video is going to be releasing DVD packs in China that are priced at about $1.50 each, in order to try and grab some of the pirates' sales. What happens under a country without copyright law is not a lack of creation, but just a shift in its provision.

Isn't this horrible. Competition in this day age? Government must be failing at their duties as a killer of innovation. ;-)

Wages And Subjective Value: The Real Story

Why is it that professional athletes make more than doctors or teachers? A common belief is that a salary is determined by how much society values that profession. They then conclude that society is sick because it values professional athletes over more critical professions.

But that common belief is a misconception. Salaries are prices, and prices are determined by one thing only: the interaction of supply and demand. It's true that how a society values a good or service affects the demand, therefore it also affects the final pricee of that good. But it influences the price, it doesn't determine it. If it was society's value alone that created prices, then food and water would be astronomical and space ships would be cheap.

The fact is that athletes make more because it is a more highly skilled profession than doctors or teachers. It takes a lifetime of perfecting techniques and getting in peak physical condition in order to participate in modern pro sports. As such, it takes a very naturally athletic person to compete, which means the supply pool for athletes is smaller than doctors and teachers. Even though athletes, doctors and teachers are all valued highly, athletes make the most money because the supply of potential atheletes is much smaller.

While it is clear that society values all three professions highly, their wages do not necessarily reflect the relative value of each. Sadly, it's easy to tack on ready-made moral judgements to issues like teachers salaries, and harder for the general public to see the bigger picture.

Game designer != economist

Will Wright is a famous game designer, but does he know economics? In this article about Nintendo's place in the new console wars, he offers his thoughts:

The strategy is simple, says Will Wright, the chief creative officer of Electronic Arts’ Maxis studio. Nintendo is waiting for its rivals to kill each other.

Well, if that's what they are waiting for, they will be waiting a long time. Competition can weed out, at most, all but one competitor. So, if Nintendo is planning on waiting for both companies to kill each other, it's not likely to happen.

Hypothetically speaking, what would happen if it became apparent that competition was hurting both companies? I expect the two competitors, Microsoft and Sony, would unite sooner then both go out of business.

The Real Purveyors of Progress

As the left and the right line up side by side to fight illegal immigration, the only political party to stand in support of this unloved group of individuals are libertarians. Who is compassionate now?