"Market Egalitarianism". No, Really.

David Brooks outraged by the decadence of the times, in which the career advice you got from Econ 101 isn't even true ("How to Get Really Rich!"):

My main message is that if you want to get rich, don’t invent a new and useful product, start a company and try to sell it. That seems risky. Put the effort into entering a clubby line of work in which legislators and professional associations are working to make you rich. It’s easier!

Instead of becoming a risk-taking entrepreneur, you should take the soft option of going to med school so you'll never have to worry about competition—

Or, as Driftglass hints, maybe you should become a columnist for The New York Times! According to Jonathan Rothwell's A Republic of Equals: A Manifesto For a Just Society (2019), "writers and authors" come 11th on the list of the 20 professions dominating the 1%, as measured by their home values.

Brooks says it ain't broke...

Margaret W. Tarrant (1888-1959), Fairy Market, via sprookjeswereld.

It's world-famous economics critic David F. Brooks—we haven't heard from that one in a while!—with some cheerful news ("The Economy Isn't Broken"): there are no structural flaws in the economy!

Stupid Economist Tricks: Hurricane Pricing

Image via The Pediatric Insider.

On September 5 professional economist Tyler Cowen was explaining over at Bloomberg (via Edroso's Twitter feed) about how

Price Gouging Can Be a Type of Hurricane Aid

Higher prices can help resources get to the people who need them most.

And on September 6 we began hearing about airlines dealing with the advent of Irma by jacking prices up almost exactly 900%:

Totally unacceptable, a $358 flight from Miami to NYC went up to $3578. Why should expect anything decent from these airlines??? F ing RATS! https://t.co/rjdH6J0yOL

— Joseph Pep Nodarse (@joerileyhudson) September 6, 2017

Because who needs a flight out of Miami most? The one who can afford to pay $3600 for the privilege. By Paul Ryan's famous definition of freedom—

This is your emperor on drugs

Sorry, I couldn't help that.

Image via Weed News.

I was pretty startled to hear this read of Trump's meeting with the pharmaceuticals executives yesterday from the APM Marketplace Morning Report:

So the president said the word, that drug prices are "astronomical" and the implication is he's going to work to make them go down. Do you see an emerging alliance here between the president of the United States and Democrats in Congress who might also want drug prices to go down?

No, there is not an emerging alliance between the Trump and the Democrats on drug prices. The opposite is the case. In the early part of the campaign, a year or so ago, when Trump was making friendly noises about the traditional Democratic proposal to use Medicare to force drug prices down, you could have imagined an alliance of that type, if you were naive enough, like the chuckleheads on Matketplace, to believe anything that fucker says, but not after yesterday. That word "astronomical" was the last gasp of this sweet hope as it drowned.

Crony Baloney

The Fairy Market: Bartering with the Apple of Time, by Penney Hughes aka Wylde Iris, 2013.

Monsignor Ross Douthat, Apostolic Nuncio to 42nd Street, still working the angle of trying to demonstrate that the Trump is really a Democrat, as in his response ("A Great Deal for the Many") to this week's pre-presidential rescue of the Carrier Air Conditioning Indiana workers whose jobs are being moved to Mexico, or at least the two fifths of them who will be getting to keep their jobs, at least for a few months:

Unfortunately this is not an optimal approach to economic policy. It ignores deep Hayekian insights about the problems inherent in picking winners and punishing losers from on high. It expands an economy of favors and phone calls in which insiders will inevitably profit more than innovators. It embodies the crony capitalism that only yesterday Republicans opposed.

Deep Hayekian insights my ass, if I may say so. Douthat doesn't know any more about Friedrich von Hayek and the Austrian School of economics than I do, and indeed I venture to say that what he knows is the same thing, that picking out winners and losers in the market is the job of that Invisible Hand, in its whirlwind of creative destruction, and government involvement in the process is thus kind of sacrilegious and likely to lead to earthquakes and floods, no doubt, or at least some similarly uncreative type of destruction.

The EpiPen is mightier

Image via Wikiquote.

The weirdest thing about the latest drug outrage, the 400% rise in the price of the EpiPen epinephrine delivery system from Mylan, is the way the CEO, Heather Bresch, who just happens to be the daughter of Senator Joe Manchin ("Democrat"-WV), seems to want to take offense at it in her CNBC interview, as if it were something done to rather than by the company—

Heather Bresch: Look, no one’s more frustrated than me. I’ve been in this business for 25 years…

Sullivan: But you’re the one raising the price, how can you be frustrated?

Bresch: My frustration is there’s a list price of $608. There is a system. I laid out that there are four or five hands that the product touches and companies that it goes through before it ever gets to that patient at the counter. No one, everybody should be frustrated, I am hoping that this is an inflection point for this country. Our health care is in a crisis. It’s no different than the mortgage and financial crisis back in 2007. This bubble is going to burst.

You hear how she glosses over her own responsibility? "You're the one raising the price," says Brian Sullivan; "There's a price," replies Bresch, essentially denying it.

It just raised itself! When nobody was looking! The Invisible Hand is angry because humans have scorned the sacred laws! Thanks, Obama!

Average is overrated

In Singapore in the early 1980s some bright spark in the Ministry of Transport decided that the old Singapore Bus Service needed competition; so they started one up, Trans-Island Bus Services, and then they proceeded to divide up the routes: one for SBS, one for TIBS, another one for SBS, and so on.

Of course it isn't really competition. There are now the two companies, each pretty much dependent on government to tell them what to do, where to do it, and how it should be priced. The price is great, too, and of course there are more routes than there otherwise would be, and probably additional jobs as well, so nobody is losing anything. But nobody's gaining anything from that famous market discipline, because you can't tell the SBS driver to go stuff it and take the TIBS instead, because the TIBS (nowadays, SMRT) isn't going to your stop, and the prices aren't going down because the government likes them where they are.

The only real good it does to have two bus companies in one town is when Tom Friedman comes to visit and he can get it into the Times that this little country is so terrific it's introduced market mechanisms into the local bus service.*

Which brings me to Tom ("Average is Over") Friedman, who's hawking some more tests this week as the ticket to getting the whole country to the Lake Wobegon condition of having all our kids be above average. This time it is the Program for International Student Assessment or PISA, made by OECD, which is going to rank all the 15-year-olds in 70 countries;

“Imagine, in a few years, you could sign onto a Web site and see this is how my school compares with a similar school anywhere in the world,” says [OECD staffer Andreas] Schleicher. “And then you take this information to your local superintendent and ask: ‘Why are we not doing as well as schools in China or Finland?’ ”

And then what? Are you moving the family to Finland, as the superintendent kneels at your feet, hugging your knees and begging you not to go? Or do you think there's going to be a SMRT school you can threaten to go to, with a teacher turnover rate of under 40% and God-free biology classes?

It's never going to be competition until (a) there's a real excess of supply over demand and (b) parents ("customers") have real economic power. An alternative, trying to make all the schools good, isn't happening either as long as you want to do it on the cheap. (Do you think they go around threatening to close schools and fire everybody in Singapore or Finland, by the way?) Otherwise, average is not going be over at all—

"But you wouldn't know about that, would you? Little thing called regression to the mean?"

*In general, privatization is necessary because socialism in Singapore works so well it's deflationary; gotta leak some of that surplus value out into the public.

OK, but my teacher seems a little remote

 The Times report by Stephanie Saul on the cyber charter school movement yesterday morning has not roused a lot of online fury. I sure don't know why. Here is how it opens:

Nearly 60 percent of its students are behind grade level in math. Nearly 50 percent trail in reading. A third do not graduate on time. And hundreds of children, from kindergartners to seniors, withdraw within months after they enroll.

By Wall Street standards, though, Agora is a remarkable success that has helped enrich K12 Inc., the publicly traded company that manages the school. And the entire enterprise is paid for by taxpayers.

You should read the whole thing, especially if you believe the way to solve our education problems is by sprinkling a little market-fairy dust on them (no, it's really just a way for the rent seekers to expropriate more money from our children).  Then have a look at Jenny Anderson on Finland: