China to Regulate Reincarnation

Seriously.

Painfully Predictable

Communist China and Socialist Venezuela have just passed the U.S. in income inequality. That is, the two have greater income inequality than us.

Not unrelated, Venezuela's brilliant leader figures he'll close out a career of shutting down government checks and balances with a lifetime position has head hancho.

There was no need for Vegas to try and give odds for either of those outcomes, they're pretty much gurantees.

"The society that puts equality before freedom will end up with neither. The society that puts freedom before equality will end up with a great measure of both". ~Economist Milton Friedman

What's Wrong with this Argument?

Are Americans Lazy? Fortune magazine at CNN Money thinks we are. Like many of their articles it seems as of late, it is surprisingly ideological rather than factual. The argument is essentially this: U.S. workers are lazy given by increased amount of leisure time (such as sleeping, days off, hours of work per week, etc). His argument is based on a very good paper out of the Boston Fed and is not one that those authors are making. So the question is, why does increased leisure time NOT equal laziness? Hint: Leisure is a normal good. I’ll leave comments open for a few days if anyone has a suggestion, then I’ll leave the answer in a comment before closing them.

Also, you may also notice a rather misleading sentence that is carefully ambiguous in its wording:
Economists see it happening already, attributing some of the surprising flatness in Americans' real total compensation of the past few years to the presence of millions of global workers competing for jobs.

Which economists? Why real total compensation and not earnings? Interestingly, part of the reason this is misleading is part of the reason the leisure = laziness argument is wrong.

Zimbabwe, Price Controls, and Socialism

Zimbabwe has arrested 7,500 since the enactment of price ceilings on many necessities on the convoluted logic that this is will curb inflation. While there are many lessons in this story, there are three big demonstrations of economic principles at play here in the story.

1. The story demonstrates the shortages created by price ceilings (Qd>Qs).
   
   
2. The price ceilings fail because black markets replace the legal markets, so you never actually get a reduction in price anyway:
   
   The price cuts have left shelves bare of corn meal, meat, bread, eggs, milk and other basics that sell for at least five times the government price on a thriving black market. Local beer became the latest item to disappear Monday. Acute shortages of gasoline have crippled commuter transportation and prevented manufacturers delivering diminishing stocks to retailers.
   
   
3. This is a demonstration of how ultimately socialism must resort to totalitarianism, that the idea we can have social freedom without economic feedom is flawed (See here for Nobel Prize Economist Milton Friedman explanation of this).
   
   "Some are ... saying they will not supply goods and services but we say you will," Mugabe said, according to state television.