What do we lose when every moment is recorded, every action scrutinized, and every past mistake preserved? Philosopher and author Lowry Pressly joins EconTalk’s Russ Roberts to discuss why privacy isn’t just about secrets or information control, the necessity of spontaneity, the importance of moral growth, and what we need to become fully human. From […] The post Let Me Be Forgotten (with Lowry Pressly) appeared first on Econlib.

I worry that people are looking for quick fixes to our current fiscal problems, when in fact we will need to take painful steps in order to get fiscal policy back to a sustainable track.  In this post, I’ll look at three recent examples:Here is Arthur Sants: The administration’s “crypto czar” David Sacks told CNN, that it “could create trillions of dollars of demand for our Treasuries practically overnight”.Sacks’ prediction is almost certainly wrong. In fact, it is questionable whether it would create any net increase in demand. Even if people did buy stablecoins at this scale, they would have to take money out of the banks to do this. The banks would then need to sell Treasuries to finance these withdrawals. On top of this, customers withdrawing deposits from banks would cause a decrease in the money supply as banks would have fewer assets to lend against. Remember, stablecoin needs to be backed one-to-one. Whereas banks can lend out a lot more money than they hold in deposits. Senator Ted Cruz has argued that the payment of interest on bank reserves represents a huge cost to the Treasury.  David Beckworth is skeptical: Senator Cruz’s proposal would end IORB. But would it also end payments to the banking industry from the federal government? Not really. For a given level of liquidity demand, banks would simply shift from holding reserve balances to holding Treasury bills (T-bills) if reserves no longer earned interest. The payments from the federal government to banks would continue, just in the form of interest on T-bills rather than interest on reserves. I have never been a fan of paying interest on bank reserves.  But ending this policy would not provide substantial revenue to the federal government, The recently passed “Big Beautiful Bill” contains a number of provisions that reduce taxes and government spending.  In some cases, the tax increases are scheduled to phase out in a few years, whereas the spending cuts are not scheduled to begin until after the next midterm elections.  But how likely is it that a future Congress will eliminate popular tax cuts?  Recall that many of the tax cuts passed in 2017 were originally scheduled to end this year, but Congress opted to extend them indefinitely.  If the Democrats take the House in 2026, will they want to see the scheduled Medicaid cuts take effect? PS.  This is from AI Overview: Delayed Rules:  The House bill delayed the implementation of two Biden administration rules aimed at simplifying Medicaid enrollment and maintenance until 2035, according to the Kaiser Family Foundation. These rules aimed to reduce barriers to enrollment in Medicare Savings Programs (MSPs) and align MSP applications with Medicare’s Part D Low-Income Subsidy (LIS).   Delayed Implementation of Work Requirements: The Senate bill includes a provision that allows states experiencing implementation challenges to potentially delay Medicaid work requirements until December 31, 2028, at the discretion of the HHS Secretary.   Provider Tax Cuts Delayed:  The Senate also delayed implementation of provider tax cuts until 2028. These cuts had been a point of concern for the health care industry.   Waiver Expirations:  While some states currently have Medicaid waivers for continuous eligibility, CMS will not renew approval for expenditure authority, and the earliest expiration date is in December 2025.   Overall Impact:  These delays offer some breathing room for hospitals and states, allowing for potential adjustments to the law and further lobbying efforts. However, the cuts and changes still pose significant challenges for those relying on Medicaid. PPS.  Slightly off topic, but more and more people are coming around to my view that tariffs foreshadow a future VAT.  Again, it’s one of those “Nixon to China” things: And, if we want to spitball here, tariffs could even lay the groundwork politically and psychologically for a future transition to an actual big-boy VAT. Citizens and businesses might recognize that consumption taxation you can see is better than consumption taxation that you can’t. A future administration could leverage dissatisfaction with tariffs to propose replacing them with a more economically efficient and lower-rate VAT.Politically, the VAT would then become not a “new” tax but rather a tax cut (in rate terms only) eliminating import tariffs. As Churchill once said: “Americans can always be trusted to do the right thing, once all other possibilities have been exhausted.” (0 COMMENTS)

  Canada Seeks To Jail Freedom Convoy Organizers for 8 Years by J.D. Tuccille, Reason, July 30, 2025. Excerpt: While Americans rightfully resent the lockdowns, mask mandates, and other intrusions into their liberty that accompanied the COVID-19 pandemic (not to mention politicians’ flouting of their own rules), most of us had it pretty easy compared to people elsewhere. In Canada, for example, pandemic restrictions were tighter and lasted longer than in the United States. That prompted public pushback culminating in the protest known as the Freedom Convoy and draconian retaliation against demonstrators by the Canadian government. While the government’s actions have since been ruled unconstitutional, two of the Freedom Convoy’s leaders have been convicted for their efforts and potentially face prison sentences longer than those handed out to killers and rapists.   Are Stablecoins CBDCs in Disguise? No by Nicholas Anthony, Cato at Liberty, August 1, 2025. Excerpts: Only CBDCs [Central Bank Digital Currencies] involve governments having direct access and control over your financial activity by default. For that reason, stablecoins are no more CBDCs than [are] mobile banking apps or debit cards. For any of these electronic payment mechanisms to be a CBDC, the government would have to take over their production from private companies and strictly control every aspect of their use. The threat of such a government takeover is always in the background, but that threat is not unique to stablecoins. And: It is only with a CBDC that your financial information would be held with the government by default. In contrast, a stablecoin in this scenario carries the same risks to civil liberties as a debit card. Rather than having direct control, overzealous governments must first go to the bank or stablecoin issuer to request information. This air gap separating individuals from the state is by no means ideal. In fact, when I’m not writing about the risks of CBDCs, I’m often writing about how financial privacy in the United States has been an illusion for decades. However, it’s important to maintain distinctions in this conversation because things could become much worse.   Lawmakers Sue ICE To Protect Right To Visit Detention Centers Unannounced by Autumn Billings, Reason, August 1, 2025. Excerpt: The lawsuit argues that a new rule implemented by the Department of Homeland Security (DHS) and Immigration and Customs Enforcement (ICE), which prohibits visits to ICE field offices and requires at least seven days’ notice before touring a facility, blocks members of Congress from ensuring DHS compliance with federal law and properly overseeing how taxpayer dollars are being spent. Section 527 of the DHS Appropriations Act protects the legal right of members of Congress to visit immigration detention centers, stating, “none of the funds appropriated or otherwise made available to the Department of Homeland Security…may be used to prevent” members of Congress or their staff “from entering, for the purpose of conducting oversight, any facility operated by or for the [DHS] used to detain or otherwise house aliens.” According to the act, no prior notice is required for lawmakers, but DHS may require congressional staffers to provide notice at least 24 hours in advance.   Gail Heriot on the Minimum Wage Gail Heriot, Instapundit, July 29, 2025. Excerpt: A few years ago, when the Commission did a report on whether to get rid of the special minimum wage for severely disabled employees, the parents and families of the affected employees (overwhelmingly Down syndrome sufferers) were strongly in favor of keeping it.   I am so #$^#% tired of do-gooders who think they know what’s good for these folks and that their parents and families don’t.  It should be obvious that removing the special minimum wage will result in job loss.  Indeed, one of the advocates for eliminating the special minimum we spoke to even ADMITTED this. The alternative theory is that most of these “do-gooders” are not do-gooders at all, but just a wholly owned subsidiary of the SEIU.  Maybe they actually WANT these people to lose their jobs, so that SEIU workers can get two jobs–the one that used to be performed by a Down syndrome employee and one baby-sitting the now-unemployed Down syndrome employee. DRH note: Gail Heriot is the only blogger at Instapundit whose posts I read without exception. I always learn from them.   (0 COMMENTS)

Friedrich A. Hayek Is there a right to education? Even in today’s polarized political environment in the United States, the overwhelming majority of citizens think there is such a right, and many hold that it applies through the completion of college.1 Every one of the fifty state constitutions includes language providing for free public education, although the language of rights is not explicitly cited. But to Friedrich Hayek, such expressions reveal confusion about both what rights are and what role education should have in a free society. Hayek warns us that the inevitable consequence of the right to education is an expansion of the state and an abridgement of personal liberty. In writing against the establishment of “positive rights” such as the right to education, Hayek is taking an extremely contrarian position. Already by 1948 the United Nations Universal Declaration of Human Rights, in Article 26, described education as a “basic right.” The full article states that: 1. Everyone has the right to education. Education shall be free, at least in the elementary and fundamental stages. Elementary education shall be compulsory. Technical and professional education shall be made generally available and higher education shall be equally accessible to all on the basis of merit. 2. Education shall be directed to the full development of the human personality and to the strengthening of respect for human rights and fundamental freedoms. It shall promote understanding, tolerance and friendship among all nations, racial or religious groups, and shall further the activities of the United Nations for the maintenance of peace. 3. Parents have a prior right to choose the kind of education that shall be given to their children. Throughout the 1960s and 1970s, US states adopted or amended language in their constitutions to provide free public education. By 2009, the European Union in Article 14 of its Charter of Fundamental Rights declared that “[e]veryone has the right to education and to have access to vocational and continuing training.” Hayek is thus very much out of the mainstream with his views on education. His position is guided by his deeply-held philosophical principles, an examination of which may be instructive. Positive and Negative Rights Hayek clearly differentiates positive rights from negative rights, a distinction which lies at the heart of his rejection of education as a right. Negative rights, such as the right to freedom of expression or of religion, always have the dual character of restricting the power of the state and of protecting individual liberty. These take the form of “the state shall not…”. Positive rights, by contrast, place a demand or obligation on the state to do something specific. The right to vote, for example, is a positive right (one of the few Hayek recognizes), since its exercise cannot be accomplished by individuals left to themselves, as is the case with the right to free speech. Instead, the state must hold elections, produce ballots, open polling places, count ballots, publicize the results, etc. Positive rights require the consent of a counterparty which has voluntarily accepted its role to secure such rights. They are more common in private associations and in the private sphere than in the political realm. A member of a country club, for instance, may have positive rights to reserve a tennis court or a dining room, by terms spelled out in the bylaws to which the member has consented by joining the club. The club has the obligation to comply under the terms of the bylaws, and the member retains the right to exit the club by resigning if it fails to fulfill its obligations to the member. Even in the private sphere of the family, Hayek notes that it is meaningful to speak of a child’s “right to be fed, clad, and housed,” since the parents are the de facto consenting counterparties of those rights. In the case of political rights, “we are all made to support the organization of government,” and as a result, we do have legitimate claims upon government to secure our political rights and to have a share in the services government provides (LLL 302).2 This of course raises the question of what services the government should rightly provide. Just as Hayek never believed in laissez-faire economics, he also rejects the minimal state. Hayek thinks it is “unquestionable” that the government should use its power of taxation to provide those services which the market cannot secure adequately, if at all, such as public goods (LLL 400-401). Other legitimate functions of the state include the administration of the law and courts, police and defense, enforcement against monopolies, central banking, establishing and upholding standards such as weights and measures, rules of traffic, and others. Hayek argues that many citizens and politicians fall into the error of thinking that since the state can legitimately use taxes to fund some services, it should provide all the services we might want in a near ideal society. For Hayek, it is too easy to move from such legitimate rights and their counterpart duties into a demand for a list of socially desirable things claimed under an ill-defined notion of “social justice.” He writes: To the negative rights which are merely a complement of the rules protecting individual domains and which have been institutionalized in the charters of organization of governments, and to the positive rights of the citizens to participate in the direction of this organization, there have recently been added new positive ‘social and economic’ human rights for which an equal or even higher dignity is claimed. These are claims to particular benefits to which every human being as such is presumed to be entitled without any indication as to who is to be under the obligation to provide those benefits or by what process they are to be provided. (LLL 303). “Society” is not a counterparty. There is no one in fact who voluntarily takes up the responsibility to provide others with these positive social and economic rights. In this regard, Hayek takes issue with Franklin Delano Roosevelt’s much-heralded “Four Freedoms” speech. It thoughtlessly combines well-established negative political rights (freedom of speech and freedom of religion), with which the state is able to comply, with novel and baseless positive social and economic rights (freedom from want and freedom from fear) which have no obligor. For Hayek, the whole of the UN Declaration of Universal Human Rights makes this error. It illicitly asserts a right to, among other things, employment, paid holidays, cultural life, and, as we have seen, an education. As socially desirable as these all may be, they are not rights in any sense of the word which a court would recognize. There is no counterparty for whom it is clearly the duty to secure these “rights.” Most seriously for Hayek, the UN Declaration treats society as something constructed by design and directed by a conscious will, not as the result of spontaneous order generated by millions of individual actions and choices cohering into structures and institutions which have proven themselves as useful for social order. Hayek worries that this confusion about rights threatens the preservation of the genuine rights upon which life in a free society entirely depends. He writes: To speak of rights where what are in question are merely aspirations which only a voluntary system can fulfil, not only misdirects attention from what are the effective determinants of the wealth which we wish for all, but also debases the word ‘right’, the strict meaning of which it is very important to preserve if we are to maintain a free society (LLL 307). The belief in these positive rights assumes society is a hierarchy whose members all serve one end, not a spontaneous order of free individuals (LLL 275, 305). For Hayek, every case in which society is thought of as a taxis and not a cosmos comes with a cost to liberty. He writes that individual freedom is lost since all must do what they are instructed to (LLL 304). This in turn makes society “totalitarian in the fullest sense of the word” (LLL 305). Earlier in this text, Hayek writes that only a government with totalitarian powers can try to bring out equal positive and economic rights (LLL 283). Even assuming the state could achieve this ideal of social justice (which it cannot for Hayek), the cost would be the complete loss of individual liberty. The expansion of personal rights to include education, then, does not benefit the citizens, but instead robs them of their freedom. Hayek writes: Though some of the aims of the welfare state can be achieved only by methods inimical to liberty, all its aims may be pursued by such methods. The chief danger today is that, once an aim of government is accepted as legitimate, it is then assumed that even means contrary to the principles of freedom may be legitimately employed. (CL 376) Hayek on Education What then is Hayek’s view of education? He holds that education is a duty of every citizen, not a right. The state may legitimately require a certain level of education for everyone, such as a high school diploma, even against the parents’ wishes. This compulsion alone should be enough to signal that education is a not right, since in no other cases does the government compel the exercise of a “right.” The requirement of a certain level of learning is in the interests of both the state and the citizens. Hayek notes that societies with democratic institutions fare better when their citizens are educated (CL 499). In addition, a basic education fosters a common set of values in the society. For the citizens, education benefits them by equipping them with the skills they need to offer their goods and services to others in a competitive market economy. In cases where the parents cannot afford to educate their children, the government should provide funding. Hayek holds that only in the rarest cases should the government operate the schools. “The distinction of the state’s power to mandate education from the state’s role in providing the education is key to Hayek’s argument.” Requiring education in the populace is a legitimate demand of the government. Hayek approvingly cites what John Stuart Mill calls “almost a self-evident axiom” that the state should compel a certain level of education for all citizens. For both Mill and Hayek, the proper role of the state is confined to requiring “parents and guardians to provide for those under their care a certain minimum of education” (CL 499), but not to be the provider of the provider of that education. The distinction of the state’s power to mandate education from the state’s role in providing the education is key to Hayek’s argument. And it is exactly this which gets lost in the widespread view that education is a right. The “Right” to Education Missing in State Constitutions Hayek’s worry that the supposed right to education would lead to an expansion of the government’s power is borne out when we look at the state constitutions and their articles on education. Not one of the 50 U.S. state constitutions ever uses the language of a “right to education.” Instead, the constitutions speak of the state’s obligation to provide a free public education where the schools are run by the government. In fact, 37 states have “Blaine Amendments” or other language prohibiting the funding of non-public primary and secondary schools. The “right” to education has led to state-sponsored schools, the support of which at the primary and secondary levels alone represents 6-7% of the U.S. GDP, which is larger than the retail sector. In many districts, the public school is a de facto monopoly. This is very far from Hayek’s vision of state-operated schools being rare. There are at least three issues with the current system of state-sponsored schools. First, just as you would not want the government as the only source of information and news (LLL 419-420), you should not want it as the sole provider of education. Hayek quotes Mill’s statement in On Liberty that a state school system can be used to mold people according to the whims of those in power and thus “establishes a despotism over the mind” (CL 498). Second is a fairness issue. Hayek fervently believes that the state should treat all citizens equally. While some parents and students are happy with the educations being offered by their local public schools, only 22% of parents in a recent survey3 felt positive about the direction of education and only 8% of teens in another survey reported that their schools did an excellent job.4 Families with higher incomes have more ability to give their children an alternative to the local public school, which is another way of saying that the children of the poorest families are most at risk for the worst academic outcomes. Third are the poor results. In a recent report issued for the 2024 school year, only 28% of 8th grade public school students were rated as proficient in math,5 and only 30% of 8th graders were proficient in reading.6 Is it meaningful to speak of the right to a free public education when less than a third of the students meet even basic levels of proficiency? In fact, there are now lawsuits in which former students are suing their public schools for negligence and breach of implied contract to educate them to a standard of proficiency. Those schoolchildren who do not attain proficiency in reading and math face a lifetime of lower earnings and have very little chance of improving their socio-economic status, an outcome which Hayek would say is manifestly unfair. For more on these topics, see “Legal Safeguards Against Omnipotent Lawmakers,” by Pierre Lemieux. Library of Economics and Liberty, May 1, 2023. “School Vouchers and the Inverse-Hirschman Scenario,” by Phillip Magness. Library of Economics and Liberty, December 4, 2017. “Is State Education Justified?” by Kevin Currie-Knight. Library of Economics and Liberty, April 6, 2020. Far from empowering the individual citizen, the supposed right to education has created an educational monopoly for many of the nation’s students, with low levels of academic attainment and reduced earnings potential as its consequences. The Hoover Institution estimates a $31 trillion loss in GDP in today’s dollars due to learning deficits from the pandemic alone.7 One response to this grim reality would be to insist on the right of parents to choose the school for their children under Article 26.3 of the UN Declaration. Although Hayek is completely dismissive of the UN Declaration, the assertion of parental rights is true to his philosophical principles both because these rights serve to limit the coercive power of the state and because parental rights recognize the authority of the government to require education while allowing the market to provide parents with options for their children. Footnotes [1] James Diamond, Jocelyn Durand, and Charlie Rolason, “Vast majority of Americans believe students deserve an equal opportunity to pursue higher education.” Ipsos. July 11, 2022. [2] References are to the Collected Works of Hayek, University of Chicago Press, volume XVII, The Constitution of Liberty, abbreviated as CL, edited by Ronald Hamowy, and volume XIX, Law, Legislation, and Liberty, abbreviated as LLL, edited by Jeremy Shearmur. [3] Alli Aldis, “New K12 Teacher Survey Indicates Morale Crisis Among Educators.” EdChoice. May 7, 2024. [4] Claire Cain Miller, “Today’s Teenagers: Anxious About Their Futures and Disillusioned by Politicians.” New York Times. January 29, 2024. [5] NAEP Report Card: Mathematics, 2024. Grade 8. Nation’sReportCard.gov. [6] NAEP Report Card: Reading, 2024. Grade 8. Nation’sReportCard.gov. [7] Eric Hanushek and Bradley Strauss, “A Global Perspective on US Learning Losses.” Hoover Institution. February 14, 2024. *Mike Kane is an historian of philosophy interested in political theory, political economy, and the relationship of philosophy and economics. (0 COMMENTS)

The Roman Empire was in trouble. During the fifty-plus years known as the Crisis of the Third Century (235-284 AD), the throne of Rome changed some 26 times, with the Roman Army engaging in a steady diet of crowning and removing claimants to the throne. These autocrats, known as “barracks emperors,” because they often came from among the ranks of the army itself, were generally disastrous in their administration of the Empire, due to a glaring lack of experience in political matters.  As they were beholden to the military, much of economic policy was geared towards keeping the soldiers happy. Severus Alexander, who while not a soldier owed his throne to the Praetorian Guard, began debasing the purity of silver coinage so that he could double the pay of his soldiers, while simultaneously paying for military campaigns against the Alamanni Germanic tribes. His occupation with the Alamanni left Rome’s other borders undefended, leading to attacks and invasions from other parties such as the Sassanids, leading to his assassination by the very Praetorian Guard which had placed him into power. This, however, is of ancillary interest to our story; what is important about these invasions is that Severus devalued the currency further to pay off his invaders so that he could concentrate on the Alemanni, laying the foundation for continued inflationary policy by his successors. By the time Diocletian came to power in 284 CE, his (non-immediate) predecessor, Aurelius, had done much to restore some semblance of order to the Empire, reunifying what had broken into three kingdoms and expelling invaders such as the Sarmatians and Vandals from Roman territory. Diocletian expanded on these actions, even going so far as to form a quartet of governing individuals, called the Tetrarchy, which co-administered the Empire with him at the head. However, the inflation continued, and the Emperor worsened it via a massive increase in military and public works spending. Making matters worse, years of increasingly poor harvests – poor, in part, because public policy forced laborers into inefficient activities such as building a new capital at Nicomedia instead of actually farming – combined with already extant inflationary pressures from monetary devaluation to cause widespread unrest, especially within the military. Remember, given that he owed his power to the goodwill of the soldiers, it was hardly in the Emperor’s best interests to have them ragged and hungry. Diocletian Issuing his Edict on Maximum Prices to assembly of merchants and farmers   Citing the influence of “evil traders,” in 301 CE, Diocletian issued his Edict on Maximum Prices, which instituted widespread price controls on over one thousand different items, from rice, to bed linens, to the wages to be paid to craftsmen (for those interested in the full scope of the price controls, and English translation of the Edict can be found here). Diocletian preemptively placed the blame for any failures of his policy on greed, launching into invective against wicked speculators and evil profiteers who conspired to rob into beggary a helpless public. Of course, he omitted the cost of increasing the number of provinces from 40 to 105, each requiring additional military and civilian officials. This alone increased the number of high-salaried public officials fivefold. Additionally, the base pay for military personal increased sixfold, newly appointed praetorian prefects and vicarii had to be accounted for, along with their staffs, palaces befitting the tetrarchs had to be erected, and the costs of a massive increase in public works projects budgeted for. All of this was being spent against a currency which, remember, was being systematically devalued, and to a degree that the government would not accept their own currency in payment, but demanded instead goods in trade. Predictably, the impact of the Edict was disastrous. The penalty for overcharging was death. The penalty for “hoarding” goods was also death. With the value of currency declining, and no way to mitigate this decline due to fixed prices, the only way to officially sell anything at all was at a loss. As a result, producers either refused to produce any goods or services, produced just enough to appear to comply with government policy while selling off-book on the black market, or simply resorted to barter with other producers. Shortages became the order of the day, and hungry Romans soon resorted to violence in a competition to obtain whatever was available. This was especially prevalent among the soldiers that the Edict was mostly designed to benefit, as they had little to trade except for money that no one wanted for goods that scarcely existed.  Soon, in order for some semblance of market stability to be restored, merchants, farmers and consumers simply ignored the policy; starving soldiers grateful for the return of food and clothing were hardly going to arrest the lawbreakers. Some 1200 years before the birth of Thomas Gresham, Diocletian demonstrated that bad money drives out good, and that attempting to ameliorate bad fiscal policy – whether prohibitive taxation, currency manipulation, or more contemporarily relevant, high tariff schemes – with more bad fiscal policy is never the solution. Whether in ancient Rome, the Soviet Union, or modern Western democracies with mixed economies containing a reasonably high level of free-market principles, price controls never work out to anyone’s benefit.   Tarnell Brown is an Atlanta based economist and public policy analyst. (0 COMMENTS)

At the end of my last post, I said I’d be following up by describing both some of Musa al-Gharbi’s modes of analysis and assumptions in his book We Have Never Been Woke, and outline who is the “we” he describes, and what he means by “woke.” First, the ground rules. Musa al-Gharbi sets out his examination of the woke, and of the elites, using a method of analysis he calls “analytic egalitarianism.” What he means by this is that all social groups will be considered according to the same rules: The behaviors of white and racial and ethnicity minorities, men and women, and LGBTQ and “cishet” (cisgender, heterosexual) Americans will be discussed in equivalent terms. This is a commitment that is perhaps more radical than it appears to be at first blush. The idea of holding everyone to the same standards and rules is a more radical approach, al-Gharbi says, because sociologists and scholars of late have used a very asymmetrical (and thus inegalitarian) methodology, casting identical behavior in very different lights based on the identity group of those engaging in that behavior: For instance, when racial and ethnic minorities demonstrate a preference to hire, promote, mentor, and otherwise do business with coethnics, this is frequently analyzed in terms of in-group solidarity or building and leveraging social capital, and these behaviors are lauded. When whites engage in the exact same behaviors, they tend to be analyzed in a completely different way—almost exclusively through the lenses of racism and discrimination—and those who engage in such behaviors are pathologized and denounced…Indeed, even when harmful behaviors by other actors are recognized and condemned, responsibility is often still laid at the feet of the historically dominant group. For instance, hate crimes committed by African Americans are regularly attributed to white supremacy; women’s abuse and exploitation of other women (or men) is blamed on the patriarchy. As I’ve discussed elsewhere at length, while these tendencies may be well intentioned, they are also profoundly condescending—and the tortured explanations they produce tend to obscure far more than they elucidate about why certain phenomena occur, or how social orders persist, and who they serve (or don’t). Analytic egalitarianism is also applied to considerations of racism. Musa al-Gharbi describes and endorses the definitions of racism put forth by Karen and Barbara Fields: In equally processual terms, Karan and Barbara Fields defined “racism” as the action of applying a social, civic, or legal double standard based on someone’s (perceived) ancestry. This is roughly the definition we will adopt here…However, it is critical to note that the Fields’ definition of racism was not focused on the application of double standards that specifically favor the historically dominant group. Instead, any racialized double standard is “racist” on their definition, irrespective of its intent or purported beneficiaries… As Karen and Barbara Fields put it, “Racial equality and racial justice are not figures of speech, they are public frauds, political acts with political consequences. Just as a half-truth is not a type of truth but a type of lie, so equality and justice, once modified by racial, become euphemisms for their opposites.” But while al-Gharbi’s modes of analysis might, as he suggests, seem fairly radical compared to standard sociological analysis (at least in the sense of being a very different approach), there is one important respect in which it not particularly radical – it actually adheres more closely to many of the scholarly works that social justice advocates often claim as inspiration: Consuming prominent analyses of the post-2010 era, one might gain the impression that wokeness became institutionally dominant because huge numbers of elites and elite aspirants read a bunch of Marx, Theodor Adorno, Michel Foucault, and Kimberlé Crenshaw, were completely convinced by their respective arguments, and are now trying to reshape institutions and society writ large in accordance with the prescriptions of these thinkers, as derived from their texts. In reality, many of the practices associated with wokeness betray, if anything, a lack of deep knowledge or engagement with the literatures that are purported to have spawned the dispositions, discourses, and practices in question. He uses the example of Patricia Hill Collins, who “invented the ‘matrix of oppression’ framework illuminating that race, class, gender, and sexual oppression are intimately related and mutually reinforcing.”  Describing her work, he observes how it has been cited in support of “the idea that some groups are uniformly and objectively more oppressed than others on the basis of intersectional advantages and disadvantages,” as well as “the widespread notion that people who are the most oppressed can understand society most clearly, and therefore those who identify with a greater number of, and more severely oppressed, identity categories should be given more deference and respect” in their social analysis than, say, cishet white men. But there’s a catch: The problem with making these attributions, however, is that Collins rejected each of these ideas directly and unequivocally in Black Feminist Thought (the text that introduced the Matrix of Oppression framework). This is a regularly occurring theme throughout al-Gharbi’s book. The ideas and arguments put forth by social justice advocates often have little resemblance, or are even diametrically opposed, to the actual contents of the work such activists often reference and claim as inspiration. Thus, Wokeness is clearly not a result of people being indoctrinated into social justice activism through a deep reading of primary texts like these…Critically, these superficially deep yet substantively shallow modes of speaking about hot topics, big ideas, and influential thinkers are a product of enculturation, not studying in any traditional sense, not even when these discourses are adopted in college (as they often are). So what is wokeness? And who, exactly, is it that has never been woke? Invoking any politically charged term runs the risk of kicking off a never-ending series of disputing definitions. In order to avoid this, al-Gharbi tries to clarify what he means by the term and its usage: Of course, the current ambivalence in the meaning, usage, and likely future of “wokeness” raises the question of what I mean by “woke” as used in this text. Let me start by marking what I do not intend: “woke” will not be used as a pejorative or a slur here. Beyond this, and perhaps to the consternation of some readers, I will decline to provide an analytic definition of the term. An analytic definition is one that is always and everywhere true by virtue of the meaning of the words used. The classic example is that “bachelor” refers to an unmarried man. This is analytically true – being an unmarried man just is what it is to be a bachelor. But not all ideas can be defined in such analytic terms – they instead refer to clusters of overlapping and interrelated but still logically distinct concepts. But lacking an analytic definition does not mean a concept cannot be meaningfully recognized and discussed: In fact, many of the most meaningful words in the English language are difficult to precisely define, as analytic philosophers have been demonstrating for centuries now. Consider “love,” “knowledge,” “justice,” “freedom,” “beauty.” The fact that these terms cannot be defined cleanly and unobjectionably doesn’t imply they’re meaningless and should not be used. Musa al-Gharbi traces out the history “wokeness” as a political and social term, finding that “goes back a long way” and seems to have originated in the 1860s with an pro-worker, antislavery organization called the Wide Awakes: “In the parlance of the times, to be ‘Wide Awake’ was to be alert to social injustice, and to be committed, militantly, to do something about it.” It eventually turned to a phrase encouraging vigilance – to “stay woke” was to keep oneself constantly alert to the risks of injustice that abound. Focusing on its modern usage and the cluster of concepts around which the idea of wokeness congeals, al-Gharbi says: Indeed, there are certain views that seem to be discursively associated with “wokeness” by both critics and sympathizers alike. Ticking through these may be useful to add some texture to our discussions because many who would now be hesitant to self-identify as “woke” may nonetheless continue to identify with some version of these beliefs – and may also view it as reasonable to associate these particular commitments with the term “woke.” Among these ideas are support for “antiracism, feminism, LGBTQ rights, and environmentalism” while seeing all these ideas as directly tied together; an “aesthetic embrace of diversity and inclusion” paired with acknowledging past wrongs against vulnerable populations; a “focus on identity, subjectivity, and lived experience,” along with validating people’s individual perceptions of the same; a commitment to “explicit acknowledgement of various forms of privilege”; a belief in “‘unconscious bias’ which creates the need to ‘work’ on oneself” but is never fully eradicable; and a “tight focus on disparities between groups,” although this focus is applied in a way that is asymmetrical. Thus, “disparities between men and women that favor men are presumptively viewed as evidence of sexism (while those that favor women are unproblematic),” and racial or ethnic disparities “that favor whites specifically are taken as evidence of racism” but “if other racial or ethnic groups outperform whites on various measures this is often ignored: the focus is on whites.” Additionally, al-Gharbi notes that wokeness harbors an “approach to identity that is, for lack of a better term, somewhat mystical.” According to the woke, “race is held as a fiction in need of being abolished and transcended” and is “held to be biologically unreal,” yet at the same time race is said to be permanent and immutable based on the biology of your birth, and “virtually any social phenomenon should be analyzed and discussed in terms of race, and failure to do this is viewed as an unwillingness to be ‘real.’” Gender and sexuality, to the woke, are “fluid, nonbinary, and socially constructed” and are thus artificial and even arbitrary social constructs, but at the same time gender identity and sexual orientation are innate, unchangeable, and fixed at birth such that “people can essentially be ‘born’ gay or born trans (i.e., ‘born in the wrong body’).” However, al-Gharbi makes it clear that he thinks this “mystical” approach to identity is not in itself a critique of woke ideas: The discursive association of the aforementioned ideas with “wokeness” therefore implies nothing about their “rightness” or “wrongness.” The observation on the “mystical” nature of beliefs about identity is likewise intended as a description, not a critique. As a Muslim, I don’t necessarily view it as a problem to hold beliefs with these sorts of deep tensions (see: free will and divine providence, for instance) – however, it is important to be aware of, and wrestle with, apparent contradictions. So if this is wokeness, who are the woke? Musa al-Gharbi identifies wokeness as the dominant ideology of a group of people he calls “symbolic capitalists”: The Americans most likely to profess beliefs associated with wokeness tend to be the Americans most likely to become symbolic capitalists: highly educated, relatively affluent white liberals. Symbolic capitalists are social elites – highly educated and highly paid professionals. According to al-Gharbi, “what is often referred to as ‘wokeness’ can be fruitfully understood as the ruling ideology of this increasingly dominant elite formation.” Thus, wokeness is a movement not of the common people, but of the elites: The genuinely marginalized and disadvantaged in society are not the folks who tend to embrace and propagate these ideas and frameworks. Instead, highly educated and relatively affluent professionals associated with the symbolic economy are the most likely to embrace (and enforce) these norms, dispositions, and discourses. In fact, the political preferences of the woke not only don’t match the ideas and preferences of those the woke claim to seek to uplift – it often conflicts with the desires of these very people: For instance, many highly educated white liberals, eager to demonstrate their alignment to causes like Black Lives Matter, aggressively embraced “defunding the police,” even though African Americans themselves generally rejected this aspiration…However, publicly striking the “right” posture on this issue seemed to matter more to adherents than advancing the stated preferences of Black people or building and sustaining viable coalitions that could achieve concrete change. This extends beyond policy differences to perceptions of daily reality: After 2011, there were dramatic changes in how highly educated white liberals answered questions related to race and ethnicity. These shifts were not matched among nonliberal or non-Democrat whites, nor among nonwhites of any political or ideological persuasion. By 2020, highly educated white liberals tended to provide more “woke” responses to racial questions than the average Black or Hispanic person; they tended to perceive much more racism against minorities than most minorities, themselves, reported experiencing; they expressed greater support for diversity than most Blacks or Hispanics. White Democrats also became significantly more likely to perceive others in their social circles as “racist,” even as nonwhite copartisans moved in the opposite direction (and white non-Democrats were flat). But before going too much further down this line, it’s worth taking a break here and examining what, exactly, a symbolic capitalist is supposed to be? What is it to participate in what al-Gharbi calls the “symbolic economy,” what is the “symbolic capital” used by this group of elites, and how does it relate to woke ideology? These ideas will be outlined in more detail in the next post. (0 COMMENTS)

On July 26, Joshua Rauh, a senior fellow at the Hoover Institution, testified at the Reagan Library before the House Ways and Means Committee. I learned a lot from his testimony and want to share it. Here are some highlights. A growing economy is essential for expanding economic opportunity for all Americans. It is deeply concerning, then, that in its January 2025 Economic Outlook the Congressional Budget Office (CBO) projected real GDP growth to average just 1.8 percent over the next decade. To put that in perspective, had growth been that low over the last 50 years, the US economy today would be nearly 40 percent smaller. There is a strong link between a well-performing economy and rising incomes across the income distribution. We’ve seen this relationship clearly over the last two decades. From 2008 to 2016, the economy grew at an annual real rate of just 1.7 percent. During that time, median real wages rose 0.4 percent per year. In comparison, from 2016 to 2019, real GDP grew at 2.7 percent, leading to median wages rising 1.1 percent per year. And: Pro-growth tax reforms depend on accurate, trustworthy, and transparent scores from the Joint Committee on Taxation (JCT) and the CBO. These agencies are currently falling short of that standard. For example, the JCT’s conventional model remains opaque. It is built on decades-old code and is supplemented by “off-model” calculations that are poorly documented. Key parameters—such as how rate changes affect tax avoidance and evasion—are kept hidden, making it difficult to evaluate their results. Congress should require that scorekeepers enhance transparency, modernize their outdated models, disclose key assumptions, and publicly benchmark their parameters to relevant scholarship. In addition, the scorekeepers should offer sensitivity analyses of their scores or offer candid, systematic assessments of the confidence they have in specific estimates. These reforms would build trust in the official scores and provide lawmakers with more information, which will facilitate further pro-growth tax reforms. And: As I noted, my recent academic work suggests that the CBO and the JCT may understate the effects of these provisions on the economy. This could translate into substantial differences in the CBO’s assumed GDP growth rate and its deficit effects. Using the CBO’s rule of thumb workbook, if annual productivity growth is 0.25 percentage points higher, the annual GDP growth rate over the next 10 years will average 2.1 percent. This contrasts with their current forecast of 1.8 percent. CBO estimates that such a difference in growth would result in an additional $1 trillion reduction in the deficit over the 10-year budget window. If annual productivity growth is 0.5 percentage points higher, annual growth would reach 2.5 percent and deficits would fall by an additional $2 trillion over the 10-year budget window. This would offset more than half of CBO’s projected 10-year deficits from the bill and, importantly, fully cover the projected deficit impact in the final years of the budget window. And that is before accounting for any additional tariff revenue raised by the administration. (italics added) And: Finally, and perhaps most importantly, future growth depends on spending restraint. The primary fiscal challenge facing the United States is not insufficient revenue, but excessive spending. According to the CBO, federal revenues in 2025 are projected to reach 17.1% of GDP, very close to the historical average of 17.3% from 1974 to 2024. In contrast, federal spending is expected to be 23.3% of GDP, more than two percentage points above its historical average, and is projected to rise further in the coming decade. On Josh’s  last point, note that if the government were able to get federal spending down by 2 percentage points, the deficit would be 4.2% of GDP rather than 6.2%. Why does this matter? Adding 4.2 percent of GDP to the federal debt would keep federal debt constant as a percentage of GDP if nominal GDP grew by 4.2 percent. That would be a nice accomplishment on the way to actually reducing federal debt as a percentage of GDP. (Note: This mathematical claim holds when we start with debt in the hands of the public equaling GDP, which is approximately true today. When those numbers are not equal, it gets more complicated.) I highly recommend reading the whole testimony, which is not that long. (0 COMMENTS)

In our forthcoming paper at the Review of Law & Economics, “The Long-Term Impact of Kelo v. City of New London: Comparing State Legislative and Judicial Responses”, my former Western Carolina University colleagues Ed Lopez and H. Justin Pace and I discuss justifications for eminent domain.[1] Primarily, we discuss the holdout problem. The holdout problem describes a rent-seeking seller who holds off selling to maximize their gain, but at the expense of the entire project. Eminent domain can be used to overcome this challenge, in which case, eminent domain can be welfare-enhancing. (This post is not about the holdout problem.  For details, see Section 2 of our article.) Related to the holdout problem is the problem that occurs when the cost of negotiating may be prohibitively high for a necessary public works project.  (Indeed, I’d argue this is the best use of eminent domain, but that is neither here nor there.)  Take, for example, an old city, say Boston.  Boston was founded in the 1630s, a period long before the benefits of modern sanitation and sewer systems were understood.  Boston grew and grew, and consequently so did human waste and sanitation needs.  Eventually, we was discovered that dumping human waste in the streets and rivers was not the best idea, and cities began constructing the modern wonder that is a sewer system.[2]  But, by the time the modern sewer system of Boston began construction in 1877, the city was already good-sized: some 46,000 people lived there.  There were many property owners involved whose property may need to be infringed upon to connect this system and make Boston healthier. Negotiations among all these owners would likely have been prohibitively expensive (even excluding the problem of holdouts or strategic bargaining).  Consequently, at several times during the process, the city invoked eminent domain to take necessary actions (the powers are now codified in Title XIV, Chapter 83 of the Massachusetts General Laws).  This is likely a good use of eminent domain powers: a general case of improving general welfare (as opposed to the more squishy “social benefits exceed social costs” used by some economists). Here, eminent domain represented the least costly way to achieve the goal.  Other old cities around the world likely faced the same issues and used eminent domain to manage them as well. But does this case mean that eminent domain for a sewer system is always a good thing?  For the sake of answering this question, let’s assume that a sewer system construction is in and of itself an improvement in general welfare. I argue that the answer to my question is “no.” Let’s move away from old cities and say we want to create a new city: Murphopolis. Murphopolis will be somewhere in the vast Arizona desert.  Some 46,000 people journey to the middle of that desert and, among the spiders, scorpions, and blazing heat, start building a town.  In 2025, the benefits of a sewer system are well-known.  In the construction of this city, eminent domain is not necessary: property contracts can be written to incorporate the necessary easements and connections.  The sewer system can arise naturally.  Indeed, one may not even need a government-run or -provided sewer system at all!  Anyone wanting to invoke eminent domain for a sewer project should face a higher standard of scrutiny. Moving to the more general problem of government, many advocates for government actions simply point to the action being used in the past to solve some problem and then conclude that the same action is appropriate.  But the time and conditions of the current problem are not the same as in the past.  Just because eminent domain was a good solution for Problem A does not mean it is a good solution for Problem B.  Using eminent domain to build the Boston sewer system is beneficial; using it to build the Murphopolis sewer system is likely harmful. Thus, what I see as a problem of government: the proper use of its power, as opposed to power’s haphazard use.  Government does have a positive role to play.  But those “men of system” (to borrow Adam Smith’s phrase) undermine the good of government by using it haphazardly.[3] — [1] Ed discusses the paper more generally here. [2] I do not use “wonder” lightly.  Think about it: we all have these tiny holes in our home that we put waste, contaminants, and non-potable water into and it gets whisked away to be properly treated and disposed.  Think of how much cleaner and safer our lives are!  How many have been spared horrible deaths or illness from diseases like cholera, dysentery, and other water/food/waste born illnesses simply by taking the sources away via this little holes? [3] As a final aside, I’d argue that most of the evils of government come not from intentional abuse of power by evil men, but rather by this haphazard approach to government.  Like a child playing with a loaded gun, their misconceptions and ignorance can lead to terrible consequences not intended. (0 COMMENTS)

In my first year of grad school, one of my professors had a long list of “forbidden words”. These were terms that do more to confuse than enlighten when used in economic analysis. Terms like “need”, “afford”, “exploits”, “vicious circle”, etc. Today, I’ll argue that we might wish to add the term “must” to that list. Brian Albrecht has an outstanding new post that nicely illustrates the problem: This approach eliminates human choice entirely. [Michael] Pettis treats markets as foreigners imposing their will: “the United States has no choice but to run a corresponding trade deficit.” Capital flows are just forced upon you like the weather if the government doesn’t do something about it. In his telling, Americans are passive victims who must automatically adjust their saving and spending when foreigners decide to invest here. The starkest example: “If a country organizes its economy in such a way that its savings vastly exceed its investment, the rest of the world must automatically adjust either its savings or its investment.” I mean that must be true, but how does that framing help us? If I sell goods, does it make sense to say the rest of the world “must” buy them? Only under weird definitions of “must.” In both cases, we are looking at an outcome (savings > investment, or my sales > 0), not some abstract goal. These are the traded quantities. And, again, it removes any choice. Why am I selling the goods? Can policy change my sales? Sure.  In a recent post, I tried to explain the confusion over the US current account deficit by looking at some other countries.  For instance, Australia has run fairly persistent current account deficits over the past few decades, whereas the Netherlands has run large current account surpluses.  There is a sense in which it is true that whenever non-Australian countries, in aggregate, run current account surpluses, then Australia “must” run a current account deficit, just as the fact that I succeed in selling goods from my small convenience store implies the rest of the world “must” buy goods from me.  Not must as an authoritarian order, rather “must” as an accounting relationship, quantity sold must equal quantity bought.   It’s also true that if all non-Dutch countries, in aggregate, run a current account deficit, then the Netherlands must run a current account surplus.  And why stop there?  If Andorra runs a current account surplus, then all non-Andorran countries, in aggregate, must run a current account deficit. How dare those perfidious Andorrans force a current account deficit on the rest of the world!! Now let’s think about possible explanations for Australia’s current account deficits and the Netherlands’ current account surpluses.  Does anyone seriously believe that a useful explanation for those patterns is: “Non-Australian countries run surpluses, and hence Australia must run a deficit, whereas non-Dutch countries run deficits, and hence the Netherlands must run surpluses.  That’s why Australia has a deficit and the Netherlands has a surplus.”  Is that what we mean by an “explanation”? Albrecht’s entire post is excellent—read the whole thing. (0 COMMENTS)

We’re bringing back price theory with our series on Price Theory problems with Professor Bryan Cutsinger. You can see all of Cutsinger’s problems and solutions by subscribing to his EconLog RSS feed. Share your proposed solutions in the Comments. Professor Cutsinger will be present in the comments for the next couple of weeks, and we’ll post his proposed solution shortly thereafter. May the graphs be ever in your favor, and long live price theory!   Question: Suppose the demand for fentanyl is perfectly inelastic, and that the users of fentanyl steal from others to acquire the money to pay for it. In an effort to crack down on fentanyl use, the government imposes harsher penalties on suppliers of fentanyl, reducing its supply. How will this policy affect the amount of stealing by fentanyl users? (0 COMMENTS)