Friday, September 30, 2005


Email from a reader:

"I live in Houston and my family is heavily involved in the petroleum industry. There were two causes of the gasoline shortages neither of which have anything to do with malice, price controls, government action or inaction, etc. though we can throw some blame on the media.

The local media was having a field day telling everyone that they were going to die. There are four evactuation regions. A, B, C and everyone else. Level A is areas that flood if you have a heavy dewfall. Level B is areas that will flood with heavier than normal rainfall. Level C is areas that will flood during a hurricane. Then there is everything else (sometimes referred to as 'white zones'.) Hurricanes are notoriously unpredictable. To err on the side of caution the local governments ordered the following evactuation procedure: Level A leave on Wednesday, Level B on Thursday, and Level C on Friday. This allows the government to evaluation condtions and cancel the higher level evactuations if necessary. Since level A will flood if a hurricane passes within 100 miles of us it was safe ordering those people out.

The media was shouting "Mandatory Evactuation For Everyone!!!!" then saying the Level ABC information without exclamation points and without explaining what they were. Alongside predictions that everyone was going to die.

Rather than an orderly evacuation it was a mass rush as 1% of the USA population entered two highways all at once. So you have a solid gridlock just by the mass volume of vehicles. Add car wrecks to the mix and breakdowns and you everyone coming to a stop, burning 10 times the fuel that would normally be burned.

Something people don't like to see is that the gasoline industry is not a monolithic entity. It takes a wide variety of independent companies to get the gasoline into your car, ending with the individual stations which are mostly individually owned. The main distributor made a bad decision for a good reason. They ordered their fleet to make their Thursday early morning deliveries, refill the tanks, then travel to Dallas. The thought process was that this way they would have a full fleet ready to return after the hurricane and could start deliveries immediately without having to worry about the conditions of the local storage or the refineries.

Good intentions but with horrid results. With the gridlock on the freeways vehicles started running out of gas. But since the stations along the way were no longer receiving deliveries there was no replacement fuel.

Now even in a truck 1/4 of a tank of gas will get you to San Antonio in normal conditions. So under normal conditions there would have been enough fuel in the service stations and in vehicles' tanks to handle the evacuation. But the panic ruined everything.

Price controls had nothing to do with it. If a station had wanted to charge $10 a gallon it would not have gotten those tankers back from Dallas".

Sunday, September 25, 2005


One of my readers (one of the various "Tims" that I correspond with) noted the excerpt from Tibor Machan that I put up on Dissecting Leftism recently. He noted the inset passage from Machan below and then argued why it is wrong. His analysis is a bit satirical but is pretty close to the truth nonetheless. Both Tim and Tibor however point out that Leftists seem to see themselves as exempt from the laws that govern ordinary mortals:

"Yet, as should be evident, the modern liberal's approach to advancing the lot of human beings is paradoxical. While denying that individuals can help themselves if left to their own resources and to voluntary cooperation, they affirm that governments-which are, after all, composed of individuals-can take the initiative and effectuate adequate solutions to human problems. How is this possible? Either we are helpless, in which case so is the government...

It's not paradoxical in the slightest. The author is simply making an assumption that leftists inherantly reject, and thus knocking down a straw man.

Let's not forget: From a leftist perspective, we can't just talk about "humanity" having one nature -- e.g. being helpless or capable, inherantly good or inherently bad -- since there are three fundamentally different types of people (forgive the grammar): WE, the VICTIMS, and the EVIL BAD PEOPLE.

The VICTIMS-- the poor, minorities, and all those other fishbowl-curiosities whose name and alleged benefit we will invoke -- can't think and/or act for themselves and thus require our protection. (Good thing too, because it gives us an excuse to do pretty much anything in their name!) They people are economically oppressed, disabled, uneducated and/or unintelligent, and can't improve their material or intellectual lot in life.

Then there are the EVIL BAD PEOPLE, who exploit them, who are much like US except they have black, hate-filled, shrunken hearts -- as obviously demonstrated by their failure to flatter us and obey our every command. These people cannot improve themselves morally -- so we don't have bother trying to convert them or explain our arguments to them (last time, they started asking all these pesky questions!) -- but in rare cases they do convert. Arianna Huffington, for example.

But WE, we are not helpless. WE already have it together. We are wiser, smarter, and more caring than the rest. The world would be a wonderful place if only it were run by US, so any failures must be the fault of the other two kinds of human beings. We fight the EVIL BAD PEOPLE who keep us from ruling over the VICTIMS and ushering the new era of amazing human potential, where all the smart and moral people (our type) demonstrate man's true capacity.

This is the basic leftist model: exploiter and exploited, necessitating the liberators.

So it's not contradictory at all -- one just needs to remember that humanity is composed of different and non-overlapping subspecies of humans having fundamentally different natures. It's the same mechanism as behind racism: Jews, oppressed German Volk, Nazis; decent white women and children, uppity negroes, Klansman. And allow me to invoke the Pharisees: Israel, "Sinners" (steeped in sin before birth -- Jesus was named among them -- John 9), and the true Sons of Abraham -- the teachers of the law.

Sunday, September 18, 2005


I received the following email from the Netherlands in response to a United Nations report that I linked to recently on Dissecting Leftism. I introduced the article excerpt with the heading: "Fat EU farmers impoverish Africa", which, like all headlines, was intended as a quick summary of the article rather than as a scholarly dissertation in its own right. I am sure that no conservative or libertarian expects much of United Nations reports and such suspicions would seem to have been well justified in this case too -- as the following email points out. By the way, the CAP is Europe's policy of protecting its farmers, not an old-fashioned contraceptive device.

"Are European farmers fat? Not if we look at their incomes. About 4% of the population in the EU-15 are farmers or farm families (corrected for part-timers etc.). Including subsidies their income share amounts to about 1,7% of total EU-15 income. So, in terms of their incomes, the majority of European farmers are certainly not 'fat' . On the contrary most European farmers belong to the low and very low income groups.This is confirmed by other data also.

Do European impoverish Africa? Not if one believes the very many general equilibrium studies that have been done on the subject. A consistent and main outcome of all these studies is: abolishing the Common Agricultural Policy will hardly has a positive effect on poverty in Africa. Australia, Brazil, Argentina etc. will be the main winners if agricultural trade is liberalised. Most African countries will hardly win, many of them will even lose. Why is that? Briefly speaking there are two reasons:

(i) Agricultural product prices on the world markets will go up after liberalisation (no dumping etc.anymore). Since nearly all African countries are net importers of food (with no capacity to become exporters) they have to pay more for their food that is imported.

(ii) The 50 poorest countries have nearly 'free access' to the EU. They get the same high price as EU -farmers for their exports. In case of trade liberalisation internal EU-prices will go down. As a consequence their export prices will go down also. Moreover, their is a serious risk then (i.e. when the CAP is abolished) that they will lose their (very small) share on the EU-markets to competitors from South America, Thailand, Australia, New Zealand etc.

At the moment there is, within the EU, a discussion on how to reform (i.e. decrease protection) the EU-sugar sector. In July one could see a protest march in Brussels: EU farmers hand in hand with farmers from third world countries who are afraid of loosing their trade preferences.

In an interview in the Far Eastern Review this Winter, Jagdish Bhagwati speaks of 'dangerous nonsense' with respect to the assertions of Oxfam and international aid institutions that agricultural subsidies in rich countries are keeping developing countries poor. See here (PDF). See also the paper by Arvind Panagarya ("Agricultural Liberalisation and the Least Developing Countries: six fallacies" -- to be published in: World Economy: Global Trade Policy).

To conclude, there are many reasons to reform the CAP and to abolish agricultural protection. But not because the majority of EU farmers are fat (rich) or, because they impoverish farmers in Africa".

I might add that I agree about the CAP being the least of Africa's problems. Robert Mugabe and his ilk are a far greater problem

Saturday, September 17, 2005

Rubin's humiliating fate no surprise


(This is an extended excerpt from Canada's Aug 27 Globe & Mail. I referred to the story briefly on PC Watch on August 31. The whole story is available to subscribers only)

"Hospitality will be your first lesson," my diversity trainer told me with a smile. I had offered her a coffee before we sat down for our session, and as it turned out, I was mighty glad I did. Many people do not, and that, she informed me, is a sign of cross-cultural insensitivity. The coffee offered my instructor an opening to explain the value that different cultures place on hospitality and the differences between individualist cultures (ours) and collective cultures (lots of other ones). This is the kind of thing they send you off to learn about when you screw up. And Jeffrey Rubin, apparently, screwed up.

Mr. Rubin is chief economist for the World Markets division of the Canadian Imperial Bank of Commerce. Every month he issues a research report on world trends that is aimed at the bank's sophisticated investing clients. Monthly Indicators, as it's called, is distributed to a few thousand select readers, and is posted on the bank's website. Despite the deadly dull title of the publication, Mr. Rubin is widely respected for his sharp mind, and his writing is unusually colourful for an economist. Perhaps too colourful for the times we live in now.

Because of a passing comment most people wouldn't pause to notice, Mr. Rubin was found guilty of insensitivity by his own employer, which issued a public apology for his misbehaviour. To signal its sincere contrition, the bank also instructed him to attend a training session in cross-cultural diversity, devised especially for him. The bank's instant climb-down was a triumph for the offended pressure group, an increasingly powerful outfit called the Council on American Islamic Relations - Canada, or CAIR-CAN. And it was an embarrassing humiliation for one of its star employees, whom friends describe as a decent, thoughtful -- and, yes, sensitive -- man.

The offending passage appeared last April 5, in a report predicting that oil prices would keep rising: "The first two oil shocks were transitory, as political events encouraged oil producers to seize full sovereignty over their resources and temporarily restrict supply," Mr. Rubin wrote. "This time around there won't be any tap that some appeased mullah or sheik can suddenly turn back on."

A few days later, the bank received a letter from CAIR-CAN. The organization keeps a close watch on the media, as well as on government agencies, businesses, universities and other institutions, for signs of bias against Muslims. It says it received several calls complaining about the passage in Monthly Indicators. "We are gravely concerned that Mr. Rubin is promoting stereotyp-ing of Muslims and Arabs in a CIBC publication," executive director Riad Saloojee wrote in a letter to the bank. "We request that Mr. Rubin and CIBC World Markets issue a letter of apology and undergo sensitization training regarding Muslims and Arabs."

The bank responded to CAIR-CAN's demands with remarkable alacrity. "Let me state that we take the concerns expressed in your letter very seriously," wrote Mr. Rubin's boss, Brian Shaw, who is the CEO of World Markets. "While the comments were in no way intentional or meant to offend anyone in the Muslim or Arab community, we agree that, in hindsight, the comments were insensitive." He added, "We have taken immediate steps to address this issue. We have reviewed all aspects of the matter with Jeff Rubin and we will be providing him with training to ensure that this situation does not occur again in the future."

On April 20, CAIR-CAN proclaimed victory in a triumphal press release.

The bank says no one thought twice about the offending words at the time. But, according to a bank spokesman, it realized that "in hindsight this could be viewed by some as being insensitive." The decision to apologize was made at the senior executive level. The bank would not say whether anyone raised the possibility that CAIR-CAN's concerns were overblown, or that many Muslims would find nothing wrong with Mr. Rubin's comments, or that it had an obligation to defend a valuable, talented and widely respected senior employee from frivolous attacks on his reputation. It would not say whether anyone asked any hard questions about CAIR-CAN, or took the trouble to learn a bit about its aggressive tactics. It would not say whether anyone raised the possibility that the language used by Mr. Rubin was, in fact, defensible.

The incident drew no further notice, until a Globe and Mail reporter ran across the press release on CAIR-CAN's website, under the headline, "CIBC apologizes to Canadian Muslims for 'insensitive' comments." The story made front-page news and was picked up by TV. Many people thought the bank had wildly overreacted. But other people heard only the TV news, which referred to Mr. Rubin's "gaffe."