Sunday, February 22, 2009

The Myth of The Rational Voter

I have been looking for a copy of this book since I heard Bryan Caplin presenting on the findings of this book. I looked in all the book stores in town, but none of them had a copy of the book. I could always buy the book on-line, and I was about too, when I took a trip to Bozeman. Fortunately, I was able to find a copy of the book at the local Barnes and Noble. I have already begun reading the book, and so far it has been living up to my expectations. When I finish the book, I will post a response with my thoughts.

Unions and Montana's Economy

I was recently reading the Billings Gazette, when I ran upon a story that they had regarding a pro-union rally that occurred in Montana. In this story, there was a quote from Jim Larson, Teamsters Local 190 political coordinator. In this quote, Mr. Larson states "Today, more than half of workers, 60 percent, say they would join a union right now if they could." 
The protest in the article was to support unions, and a bill that is a piece of US legislature. This bill would change the procedure for forming unions in businesses in the United States. For more detail on the bill, you can look here: http://en.wikipedia.org/wiki/Employee_Free_Choice_Act
To begin with, I would like to know where Mr. Larson came up with this number. If so many people wish to join unions, why is the proportion of the work force that is in a union declining? Using numbers provided directly by the AFL CIO, the proportion of the labor force that is part of a union has declined from 14.9% in 1995 to 12.4% in 2008. This is not a recent trend either. Union membership peeked sometime  in the late 70's. If so many people want to join unions, why have their share of the population been declining for 30 years? 
What I found particularly interesting was, Montana recently attempted to pass legislature that would make Montana a right to work state. (In case you don't know, this means that workers who do not want to join unions, can still work in jobs where other workers are part of a union. Without this bill, employees can be required to join a union, or loose their job. ) However, this bill has currently been tabled, thus it will not pass, and Montana will not become a right to work state.  You can find information on this bill at: http://data.opi.mt.gov/bills/2009/billhtml/SB0339.htm
I find this particular piece of information confusing, when compared to Mr. Larson's statement. If so many people wish to join unions, why is it necessary to force people to join a union, or loose their jobs? Why is it necessary to force these people to do something they don't want to do? I thought unions were supposed to support the rights of workers, not restrict them.
Could it be that union leaders are just as interested in promoting their own self interests as businesses are? 
I don't exactly know how I feel on the whole concept of a right to work law. If a business makes the agreement to only hire union workers, why should the government stop them? However, the very fact that the same business would want to hire non-union workers makes me question the tactics that are used to push business to make such deals in the first place. However, this blog was not an attempt to promote, or dispute, right to work laws. If just found the statement made by Mr. Larson to be particularly hard to swallow, when looking at what has happened in Montana, and in the United States.

Friday, February 13, 2009

E-mail about the book "The Tyranny of Dead Ideas"

While I was at work today, I received an e-mail from the Milken Institute. The e-mail was to inform me of a seminar that is going to occur in Santa Monica. I don't know why I get these; when would I be able to attend a seminar in California? But I digress. The forum was to discuss the book titled: "The Tyranny of Dead Ideas" and it was written by Matt Miller. The purpose of the book is to discuss, and challenge, "conventional" wisdom.
When I began reading the description of the book, it sounded quite interesting, and to some extent it still does. However, when I got to the section that listed these supposed "conventional" wisdoms, I asked the question, when are these considered conventional thoughts? Here is a list of the topics discussed in the book:
  • Our kids will earn more than we do.
  • Free trade is always good, no matter who gets hurt.
  • Employers should be responsible for health coverage.
  • Taxes hurt the economy.
  • Schools are a local matter.
  • Money follows merit.
While I find it particularly difficult to think that most people hold most of these thoughts, there is one that particularly jumped out. As an economist, from my own personal experiences and from what I read, I would not say that it is the conventional wisdom of most people that free trade is good. If you doubt this, you should read some of that Bryan Caplan's work. In his book "The Myth of the Rational Voter" Bryan finds that the general public tends to be significantly biased against foreiners, and free trade policies. He addresses these topics when describing a phenominon he describes as an "Anti-foreign bias".
We can already tell from the last portion of the point where they say: ... no matter who gets hurt.
It would be just as easy for them to say: Free trade is not always good, no matter who benefits. By using the original wording, they are making it implicitly clear that people are hurt by free trade, why ignoring the fact that some people benefit from free trade.
While I can guess that I would not agree with Mr. Millers view points, I would still find some of the topics he brings up could be quite interesting. Too bad I won't be able to go to the seminar.

My blog

This is my first blog. I felt the desire to begin doing this with the hopes of discussing stuff that I find interesting. I guess that is not surprising, given that I think this is the reason most people give for writing blogs.