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We’ve jumped the shark: employees are now Green Reps. Isn’t this sort of forcing folks to either publicly be “for” or “not for” workplace sustainability?

What if one chooses not to become one? Who doesn’t want their workplace to run more efficiently anyhow?

I can’t stop thinking about this.

It may appear funny, but our anti-dynamist culture is probably not far away from being like this. Here is a brief story via Tim Taylor, about Greece of course:

This is best encapsulated in an anecdote from my visit to Athens. A friend and I met up at a new bookstore and café in the centre of town, which has only been open for a month. The establishment is in the center of an area filled with bars, and the owner decided the neighborhood could use a place for people to convene and talk without having to drink alcohol and listen to loud music. After we sat down, we asked the waitress for a coffee. She thanked us for our order and immediately turned and walked out the front door. My friend explained that the owner of the bookstore/café couldn’t get a license to provide coffee. She had tried to just buy a coffee machine and give the coffee away for free, thinking that lingering patrons would boost book sales. However, giving away coffee was illegal as well. Instead, the owner had to strike a deal with a bar across the street, whereby they make the coffee and the waitress spends all day shuttling between the bar and the bookstore/café. My friend also explained to me that books could not be purchased at the bookstore, as it was after 18h and it is illegal to sell books in Greece beyond that hour. I was in a bookstore/café that could neither sell books nor make coffee.

A good place to start looking for things like this in America would be ________ … ?

I’d  like my readers and students to briefly examine the economic literature to determine what the “consensus” is on these two questions.

  1. What is the economic incidence of the payroll tax and other “benefits” that are mandated to be paid by employers to employees? For example, the total payroll tax amount imposed by the government is 15.3%, with supposedly 7.65% of it being legally borne by firms and the other 7.65% of it being legally borne by workers. There is a solid amount of research on this and a strong consensus (even stronger than the climate consensus) on who bears the burden (i.e. who really pays this tax). The same (though not as strong) will be found about who really pays for employer provided benefits like paid vacation and so on. Note that this research is simply a mechanical exercise and says nothing of the goodness/badness/desirability of this outcome.
  2. How much do firms respond to increases in the cost of capital – such as when interest rates rise – or other increases in firm costs, such as when there are changes in the corporate tax code? Again, I understand the literature to be pretty clear here. Go look it up.

After you have examined this research, please explain why nominal changes in employer costs on some other dimension would or would not be expected to produce a different result than you find in one or two above?

Lifesaving Irony

Paul Ehrlich is thought to have saved many millions of lives.

Just not THE Paul Ehrlich.

Regulate the EPA

This obviously “suits” my preferred narrative. What a shame. By the way, the worst polluter in the U.S. is the Department of Defense, but maybe if we adjust for scale the results would be different.

The EPA is not “bad.” No more no less than any other org. Tales as such should not be used to support or attack a particular narrative. These tales require a thoughtful reflection on institutional structure, incentives and basic human nature. Few of us want to do that.

Two Items for Today

1. I wonder why running shoe and hiking gear or really almost all apparel manufacturers rarely if ever advertise on the durability and “long-lastingness” of their product? I don’t mean general claims but rather things like, “these new La Sportiva’s will give you 450 miles of class3 and below hiking!”

2. I once took Koch money to run a student seminar. Not only was I not paid, but was probably made personally poorer for it. I have since shut down the seminar, obviously because it requires a shill to identify scarcity.

I’m not much fun to go out with anymore (that presumes I ever was fun in the first place). Any sign, slogan, bumper sticker, protest, comment, etc. elicits a reaction from me – mostly simply with me asking the question, “How do you know?” That’s not a way to make friends or keep wives happy. Mrs. Wintercow happens to love Chipotle and on occasion she is so hungry that she drags me with her. download

I had vaguely followed their campaign to stop using GMOs but had not paid much attention to it, as with most things in my life these days. But when I walked into the store the other night, their supremely proud signage congratulating themselves on just how ethical and awesome and just they were got a bit under my skin. Now, this post is not a lesson on GMOs (which by the way is probably a misleading term, almost all plants have been genetically modified in some way or another, what you should be thinking of when you hear popularizations of anti-GMOs is direct gene transfer, or a transgenic process, and even that is misleading because as any competent biologist can tell you that this process happens “naturally” as well, but be that as it may …) but merely an observation about Chipotle.

If you were to go to the counter or send an e-mail to the company asking them, “How do you know that stopping your purchase of GMOs is “good”?” you are not likely to get an answer. First reason is that I am sure whatever research is done on it is not widely known and second is that the term good is like a moving goalpost. Does it save species? Does it make people healthier? And so on. Of course, it is “good” in the sense that if this is what their customers want, then it is a prudent business move on their part to deliver it to them. What I particularly like about this reaction by Chipotle is that it illustrates the point that is simply dismissed by many as ideological capitalistic garbage – that firms have very little market power over both their workers and customers, and that the sole purpose of production is in fact consumption – and that the whims and desires or consumers are what drive entrepreneurial processes.

But my point today is much simpler. Given that I was “forced” to eat my non-GMO burrito the other day and not make a scene in a crowded restaurant by asking about the science, has anyone actually stopped to ask what Chipotle has accomplished by ending its use of GMOs? Well, I’ve been asking questions and I’ve come to learn that the biggest change they made was eliminating their reliance on GMO soybeans. The soybeans (used for oil mostly) that were being used were genetically modified to be herbicide resistant (you may have heard of “Roundup Ready” soybeans) – this allows farmers to plant the crop and spray for particular weeds without damaging the crop. Now, without lecturing you on what we know about Roundup Ready soybeans, we can simply ask the question, “What has Chipotle replaced that with?” And the answer seems to be that instead of soybeans Chipotle not sources their oils from “non-GMO” sunflowers. What is first of interest about sunflowers is that unless I am mistaken they are not a legume and are not therefore nitrogen fixers. On first glance it would seem to mean that by relying on sunflowers for oil instead of soybeans that we are increasing the demands for fertilizer use. And not only does this fertilizer production and use contribute to global warming and the death of fresh and salt water resources, the processes used to generate the fertilizer may in fact have some less than environmentally friendly origins when it comes to species protection and biodiversity.

But ignore that. What else do we know about the sunflowers that Chipotle seems to be relying on? It turns out that they are relying on conventionally bred sunflowers but once that have been modified (through selection and other processes) to be herbicide tolerant as well. It turns out that the herbicides that are used on these “conventional” sunflowers have many more weeds that are resistant to this herbicide than the Roundup that would have been used on the soybeans – which means more herbicide being used at different times and magnifying the future problem of herbicide resistance in the targeted weeds. So can we at least ask the question of whether anything (aside from marketing sheen) was accomplished by Chiptole’s “bold” move to stop using GMOs? Are herbicide tolerant crops not being used? Is crop diversity increasing? And has Chipotle spoken with farmers, the USDA and other conservation experts on soil erosion, fertilizer use, the impact on pollinators, etc?  And so on.

But we cannot ask such questions, they are not polite. Maybe Mrs. Wintercow is correct that I simply need to be GMO-ver it.





Scott S. Said It

I’m always bemused when white American liberals regard libertarians as “conservatives.” It shows you where their priorities are. Apparently those liberals view economic issues like campaign finance reform, Dodd-Frank and net neutrality as being more important than hundreds of thousands of unfairly imprisoned blacks and Hispanics, or minorities getting shut out of jobs by occupational licensing laws, or millions of poor people being shut out of the US by our immigration laws. I suspect that there are lots of black and brown people all over the world that have different priorities. Perhaps that partly explains the racial make-up of Sanders’ crowds.


Rest in Peace Harry

Long-time reader (the only one perhaps!), commentator and friend, Harry Wood, passed away yesterday at his home in Quakertown, PA. The site with be much quieter without him. Harry was supremely well-read, worldly, patient and interesting – one of the those fellas they write books about, I’d do it if I had the talent. He has a wonderful family who despite having only met me a couple of times stay in regular contact, and I hold them in high regard.

May the grass be green and luscious wherever you may be Harry, and should you find yourself in the middle of the fairway, I hope you strike a solid drawing three-iron to within feet of the cup. And should you find yourself in the rough, well, there is no rough where you are, only a “second cut.”

I wonder how, in the long-run, people will respond to this. On the one hand, the favorite trope of many is that markets fail, particularly insurance markets, because of the asymmetric information problem. On the other hand, there are always going to be huge concerns about privacy when it comes to the many solutions like this one to the problem.

Asymmtric Info

More to say, as always.

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