Daily Archives: April 7, 2014

Slate’s Civil War about Bigotry and Markets

By William K. Black

Slate is having a healthy, but incomplete, debate about the uproar about Brendan Eich’s resignation from Mozilla.  Eich donated $1000 to the successful campaign to adopt “Proposition 8” in California in 2008.  Prop 8, until it was struck down, banned marriage equality for gays.  William Saletan published a satirical article suggesting that everyone be “purge[d]” who contributed to Prop 8.

Other columnists, such as Mark Stern, weighed in to remind readers about the cruelty of the often homophobic TV ad campaign used by Prop 8 supporters.  Stern makes the point that much of the campaign was designed to picture gays as recruiting straight children.  This column (eventually) discusses why Eich stepped down, but it begins by explaining why neoclassical economists have such a terrible track record in understanding discrimination and its remedies.

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Sorry, Kyoto Signatories, Emissions Traders, Carbon Taxers, Homo Oeconomicus Won’t Save the Climate – Part 2

By Michael Hoexter

[Part I] [Part II] [Part III] [Part IV]

4.  Existing Climate Policy Is Lacking a “Drive Axle” Between Ethical Impulse and Policy Implementation

The decision in the 1990’s to turn over climate policy to market mechanisms, in particular emissions trading, was framed by supposedly “objective” economic assumptions based as outlined above on the idea that people are essentially, Homo oeconomicus, i.e. act in practice as if they do not consider, among other things, the moral dimension of life, are “utility” maximizers and are essentially divorced from their community of context or the community of all human beings more generally.  The Kyoto Protocol and its various progeny including the European Union Emissions Trading Scheme (EU-ETS), the Northeastern US Regional Greenhouse Gas Initiative (RGGI) and California’s AB 32 cap-and-trade system, all “hand off” implementation of the intention to reduce climate change to a constructed carbon permit market, layered above the real markets for goods and services.

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Nobel Schizophrenia over the Georges: Stigler and Akerlof

By William K. Black

In a recent column I focused on three brief passages from George Akerlof and Paul Romer’s 1993 article (“Looting: The Economic Underworld of Bankruptcy for Profit”) that had they been listened to would have prevented the fraud epidemics that drove our recent financial crises.

Here is one of those three passages.  Notice how unequivocal they were in their statements about causality.

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