So far, this article from the LA Times has given the best and most readable opinion I’ve read on the bailouts and the recent economic “crisis”. Good enough, in fact, for me not to have anything else to say on it. Enjoy!

I begin this post with an opening caveat: The Huffington Post is a liberal (and I mean liberal to the core) site from which this article was gathered. Thus, I intend on completely slaughtering the article, with the full knowledge that the source is biased.

In the article by John Neffinger entitled “Hello? If John McCain Had His Way, That’d Be Our Social Security Money Wall Street is Losing,” Neffinger tries to distinguish the differing policies of the two presidental candidates with the large claim that “the American people” already rejected the idea of Social Security privatization under Bush the Second. Neffinger states:

But as it turned out, we Americans were not about to let our elected representatives turn over our social security taxes to Wall Street financiers to gamble with if it meant losing the guaranteed income that has allowed millions upon millions of American seniors to live out their sunset years with at least a basic measure of dignity.

I’m not even sure where to begin with this statement. Granted, I am not an expert on President Bush’s plan to privatize Social Security, but as I understand, a privatization effort would involve requiring a certain percentage of a worker’s income to go into a safe method of investment (possibly involving the stock market) that would then accumulate interest. This amount, according to Laurence Kotlikoff and Scott Burns in their recent book, The Coming Generational Storm: What You Need to Know about America’s Economic Future and Edgar Browning’s ”The Anatomy of Social Security and Medicare” would exceed even the more favorable return-on-investment estimates for social security. They go on to note that this plan for Social Security would even be more profitable during times of economic downturn (they use historic figures for this) because of the method of long run investment. Unfortunately, Neffinger doesn’t realize this:

This is something Americans understand: social security is secure, and the stock market is anything but.

Secure? I’d like to ask Neffinger if he would bet on that. Or rather, if he imagines that with the ever increasing life span of Americans and the ever decreasing birth rates, he will reap his full Social Security rewards and be able to live by Social Security alone in old age.

Dr. Stephenson linked an interesting article here about how some drug dealers are uping their rates because of the high price of gas. The markets at work.

HT: Division of Labour

Econometrics is hell. Any dissention on this?

How many research projects can I roll into one? So far…

1. Senior Thesis for Honors Program

2. Senior Thesis for Economic Department

3. Senior Thesis for Government Department

4. Summer Project for Mercatus Center

5. Student Research project on the UN for Berry

6. Richard’s Scholars Topic

Just  think of it this way… I’m economizing my time, maxing my benefit, and minimizing my costs. The topic? Comparing and contrasting different governance methods of natural resources in sub-Saharan Africa and seeing which type (top-down government or bottom up community based) leads to more conflict over mineral wealth and renewable resources. In essence, how African governments continue to rape annd pillage their lands while providing no benefit to their citizens, meaning that my tax dollars have to be used to keep them alive!

Earlier this summer, I attended a conference on Capitol Hill about poverty in Africa (as many of you know – this is my “specialty”). Although I didn’t hear anything terribly ”new” on the situation in Africa, I was struck by the pessimism of the speakers. Bascially, Africa is what it is – we can study it, hope for the best, but the actual likelihood of change – well, that’s slim to none.

I have also encountered the overly optimistic view on African poverty. Jeffery Sachs (notable economist from Harvard), claims that just by giving more and more money to Africa, we can SOLVE poverty! Solve… like it’s a linear algebra problem that has one right answer.

Perhaps I just enjoy playing the devil’s advocate, but to both positions I say – Not so! I understand the reality of the situation in Africa – death, disease, hunger, lack of infrastructure, stability, corruption everywhere – it’s a rough place. I also understand the desire to have a solution (especially one that you can present to the public in order to raise funding). However, I have noticed a disproportionate lack of people in the middle, people who feel as I do, that while the situation is dire and the problems are plentiful, there are certain actions that we can take to encourage growth, better medicine transfers, more productive agriculture, etc.

To the optimists, I would be a pessimist. To the pessimists – an optimist. I have been called out on both sides numerous times. There are always the people who look sideways at you and say something sly like “You know you’re not actually going to make any sort of perceptible difference right? I mean – sure if you want to hole yourself up in an office and study Africans forever, go ahead… but you’re work/life is pretty much pointless.” And then there are those who, with eyes shining in admiration say something like “OH!  That’s such good work. You can do sooo much over there, can’t wait to see it! You know… I gave a check to that one AIDS relief fund just the other week! Let me go find their address… I bet you can work with them!” For once, I just like someone to say…. “Wow that’s a huge area with a ton of problems. I was reading about this one project that did have some success though. I bet you’ll be able to have some small-scale effect – maybe that will spill over.”

Perhaps this is just my soapbox, but I wonder why people all over the spectrum of education (from people who know nothing about economics in Africa, to those who are professors of such) take such tight views on whether or not we can be successful. Why are we even talking about what we can do? Shouldn’t we be focusing on what they – the Africans – can do? I think that if our perspectives are correctly aligned, and we focus on the right people doing the things that need to be done, a tempered position of knowledgable optimism is the right view to take. I’m not advocating naivety, but rather the simple realization that the situation in Africa is, for the most part, out of the hands of the US. Yes, those of us working in the field can do something… something to help the people of Africa to help themselves.

Not to worry – the posts to be published are piling up, but with moving twice in the last week, I’ve not had time to update lately. Be on the look-out for a flood of posts in the coming week… topics include modern day economics, the election/politics, and a few thoughts on Africa.