Wednesday, May 25, 2016

Blood Oil and free markets

In last week's episode of EconTalk, Russ Robert's interviewed Leif Wenar on his new book, Blood Oil, about the impact of resource trade with tyrants and despots. Wenar argues that the current trade in natural resources, particularly oil, is not a true free-market economy because free markets depend on values such as private property. As Wenar points out, if I took over a corner gas station by force no one would suggest that I had the right to then sell the oil owned by that corner station because I don't actually own those resources. When we trade for natural resources with nations run by despots who separate their state's resources from their citizens--Saudi Arabia, Russia and Equatorial Guinea receive some analysis in the interview as different ways of doing the same thing--we are engaging in an unjust system which rewards pirates who steal resources from their rightful owners and corrupt the market.

Robert's is deeply impacted by Wenar's argument, but brings up concerns about both Wenar's somewhat interventionist-sounding plea that the government ban trade with such despots, pointing out that the criteria for a despot are somewhat subjective: why should we attack Equatorial Guinea's leader's savage exploitation of oil while ignoring China's more mild exploitation of labor? Wenar's main argument is that, while labor exploitation is bad, natural resources present something of a unique case. His arguments for this are good, but I would suggest a couple of critiques of both Wenar's solutions, and Robert's concerns:

First, I'd recommend that, rather than seeking to establish an objective criteria for how much despotism is too much despotism (at which point government sanctions need to take over), we would be wiser to mandate transparency: let the public know what they're buying (i.e. gas stations post what percentage of their oil is purchased from what market - Wenar intends to begin posting such data to his website in the near future).

Second, and this plays into the first answer: we need to acknowledge that there is a spectrum between despotism and ideal economic freedom: Robert's point about how to decide that Equatorial Guinea is too despotic but China is okay can be extrapolated to point out that the US isn't perfect in economic freedom, but it's a lot better than Equatorial Guinea. We need to avoid making the perfect the enemy of the good: by not regulating the outcome but requiring transparency from merchants the public can exercise subjective judgement about how much encroachment is too much, and the market can work against truly despotic situations like Saudi Arabia and Equatorial Guinea while exercising more caution in our treatment of China or the US.

Wednesday, May 11, 2016

Marriage and community in Brooklyn

Abby and I watched Brooklyn last night (a really great film, by the way) and, maybe because I preached on marriage last Sunday, it made me think about the importance of the community in a marriage: we make vows before witnesses because our feelings are remarkably fickle as a means of keeping us true to vows--which are actually the means of keeping us "happy" in the older and fuller sense of the word: fully flourishing. 

[Spoiler alert!] Eilis Lacey and Tony Fiorello took vows in private; she loves him, is most happy with him, should be with him; but when she goes back to Enniscorthy, (Ireland,) to visit her mother she has community pressure to accept Jim Farrell's pursuit of her, take Rose’s old job, and have the local version of the “good life” she may have desired growing up. She hasn’t said she’s married at first because she doesn’t want to let people down: there was to be a public wedding at some future time, maybe when more family could be involved, so she keeps the marriage secret, and the community works against it since they don’t know about it. When Ms. Kelly confronts her about the one shred of community involvement in the wedding (Kelly is distantly connected to the family Eilis and Tony randomly bumped into at the Brooklyn court house) the community does its work [in a way this is like Smith’s invisible hand] even though the connection was so tenuous and the intentions of the person who was the actual instrument were not honorable. Eilis’s declaration “I’m Eilis Fiorello” places her back in her correct place in the universe again; publicly the wife of the husband she loves, bound back to the new home she has made in Brooklyn… 

(The fact that Tony’s family’s plan is to build a neighborhood on Long Island and extricate themselves from the community they are part of and settle in a place that requires ridiculous amounts of infrastructure to maintain, and where there is no community to join seems to actually break the continuity of the narrative since it means their goal is really to escape Brooklyn; but the film is putting authenticity over narrative on this point since it’s a historically accurate—if ultimately unhelpful—goal.)