Thursday, June 25, 2009

Free-Lunch Faith Vs The Reality Of Economics

Did you play Monopoly when you were a kid? Did you play it alot? Do you remember how you felt initially about buying Boardwalk (Mayfair) and Park Place (Park Lane)? They were too expensive, right? What happens to the game when a new player enters who can set and change the rules in the middle of the game, play as many game pieces as they want, and print and issue money for any purpose in the game to their own whim? It is not good. Image Credit:

Free-Lunch Faith Vs The Reality Of Economics

On what is beginning to feel like a daily basis, the Obama Administration, with the unprecedented aid of the mainstream media (last night, ABC spent most of their broadcast time broadcasting directly from ... The White House), is attempting to sell the faith of a free-lunch to a hungry hoard of faithless people.

What is being sold to the American public is a cure to all process ills and an improvement in ones life if one would just let the Government take over and run everything from our Free Enterprise Manufacturing, Healthcare, and Energy systems (and this is just a start). The Obama Administration loves to cleave to the argument that with the Government becoming a "PLAYER" in an enterprise they are promoting competition by delivering an alternative approach to a marketplace but this logic is grossly flawed.

The reality of economics that derails this logic is the it is difficult for anyone to compete on a level playing field when one of the players is also the referee, and the body that makes the rules ... and prints the money upon which the game is played.

Get-Out-Of-Jail-Free "Chance" card. Image Credit: Ebay

Would anyone play a game on the board game, MONOPOLY (our cultural introduction to economics), with a person who had the ability to create game board pieces without a cost or penalty, print and issue money to himself without really having to tell anyone when he expects to use it during the game to purchase pieces and/or set up hotels and set the rules beyond what had been printed and distributed at the beginning of the game (example: this player has an unlimited supply of "Get-Out-Of-Jail-Free" cards)? The answer is NO!

In every human endeavor there is really NO Free Lunch, and the reality of economics always shows that when a corrupt and over influential force enters into the mix of a free enterprise system, the system becomes corrupted and tilted to the influence that has the ability to change the common sense rules that govern the system.

Homeschool Real World Math - Here is another fun addition of real world math. Firstly, we use and adore Math-U-See consistently throughout the year in our homeschool. There are days however, that I like to mix it up and do something a little playful to get them thinking about math in the real world. /// This morning we played a game of monopoly. We received the newest version of Monopoly: Here and Now the real World Edition for Christmas. It is a fun version that incorporates geography, world facts on the chance and community chest cards, and interesting games pieces that take the kids literally around the world in every game. /// Our youngest got to work on basic counting by moving the pieces and rolling the dice. Our middle worked on basic addition by adding everyone’s dice together and telling them how far they had to move the pieces and our oldest had to read out all of the chance and community chest cards for each player. We had a ton of fun. This particular edition, does not have money, but cards and a banker machine that you add and subtract money for each transaction made. By the end of the first game, they were working through place values in the millions, Large number addition and subtraction and how to work the key pad which is similar to a calculator and a keypad on the computer. I wont even get into the idea of money management and budgeting as more abstract ideas they begin to absorb through this game. /// All in all, I think I hid a little real world math by way of a game today. Give it a try it is easy and fun to do. /// Tomorrow, we will do a little more real world math, when they get to spend a few real dollars at the zoo to purchase a drink and choose a few animals they would like to feed. I will hand them each a zip lock bag of coins and they will have to count their way out of it. That should be a barrel full of monkeys…excuse the pun. Grace and Peace to all budding mathematicians in the real world! Caption & Image Credit:

This excerpted and edited from

Tilting at Green Windmills

by George Will - - Thursday, June 25, 2009

The Spanish professor is puzzled. Why, Gabriel Calzada wonders, is the U.S. president recommending that America emulate the Spanish model for creating "green jobs" in "alternative energy" even though Spain's unemployment rate is 18.1 percent -- more than double the European Union average -- partly because of spending on such jobs?

Calzada, 36, an economics professor at Universidad Rey Juan Carlos, has produced a report which, if true, is inconvenient for the Obama administration's green agenda, and for some budget assumptions that are dependent upon it.

Calzada says Spain's torrential spending -- no other nation has so aggressively supported production of electricity from renewable sources -- on wind farms and other forms of alternative energy has indeed created jobs. But Calzada's report concludes that they often are temporary and have received $752,000 to $800,000 each in subsidies -- wind industry jobs cost even more, $1.4 million each. And each new job entails the loss of 2.2 other jobs that are either lost or not created in other industries because of the political allocation -- sub-optimum in terms of economic efficiency -- of capital. (European media regularly report "eco-corruption" leaving a "footprint of sleaze" -- gaming the subsidy systems, profiteering from land sales for wind farms, etc.) Calzada says the creation of jobs in alternative energy has subtracted about 110,000 jobs from elsewhere in Spain's economy.
What matters most, however, is not that reports such as Calzada's and the Republicans' are right in every particular. It is, however, hardly counterintuitive that politically driven investments are economically counterproductive. Indeed, environmentalists with the courage of their convictions should argue that the point of such investments is to subordinate market rationality to the higher agenda of planetary salvation.

Still, one can be agnostic about both reports while being dismayed by the frequency with which such findings are ignored simply because they question policies that are so invested with righteousness that methodical economic reasoning about their costs and benefits seems unimportant. When the president speaks of "new green energy economies" creating "countless well-paying jobs," perhaps they really are countless, meaning incapable of being counted.

For fervent believers in governments' abilities to control the climate and in the urgent need for them to do so, believing is seeing: They see, through their ideological lenses, governments' green spending as always paying for itself. This is a free-lunch faith comparable to that of those few conservatives who believe that tax cuts always completely pay for themselves by stimulating compensating revenues from economic growth.

Windmills are iconic in the land of Don Quixote, whose tilting at them became emblematic of comic futility. Spain's new windmills are neither amusing nor emblematic of policies America should emulate. The cheerful and evidently unshakable confidence in such magical solutions to postulated problems is yet another manifestation -- Republicans are not immune: No Child Left Behind decrees that by 2014 all American students will be proficient in math and reading -- of what the late Sen. Pat Moynihan called "the leakage of reality from American life."

Reference Here>>

Welcome to the free-lunch faith and evangelism due to the leakage of reality from American life delivered to us from the Obama Administration, here in Carter's Second Term!

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