Different River

”You can never step in the same river twice.” –Heraclitus

August 18, 2005

Selling Indulgences, Modern-Style

Filed under: — Different River @ 2:10 am

Tyler Cowen called his post on this, “Markets in guilt reduction,” which is a better title, but if I’m going to steal nearly an entire post (with attribution of course — I’m a closet academic!), I should at least make up a new title.

Besides, I’ve been claiming for years that “Environmentalism” is actually a religion, in the sense that environmentalists believe certain things completely on faith, maintain their believes in the presence of overwhelming evidence to the contrary, and engage in activities (sacraments) they claim “help the environment” in the absence of any evidence those activities actually help the environment or accomplish any of their purported goals. In fact, now that I think about it, Environmentalism is a heck of a lot less rational than a lot of actual religions I can think of. Iincluding my own, of course — we don’t eat pork, but we never claimed that refraining from pork “saves pigs,” in either the economic or theological sense of the word.

Anyway, now the Environmentalists are heading down the same road that proved to be a disastrous dead end for a Certain Other Religion — they are selling indulgences!

If you’re feeling guilty about driving your giant sport utility vehicle (but not so guilty that you’d ever give it up), salvation is at hand. For a yearly fee of around $80, a company called TerraPass will offset the damage your SUV does to the atmosphere by spending your money to reduce industrial carbon emissions and to promote the spread of clean energy. They’ll also send you a decal and a bumper sticker, so everyone in the neighborhood will know that your gas guzzler has been sanctified.

In other words, for $80 they will sell you a sticker which tells all your Environmentalist neighbors that you are a good Environmentalist even though you drive an SUV.

As Tyler points out, this could turn out to be a growth industry of sorts:

Of course we need not stop with SUVs. Have your life taped and recorded, and submit the results to certified third-party arbitrators (who, by the way, will safeguard your confidentiality). They will tell you how much of a cancer you have been to the body politic, and suggest offsetting charitable contributions.

Environmentalism is clearly at a lower stage of development than other religions, the last of which gave up selling indulgences about 450 years ago.

They are also being undercut. Randy Cassingham will sell you “Get Out of Hell Free” Cards at 10 for a dollar!

(No, Randy is not paying for this “ad.” Yes, I bought some of the cards. No, I haven’t had to use them. At least, not for their intended purpose. ;-) )

Economic Ignorance Causes Injuries

Filed under: — Different River @ 1:36 am

If you’ve ever taken any economics class, you should remember that if prices are free to adjust, there will never be a persistent “excess” or “shortage.” If there’s an excess, sellers will cut prices to get rid of the stuff, and if there’s a shortage, they’ll raise prices until enough people decide not to buy whatever it is. And when either of these happens, we say the market “clears.”

When prices aren’t free to adjust, weird things can happen. If prices are too low and can’t adjust upward, the amount buyers want to buy exceeds the amount sellers have to sell. That means that something other than “willingness to pay a higher price” has to be used to ration the few goods among the many buyers. And this results in buyers “paying” more, but in different ways than paying more money to the seller. This is why, for example, in places with rent control (like New York City) you have things that don’t exist in other places, like rental agents paid by the tenter, bribes to the building superintendent, illegal subleasing, and so on. It’s also why there are waiting lists (where you “pay” with your time) for health care in Canada, and for popular books at your local library.

It is also why some people got trampled a couple of days ago in Richmond.

Laptop Stampede

See, it seems the Henrico County School District had 1,000 surplus iBook laptops to sell, and they decided to sell them for $50 each. At which price way more than 1,000 people wanted to buy one. No doubt they thought they were doing enough “rationing” by giving Henrico County residents first crack at them, but it turned out way more than 1,000 Henrico County residents wanted to buy one. So, implicitly it got to be “the first 1,000 people in get one,” so there was a mob scene:

What started as a sale turned into a mob scene as thousands of people pushed their way through the Richmond International Raceway gates to buy a $50 iBook laptop computer from Henrico County Schools this morning. The school district had only 1,000 of these surplus computers to sell, and Henrico County residents got first dibs.

Starletta Wilson came to the sale but when the gates opened at 7 a.m., chaos broke out.

“Yeah, they pushed me, look at my child’s stroller… they actually pushed me and stampeded over me. Those people who are down there now were behind us,” Wilson said.

Dustin Coppinger, who attended the sale, said he saw an older man get trampled.

“An old man in a walker was trampled to the ground. Trampled to the ground… walked all over,” he said.

Dozens more were pushed to the ground as the crowd races through the gates.

A one-year-old baby almost became a victim. Her father pulled her out of her stroller.

“Look at her stroller. Her stroller’s demolished. Look at my stroller,” said Wilson.

Alice Jemerson was one victim who got trampled.

“Look at my knees. They ran on top of me. I just starting kicking the people,” she said.

Note that whenever the price of something can’t adjust, the amount “paid” has to adjust in some other way. In this case, successful — and even unsuccessful — buyers ended up “paying” with their running speed, agility, and tolerance for violence towards themselves and others, in addition to waiting time. And, some buyers paid part of the price and decided it wasn’t worth it:

A man who had been standing in line since 2 a.m. came to Jemerson’s rescue. Bair Hossai was almost guaranteed to get one of the coveted computers.

“I’m not going to leave somebody who’s hurt. It’s not worth it. I could have been in the line, but I’m not going to do it, because it’s not worth it,” Hossai said.

Faced with the “cost” of living with his conscience after leaving someone on the ground unprotected, this fellow decided that was too high a price to pay.

To bad he couldn’t have found out just by being outbid in a peaceful auction, or by hearing a higher price when he heard about the sale. That would have saved him five hours of waiting — and it would have saved Ms. Jemerson from being trampled.

What al-Qaida Really Wants

Filed under: — Different River @ 1:13 am

A Caliphate in Seven Easy Steps. Worldwide. By the year 2020.

Step 1 is complete. Step 2 is in progress. We have been warned.

Hat tip: Eye of Polyphemus

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