PBurns 5/24 is trying too hard to dislike me, or what I say, or both.
He seems to have me confused with some ideologue he has known, so that he
need not bother getting a fix on what I actually said.
> Implicit in this reply is the view that the stock market accurately or
efficiently values a company's assets.
No. It's sufficient that the alleged "undervaluing" is, as you say it
is, _systematic_. What matters is that investors tend to think a company
that reduces dividends is a less attractive investment (identifying at
what point the investment market takes account of expected/known reduced
dividends is not trivial). I don't have any difficulty with the notion
that a firm's decision to pay dividends at level $x rather than $x-y
means that $y is not available for one thing or another -- golden
lavatories, R&D, Germany's week at the spa for workers, whatever. A
far-sighted investor might well realize, when he sees R&D starved or
workers sent home so that dividends will be paid as expected, that that
firm is not such a great investment after all, busy as it is eating the
seedcorn. The far-sighted investor, everything else equal (which it
rarely is), will do better than the short-sighted, who sees only the
expected $x. (Of course, I could probably value long-term returns
accurately if I got to do it ex post; I don't suppose Miles accounted for
that?)
> Recent research shows that US executives are much more highly paid
than their foreign counterparts both absolutely and relative to their
employees, and that executive compensation bears hardly any relation to
company performance, has more to do with company size
So what? My point was not that US executives are under- or
over-compensated relative to European, or whether measures of efficiency,
profitability, etc. are, in light of substantially different accounting
conventions in different nations, all that helpful. My point was only
that if a firm wants an executive who can do the job, it has to pay the
market price for that executive (or he'll go elsewhere, or goof off). Of
course firms judge wrong about a) what it takes to do the job, b) what
the job is, and c) whether Candidate Q is the right one for the job. So,
of course, there will not be a perfect correlation between pay and
performance; indeed, in the short run, the less-excellent executives are
being paid rent because of all the ignorance involved. In the long run,
I would expect the better executives to have higher career earnings.
Everything else equal, which it isn't.
> So you're in favour of adopting a national full employment policy
then, are you? What's it to be, Mr Etchison, full employment policy or
the dole? Or would you be happier with just plain old destitution,
misery and death?
I think the range of choices is broader than that, and that even having
chosen what PB no doubt considers the only acceptable answer, much
remains to be said about design and implementation. I think that what
would in practice be an as-full-as-possible/practicable employment policy
would be different from what PB would design. As full as I don't doubt
he is of love for The People, he gives them little credit for ability to
manage their own affairs, insisting instead that the Best and Brightest
must undertake to remove the necessary funds from the rest of us, to
transmit them (with a little left behind, in the bureaucracies and
legislatures and agencies) to the deserving (does that enter into it?)
poor; I expect he would a) say that The Big Guys won't allow people to
manage their own affairs, and b) that he would expect far less
disincentive from doles than I would.
The just plain old destitution, misery and death of, say, Albania
doesn't appeal much to me, though I believe it did have a full-employment
policy of sorts. That the ordinary run of folks could, working with each
other rather than depending on the government, work out ways of keeping
each other afloat during hard times is a proposition with some empirical
support.
Now, how to get there from the present (in which, I judge, the ordinary
run could not in short order pull together such a thing) rather goes into
PB's line, I would think. A capitalism run by men with no heart is not
good enough, as Mr. Wojtyla says (actually, he'd much prefer they be men
of faith as well). On the other hand, socialism (in his experienced
view) seems to be a non-starter because, among other things, it dissuades
men with heart from actually running the show -- tends to put them in
prison and stuff, and to deprive the rest of us of any chance to connect
our work and our livelihood. It would never occur to me to deny that one
cannot be simultaneously a businessman and a jerk (or worse). It would
occur to me that capitalism, tempered with a sound moral foundation and
ample opportunity for subsidiarity, will taking one thing with another
come closer to avoiding "destitution, misery, and death" for the ordinary
run better than any alternative which has been tried.
This next one truly mystifies me: I remarked that my criminal clients
did not work very hard at finding work. PB's response?
> A free market economy, even in a highly industrialized and
technologically advanced society such as the United States, will not
provide all with sufficient employment, income, and other basic services
A bit later, he characterizes this as "blaming the victim." The mantra
is familiar, but out of place. On the other hand, would I be overstating
it if I inferred that, to PB's way of thinking, they shouldn't have _had_
to go out and look for work? That to expect it of them is beastly, and
were they to do it the experience would be insufferable? He has a far
sunnier view of the fundamental good nature of the criminal class than I.
He goes on,
>-the poor simply couldn't afford them, or could only afford an inferior
quality of such services.)--sufficient, that is, for a modestly dignified
frugal life. (Try living on Los Angeles' county's 'home relief' benefit
or even the minimum wage at 60 hours of work a week).
Actually, I have lived on comparable amounts. I lived in
barely-one-room "apartments" of doubtful salubrity, drank no beer and
smoked no cigarettes or other weed, went to no movies and bought no
clothes but at Sallie and garage sales. I sired no children. With a
little less effort, I could have done this for a long time, had the Texas
or California Employment Commissions thought me worthy. Oddly enough, my
ability to find a job coincided in time almost exactly with the
running-out of benefits. Now, I did have the advantage of not having
been brought up to expect not to work for a living (and, yes, of being
white, male, and otherwise despicable). As far as I recall, I was at
least modestly dignified.
> I do not share his naive confidence that rugged individualism and
self-reliance will do the trick
Where do I start? I do not believe in the atomic, isolated "self" of
post-Millian liberalism. What PB calls "self-reliance" I would insist on
locating in a matrix of social, moral, spiritual, and political support,
because I think we in fact are inextricably formed from them, however
successfully we might think we have freed ourselves from one chain or
another. But if "self-reliance" includes family-reliance and
neighbor-reliance and parishioner-reliance and
fraternal-organization-reliance, and so forth, then I would confess to
affirming the value of "self-reliance."
"Rugged individualism"? Being alive is hard, and we find ourselves in
it together. What to do? There are some folks who sometimes act to make
things easier for others, and what appear to be a lot more who are much
more interested in scoring, at whosever expense. At least from the point
of view of the least among us, the former is preferable. That does not
lead ineluctably to what appears to be PB's, and Dasgupta's, preferred
institutions. It is, I think, one thing to say that I have a duty to
help/love my fellows, to give away my last coat and think first of the
welfare of others, and quite another to say that you have the right to
force me to act that way. The first seems weak, passive, inadequate to
the hardships placed in our way by scarcity and evil; the latter,
however, on the historical record seems to end up with predators in
charge. Ordinary Christians have no difficulty understanding why that
should be so; those not blessed have to learn it the hard way -- by
looking at the world. So -- it is life which is rugged, which affords
the opportunity as it presents the need for Charity. "Rugged
individualism" separated from bonds of community is not my suggestion,
and I regret PB found it so easy to say otherwise.
> Millions of people die every year from avoidable hunger and disease.
Does Mr Etchison believe that this is due to those people's fecklessness?
If he does, he is an even scummier individual than I thought.
The figure in the US is, of course, rather smaller. Taking the
parochial, not global, view, I am told that in the US smoking and alcohol
seem to account for more than half of "avoidable" (that is, postponable)
death, and both of those surely are avoidable -- by individual choices.
I would not wish lung cancer on anyone, but it is difficult to believe I
must organize institutions which remove from those who have chosen to
smoke, in the face of clear-enough evidence of the risk they thereby run,
the responsibility for bearing the consequences. Of course, the same is
true for those who, in the face of evidence at least as clear, insist on
continuing in frequent promiscuous sex involving anal intercourse and/or
poppers. But, those who make themselves sick apart, there are people who
would not die as soon if they had the highest level of health care. That
leaves unresolved whether "avoidable" includes _any_ reckoning of cost.
I cannot forebear guessing that PB would not include, among the
"avoidable" deaths, the millions of inconvenient children who are not
permitted to be born. Counting them would make his "millions of people"
more accurate, though, so I may have misjudged him.
So, we come to "avoidable hunger." May we eliminate, as candidates for
charity, everyone who decides to buy a pack of cigarettes or a bag of
potato chips or cable TV or recreational pharmaceuticals rather than food
first for their children, then for themselves? Of them, I would consider
using PB's word, "feckless." (PB's "scummier" is, under the rules of
this list, clearly not a flame. Right?) But there are too many left.
There might be an interest discussion about the contribution, to existing
avoidable hunger, of such things as agricultural programs, subsidized
urbanization, zoning, above-market minimum wage laws, and a myriad of
other matters.
But then, PB is so enthusiastic about finding me wicked that he does not
(cannot?) consider the possibility that it is mechanisms, institutions,
experience, and not Principles which need discussing, and about which we
might, alack, occasionally find ourselves in agreement.
Michael Etchison
[opinions mine, not the PUCT's]
