What El Salvador’s murder rate teaches us about government and organized crime

A recent NYT article explores whether a deal between gangs and the El Salvadoran government to give incarcerated gang members better living conditions is responsible for the drop in homicides in the country. Homicides in El Salvador Dip, and Questions Arise

The possibility that the reduction in violence resulted from a secret deal between the government and gang leaders to halt killings in exchange for better prison conditions has rattled El Salvador’s political establishment and led to various explanations from government leaders.

What kind of ivory tower must you be living in to be rattled by government and gangs working together to limit violence? The Washington Post reports that “El Salvador and neighboring Honduras have the highest homicide rates in the world with 66 and 82.1 homicides per 100,000 inhabitants, respectively, in 2010.” To compare, the number is 4.7 for the US.

The deal seems like a no-brainer. When an average of 14 people are dying every day, do whatever you need to do. The criminals are still off the streets, and fewer people are dying. They’ve gotten the number down to 5 per day.

We think of organized crime and government as opposed. But the similarities far outnumber the differences. Both provide protection and social services, such as money lending, and even education and health care. Both hold a monopoly on violence in the regions they control. Both are fundamentally coercive. Bureaucrats don’t want this type of cooperation happening, or getting out. They know that seeing the state working with gangs, and not against them, reveals just how similar they are. Even more than that, it shows that government’s perceived legitimacy is just that, perceived. Government is organized crime with the patina of legitimacy derived from the chimera of choice.

Not really related, but I love this song.

Photo by Participatory Learning.

US Government: drones can kill you, but they can’t bring you tacos

One of the difficulties in arguing against licensing requirements is that the innovation they prevent is unseen.

But a brilliant MIT grad named Star Simpson is making the unseen seen via the Tacocopter. It’s a small, unmanned drone helicopter that would deliver orders made via smartphone to locations determined via smartphone users’ GPS.

Would, but can’t. The journalists at Wired got super excited, only to find out that Tacocopter is a no-go until the FAA relaxes regulations requiring difficult-to-obtain licenses for unmanned aircraft. So the punchline is that the government can kill you with drones but it won’t let Tacocopter use them to deliver your tacos.

Tagline: Our unmanned delivery agents are fast and work tirelessly.

But why? Unmanned drones require difficult-to-obtain licenses because pilots lobbied for the requirements. Pilots know unmanned aircraft is competition. And what do you do about competition in a corporatist state? You rent seek. Licensure is perfect rent seeking because it artificially limits competition.

When cops were trying to use drones to aid with surveillance, pilots teamed up with the ACLU to fight the law, and not because they were worried about civil liberties.

So this is a brilliant move by Simpson to make at least one thing that we’re missing out on as a society due to corporatism extremely clear. Here’s hoping the taco lobby is stronger than the pilot lobby and the Wired journalists get their tacos real soon.

Rabbit trail begun via Tyler Cowan’s Marginal Revolution blog.

‘Stock Act’ strikes the branch, misses the root

Why does insider trading bother people so much that Congress has come up with a “solution” that will cost $1.7 million? (‘Stock Act’ sticks taxpayers with $1.7 million tab)

Politicians are people too

People hate insider trading because it reveals that politicians, when given the opportunity, make decisions that benefit them. They aren’t  superhumans born without a self-improvement gene, or people who’ve learned how to overcome it. Cronies, they’re just like us!

The danger of self-interest in politics is clear. To mitigate this danger, there are two choices.

Make all the things illegal

Your first option is to try to take the benefits of the choices away from the politicians and bureaucrats. Find every way a politician or bureaucrat could possibly personally benefit from their legislation and make it illegal. Privately funded campaigns, stock market choices, dinners paid for by lobbyists, private schooling for their kids, consulting jobs after they leave office, all that has to go. Then tackle the million perks of which we could have never thought.

Strike at the root

The other option is to take the power to legislate away from the politicians and bureaucrats. Limited government means lobbyists can take congressmen and women out to dinner every night of the week. But it’ll be for nothing, because they won’t have the power to make choices that screw us over and benefit them.

Take the Pelosi VISA scandal for example. Nancy Pelosi voted for a bill that screwed consumers and enriched her VISA-stock-owning husband.

First of all, the problem is the bill. The bill is the end result that we’re trying to avoid: legislation that screws consumers.

Now you can go around spending billions of dollars trying to find out which stocks every family member of friend of a congressperson or bureaucrat owns. Or you can take the power to regulate private enterprise away from congress and leave it to the market.

One will be extraordinarily expensive and totally ineffective. Rent seeking and collusion will continue to wreak ruinous legislation on the masses.

The other will unleash the power of the competitive marketplace. When businesses can no longer effectively lobby government for competitive advantages, they’ll actually have to innovate.

Unless I’m missing something here, the choice seems pretty clear.

Photo by Amber de Bruin.

The best part of Paul Ryan’s budget

In The Worst Part of Paul Ryan’s Budget, Derek Thompson writes:

[Paul Ryan's] long-term budget… would cut 91 percent from these and all other non-defense programs. Ninety-one percent. [Under this plan] we’re forced to let our highways rot, while the unemployed go bankrupt and our veterans go homeless.

This is so silly, and yet cute. It’s like when a dog gets scared of thunderstorms. Rotting highways, oh my! Homeless veterans, gasp!

Homeless veterans?

Meanwhile, let’s see What Paul Ryan’s budget actually cuts — and by how much.

Paul Ryan’s plan spends:

  • 16 percent less on “income security” programs for the poor
  • 25 percent less on transportation
  • 13 percent less on veterans
  • 6 percent less on “General science, space, and basic technology.”
  • 33 percent less for “Education, training, employment, and social services.”

Sure sounds like letting our highways rot, while the unemployed go bankrupt and our veterans go homeless to me. This blatant fear mongering leads me to wonder what part of unsustainable spending writers like Derek Thompson can’t understand.

Photo by Photography by Kat.

Ex H&R Block CEO: license small tax preparers

Today in Corporatism, a former CEO of H&R Block turned bureaucrat just created a law requiring licenses for small tax preparers. Of course the requirements are waived for lawyers, CPAs, and large tax-preparation companies like H&R Block.

From the Reason article entitled Just What America Needs: More Red Tape:

“Everyone,” said President Obama six months ago, “knows that small businesses are where most new jobs begin. And you know that while corporate profits have come roaring back, smaller companies haven’t.” Perhaps he should pause to ask himself why.

Maybe he has to ask himself why because he’s being advised by people who clearly don’t understand how regulation affects an economy.

Listen, Occupy Wall Street, liberals, social justice people, et al. If you want to get mad about big businesses screwing consumers and the little guy, understand the mechanics of the screwing.

This is how it’s done:

1. Government is a revolving door of business leaders becoming bureaucrats becoming business consultants.

2. These bureaucrats write legislation creating barriers to entry for  competitors. This benefits their benefactors and ensures them lucrative consulting positions once their tenure in government ends.

There’s only one way to fix it. Getting rid of business destroys the world’s only producer of wealth. Trying to regulate business  creates more of the same. Obviously keeping business from using regulation to hobble competition can only be done by eliminating their power to regulate.

Photo by soukup.