Friday, October 18, 2024

The Hershey's Kisses Rate of Inflation

In 1968 or 1969, my sister and I went to one of those old-fashioned corner markets in Madison, Indiana, and bought Hershey's Kisses at the price of two per penny. These weren't in a package but sold in pairs.

Today, the packages of Hershey's Kisses at Walmart vary slightly in price depending on the size, but they average about $8 per pound. So the average price of a Hershey's Kiss is 8 cents each. (Each Hershey's Kiss weighs 4.5 grams or roughly 1/100th of a pound.)

This makes the Hershey's Kiss rate of inflation over 55 years 1600%. During the same period, the official rate of inflation, which I always find suspect, is 850%. Either the official rate is wrong, or Hershey's Kisses rose faster than inflation.

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Best wishes,

John Coffey

http://www.entertainmentjourney.com

The Cobra Effect: Why Good Intentions Don’t Solve Problems

Saturday, May 25, 2024

What went wrong with capitalism

Just one problem: the era of small government never happened. Government has been expanding for nearly a century in virtually all measurable respects, as a spender, borrower and regulator; the one brief retreat, under Bill Clinton, proves the trend. In the US, government spending has risen eight-fold since 1930 from under 4 per cent to 24 per cent of GDP — and 36 per cent including state and local spending. What changed under Reagan was that as spending rose, tax collections remained steady, so government started paying for its own expansion by borrowing. Deficits went from rare to routine and as a result public debt has quadrupled in the US to more than 120 per cent of GDP today.  

America is displacing Europe as the society least tolerant of financial distress for anyone, up to and including the super-rich

Rather than reversing the course of government, Reagan changed the conversation, which did often focus on a neoliberal agenda of cuts to taxes or deficits or regulation. But even when governments attempted to deregulate, the result was more complex and costly rules, which the rich and powerful were best equipped to navigate. By the 1980s, fearful that mounting debts could end in another 1930s-style depression, central banks started working alongside governments to prop up big corporations, banks, even foreign countries, every time the financial markets wobbled.  

With good reason, progressives deride this new version of capitalism as "socialism for the very rich", but governments were doling out relief for the poor and middle class too. More than socialism for the rich, this is "socialised risk", a campaign to inoculate an entire society against economic downturns. Although still widely criticised as the land of "raw" Reaganite capitalism, America is displacing Europe as the society least tolerant of financial distress for anyone, up to and including the super-rich.  

Something has been changing in the culture. Just as the American "revolution in pain management", which insisted on treating even moderate injuries with powerful opiates, was hooking the nation on OxyContin, its approach to economic pain management was addicting the system to a drip feed of government support. During the past two decades, the US fell from fourth to 25th in the Heritage Foundation rankings for economic freedom as both regulation and debt increased.  

If the era of small government was a myth, then the majority who want government to "do more" would be wise to think twice. An even bigger government is more likely to magnify than ease their frustration with the dysfunctions of modern capitalism.

Saturday, April 6, 2024

How to Make a Million Dollars


Ben Shapiro is an exceptionally talented person.  I would be happy with just a job I like.

Thursday, February 29, 2024

Ayn Rand: The Real Motive for the Socialist Mindset


The term "Capitalism" gets thrown around and has become a pejorative on the political left.  So maybe we should define what we mean by "Capitalism".

A free market is one in which you get to make free choices.  The opposite of this is tyranny, but no society is either completely free or completely tyrannical.  Being free to make choices includes the freedom to make voluntary exchanges,  to own property, and to do business for your own benefit.

The definition of Socialism is that the means of production is socially or collectively owned.  By definition, the means of production can't be privately owned, which requires an authoritarian state to take away people's right to engage in commerce.   This makes Socialism not only evil, but impractical because it prevents people from acting in their own benefit, and it prevents the innovation that would come from large numbers of people doing business.  It also takes away incentive structures of success and failure that result in a more efficient free market.

One thing that the political right believes that maybe the political left doesn't is that people respond to incentives.  Give people an incentive to not work and they won't work.  Give people an incentive to be productive and innovative and they will be productive and innovative.

These claims are easily demonstrated by looking at how various economic systems have faired.  Far-left economic systems have faired very poorly and have been a disaster for the people living under them.  All you need for a prosperous society is to embrace a free market to at least some degree.


Wednesday, February 21, 2024

Why Democracies Always Fail


Two centuries ago, a somewhat obscure Scotsman named Tytler made this profound observation: "A democracy cannot exist as a permanent form of government. It can only exist until the majority discovers it can vote itself largess out of the public treasury.

Wednesday, February 14, 2024

Richard Wolff: How You Are Being Exploited

Richard Wolff on Capitalism



This is a fundamental misunderstanding of economics.  I have worked many different jobs with many different salaries.  Not one of these I could have earned the same amount of money working on my own.  I didn't have the resources.  It was my employer that provided the facilities, the equipment, the customer base, and the know-how that allowed the business to make money.  I voluntarily traded my labor for the resources that the employer provided.  On my own, I wouldn't have been nearly as productive.  I would have starved.

Voluntary exchange works.  

Richard Wolff has never run a business.  If he had, he would see the world differently.