The New Ideas Blog

Forbes magazine recently did a profile of Victor Li from the the University of Michigan, and his newest innovation; flexible self-healing concrete. Great idea (and you should see the photo of the concrete bending without breaking). But that is not exactly what this post is about. Instead I want to look at another idea that occurred to me as I read the article. It is that we often create things without regard to the future costs they will impose on us or others.

In fact, after neglecting the massive highway system we have built in this country for decades, it would now cost well over two trillion dollars to catch up on maintenance and (more…)

I used to argue against government welfare programs on moral grounds. My reasoning? Here’s the short version: If you don’t have the right to take my money to pay your bills, you don’t gain that right by having a government do it for you. Now I tend to favor limited welfare because survival is a higher value than my right to keep all of my money. But there’s another reason to be critical of welfare programs: They don’t work very well. Welfare that works should not just feed people, but help them to feed themselves.

I come from a background that not only included a very low income for years, but also included (more…)

Of course there are opportunities during a recession, including those listed below. In fact, many “lucky people” will prosper in these tough economic times. If you want to be one of them, you have to start to think like them.

To begin with, you might want to turn off the stream of bad news on the television. You get the picture, and there isn’t actually that much “usable” information that you can get from these sources. Believe me, you’ll hear about (more…)

You may recall my recent post titled, “Public Lies,” which took a look at the fallacy of licensing as a necessary function of government. The advantages of licensing clearly are on the side of the industry licensed, not the public. This is why businesses band together to call for such regulation. While looking into this further I found some more statistics and stories that are very interesting.

As union membership has fallen over the years, licensing has become the method of choice for those seeking government force to protect them from competition. 43 million U.S. workers are now in licensed professions. In 1981 there were less than 100 occupations in the United States that were licensed (a recent article in Forbes Magazine estimated the number at 80). Now there are 1,100 occupations for which a license is needed. Contrary to what some might think, there has been no (more…)

The very concept of retirement is flawed. It is based on several false premises. First is the premise that at a certain age you are no longer able to provide economic value. That is clearly nonsense as shown by the many millionaire entrepreneurs and business people in the sixties, seventies and eighties. Yes, we generally get weaker and lose some abilities as we age. But there are seventy-five year-old retirees playing tennis out there, and anyone who can still think and move two fingers can do what I’m doing for a living.

Another false premise is (more…)

The role of prices is one of the least understood yet most important concepts in economics. Today I’ll explain that a little bit, but there is a lot more to say on the subject.

Suppose a country grows sugar cane, yet starts to buy imported sugar from halfway around the world, thus destroying its own industry? Why would they do this? Because the information represented by prices has been distorted. What I mean is that prices give us the information as to what to do. If local sugar is priced at 60 cents-per-pound and sugar from the United States at 50 cents, it makes sense to buy the latter. But perhaps the real price of U.S. sugar would be 70 cents if it weren’t for the subsidies and special tax breaks the government gives to the industry. That is how you pervert the (more…)

As you know, I like to put my own new ideas out there. But I also like to sometimes write about creative ideas that are in the news. Sometimes these are things that are already being tried, and other times they are the subject of ongoing debates. Here are some that caught my attention this week.

Voluntary Gas Tax

“Who would volunteer to pay more in gas taxes?” That was what I and a lot of other readers probably thought when seeing this opinion piece in Forbes magazine by a couple professors from (more…)

The “too big to fail” argument has been a popular one recently. It is thought that if companies like AIG or General Motors go down, they can drag entire economies with them. Now, if this is true (it seems to be to some extent), what can we do about it? I certainly don’t like the idea of having my money taken to prop these giants up, so I’m going to suggest something more radical for the future.

Don’t let them get that big! Now, this may seem strange coming from someone with my capitalist leanings, but I can explain this so clearly that (more…)

A friend sent me the following story/explanation of our tax system and tax cuts, and I thought I should pass it along. It makes several insightful observations and a strong point about “beating up” the wealthy (always a bad thing to do). I like it, but I have two contradictory points to make once you have read the story. Here it is:

Suppose that every day, ten men go out for beer and the bill for all ten comes to $100. If they paid their bill the way we pay our taxes (more…)

Which is worth more; an orange or an apple? At the moment an apple costs more at the grocery store, but the question isn’t really identical to “which costs more?” After all, one or the other has more value to you even if they both were free. Or to use another example, if the price of a pen was higher than that of a computer, you would still probably consider the computer to be “worth” more than the pen - unless you were selling them. Clearly what we think of as value is not identical with “price,” nor is it always closely related.

So what is a thing worth? How do we (more…)