Contrary to what the president told the US Chamber of Commerce, government regulations deserve no credit for the invention and implementation of the auto-defrosting refrigerator and freezer. Quite the reverse. His timeline is off by 63 years. FULL ARTICLE by Jeffrey A. Tucker
Source link: http://archive.mises.org/15613/obama-on-auto-defrosting-refrigerators/
Obama on Auto-Defrosting Refrigerators
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Perhaps, like Al Gore, Obamanocchio will just claim to have invented the Wii or the iPhone.
I’ve had the same shower head for the past 20 years or so. I took it when I was working in a house where the homeowner replaced it. It has made several moves with me. I will not comply with “low-flow” shower heads.
Several years ago I lived in apartment with a heavenly shower head. I had to move because the apartments were being sold and turned into condos. This meant they were remodeling etc. I’m still kicking myself for not taking the shower head, which they almost definitely trashed. I found a decent generic one for where I currently live, but I know I’ll never find an equal.
Some years ago there was a company that started selling a Y connector pipe fitting that you attached to your shower line and then added two shower heads to get double the flow. I bought one and it’s great. I seem to recall that this company was shutdown by the government, but I’m not certain on that.
That’s extremely comical. I can just imagine it, when you buy a Y-fitting at the hardware store, you’re required to show your ID and proof of being a licensed plumber, and also if you try to buy more than 2 a month, a warrant will be put out for your arrest, since these can be used for illicit purposes (installing in a shower).
I’m searching for a 50 year old toaster! oh yeh’and a lawnmower…..
I have a lawnboy pushmower from the late 80′s. I took it in about 5 years ago to have a minor repair made on the starting mechanism. The repair man told me that I had a treasure – a pushmower made before a bunch of environmental regulations went into effect. He said the deck will rot off some day (still looks fine to me), and that will be the only reason you will have to get a new one (I guess minor repairs excluded?). The new ones will last maybe half as long with all the technology to comply with the regs. Amazing….fyi – I just start it up each year and run it all summer, doing essentially no maintenance.
Errr, maybe not. But … the government did help to create the epidemic of unemployment and underemployment which gives many people the opportunity to play a lot more Wii than they would have otherwise. The continuing mismanagement of the nation’s finances will provide stimulus to the gaming industry to create a lot more time-wasters and electronic anti-depressants.
The electronic and computer industry will also be able to address the housing problems caused by Obama … check out the homeless people living in internet gaming cubicles in Japan …
Meh, I’m waiting for the day when we start to elect congressmen who grew up with video games. Then maybe they’ll stop all these nonsensical attempts and censorship.
Are you KIDDING!? I loathe the day when we see congresspeople who actually care about the gaming industry.
I can see it now:
The “Hardcore Gaming Act.” Setting a national standard for how difficult a video game has to be in order to be fit for consumption.
The “Gaming Length Standards Act.” Every non-Arcade style game must have 80 hours worth of content before the ending credits are reached.
The “Realism in Gaming Act.” Video games must be as “realistic” as hardware allows. Three-second reload times? The ability for your character to still function perfectly with one hitpoint? Vast mazes to explore that seem to have no purpose other than being a hiding place for monsters? All gone!
Harder games? I don’t think so
Aafter seeing some reviewer had voted Bioshock as “scariest game of all time” (it’s not because it’s too cartoony, you only have one walking speed and it’s running, every enemy telegraphs their intent and there’s no consequence to dieing) I remembered playing a truly scary game, which is System Shock 2 (predecessor to Bioshock, can’t have 3 because its IP has been bought off by a-holes) and how nowadays games are too easy.
The only people who think games nowadays are hard are people like my 10-year old cousin who complains that in Fallout 3 he has no money and horrible karma, but this is because the only way he conceives of making money is by killing people and stealing their wallets, rather than, I don’t know, helping them and making money and good notoriety.
How about energy star ratings for games, where it must give a certain amount of enjoyment per hour? Or low-flow consoles, which prevent you from playing more than 90 minutes (1.5 H) per day?
Ubisoft (sort of) already achieved that with their new DRM where it stops saving the game after 60 to 90 minutes and everything you do after that is lost.
Not to mention the other day when their authentication server went offline for maintenance and they didn’t have a redundant server, so players couldn’t buy the game they bought “legally”.
I would get the shaft if I put a server offline for whatever reason and didn’t have a backup
I blame France’s social welfare and workplace laws for making them lazy and incompetent
I attempted to pick examples of how the current gaming community would mess things up if they were given their way in terms of legislation. Regulations are destructive no matter whose particular interests they attempt to serve. Putting restrictions like limiting WoW to 20 minutes a day would have been too easy. A content requirement would just dilute the actual game horribly, while giving gamers exactly what they “wanted.”
Seattle: Your right, having politicians who actually care about video games would be horrific. Tbh, my comment was somewhat of a reaction to a story I’d watched on Fox just before about violent video games and the need for censorship.
But I fear the first thing we’ll see is a crackdown on downloadable games. Apparently Nintendo, who opened up new markets for casual gamers, are now shocked that casual gamers would rather spend $1 or $2 on an I-phone game than $20 for a DS game:
http://www.gamasutra.com/view/news/32855/Nintendos_FilsAime_LowPriced_Mobile_Games_Among_Biggest_Risks_To_Industry.php
Of corse Nintendo could go back to focusing on hardcore gamers, or they could find ways to get a greater foothold on the downloadable games market(perhaps starting by improving and increasing developer access to their own dowloadable games services). But they’ll probably take the easy way out and lobby the government to crack down on the competition.
Isn’t it a REALLY scary thought that he may actually believe his tale of beneficence showered on us by the government? And if he doesn’t, isn’t that even scarier?
No, he believes it. Kinda like how he believes the CRA of 1964 and the war on poverty freed African-Americans.
The automatic defrost feature (“frostless”) does reduce cost of electricity in operation. Why and how? Refrigeration relies on compressing a gas, usually freon, which produces heat which is dissipated into the air. The freon, now a liquid, moves through the refrigerator’s inside coils and expands back into a gas, withdrawing heat from the interior. Efficiency depends on heat exchange. When the coils inside the refrigerator experience the inevitable “icing up” the efficiency of the refrigeration process declines. Ice is an insulator. Defrosting thus improves efficiency, although it was initially offered as a labor saving device.
If you’ve got a chunk of ice in the refrigerator, isn’t that sort of a reservoir of coldness, reducing the need for the compressor to run? The refrigerator was preceded by the icebox…
The auto defrost saves power because the median American is to lazy to properly manually defrost his freezer.
Unless the plumber installed a water storage tank and pump he didn’t increase the house water pressure above the pressure in the water main. I suspect Mr. Tucker had a pressure reducer at his water meter and the plumber reduced the reduction. 30 seconds worth of work, $200 to know which screw to turn.
Too lazy? So you must start a fire by rubbing sticks together, rather than lighting a match.
Jeffrey Tucker appears to be either, commercially speaking, insane or without a clue as to how and why innovation develops. Primarily, Inventors develop inventions to solve problems that they believe will give them rewards in the form of money. Without patent protection, it would be the rare inventor who would succeed as non-inventive, non-creative business types would simply copy these inventions without paying the inventor a cent. Tucker may think that is fine and dandy, but I think it is just plain nuts!
And of the millions of inventions and innovations that came about each year, how would these “non-creative business types” know which inventions to copy? They would copy the ones that were most successful, and had made the most money.
If Tucker could outline a perfect system that allows the inventor to profit from him creations without IP laws, that would be a great argument for having government implement that system. The fact that he doesn’t necessarily know what the best system would be doesn’t invalidate his argument against IP.
The idea of liberty is frightening to some, as they have become accustomed to the soothing voice of government telling them fairy tales as they drift off to intellectual slumber.
It appears to me that you either didn’t read, or read but didn’t understand, Mr. Tucker’s article, at least insofar as his references to how and why innovation develops. Tucker wrote [emphases mine]:
Leaving aside the question of the effects of patents, which is an open issue, how is that fundamentally different from your account?
Keith Töpfer
The best “system” is actually the first mover concept. An inventor gets to enjoy immense profits by being the first to market with a particular invention. The original inventor has a leg up on the competition by having a greater understanding of the invention itself, first movement to the market, first to absorb startup costs, and first to start working down the learning curve process. Firsts in an industry always make immense profits, assuming they prove popular enough to justify their existence, whether the industry is around a specific product or a broader concept of services.
By being the first to invent, construct, and develop a manufacturing process, the original mover can place a very high price on his invention and enjoy the novelty concept of selling a new product. Between this novelty concept and, down the line when competitors start using the design, his superior profit margins due to having greater experience in production will ensure profits, though not as extreme, in the long term.
However, if said inventor lacks the foresight to properly price his product early on and fails to learn the ins and outs of producing his invention for the market, then that’s his own failings. IP laws do little more than attempt to protect an individual or organization from its own improper behaviors instead of incentivising R&D. Inventors don’t sit on new developments out of concern they don’t get a monopoly rights over it for X years. They’ll develop it and sell it because refusing to sell it is worse than selling it and getting copied. $0 vs $ Something More Than 0.
Patents only exist to protect business incompetence. No one deserves recognition for being the first to invent something. If they can market and sell it, that’s great. If they sit on their hands and let the opportunity to hold the market via merit and skill, that’s not my problem and they deserve to lose out on all the riches.
>Without patent protection, it would be the rare inventor …
This comment is one of myth, rather than substance. He BELIEVES that innovators will never innovate if they can’t get a patent.
Well, I innovated some years ago in the software business, BEFORE patents were allowed on software. In fact, everyone innovated and everyone shared every idea around. That’s why there was so much growth in software in the first years.
Can you imagine today, someone gets a patent on the linked list, or hash tables, or any of a million ideas that people came up with and shared before there were software patents.
Some people who had really good ideas, like the developers of computer language translation tools wrote books about their ideas.
There were computer user groups where they had awards for the best ideas. I remember one called the magic session. The rewards given in that session were notoriety. If you won an award, it was a ticket to any job you wanted in programming.
And of course today, there’s open source software. And even the big companies wish there weren’t patents on software, as it costs them a fortune to fight off all the little patents that people get on the most trivial of ideas.
I always thought necessity was the mother of invention, not patent rights.
“Women buying by the thousands!” Haha.
I thought Al Gore invented the frost-free refrigerator shortly before he invented the internet.
And that was just before he discovered the global warming problem.
I often hear how “smart” our President is. But it’s instances like this one, and several others, that tell a much different story. If one does even a cursory study, he or she will find that government regulations stifle business creation and productivity causing us far more harm than any intended good.
I long ago grew tired of the Ivy League educated bureaucrat, and all of those of like mind, who consistently make things worse (e.g. Dodd-Frank, Obamacare, cap and trade, and the list goes on). Lord save us from these people!!!!!
Yep, all those regulations, rules, and requirements that hamper,harass, and hound American business and stifle the spirit of innovation are at the heart of the problems that our country now faces. Or has ever faced. Rescind,revoke, and repeal them straightway and then watch us flourish.
Without denying that an over-reliance on rules and regulations can and has interfered with the course of commerce, I think you might also concede that absent some regulations and rules, our corporations–and certainly some individuals–can and will run amok even as they defend their conduct as nothing more than what is required of them in a competitive environment if they and their institutions are to thrive and their shareholders to profit.
In another context, a famous playwright put some words into the mouth of Thomas More that may help in considering the notion that our commerce and our society are hamstrung by all these rules. When Richard Rich comes calling on Thomas More, Henry VIII’s Lord Chancellor, seeking employment, More turns Rich away saying he won’t help him. More’s family, who are present during the More-Roper exchange, tell More that Roper is dangerous, a spy, and a bad man, someone who should be arrested. When More says there’s no law against being a bad man, son-in-law Thomas Roper says that there is, God’s law, to which More responds that in that case God can arrest him. More’s wife Alice points out that while they’re talking Rich has left; More responds that Rich could leave even if he were the Devil himself until he broke the law. Not believing what he’s hearing, Roper says that More would apparently give even the Devil benefit of law. More responds Yes, and asks what Roper would do: “What would you do. Cut a great road through the law to get after the Devil?” Roper replies that he’d cut down every law in England to do so. Now fully engaged, More responds: “Oh? And when the last law was down, and the Devilturned round on you–where would you hide, Roper, the laws all being flat? This country’s planted thick with laws from coast to coast–man’s laws, not God’s–and if you cut them down–and you’re just the man to do it–d’you really think you could stand upright in the winds that would blow then?”
Too many laws? Too much regulation? Probably. But when you strike out for the forest with the chainsaw to clear away the deadwood and remove the brush, consider that there are rules and regulations that protect, even while others may impede. Careful with that saw.
When I hear that tale I think of the cop tasering a civilian or killing someone’s dog in a 4 am no-knock raid or a prosecutor f-ing some guy’s life because it makes him “tough on crime”
There will always be “rules” but the important question is whether these rules are made to serve man or man to serve the rules
Basic property rights are the rules you speak of. These only give power over their own property, acting to decentralize power. Any further rules you add will only serve to centralize power, and weaken property rights. Centralized power is an irresistable target for those who want to wield it over others.
Wouldn’t your More-Roper exchange be better suited to the means of politics? Don’t more people use politics to chase the devil-this-week, than people who try to solve societal issues via ideas and reason in a peaceful and voluntary manner? Since when does libertarianism (and its applications to government regulation) involve “getting after the devil?” Nobody suggests that a severe repeal, or even the absence, of government regulation would result in a magical, utopian change in the human condition. So whose devil do we defend against? Who will the regulations serve? Which regulations are good, and which excessive? What is good force, and when does it cross the line? And who is wise enough to enact the regulations? Who is tempered enough to enforce them? Certainly not politicians. And we can’t all be served in this way.
Ludwig von Mises: “Society is best served when the means of production are in the possession of those who know how to use them best.” – Socialism
Couldn’t have put it better.
Sione
The usual line of comments. Too lazy to “properly” defrost a refrigerator? Maybe they just have better things to do with their time, Bill. Some rules and regulations protect? Mabye that’s the intention, but not often the result. You haven’t been on this site very long if you haven’t already heard about the calculation problem and about the issue of unintended consequences. Furthermore, corporations themselves are a creation of government, so rah-rah-rah, corporations running amok could only happen with government help and protection. And since there are alternatives, such as private options for certification and standards, we really have to get down to the basics of what government is and what its purpose is to adequately consider how little valued government actually adds to our lives, and furthermore, to really understand why it adds so little value to our lives.
Obama is right – if you understand the context in which he is making the statement and his audience – regulations do enhance industry – large established companies at the expense of smaller companies and new market entrants. And it has made “our lives better” meaning his group – the ruling elites who
benefit from these regulations (remember the audience before whom he is speaking). Regulations are a tax on lower cost products and a tax on those consumers who would normally buy such lower priced products. They designed and intended to be anti-competitive and push toward cartelization of industry being regulated. If in fact any of the regulations were demanded by the marketplace suppliers would supply that demand much faster than any government regulator could.
Who says the government can’t drive innovation? What about NASCAR? LOL
All evidence suggest that the truth is precisely the opposite of what Obama claimed.
No. 137 in the series.
I think there may be some misunderstanding of the remark quoted in the article. Obama’s remarks are easily misunderstood as stated, and that may have been his intent or simply carelessness.
Having spent a considerable amount of time and effort working with EPA regulators over the Energy Star program, I think Obama probably had something else in mind by his remarks. When I heard his remarks, I understood them as parsed below. He was simply disputing the earlier claims that the automatic defrost feature would need to be sacrificed to meet the strict energy consumption targets. He was not making a claim that government regulations inspired the automatic defrost feature.
“The government set modest targets a couple decades ago to start increasing efficiency over time [he is describing the EPA's Energy Star Program for voluntary product labeling requirements or energy efficiency]. They [the energy saving goals] were well thought through; they weren’t radical [even though many complained]. Companies competed to hit these markers. And they hit them every time, and then exceeded them. And as a result, a typical fridge now costs half as much [he can't take any credit for this] and uses a quarter of the energy that it once did — and you don’t have to defrost, chipping at that stuff and then putting the warm water inside the freezer and all that stuff [this remark was to dispel the early naysayers for the Energy Star program who originally claimed that the energy targets were so strict it would mean giving up the automatic defrost feature!]. It saves families and businesses billions of dollars.”
I am not defending Obama’s claim to credit for the invention, which is absurd, rather I am simply offering the possibility that he was misunderstood.
You can make all the excuses and rationalizations you want and we can construe anything anyway we want, the possibilities are endless. But the fact is that he was simply and purposely misleading. We are talking about President Obama here, you know. If he meant what you say he should have said what you said. He didn’t. He said what he meant to say and tried to pass off an idea that is untrue.
I don’t think Obama was trying to mislead anyone. He may not be a scientist like his Nobel prize Energy Secretary, but he tried to repeat what we had heard from him and did not find the right words. I believe he was referring to the fact that it’s perfectly possible to have a very energy efficient fridge without auto defrost and yet without the need to manually defrost (the warm water Obama was referring to). It’s the norm in Europe and it entails a large evaporator (basically most of the back panel inside the fridge) rather than indirect cooling with a fan which is typical in American fridges.
Don’t get me wrong, I hate regulations. So, to me, the real question is why doesn’t the US appliance industry offer innovation and products the whole world wants. Maybe it’s this standardization and “if it ain’t broke don’t fix it” approach learned during the wars (see Rothbard’s WWI economy pamphlet). The auto industry suffers the same syndrome.
Refrigerators in Europe are also quite expensive and there are still large pockets of populations there that don’t even have one and do daily market shopping. If the American consumer wanted the energy efficient model, it would be offered. But consumers have decided that the expense of the new model is greater than the energy savings, especially considering that most people don’t buy new refrigerators that often. I wouldn’t pay an additional $500 (this is assuming the evaporator isn’t also more prone to failure and more frequent maintenance) to save $5/month for 10 years. It makes no sense from a present value analysis standpoint. Ya, $600 in savings is more than the $500 paid, but I can put that $500 into an interest bearing device today and be well above $100 gained ($600 savings – $500 additional outlay). At my rolling 10 year investment average, I can turn $500 into $1,500, or a gain of $1,000.
I pointed this out once to a Sears salesman. I was looking for a $500 refrigerator and he insisted on showing me the $1,000 refrigerators. When I asked him what justified the price increase, he cited energy efficiency. I inquired about his basic arithmetic skills; even if I could reap 100% of the energy savings predicted by the yellow tag on the appliances, I would never see my money back at current electricity rates in Ohio, or even if they went up substantially. He simply did not get it.
Worse, they informed me that I would have to pay for delivery (not unexpected), and *lose a half day of work at their whim to deliver the unit*. When I inquired about evening or Saturday delivery, he informed me they don’t do that. I pointed out how inconvenient this was for his customers. After all, where did he think most of us were during they day, but away at work earning the money to pay for the expensive device to be delivered during those same work hours?
I gave him the skip. Instead I went to a competitor that doesn’t have commissioned sales dinosaurs. I walked up to the unit I wanted and said I wanted to buy it. Somebody filled out the sales slip, arranged for delivery at a time convenient to us, and the transaction was complete.
I’m into cheap refrigerators, clothes washers and dryers, basic gas furnaces, and simple water heaters. Don’t sell me on energy efficiency unless you can demonstrate NPV gain.
I’m wondering if anyone in this blog has ever looked at how fridges are made. J. Tucker probably doesn’t.
Precisely, indirect cooling fridges with auto defrost not only need lots of kWh, they also are a lot more complicated with fan, heater, timer, relays etc. That’s a lot more hardware than fridges with the evaporator inside which requires absolutely zero maintenance id it’s large enough to cool the food while avoiding frost.
It’s just not part of the American way of life to care about energy consumption and some branches of US industry just have it in their mindset that bigger is better (“bigger cars mean bigger profits” they used to say) and technology doesn’t matter. That’s the exact opposite of Apple’s iPhones which are world hits while US cars and appliances basically don’t sell outside North America.
This doesn’t justify government intervention per se, but it begs the question why.
Production processes can be more expensive even if the unit itself is simpler. Automobiles are a perfect example. The reason there isn’t a huge change is primarily because of the massive capital investment required to produce a different product. Given that manufacturing tends to be burdened by heavy regulation and union protectionism, there’s little incentive to make the huge changes. That’s why the less complex unit will end up costing so much more, because of all the allocated costs of making the change to produce in the new method. A change in a manufacturing process, even to change out a part, requires unit redesign, plant floor reconfiguration, lost production time to engage in these changes, readjustment of the purchasing system to implement a new supply change, and so much more. Toss this into an environment where every step is heavily regulated and a politically connection labor union that won’t let you fire the guy, or even change the job description, who used to install screws on the indirect fan that is no longer required. There is just too much intervention in the entire process, pushing the return on investment into negative territory to update to some newer process.
This is an excellent point–government’s “energy-efficient” mandates make the cost of appliances more expensive. My father had a small, presumably cheap, refrigerator without automatic defrost well into the 1970s, before it eventually died and he had to replace it. I suspect that fridges without auto-defrost were cheaper up until they were completely phased out to meet government mandates.
That may be true. But why did the US appliance/car makers not take care of their product ranges better ?
US/Canada consumers (at least those who didn’t embark on the SUV bandwagon) buy European/Japanese/Korean cars massively, basically because local products are no match. Except for the snob effect of a Hummer in downtown Rome, the opposite is not true.
It’s not as glaring for appliances, but US brands offer very limited choice compared to Europe. Appliances like ranges, ovens, dryers, faucets are (or used to be) very standardized in the US, which has its advantages in terms of maintenance and proven ruggedness, but they just don’t sell outside America. It all looks very much like the Soviet era, which is why, in search for a rationale, I was referring to Rothbard’s analysis of the WW economy.
Oh, speaking of patents, it looks like we’re all gonna have to kick in some to get the next version of some MS software cause they’re likely to have to cough up 1/2 a billion to some guy in Australia who got a patent on protecting software by getting you to call up for a key to unlock it. You know, when windows XP complained you didn’t have a license and you needed to call MS.
My partner and I had the same thing in the 80′s and so did many of the people we competed with. So much for software patents and prior art arguments.
http://www.reuters.com/article/2011/01/04/us-microsoft-uniloc-idUSTRE70341320110104
I had a run in with some fun government regulations. The house I purchased a few years ago came with a brand new washer and dryer. They were energy star rated, so they got some special treatment from the government, tax incentives, blah, blah, blah.
Well within 3 months they stopped working, literally with one day of each other. When the repair man came out he replaced a couple of electrical parts and told me that these things break all the time because they are not built to hold up to the power that is actually needed, but they do allow the company to get an energy star rating.
He also pointed out that the parts he replaced them with weren’t energy star rated, but should last me for many years to come. We haven’t had a problem with them since. Yet another example of government innovation “improving” consumers lives.
Government regulations have made a mess of our daily lives. Whether it is banning effective products or mandating inferior functionality in our appliances and fixtures, government’s role here is indisputably to degrade our quality of life.
Jeffrey, I’m sorry, but while you are certainly correct that government regulations have made a mess of our daily lives, your conclusion that “government’s role here is indisputably to degrade our quality of life” is extremely shallow, and the rest of your discussion suffers as a result.
While a great deal of stupidity accompanies government, while do you ignore the cupidity that DRIVES government? You know, the cupidity that drives the elites who always dominate the use of government, the self-interest that influences the decision-making of administrators, bureaucrats and employees, and the cupidity that drives the rent-farming by politicians? Are not the powerful corporations that use government to pick consumers’ pockets and to create barriers to entry not worthy of mention?
And why no discussion of dynamics? We have a regulatory state not simply because we have elites, politicians and bureaucrats who wish to extend their control and purview, but because we have governments that create risk-shifting corporate machines whose owners have no downside liability for corporate misdeeds. By the simple act of granting corporate status, governments have set off cycles of social damage, growing demands for government action by citizens to “do something”, a growing “agency problem” as government interventions increase management independence from shareholders, growing opportunities for a socially irresponsible corporate elite, bureaucratic and political manipulation, and growing partisanship for control of the wheel (including fights over CSR and tort reform) and of the spoils of our increasingly top-heavy system.
Yes, we still have competition in the marketplace. But the reason we don’t have MORE freedom is not just “stupid government” by self-serving central planners who don’t understand the marketplace; the real reason is that that we have elites who used the grant of limited liability corporate status to avoid personal responsibility and to mask their depredations, and then further use their concentrated power to control government.
More thoughts here:
http://mises.org/Community/blogs/tokyotom/archive/2007/10/16/fighting-over-the-wheel-of-government.aspx
http://mises.org/Community/blogs/tokyotom/archive/2010/07/06/the-cliff-notes-version-of-my-stilted-enviro-fascist-view-of-corporations-and-government.aspx
http://mises.org/Community/blogs/tokyotom/search.aspx?q=limited+liability
Merely pointing out the stupidity of our court intellectuals does nothing to strike at the roots of our problems, and certainly is not persuasive to leftists who think that more government is the only solution to corporate risk-shifting and rent-seeking.
Kind regards,
Tom
No, because that is what everyone tries to do when there’s a concentration of power: grab its reins. You think corporations are the only ones doing this? Think welfare, medicare, social security, and the coming required-managed-health-care-for-all. In other areas you see it too, with people constantly abusing the return policies of stores, making false insurance claims, whatever. So you have to expect this kind of thing and make a system immune to it. You do that by not concentrating power, by giving people no power beyond deciding what they do with their property.
Shay, you can choose to ignore that we have a big government because it benefits the interests of powerful insiders; I prefer not to blind myself and limit my effectiveness in such a way.
TT
Regarding D.Broberg, we discussed this on private emails at some length. The version of the story that Obama’s people would offer would go something like this. Private enterprise makes stuff big and energy consuming and ever more so, so long as profitability stays high. Government is needed to assert social priorities and set guideposts on important matters like energy use. These perimeters force business to look for other ways to compete and profit and so they turn from bigger, faster, stronger to other issues like convenience, design, elegance, etc., so in this indirect way regulations are responsible for making companies smarter and more innovative.
This is a softer version of the story, but it is just as false.
“Private enterprise makes stuff big and energy consuming and ever more so, so long as profitability stays high”.
Actually this appears to be true for industries like appliances and cars. But why is it ?
In a string of posts above, I was wondering if it isn’t the effect of earlier regulations in which case this additional layer of rules is just going from bad to worse.
Why is it true that private enterprise makes stuff big and energy consuming and ever more so, so long as profitability stays high? The question is at best rhetorical because the answer is obvious in the question: profitability stays high. I think you are searching for nuance where none exists. If profitability is high, this means that individual preferences are for the larger, less efficient product at a price point well in excess of costs. If profitability is high, producers will continue producing the product.
As for why American products don’t do well in foreign markets, the question can be turned around. Why don’t many European products do well in the U.S. ? They aren’t buying our large refrigerators and we aren’t buying their small refrigerators. Your question about product viability in other markets assumes that markets are homogeneous, which they aren’t. This reasoning is also used to explain “flaws” with American industry and its products, but this requires one to ignore individual preferences and assume the inherent superiority of one market over another. I daresay there is a certain arrogance required to find flaw with American products because a foreign market doesn’t want it.
All of this is mostly entertaining postulation, because markets suffer heavy government interference with regulation, tariffs, and consumption taxes. Who knows what energy prices would be in a truly free market? Would appliances be larger or smaller? We cannot know, because the true price of water and energy to run the appliances is not known, in America or elsewhere.
Jeffrey, I chose not to address the particulars of your complaint here both because it is a generally valid criticism of government and because I wanted to expand the focus to important rent-seeking dynamics.
But I must say that I find I have to argue with your facts as well, in a rather basic way: the “Energy Star” program that Obama was talking about is entirely voluntary.
It’s also being gamed by manufacturers, as Business Week pointed out a couple of years ago:
http://www.businessweek.com/magazine/content/08_41/b4103076223809.htm.
Yours in striking at the root,
Tom
“Energy Star” program that Obama was talking about is entirely voluntary.
I heard somewhere that this rating is linked to tax breaks. Let me find that …
Read the comment from “Larry February 9, 2011 at 11:29 pm”
The guy was merely trying to avoid some “voluntary” taxation..
Interestingly, Bonnie T. in the comments to the article that you link to provides an interesting link:
http://www.epinions.com/content_5322678404?nli=1
In this article, the writer makes the case that the “Energy Star” program actually makes things worse for the environment, by making silly assumptions.
Among the points made in the article, is that the newer, more complicated machines, while Energy Star compliant, suffer from more repairs required, more down-time while waiting for hard-to-find parts, and shorter lives when complicated parts become unavailable–thus, these machines end up in landfills, or are recycled, much earlier than they properly ought to be!
The article also points out that Energy Star ratings assume that you are going to be drying your clothes in a dryer, so it gives a higher rating to machines that do extra work to remove water. If don’t us a dryer though, though, this extra effort would mean nothing to you! This, and other similar questions (such as running an extra rinse cycle in a “high-efficiency” machine, or how you heat your water) are completely ignored by government requirements.
An interesting read, indeed!
Oh, and I would add: while Energy Star is allegedly voluntary, the epinions article also points out how the Energy Star “volunteerism” has gradually become “requirementism”.
Like recycling, “energy-efficient” government regulationssforces end consumers to pay more for less. It’s only an improvement in the politician’s mind. Such developments will occur without government interference when enough people want them, and they truly become cost-effective.
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