Why Buying Local Doesn’t Work

Update: I allowed this to be published prior to my knowledge that Mr. Hartwell was unfit to practice journalism – he fails to fact check and he’s bad at his job. I do not disavow any specific aspect of what has been written below, but what follows would not be published by me today.

By Michael Hartwell

Pseudoscience comes from many angles. Woo is woo, but the major forms skeptics encounter are in biology, medicine and physics – “hard” sciences. Economics is an ugly cousin to these disciplines. It’s imprecise, it overlaps with politics and there are major disagreements among the experts.

Still, economic pseudoscience exists. The particular economic woo I’m writing about here is called “local purchasing” or localism. You have probably witnessed a campaign to “buy local” by purchasing goods and services from businesses with headquarters in your area. This is said to “keep the money in the community.” Next, the local business owner spends the money at another local store, creating a “multiplier effect.” The chef buys from the farmer, who buys from the shoemaker, who buys from the mechanic, etc.

By restricting sales within the community, we are told, this closed-loop system will generate jobs and wealth within the community. The money leaves the community, however, if we buy from outsiders and wealth and jobs are lost.

This sounds reasonable to the general public, but it is pure pseudoscience. The closest skeptical comparison is the scheme to create energy by burning hydrogen from seawater. The flaw was that advocates kept track of the energy coming out of the system, but ignored all the energy that went in to separate the hydrogen. Burning salt water creates a net energy loss, while local purchasing preferences impoverishes a community.

What economists know

Localism is really a rehash of an outdated economic view called mercantalism, where entire nations thought restricting trade would create wealth. They thought nations would become rich by increasing their exports and decreasing their imports. Goods and services would leave the nation, and gold and silver would come in.

Adam Smith disproved mercantalism with his book The Wealth of Nations in 1776, arguing that wealth is not in gold and silver, but in goods and resources. Money is just a proxy for resources. By specializing in the production of some goods and trading for others, people can take advantage of economies of scale and end up wealthier than the nations that tried to be self-sufficient. A Smithian nation would become very good at making Item X and trade some surplus for Item Y from a neighbor, while a mercantilist nation would do a mediocre job of producing Item X and Item Y and trade some of it away for shiny pieces of metal.

Building onto Smith’s work, David Ricardo introduced comparative advantage with his 1817 book Principles of Political Economy and Taxation. Comparative Advantage is counter-intuitive, rarely understood by the public and undeniably true. It is the idea that entities should concentrate not on the tasks that they are the most skilled at, but the tasks that require their most valuable skills in comparison with other entities.

For example, say John Lennon and Neil Diamond are on a camping trip and want to listen to some music while sitting around a warm fire. One person needs to play the guitar while the other constantly tends the fire. Let’s assume Neil Diamond is a talented musician, but the worst fire-stoker in history and would let the flames go out, while John Lennon is internationally recognized as the most talented musician and fire-stoker of the century. Who should do which task?

The optional choice is to have John stoke the fire while Neil plays the guitar. Even though John is better at both, he benefits from having Neil around to play the guitar while he works on the fire. In essence, they are specializing in tasks and trading with each other. So with Smith’s strategy of dividing tasks and trading, and Ricardo’s addition of assigning entities to the tasks where their skills are needed the most, international trade has emerged as a critical tool in creating wealth and improving the standard of living for the general public.

The “multiplier effect” that localists and other mercantilists cite is a real concept, but more inevitable than they realize. Economic Journalist Frédéric Bastiat famously criticized this sort of scheme in his 1850 essay Ce qu’on voit et ce qu’on ne voit pas (That Which is Seen and That Which is Unseen) with a parable about breaking windows.
A boy throws a stone through the window of a local bakery and a crowd of people gather around, displeased at the vandalism. One person tries to find a silver lining and suggests the ruffian is actually a social benefactor, as the baker will now have to hire the local glazier for a new window. The glazier will have more money to buy from the cobbler. Everyone is happy and believes the local economy has been stimulated.

Sound familiar yet?

But no one bothered to ask the baker what he thinks. They forgot to look at the other half of the equation – where the money for the glazier is coming from. It turns out the baker had been saving up his money to buy a new suit from the tailor, but now has to buy another window. The tailor could have spent that money at the cobbler, and so on and so forth. The community is now a little bit poorer as the baker has one less suit then he otherwise would have.

As Adam Smith showed, wealth is in resources and destruction doesn’t create resources – it destroys them. Bastiat went on to say that burning the city of Paris down to the cobblestones would create jobs in reconstruction, but destroy wealth.

Enter the woo-promoters and misguided social activists

But not everyone has read Smith, Ricardo or Bastiat. Modern mercantilists claim the nation will be wealthier if we buy domestic products, subsidize domestic companies, oppose immigrant labor and thwart the outsourcing of jobs. It’s the same bag of bones; only instead of trading away goods and services for precious metals they accept green pieces of paper.

Economist David Henderson coined the phrase “Do-It-Yourself Economics,” which are “firmly held intuitive economic ideas and beliefs which owe little or nothing to textbooks, treatises or the evidence of economic history.”

It’s not that localists and other mercantilists have new insights that have overturned some dusty old ideas, it’s that they never read them and aren’t aware they exist. As Paul Krugman wrote in his 1996 Pop Internationalism, a wonderful book on economic woo:

“…We learn that the authors on my reading list do not base their disdain for academic economics on a superior or more subtle understanding. Rather, their views are startlingly crude and uniformed… [the view] is dominated by entirely ignorant men, who have managed to convince themselves and everyone else who matters that they have deep insights, but are in fact unaware of the most basic principles of and facts about the world economy.”
The point of jobs are not to keep people busy, they are to produce things of value. However, pseduoeconomic schemes often focus on creating useless jobs instead of producing things. Milton Friedman once mocked a purposely-inefficient job-creation program that made workers dig with shovels instead of backhoes by suggesting they be given spoons instead.

Imagine two castaways stuck on a deserted island. The first night they agree one will gather firewood while the other scrounges for food. However, 50 feet into the brush the food-gatherer discovers a third castaway with a ten-year supply of non-perishable food he’s eager to share. What reaction do you suppose the castaway who was attempting to gather food would have?

Would you expect him to be upset and saddened?

No? But remember, he just lost his job. A “foreigner” is attempting to flood his little economy with cheap food. Of course, he would be happy to have it, as letting someone else provide food frees him up to work on other tasks, such as building a shelter or making a rescue-signal. The same lesson applies to the division of labor in advanced societies. Letting someone else grow our food frees us up to work on other things, like entertainment or medical technology. It doesn’t matter what side of the community border they do it on.

Taking localism claims seriously

Now that I’ve described how economists see wealth, money and jobs, let’s look back at the economic claims of the basic “buy local” movement.

The claim is that by purchasing things entirely from within the community, money will stay in the community and the community will become wealthier.

So that means that the community will turn resources into goods using jack-of-all-trade production, instead of specializing. Therefore, more resources will be used to create fewer goods. These goods will then be traded within the community. The focus is to “buy local” but not to “sell local” so occasionally goods will be sold outside the community and more green pieces of paper will come in. However, no new goods will be allowed into the community – they must be made locally, so the volume of green pieces of paper will increase.

Localism concentrates on what the merchants take in, but it forgets to factor in what consumers pay out. Higher production costs mean local goods will cost more to buy, so the purchasing power of these green pieces of paper will decrease. In addition, with resources leaving the community and more green pieces of paper coming in, the ratio of resources to currency will change. This is essentially inflation, and merchants will demand more money as goods become scarce while they are awash in currency. Even in their perfect dream economy, dollar bills may stay in the community, but wealth will not increase, as wealth means having more goods and resources.

Buying local means higher prices, fewer choices, longer work hours and a lower standard of living. It claims that using inefficient production will increase the amount of goods and resources. By slowing down, we’ll go faster. Resources will be conjured from thin air. It is pseudoscience, pure and simply.

Localists are classic pseudoscientists

We all understand that creationists know next to nothing about biology. They do not study biology. Normally, we shouldn’t fault a person for that, but these people have a great interest in biology. We know this because they speak about biology all the time. They do not make sophisticated criticisms based on intimate knowledge of the subject, but instead make “common sense” observations on a crude version of biology.

Localist activists are the same way. Clearly, they have a deep interest in economics. They talk at length about the multiplier effect, supply and demand and growth. They don’t know anything about comparative advantage, economies of scale, creative destruction or trade. Apparently, their interest in economics isn’t strong enough to get them to actually study economics.

They want the veneer of science, so they cite what they refer to as studies – non-peer-reviewed amateur reports they claim show financial benefits. All of these so-called studies come from two sources. The transparently-named “Institute for Local Self Reliance” and a small firm called “Civic Economics,” which as far as I can tell is two guys in Austin Texas with a pocket calculator.

In a 2008 Buy Local debate at the University of Vermont, localist Bill McKibben used a classic “Gish Gallop” tactic against economist Russ Roberts, demanding he respond to a list of bogus claims too long to address in the time allotted.

And like conspiracy theorists, localism is a hydra with many heads. Decapitating the economic claims causes believers to shift to claims about the environment, national security or aesthetics. This is the critical response I expect to receive, even though Brian Dunning has already done a great job of exploding the environmental claims.

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Bastardizing History

By Gabriel Levesque

History is too often called upon to support presentist ideological and political themes. Politicians and radio personalities use historical figures to suggest their ideas are correct and in accordance with some great historical figure. Polarizing images and comparisons with Lincoln, for example, dominated Obama’s campaign and the first year of his presidency. Obama’s political adversaries countered by comparing his policies with Soviet Russia and Joseph Stalin. This is a practice that is unfair and all too common. Historical figures are products of their particular era and of their own particular circumstances and life trajectory. Conjecture only bastardizes the historical process and creates falsities that damage the pursuit of truth.

A recent example of historical bastardization came in the way of January’s Supreme Court decision that blocked the ban on the corporate funding of political candidates. Hamiltonian and Jeffersonian logic were cited as precedents to support the court’s 5-4 decision. The First Amendment was granted to companies as a whole, thus allowing free speech in the form of monetary support. This is a shady deal that extends the probability that large corporations will continue to dominate U.S. policy making for some time. However, a detailed look at the morality of this decision is beyond the scope of this limited narrative. What is pertinent, however, is the fact that “Jeffersonian logic was upheld.” First of all, what is Jeffersonian logic? Jefferson has had his personality and thoughts twisted in every direction to meet almost every political scenario’s needs. From pro-slavery laws, to pro-abortion rulings and now to First Amendment monetary rights for large companies – Jefferson has been the raison d’étre. This is unfair on so many grounds. I will address two.

For starters, Jefferson has been dead for two centuries. Projecting what he might say now, or what he might have said about recent events is pure conjecture. Every event is a product of recent dealings and experiences. Jefferson would have little understanding of what corporate campaign spending is and what it means to the masses of America (in an aside note, Jefferson was initially against the formation of political parties as he saw them as dangerous). Jefferson was a product of the mid eighteenth century; his values, thinking, and reasoning are not our own. We live in a much different time. We live in an era of globality and complex integration where each person is interconnected in ways which are not always clear. Uranium miners in Uganda indirectly affect the relationship between Iran and the United States; local banks in Ireland fuel Portuguese shipping ventures. Jefferson lived in a pre-industrial agrarian society. The needs of the United States in early nineteenth century were very different from our twenty-first century needs.

Finally, the decisions we make should be about the benefit of the people who are living today. Using the dead as reasoning for current laws is a poor way to govern the masses. Precedents are only helpful when they aid the generation who stands today. History is important for understanding the human experience and trajectory. History can allow the current generation to examine relationships of the past and understand our moment in time. Applying past reasoning as justification for current situations and solutions is dangerous. Each situation is unique – every solution must be unique. Jefferson already served his sentence; let him rest.

Gabe is currently a graduate student at the University of Maine and can be contacted at Gabriel.Levesque@umit.maine.edu.

Help Take Down Naturopathy

By Michael Hawkins

There usually is no central theme to Without Apology. This is premised on the notion that a broad band of ideas is the most fruitful method of reaching people. However, sometimes there are more pressing issues.

It may have been noticed that a number of articles are devoted toward discussing naturopathy – the belief in a magical “vital force” which is central to the body being able to heal itself. At first glance this belief may seem harmless, but reality shows otherwise.

Naturopaths are licensed as a certain type of doctor in the state of Maine. This is a mistake. It would be inappropriate to go to one of these individuals for medical care. (Indeed, one of the health methods of some naturopaths is iridology; this is where one looks at the color patterns and other characteristics of the iris to make determinations about certain aspects of a patient’s health.) The low qualifications needed to become a naturopath, the sub-standard medical training, and the plainly silly diagnostic methods give the very real possibility of a naturopath prescribing contra-indicated drugs. At the very least, a waste of time and money is highly likely.

It is important to the health and safety of all Maine citizens that naturopaths lose their right to practice medicine in Maine. We ought to hold our medical professionals to higher standards.

Please email your state senator about this. Actually do it. It only takes a minute – http://www.maine.gov/legis/senate/senators/email/maillst.htm

If you do not know your state senator, email Libby Mitchell – http://www.mainesenate.org/mitchell/email.htm

The health of the gullible, the ignorant, and the simply deluded is at serious risk right now in Maine because of the status of naturopaths. It is paramount that everyone do what he or she can to prevent dangers in the healthcare industry. Write your representative and ask that Maine become the third state to have an outright ban on the practice of naturopathy.

How Naturopathy Could Kill Suzie Q

By Michael Hawkins

The following is a letter the Kennebec Journal will apparently not print. Trying to discover the reason and rationality behind the decision is futile. It’s just a bad paper.

Let’s pretend Suzie Q has a pain in her stomach. At first she chalks it up to something she ate. But the pain keeps returning. Maybe it’s a bug, she thinks.

After the pain persists for some time, Suzie Q wonders if maybe it’s stress. She slows things down for a little while.

But it doesn’t help.

Soon she decides she needs to see someone about this. She goes to a naturopath.

The naturopath assesses Suzie Q’s state. Maybe he utilizes Chinese medical astrology. ASTROLOGY. After all, accredited naturopathic schools really do teach it.

He decides Suzie Q needs garlic or some similar herbal remedy. Then he asks for his $80-200 fee.

Suzie Q goes home happy, but the pain soon deflates her again. She continues to see her naturopath, trying multiple herbs.

Six months pass when she finds herself in a hospital bed. She’s surrounded by medical doctors. Her oncologist tells her she has an aggressive stomach cancer that has progressed too far for treatment. If only she had seen him six months earlier, she might have had a chance.

What if Suzie Q was your friend? Your mother, your sister, your brother, your father, your spouse, your child? You?

Contact your representative and demand that naturopaths lose all licensing and practicing rights NOW.

Spanking

I often find myself on the lonely side of an argument. I don’t think it’s because I’ve gone off the deep end or that I’m out of touch. It’s that I live in America and my argument-based loneliness is local. The so-called liberals here are the moderate right in most of Europe and our far right-wingers are closer to fascists more than anything. So when I formulated my opinion on spanking in regards to discipline, I expected to be expressing a minority view. That has largely turned out to be true, both in an anecdotal sense and a broader, public-opinion sense (the U.S. is nowhere near banning spanking whereas much of Europe has advanced beyond this neanderthal stage).

The case for why spanking is wrong and immoral is not a difficult one to grasp, but it can be difficult to make it. First and foremost, principle must be emphasized. This is the absolute cornerstone of my argument – and it’s what is most often ignored in the presentation of counter-arguments. Without some sort of broad, yet qualified (see definition number 3) underlining to an argument, there is no good basis; the argument becomes too malleable and convenient. To date, this entirely typifies the sort of arguments favoring spanking that I have heard.

The principle which I follow is simple: hitting is bad. But by itself, that is far, far too broad. It needs qualifications. Hitting is bad except when in self-defense. That doesn’t mean hitting becomes good in self-defense, just that it becomes justified. One can go further and say hitting is bad except when in defense of others. And then one must go further and qualify that what is being defended is something of a high importance. In most cases, bodily defense is the reference. A case can be made for property, but that is not important here.

So now with this general principle, one can apply it to specific situations to check its universality. If the rule becomes “It’s bad to hit except when it’s against a Jew” then we don’t have a universal principle – or we need to justify this new qualification. In the case of specific religions or races, the qualification almost never works. If it does, it’s because there’s something else at work (“It’s bad to hit except when it’s against such-and-such a race” may have some operation value during a time of war). At any rate, it is necessary to test the universality of “It’s bad to hit” (with our justifiable qualifications in mind, i.e., self-defense):

It’s bad to hit children.

This works, but with a limited scope. After we check off our already stated qualifications, this statement leaves open the implication that it is okay to hit adults. Since that clearly is not true, the statement needs to be amended back to the principle: It’s bad to hit.

The issues that arise here should be easily dismissed, but for whatever reason are harder than an Alabama tick to dig out. The first that comes to mind is power. In my experience and in sifting through the Interwebbings, spanking proponents want to make the distinction between really wailing on a kid and some relatively light slaps on the butt. And this is where I am forced to go back to principle. If hitting is wrong, all qualifications considered, then hitting is wrong is wrong is wrong. It is irrelevant how hard one wishes to spank a child. If the intent is to cause physical harm, then there is nothing justifiable in that. It’s like saying stealing is wrong…unless it’s just a little bit. That’s a silly fall from logic.

Another issue is that of parental rights. Most people can agree that parents are the primary caregivers and are primarily responsible for the well-being of the child. To some this seems to mean parents are bestowed with natural rights to discipline as they see fit. But again, it always goes back to principle. If it’s wrong, it’s wrong.

What I find most interesting about the “parents’ rights” argument is that it usually comes down to blood relations. That makes no sense. First, it compromises principle where it is convenient – it is not okay to hit a Jew by virtue of that person being a Jew, and so just the same to a child. Second, I fail to see how genetic relatedness is even relevant to the conversation. It’s so specific and, again, convenient. But besides that, it excludes those who adopt or otherwise become legal guardians of children not their own. What’s more, the child is equally related to the parent. If not for the difference in physical prowess, why shouldn’t the kid be allowed to discipline the misbehavior of the parent? Clearly, something more than genes must be at work. For someone to make such an argument seems bizarre, out of touch, and, unfortunately, all too common (at least in my experience). It’s a “shield argument”, really. It shields the proponent from needing to justify allowing strangers to discipline their child. If it’s okay to hit a child out of discipline for one person, it should be okay for another. Introducing arbitrary guidelines (one must be blood related and/or a legal guardian) does not effectively get around the issue. It skirts it out of convenience.

Finally, in no particular order, there’s effectiveness, effect, and what spanking teaches. Commonly, proponents of spanking either attest to not wanting a “spoiled little brat” or that spanking has no detrimental, long-term effects. Both are terrible points. First, plenty of people grow up without being spanked and were never, nor are, “spoiled little brats”. Second, whether or not spanking has long-term effects is irrelevant. Even is spanking proved to be an effective means of discipline, it wouldn’t affect a single aspect of the argument so far put forth. It goes to principle. Burning a child with an iron would be effective discipline, but the argument has clearly surpassed whether or not effectiveness is at issue. It is not. To bring it up is to simply ignore everything that has been said.

The truth is that the science doesn’t show one way or the other how effective spanking is. The results are mixed, sometimes muddled. However, one thing science does tell us is that for physical punishment to be effective, it needs to be gradually increased over time in most cases. If it isn’t, a tolerance is built to it. We can extrapolate and apply this known fact to spanking through conjecture, but direct evidence is light.

And then there’s what spanking teaches. When one breaks it down, it becomes clear. Spanking tells children that in order to get their way, they just need to hit. In order to correct the unwanted behavior of others, physical force will do the trick. This does not mean that children will grow up to be violent. For most children, that connection probably won’t even be made. Rather, they will see only some people are allowed to hit others. Often, this will be because parents and teachers will give them the conflicting mantra “Don’t hit others”. Ultimately, this confusion turns out to be a good thing for everyone, but that is not the point here. Spanking is teaching that hitting is okay in the correction of unwanted behavior. The fact that most children will not understand what they are being taught is immaterial.

At the end of all this, whether or not spanking is okay should be clear. It is not. It is an immature way to obtain one’s way out of stupidity, miscalculation, frustration, and/or an inability to raise a child who shows intelligently-based respect, rather than just faux fear-based ‘respect’.

Infuriatingly silly

Jerry Coyne has a post about why Francis Collins pollutes science with religion. It’s a succinct piece that basically nails Collins for all his silly, childish, superstitious, frankly stupid beliefs.

The most inane and disingenuous part of Collins’s argument is his claim that without religion, the concepts of good and evil are meaningless. (Collins’s slide 5 in Harris’s piece: “If the moral law is just a side effect of evolution, then there is no such thing as good or evil. It’s all an illusion. We’ve been hoodwinked. Are any of us, especially the strong atheists, really prepared to live our lives within that worldview?”) That’s palpable nonsense. Good and evil are defined with respect to their effects and the intents of their perpetrators, not by adherence to some religious code. It is beyond my ken how a smart guy like Collins can make a claim like this, even going so far as to argue that “strong atheists” like Richard Dawkins have to accept and live their lives within a world in which good and evil are meaningless ideas

It’s inconvenient for Collins or any other religiously-driven person to admit that morality is a purely human affair. And really, it’s getting to be a tiresome argument. Explanations abound for how morality could have naturally evolved. That should be good enough to force any reasonable person to admit that, no, morality need not have a god, it need not adhere to the whims of one individual entity, and it definitely is not universal. Our ideas of morality change with the times, with cultures, with known facts, with context. The only real constant is that every human society has developed a moral system. The details within each system may vary wildly – in bin Laden’s, the death of most of America is just – but they are always put within some sort of construct. That does not mean that bin Laden’s version of morality is equal to any other version which may exist. One key component in any moral system is basing premises on facts. That’s the main reason that god-based moral systems tend to fail or be wacky (see inane hatred of homosexuality among, well, almost all the religions). It’s one of the reasons bin Laden’s system doesn’t work and is not equal to mine or yours or most Americans’ or other Westerners’ (or even most Muslims’).

Collins, like most Christians who think they somehow own the moral high horse, despite all the contrary evidence, does not understand that morality is not universal. It is only moral systems. His is broken and can only work because he’s made it malleable to the progression of secular values and understanding. Indeed, if religions weren’t so agreeable to such change, Christianity would be as much a relic as slavery. Of course, that isn’t to suggest that religion so easily moves along with reason. It doesn’t. It usually comes kicking and screaming, forced by the hand of rationality.

There are, of course, also statements made without evidence, including this one: “God gifted humanity with the knowledge of good and evil (the Moral Law), with free will, and with an immortal soul” And this (slide 4): “We humans used our free will to break the moral law, leading to our estrangement from God.” How does he know? What’s the evidence? Isn’t the distinction between the science slides and the faith slides being blurred here?

One thing I’ve been forcing myself to ask myself a lot lately is “Where’s my evidence?” I recently went on a big hike through the 100-Mile Wilderness, the most remote and difficult section of the Appalachian Trail. I recall passing a tree root that had made a sort of rainbow shape. Each end was in the ground, but the middle was up in the air (as opposed to laying against the ground). It was unusual, but I quickly thought “It must have been buried at some point before being exposed, thus causing it to pop up”. I had to stop myself right there. How did I know that? I didn’t. It was a plausible guess, but other explanations were also plausible. It could have grown that way. Another tree could have been there before being removed, long ago, by the Maine Appalachian Trail Committee (MATC). It could just be a brief, weird angle I had making me think it was a root when in reality it was just a fallen branch that appeared buried in the ground. All I had was a hypothesis, and one I wasn’t about to test. I had to settle with “I don’t know” as an answer. Sometimes that isn’t just a temporary answer. Every single claim/question about the after-life that Collins makes deserves a permanent “I don’t know”. He doesn’t have the evidence. As a scientist, he should value that above all else in his work.

But then again, he is a Christian. Religions do not value evidence.