The Bear’s Lair: Regulators — killing new industries since 1831!

The New Steam Carriage by George Morton

This column has not written enough about the economic damage done by excessive regulation, partly because most of that damage takes the form of new businesses snuffed out. Something that has been eliminated from existence is by definition difficult to write about. However, in my Industrial Revolution researches I have found an example of regulation from 1831 that without question eliminated an entire industry – or at least, postponed it by 70 years. It is an excellent example of the immense economic and social damage, hidden in most cases, that government regulation generally brings. Continue reading

The Bear’s Lair: The first retrograde century since the 14th

Judging by its first 21 years and the prospects therefrom, there is a good sporting chance that the 21st century will be a grim one for most people. Since at least mediaeval times, each century has been an improvement on the previous one, for ordinary people living through it. Incomes have risen, technology has made lives easier, endemic violence both small-scale and large-scale has declined in frequency. The 21st century may be the first since the 14th that reverses this trend. Continue reading

The Bear’s Lair: A property franchise makes sense

This column is increasingly convinced that economic policy peaked in quality some 200 years ago, to give us the Industrial Revolution. Contrary to Whig historians’ fantasy, the government that produced that policy was elected on a relatively broad franchise, of property-holders possessing a “40-shilling freehold” – a fairly low requirement. While returning to such a franchise is outside today’s practical politics, one can imagine it becoming a possibility, perhaps after a crisis. It is therefore worth looking at why it is desirable and how it could work. Continue reading

The Bear’s Lair: Socialism wrecked the BRICs

As the celebratory editorials note, it is now 20 years since Goldman Sachs’ Jim O’Neill propounded the concept of the BRICs (Brazil, Russia, India and China) and proclaimed that the four emerging market economies would outgrow massively the major Western states and become a dominant factor in the world economy. The idea was naively optimistic, a product of the globalist 1990s when to those of O’Neill’s persuasion the world seemed to have settled into a unitedly social democrat future. That was the problem – the elements of socialism in the BRICs’ economies and in the world as a whole substantially damaged the BRICs’ prospects – and ours also. Continue reading

The Bear’s Lair: Financial engineering fuels U.S. weakness

The sale to a Chinese company in 2016 of one of the world’s largest cobalt sources, controlled by a U.S. company Freeport McMoran (NYSE:FCX), is emblematic of U.S. national weakness, “wokeness” and decline. However, one underlying cause of that sale was the blizzard of stock buybacks and unsound acquisitions made by FCX in the years preceding its hurried liquidity-seeking selloff. The ability of corporate management to play games with the balance sheet to maximize its own rewards is a major source of U.S. competitive weakness and should be eliminated. Continue reading

The Bear’s Lair: Suppose Al Smith had won in 1928

Looking back on past critical elections, those readers generally agreeing with this column will have a number of “turning point” elections in which they could wish the more “conservative” candidate had won, although our definitions of “conservative” may differ. In one case, however, one could wish that the more liberal (in the American sense) candidate had won. That is the U.S. Presidential election of 1928, in which not only would the Democrat Al Smith have been a more satisfactory President economically than Herbert Hoover, but his probable re-election in 1932 would have deprived the world of the New Deal. Continue reading

The Bear’s Lair: We have passed Peak Productivity

The Bureau of Labor Statistics announced last week that U.S. non-farm business sector productivity unexpectedly fell 5.0% in the third quarter of 2021 and was 0.5% lower than its level in the third quarter of 2020. This returns the U.S. economy to a pattern of ultra-low productivity growth that first became evident in the Obama years, a dismal trend which seems likely to intensify in the next few years of President Biden’s term. Given the global environment, however, there may be an immensely depressing answer to an important question: was 2019 the peak of global productivity, with decline and decay in living standards inevitable for the future? Continue reading

The Bear’s Lair: Will the Metaverse kill civilization?

Facebook chairman Mark Zuckerberg announced last week that he was changing the company’s name to Meta, because he believed that the “Metaverse” of virtual reality would become the company’s most important business in the future. Whether Zuckerberg or someone else succeeds in creating a convincing Metaverse, it seems to me a wholly negative development for humanity. Electronic reality, already highly competitive with the world we live in for gadget users’ attention, may take over completely. Surely that would bring civilization to a miserable end, for economic as well as philosophical reasons. Continue reading

The Bear’s Lair: Invest away from the billionaires

The Biden administration and its allies in Congress are now considering a “billionaires’ tax” on the unrealized capital gains of billionaires’ stock holdings. Nothing is so well designed to collapse the whole house of asset-bubble cards, as the billionaires re-direct their investment towards areas that are not caught by this impost. It therefore seems worthwhile for us mere mortals to devote some thought to the concept of “investing without assets,” putting your money in areas that will be proof against the asset bubble’s collapse, mostly because they have not shared in the asset bubble’s hyper-inflation. Continue reading

The Bear’s Lair: Facilis Descensus Averno

Putin with his 1972 Zaporozhets

Putin with his 1972 Zaporozhets

“The gates of Hell are open night and day
Smooth the descent, and easy is the way:
But to return, and view the cheerful skies
In this the task and mighty labor lies.”

Book VI of Virgil’s Aeneid, translated by John Dryden, published in 1697 when poetry was poetry, is a useful window on China’s descent into renewed Communism – and indeed, the West’s tendencies in that direction. Residents of Eastern Europe and the former Soviet Union know how difficult and arduous it was to convert from Communism to capitalism, or even social democracy, but the road in the other direction is very smooth – at first. Continue reading