What is the tipping point to economic strangulation?

That is the question posed at the end of an article in the National Post by Kevin Libin. Apparently in Egypt more than one-third of the working population was employed by the state. That may have been the tipping point that brought down the Mubarak regime earlier this month.
The same kind of situation is happening in many jurisdictions around the world. When the size and cost of the public sector is factored together with their near and longterm entitlements, and the private sector is so burdened and disadvantaged, something has got to give. That maybe what is playing out in Wisconsin and what prompted an article in the New York Times to ask: Is Wisconsin the Tunisia of collective bargaining rights? Talk about mixing metaphors.
In Canada the same kinds of problems occurred in the 1990's when the Liberal government of the time instituted severe cuts to the size and spending of the federal government with very positive economic results. These same problems are beginning to appear again (see the graph); the Conservatives are in power now, but no matter, they spend like Liberals. This of course provides ample evidence that all the major parties in Canada are identical in power - spend and tax or borrow from the future. They all do it.
Even in smaller jurisdictions like cities in Canada or the US something will have to give and soon. The City of Toronto has frozen municipal taxes for 2011, but he future looks bleak for the new cost conscious administration, with a possible $770 million dollar shortfall for 2012. I'll predict an interesting and possibly violent next few months/years.

Incentives work better than disincentives

Would you pay for plastic bags at a store checkout counter? That is an issue in the Toronto region. Of course retailers pay for the bags they provide customers at checkout. The price per bag is minuscule because the number of bags used is large. But efforts to change human behaviour by penalizing them often just create resentment, antagonism or worse.
In libertarian philosophy, choice is always preferred and coercion is always shunned. So whether it's a ban on plastic bags or recreational drugs the operative word "ban" is antithetical to libertarian thinking. Even a surcharge on plastic bags rankles most libertarians. There must be a better way to change behaviour if that is a goal.
I'll put aside for a moment whether plastic bags are desirable or not (here is an opinion I would support). Personally, I have no problem with plastic bags, but if I was a store keeper, I would at the very least offer a choice, like they used to: paper or plastic, very sensible.
Of course store keepers feel compelled to abide by the government edict that prohibits "free" bags and they feel no obligation to offer a choice. Why? Because they were not offered a choice, and orders are orders. But imagine the goodwill that customers would feel if indeed some entrepreneurial store keeper started offering recyclable paper bags to their customers in the spirit of "you can catch more flies using honey than vinegar."
Some people at Volkswagen had thoughts along those lines a while back, so they sponsored what they call "The Fun Theory." The video below was part of that enterprise which causes people to change their behaviour if they are incentivized to do it. Watch the video and go see the others here.

The School Sucks Project - Part 2

A new philosophy magazine called Kontext is looking for readers and contributors. The magazine is published bimonthly out of the United Kingdom and its first issue as a pdf is available for free download. The hard copy may be purchased for about $12US.
Stefan Molyneux is a contributing author (my link), and the first issue is entirely about education which is what tweaked my interest, see Part 1.

The website of Kontext has links to Freedomain Radio and Mises.org which also makes it interesting to me. But what really got me involved was the link to The School Sucks Project.
As a former teacher, I am painfully aware of some of the problems in the government-run educational bureaucracies that exist in the English speaking Western democracies, particularly Ontario. The School Sucks Project (TSSP) uses a surgeons precision to splay open the entire body of the educational system (especially in the United States) and examine the entrails, and it's not pretty. TSSP looks at everything, the origins, the purpose, the immediate and long lasting effects of the school system that has shaped each us in some way for good or ill.
This first issue of Kontext and its link TSSP, asks the right questions about our school system.  How can a system that is regulated and funded by a government bureaucracy, administered by bureaucrats whose primary job is to manage public funds, and executed by unionized teachers whose allegiance is to the system and each other rather than the clientele, deliver good service, a good education? How? It boggles the mind. Mass-produced indoctrination and socialization must by its very nature create oddities, freaks, widgets that don't work. Whose child is so worthless that s/he can be tossed aside as unfit to proceed (like a malformed widget) as so many children are now? The system truly sucks. Is it any wonder that today the political structure of these same Western democracies employs the same sorts of coercion that were ingrained into each of us by the school system? If you are instilled with collectivist ideas for 12 years you begin to think that is normal, to think like a collectivist. It's not normal, we are each of us different in some way, and those differences cannot not be accommodated by the school system as it is.
Kontext offers its readers an alternative to the established model, its worth reading and promoting. I look forward to the next issue in April that will look at "People and Movements." Good luck!

Watson wins Jeopardy!

If you missed the historic win of Watson the computer on TV, here is the brief YouTube version, enjoy:

"Mr Watson—Come here—I want to see you"

Did anyone seriously believe that the humans could beat IBM's Watson computer in Jeopardy! last week? Did you seriously think that IBM would screwup the advertising coup of the year to Ken Jennings? I didn't even bother watching, but that does not mean I'm not impressed with the result. This was a major step since IBM's Chess contests with Gary Kasparov in 1996 and 97. Deep Blue beat Kasparov in May 1997, after first losing to him the previous year. That computers can play chess is no big deal these days, but understanding Jeopardy! clues, is another issue.
Next year (2012) is The Alan Turing Year and maybe IBM is planning to crack the Turing Test and win the Loebner Prize for the first computer to fool humans into thinking they are talking to a human, maybe. Passing The Turing Test would be a major step in Artificial Intelligence research and since it took 25 researchers and four years to teach Watson to play Jeopardy!, I have my doubts.
Both chess and Jeopardy! have much in common, they are both games, somewhat predictable with rules, although Jeopardy! is much broader in scope, and more difficult because of the language aspect, neither really compares well to real life situations. However if the "real-life" situation is somewhat confined to a particular occupation, Watson may become an interesting help mate. This link will open a TED webpage that features a discussion with one of Watson's creators and some of the implications of this type of technology.
It seems Canadian medical schools are being accused of bad-mouthing family practitioners at a time when a shortage of this type of physician is possible because of aging boomers like me. Medical schools seem to have a bias to specialties for their students instead of family practice, and as a result less than one-third of medical students show interest in that field.
Here is a possible role for Watson, that is, program it so that it might be able to interact with human patients in a medical practice. Could Watson in real time assist in diagnosing ailments while freeing up physicians to do physical exams or other things? One of the major complaints that I can see in Canadian medicine is face time with physicians so that they can hear the patient's whole story. Of course this is the value of the family practitioner, s/he can discover all aspects of patient health IF they had the time. Furthermore, computers never have bad days, spats with their spouse or partner, headaches or get sidetracked by chatty patients. Computers will execute their program, ask ALL the pertinent questions, and a nuanced computer like a Watson, could get a useful chunk of data that a human doctor could miss. It's a thought anyway, but not that far-fetched as you can see here. 

Welcome to New Hampshire.....

No income tax, no general sales tax, less taxes in general and relatively limited government, if you think like a libertarian, you might like New Hampshire.
ReasonTV has a very interesting interview with one of the producers of a documentary that:  "follows one man who is walking across the country to raise awareness about the Free State Project, another who already moved to New Hampshire and works as an advocate for medical marijuana patients, and a Ron Paul-inspired teenager who decides to leave his friends and family in California to live in New Hampshire."

Behind the scenes at the movie Atlas Shrugged

Enjoy these two short clips of the movie version of Atlas Shrugged Part 1, including interviews from the director, the screen play writer and various actors.  Thanks to ReasonTV.

Do you wonder why government always gets bigger?

Here is why (one reason) governments are going broke all over. Imagine, if we all could work for government, we would all be doing quite well? From the National Post.

Ontario Power Generation: under poor management

Poor management! Without looking at the back story, how else can the dramatic rise of the price of electricity in Ontario be explained? When input fuel costs have actually dropped (natural gas), and other costs have been relatively stable, why is your electrical utility bill more expensive today than one year ago? The pamphlet (at left) attempts to explain the reasons behind the huge price increases. I've always been under the impression that the job of management involves using resources in the most efficient way to achieve the best service for the most competitive price. But when there is no competition, and when management has an agenda that is at odds with the needs of customers, what else can you expect?

The Liberal government of Dalton McGuinty manages the operation of Ontario Power Generation (OPG). Here is what OPG says on its website: OPG is an Ontario-based electricity generation company whose principal business is the generation and sale of electricity in Ontario. OPG was established under the Business Corporations Act (Ontario) in 1999 and is wholly owned by the Province of Ontario. "Wholly owned by the Province of Ontario," the government sets policy, and plans future projects that often require huge amounts of capital investment and sets the course for the future prosperity (or lack thereof) of the Province. Therefore a major component of the wealth of Ontario is centrally planned at Queen's Park, right or wrong, that is a fact. The OPG website says the right things, but somehow their comments are at odds with the McGuinty Liberals: Our focus is on the efficient production and sale of electricity from our generation assets, while operating in a safe, open and environmentally responsible manner. "Efficient production," I beg to differ. Below you see my first YouTube video attempt, which outlines the pricing plans of Dalton McGuinty. I hope to follow this up with others. By the way, a job review (general election) for management comes up on Oct. 6, 2011.

Flag Day in Canada is not......

Today was another unheralded Flag Day here in the Great White North, the 46th since Feb. 15, 1965, barely a mention in the media. The fact that it is unheralded says something interesting about Canadians. I'm not sure what that something is, but I like it. It's certainly not that we aren't patriotic, just cast your thoughts back one year to the Vancouver Olympics and you will change your mind on that.
However, I do know what this day and the flag does NOT say.  It does not say 'country-first,' an irrational phrase often heard in the US. It does not say that we have socialized medicine, it does not say that we take care of each other, in fact when the flag was first introduced the government sector was much smaller, and the welfare state was just in its infancy.
I would hope that the flag says to the world that the individual Canadian is proud, responsible for him/herself, and stands alone like that red maple leaf on the white background (see the first line). Our flag represents a place on a map, where we the inhabitants should cherish a common law that includes protecting the rights of those individuals who live there. It also is an invitation sent to the world, come here and adopt our ways and you can to live in freedom.