Wednesday, May 26, 2010


There's Emerson, Lake & Palmer.

And then there's Sam & Jill:

May 2010 from Jill Andrews on Vimeo.

The Broken Oil Rig Fallacy

I saw this posted today by a friend:

During first 36 days of Katrina, Bush made 7 visits to Gulf Coast...
So far on Day 36 of BP oil leak, Obama has made 1 visit to disaster area...

There are days – with increasing frequency – that I want to slam my head into a wall. If I had a dollar for every time I saw these factoids from my Republican friends I could take us all to the most expensive restaurant in Charlotte. So Bush went to the Gulf seven times. So what? Only the most reclusive non-observer in the world could have missed the fact that the Federal government’s handling of the Katrina crisis was an unmitigated disaster of galactic proportion. Billions of taxpayer dollars thrown away on food, trailers, and sundry accoutrements that never made it to the Gulf or were never utilized in any meaningful way. Thank God that Obama has had little involvement with the BP oil spill; otherwise it would turn into a global catastrophe.

Broken window fallacy, indeed!

My friend’s comment belies the underlying and persistent belief that afflicts many Americans: the notion that the government should do something. Compound this with loyalties to whichever jersey the president happens to be wearing. Can anyone seriously defend the administration of George W. Bush?

Shortly after Obama’s election another life-long Republican friend, quick to establish his PC cred, opined that, “he shows he is serious about providing this nation with leadership.”

Families, armies, businesses and ball teams have leaders. In the Bible there are but two great leaders: Moses and Christ. David was not so much a leader as a shepherd – first for his father’s flocks, then for God’s people. “Leadership” is not the main objective of human government. At best its primary responsibilities are the protection of life and property from sundry interlopers, and the arbitration of disputes.

Political “leadership” leads nations into debt and/or war – regardless of which jersey is worn.

Tuesday, May 25, 2010

Unrighteous Indignation

Apart from the tiny fraction of the US population that understands economics, everyone was content while the private-sector credit bubble was inflating. The Fed chairman was hailed as a "maestro" for keeping interest rates at artificially low levels and thus ensuring that the prices of most investments -- especially high-risk investments -- remained on upward paths, while politicians of all stripes were happy that the market for home mortgages was the greatest 'beneficiary' of the Fed-sponsored inflation of money and credit. Actually, politicians didn't leave much to chance, in that regulations were passed to encourage the provision of mortgage-related credit to anyone with a pulse and government-sponsored enterprises (Fannie Mae, etc.) worked tenaciously to increase both the supply of and the demand for mortgages. The banking industry played its part to the hilt by inventing new ways to expand credit (think: Residential Mortgage-Backed Securities and Collateralised Debt Obligations), but it is important to understand that the banks would not have had an incentive to create these new credit-related products unless there existed huge demand for such products. The demand came from large investors -- hedge, bond and pension funds, for example -- that were desperately searching for yield in a world where yields had been kept artificially low by various central bank and government manipulations.

The main problem with credit bubbles is that they result in a massive transfer of resources to activities that would not be economically viable in the absence of the artificially low interest rates and the monetary inflation. Consequently, although they temporarily create the feeling of prosperity, they deplete real savings and lessen the economy's long-term growth potential. The recession or depression that inevitably follows the bursting of a credit bubble is caused by the ill-conceived investments made during the bubble rather than by the bursting of the bubble itself. Think of it this way: once the bubble bursts and the supply of new credit is curtailed, a light is suddenly shone upon the terrible mistakes that were made during the bubble.

During the giant credit bubble that ended in 2007, the banking industry made more than its fair share of investing errors and was thus eventually left with enormous holes in its collective balance sheet. Some of the largest US banks should have gone under, which would have resulted in the holders of bank equity losing all of their money and the holders of bank bonds losing most of their money. It would NOT, however, have resulted in bank depositors losing any of their money or in the cessation of the traditional banking businesses (the taking of deposits and the making of loans). Unfortunately, the government deemed that the banks were "too big to fail", and arranged for hundreds of billions of dollars to be siphoned from the rest of the economy to prevent the large banks from collapsing. Note that the banks were not actually "too big to fail". They should have failed, and the US economy would be in far better shape today if they had.

Further to the above, the banks certainly played a role in creating the current mess, but it was a supporting role. The lead roles were played by the government and the Fed. However, now we have the ridiculous situation of US policy-makers passing legislation that grants themselves greater power and crimps the activities of the banks, with the stated aims of mitigating the risk of another financial crisis and preventing banks from becoming "too big to fail". If they are serious about mitigating the risk of another financial crisis then they should pass legislation that abolishes the Fed and severely crimps the activities of the government.

The attacks on the banks are nothing if not predictable. Throughout history the ends of giant credit bubbles have invariably been followed by periods of recrimination, when politicians looked around for someone other than themselves to blame. In the current case the banking industry is the most logical target because it is blatantly obvious that the large banks have profited handsomely at the expense of taxpayers over the past 18 months. But isn't it bizarre that the finger of blame is being self-righteously pointed at the banks by the very same people who arranged or approved the gargantuan wealth transfer from taxpayers to banks?

Steve Saville

Monday, May 24, 2010

Out of Africa

The mission to which we belong identifies itself as “an evangelical church in the Anglican tradition,” affiliated with the Anglican Mission in the Americas (AMiA). Recently, the AMiA opted to revert to “Mission Partner” status with the Anglican Church in North America (ACNA). That means the AMiA will work at some distance from the ACNA of which it was an original constituent.

In a comment thread at StandFirm I found this note that offers some context:

…the history of the Church has always been one of both charism and order.

In the Anglican case, we must remember that AMiA quite intentionally seeks, in its ties to Rwanda, to partake of the blessings of the longest revival in modern church history (the ongoing East-African Revival). AMiA is passionate about planting churches, making disciples, and fanning the flames of the Revival in North America.

ACNA, on the other hand, appreciates all of that very deeply, but is quite keen to faithfully receive and pass on the enduring ethos of an ecclesiology that comprehends the orthodox streams of evangelical, catholic, and charismatic Anglicanism. In its North American context, it knows that prayer-book faith and sacramental practice, not to mention the visible ecclesial life of the Anglican tradition, are significant draws in a religious (esp. evangelical) landscape deprived of the roots and richness afforded by the Great Tradition.

So, AMiA will continue to tilt toward ‘charism’ and ACNA toward ‘order.’ It will be up to the bishops of both movements to recognize their need for each other in years ahead. Some minds are inclined toward disjunction… others toward conjunction. For the time being, it may be just as well that both mindsets have some opportunity to bear their distinctive fruits. No doubt, some fig-tree testing lay ahead as well. Fortunately, Jesus Christ is Lord* of the Church—a Church that has, historically, accounted for both charism and order.

*More precisely, Christ is Head of the Church.

Friday, May 21, 2010

Brain Salad Dressing: or, How I Learned to Stop Worrying and Love ELP

I’ve had the good fortune to make acquaintances with a few of my favorite musicians. They’re easily knowable; none of those I count as personal friends have “hit it big,” at least not yet. Sam Quinn (formerly of the everybodyfields and now fronting a new band called Japan Ten), spent this past winter down the road from our home. He came over several times to help us repaint a couple of rooms of our house in exchange for home-cooked meals (he has since gone back to South Knoxville, TN). His former everybodyfields partner, Jill Andrews, has dropped by several times while gigging in the area. Another Knoxville band we met through Jill, the Dirty Guv’nahs, call our home their local “bed & breakfast.”

These artists share distinctly Southern, roots-based musical styles. For one that grew up around bluegrass, Southern gospel (my dad’s family was a singing quartet), Southern rock, hony-tonk music and Hee Haw (my first superstars were Buck Owens and Grandpa Jones), it was logical for me to get into these younger neo-traditionalists.

But my tastes include a completely different side. In the early ‘70s I discovered progressive rock. It was the perfect music for a geek (or nerd) such as I was – too serious and too complex for my more popular friends.

Fast forward to the very recent past. We have three children at home, the oldest of whom just turned 16. Digging through my old vinyl collection, they have been spinning progressive wax on a beat-up turntable they found at a downtown thrift store for ten bucks: ELO, Kansas, Yes, Genesis. Our son is quite proficient on both guitar and piano. The night of his prom he stood in his bedroom, fully attired in his tux, playing intense lead licks to Kansas’ “Icarus, Borne on Wings of Steel” on his homemade Strat copy. He told me that Kansas is the best band he has heard, that nobody today is doing anything of that caliber.

Unfortunately I didn’t keep all my old albums. Among the missing are selections from Rush, the Moody Blues, and Emerson, Lake & Palmer. I wasn’t sure how our son would react to the latter, since their music was driven by keyboard instead of guitar. But we began looking at YouTube videos; to my surprise, he was transfixed by the classical and jazz elements in ELP. And I remembered what I liked about a band that I was done with long ago.

Pompous? Yes. Pretentious? Indeed. But undeniably creative. And a reminder, too, that rock music has always had an element of over-the-top. Perhaps the truly compulsive ones are obsessed with maintaining purity for the masses.

By the way, we have no Pete Seeger records in our collection. But we do have The Byrds…

Everything in Obadiah

Pride as the worst of sins in government, business, the Church, relationships... and the final issue of Esau and Jacob as Jesus was brought before Herod. Listen to Dr. J. Vernon McGee squeeze everything from four verses in the littlest book of prophecy -- what he calls the atom bomb of the Old Testament.

Tuesday, May 18, 2010

Casus Belli?

Book Review: Tariffs, Blockades, and Inflation: The Economics of the Civil War
By John Majewski • March 2006
Posted March 18, 2006 (The Freeman)

In concise and clear prose Professors Mark Thornton and Robert Ekelund use basic economics to explain the causes, outcome, and consequences of the Civil War. Employing Public Choice theory — a subdiscipline of economics that focuses on how public officials and government bureaucracies make decisions — Thornton and Ekelund attempt to revise many standard accounts of the war. Although their economic analysis sometimes comes across as simplistic, they nevertheless add an important and overlooked perspective on the causes and consequences of the bloodiest war in U.S. history.

Perhaps the most controversial claim in Tariffs, Blockades, and Inflation is that the tariff (as opposed to slavery itself) may have been far more important in causing the Civil War than many historians assume. The protective tariff hurt the long-run economic performance of the nation as a whole, and it was undoubtedly a major regional divide between North and South. Northern manufacturers benefited most from a protective tariff, while Southern planters and farmers, who paid higher prices for the manufactured goods they purchased from either Britain or the North, suffered most. Given that Lincoln wanted to raise tariffs, Thornton and Ekelund argue, his election signaled the possibility of a protectionist regime that might have reduced the value of Southern plantations and slaves by some $700 million. Southerners could probably have blocked Lincoln’s attempt to raise tariffs if they had stayed in the Union, but Thornton and Ekelund argue that “tariff uncertainty” made secession an appealing option. Rather than risk higher tariffs, why not simply leave the Union?

Thornton and Ekelund also highlight the impact of the Union blockade, which ironically led Southern blockade runners to import highly valued luxury items rather than wartime necessities. Thornton and Ekelund argue that the blockade changed relative prices within the Confederacy so that it became more profitable to import easily transportable luxuries (such as silk textiles) and less profitable to import bulky necessities (such as iron and machinery). Profit-oriented blockade runners thus focused on luxuries even as Confederate civilians and soldiers suffered grievous shortages of basic necessities. The “Rhett Butler” effect, as Thornton and Ekelund call it, had a host of unintended consequences. It lowered Confederate morale and led to widespread condemnation of “unpatriotic” blockade runners and speculators. Such public sentiment, in turn, led to counterproductive government policies (such as price controls) that made shortages even worse.

The final chapters show the consequences of government intervention in both the North and the South. Thornton and Ekelund, for example, analyze inflation as a form of taxation. By raising money from the printing press, the North and South alike created a ruinous inflation that misallocated resources and severely damaged morale. The inflation problem was especially severe in the South, which could not impose direct taxes or borrow money to the same extent as the North. The focus on inflation ties in nicely with the argument that the Civil War hindered rather than helped economic growth. This point is especially persuasive and important, if only because some historians still believe that war is essentially good for a capitalist economy.

In many respects Tariffs, Blockades, and Inflation is an appealing book. The explanations of economic theory are clear and helpful, and the book is generally evenhanded in its willingness to blame both Northerners and Southerners for enacting bad economic policy. Yet the book is somewhat uneven. Its brief and readable format — and its tendency to summarize secondary works rather than delve into nineteenth-century sources — sometimes oversimplifies complicated political debates. The book’s brevity also means that some arguments are not fully fleshed out. To cite one example, Thornton and Ekelund claim that a less inflationary policy in the South would have forced policymakers “to rely on more decentralized and defensive military strategy.” This is a big point that cries out for further evidence and elaboration.

So, too, does their idea that “tariff uncertainty” was an important motivation for Southern secession. Tariff uncertainty had always existed in the antebellum decades. Why, then, did Southerners leave the Union in 1861 and not in 1842, when the Whigs passed a protectionist tariff? Or why did most Southerners reject secession when South Carolina attempted to nullify the tariff in the early 1830s? How rational is it to fight a war, which would leave 620,000 men dead, over tariffs that might or might not be enacted?

If Tariffs, Blockades, and Inflation may leave readers wanting more, it nevertheless is a clear application of market-based economics to the Civil War issues. Readers will find it a helpful introduction to the literature that Thornton and Ekelund cite in their useful bibliographic essay.

Waiting, Worry & Witness

An exceptional sermon for the “in between” times, by David Turner, given at All Souls Langham Place (London) this past Sunday.

Wednesday, May 12, 2010

The Parable of the Prodigal and the Pig

Back to eternally serious business, a classic and timely teaching from Dr. J. Vernon McGee on 2 Peter ii. 21, 22 here.

Thursday, May 6, 2010

God Bless George and Margaret

George and Margaret have been married for 60 years. George was born and raised in Beaufort, SC, and bears the thick-as-molasses, unmistakable drawl associated with the South’s earliest Cavalier settlers. Margaret grew up in West Virginia. They were both raised Episcopalians.

After last night’s Bible study from Ephesians 1:15-23, George and I were talking, heart to heart. I was filled with sadness, for in a couple of weeks this silver-headed couple will withdraw to Blowing Rock in the North Carolina high country to spend the summer. I had shared something in the study I learned from a sermon by Rico Tice, a pastor at All Souls Langham Place, London: that when Paul sent Timothy to Thessalonica to check on the spiritual condition of the fledgling church in the face of fierce persecution, Paul figuratively held his breath (1 Thess. 3:5) until he knew how the Thessalonians were getting along. I told George that we would all be holding our collective breath until he and Margaret returned in the Fall.

They have endured much. Week to week they put up with a ragamuffin bunch of Gen-Xer’s at our tiny church. Worst of all, in these golden years of their lives they have dealt with the loss of the church they once knew. “The Episcopal church left us, brother,” said George, referring to the denomination at large. “They twisted the Bible all around till it means something different from what it says.”

“Not all of them,” I answered. “I have an old picture of St. Michael’s in Charleston that was taken at the end of the War. Some of the buildings around it are burned out, but it’s still standing. Fire and war and earthquake; its congregation seems not to have swerved to the left or the right.”

George grinned and his eyes glistened. “My home church down in Beaufort is the same way. It’s been around since 1712; they don’t know the Bible other than what it’s always been.”

Thou shalt rise up before the hoary head, and honor the face of the old man, and fear thy God: I am the LORD. (Leviticus 19:32)

The Southern Avenger Breaks Down Conservatism

There are conservatives, and then there are conservatives. Jack Hunter and Scott Horton delineate the difference:

Jack Hunter « Antiwar Radio with Scott Horton and Charles Goyette