Getting Hayekian

Thanks to international supply chains, Scott Lincicome’s Five Timer gold jacket is in the mail ...

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Thanks to international supply chains, Scott Lincicome’s Five Timer gold jacket is in the mail today as he joins Jonah to discuss a whole panoply of economic trends. Scott and Jonah talk about some of his observations from his posts as a fellow Dispatch-er with his Capitolism newsletter, as well as through his role at Cato where he has just put out a ton of research refuting the too-clever-by-half idea that the government can seize the manufacturing industry for national security reasons. The guys also discuss how COVID has essentially reversed the consumer side of the American economy. (“The pandemic has temporarily converted us into a country that buys goods instead of services”), and they even manage to get in some Hayek (peace be upon him).

Show Notes:

–“Five Timers Club”

–Scott’s newsletter, Capitolism

–Democrats trying to push through $15 minimum wage

–Tom Sowell on the minimum wage

–More from Less by Andrew McAfee

–Scott’s latest for Cato

–Scott’s take on the ‘deindustrialization’ myth

–A rundown on the National Technology Industrial Base

–U.S. ventilator overproduction

–Sherrod Brown’s “Buy American” push to the Biden administration

–Jonah: Thank globalism for COVID response, not nationalism

–Jonah, microcosms, and macrocosms

–Invisible Wealth by Nick Schulz and Arnold Kling

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Comments (21)
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  1. Sean Smith

    RE the minimum wage: Something I hardly ever hear discussed that has a HUGE bearing on this issue is the fact that raising the minimum wage exerts strong upward pressure on ALL wages. As a concrete, real-world example, I run a sawmill. Our starting wage (which comes with a good benefit package) is $16.95/hour. Our average wage is just a bit above $22. Our state minimum wage in Oregon is $11.50, meaning our starting wage exceeds the minimum $5.45. This reflects the fact that a starting position at this mill, while not requiring much in the way of skills, is harder work and somewhat more hazardous than other unskilled, entry-level positions that pay minimum wage. Hence we pay a premium of $5.45 over the minimum to reflect that. Bring the federal minimum up to $15, and our premium obviously shrinks to a mere $1.95, and everyone at that level starts clamoring for more. Why, they ask, am I busting my butt for only $1.95 over minimum wage? So we bump the starting wage, and the next thing we know everyone at the next tier up is wondering why they're now only making slightly more than the starting wage. And on it goes up the food chain. This is why unions consistently push higher minimum wages even though most of the unionized workforce earns far more than the minimum. Union wages are usually indexed to the minimum, and their collective bargaining agreements very often stipulate that members must be paid some specified percentage over it. Bump the minimum to $15, and it will become a LOT more expensive to employ EVERYONE, not just minimum wage earners.

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  2. Deirdre Darr

    Thanks for today's podcast, Jonah! It got me thinking about food supply chains that have been impacted since the pandemic. I live in a rural area and our one large chain grocery store is struggles with supply (not just of toilet paper or paper towel), of milk, cheese, eggs, meat, and so on. There are dairy farms nearby (within township limits), but the milk is shipped hundreds of miles to be processed. A local farmer told me that the food processing plants can not adapt to deal with sudden changes. If your plant packages 5 pound bags of shredded cheese for Costco, that's all they do and can't change to package pound blocks of cheese. In terms of food security and supply, would it be wise to have more, smaller dairy plants (or slaughthouse, mills, etc) so that food is available more locally. WWHS (what would Hayek say?)

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  3. Julie Daulton

    Why is ammo for personal firearms in such short supply, and hence, way overpriced? Why doesn't the demand result in the supply increasing? Perhaps for Mr. Lincicome's sixth appearance, he can answer this question.

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    The Bell Tower

    Dude! Scott sounds like Mitch from Real Genius.

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    Adicesa14

    This was a really good conversation. Economics is a topic not well understood by most folks (including me). I suspect understanding could be enhanced by discussion of oft referenced economic metrics (e.g., GDP, unemployment rate, cost of living, trade deficits, taxation, productivity, … etc.). How are they calculated? What are the inputs? How do they fit together? More, please.

    Like others, an abrupt ending. Correctly herding electrons is difficult, even for nerds. Patience, people.

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    DillaDonutz

    Somebody please post link to SNL video they mention.

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    Anne W (Raw5254)

    I need to listen to this one again. I think the lineup of contributors to TD is impressive, but the addition of Scott Lincicome was genius.

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  8. Jaaron

    Great show. I love this stuff. I would buy Scott up to 8 drinks and 4 pounds of nachos to pick his brain on economics. Extra drinks if he brings charts.

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    CynthiaW

    I really like Mr. Lincicome and his charts.

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  10. PM

    Some hope for Jonah as he is at least somewhat willing to move trade away from China.

    As far as tariffs go, it doesn't seem necessary to me.

    If we can convince hordes of people to not vaccinate their children and hordes of people to believe the election was stolen, it shouldn't be that difficult to convince hordes of people to not buy Chinese made goods.

    Jonah makes an awesome point about how government cannot be run like a business.

    In case neither of you know, we do still make T-shirts in the US. Hopefully neither one of you are secretly harboring a "MyPillow Guy for President" :)

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