Dog Bites Man

Actually, I've lived my whole life as a boy/man, and haven't been bitten by a dog yet. But a Neil Reynolds column that is a deliberate lie meant to deceive readers of the Globe and Mail into believing something that isn't true, I have seen. Many times.

Greg documents the latest, Reynolds suggesting that Canada shouldn't have a mandatory census because the Scandinavians don't, when anyone who's paying attention at all knows that if Canada wanted to adopt the Scandinavian system (where the government collects so much information on everyone that they don't *need* a census), Reynolds would be the first person fighting against it.

To be honest, given that the Globe and Mail continues to employ Neil Reynolds after years and years of every column of his being either an attempt at deception or hilariously bad advice, it's hard to take anything in the paper seriously, or believe that the editors really have any concern whatsoever for producing a publicly useful product as opposed to just selling papers.

Even if the Globe wanted to make the argument that Reynolds is useful in a George Castanza, do-the-opposite, sort of way, like a compass that always points South, surely they could just provide his advice on what (not to) do directly to policymakers, without taking up valuable newsprint and possibly temporarily fooling people who are reading the Globe for the first time, or those poor folks with an IQ under 50 who haven't yet figured out that they should ignore (or do the opposite of) everything Reynolds says.

Cheap Shots

Neil Reynolds, August 15, 2007, Globe and Mail:

"What's the best way to expand a welfare state, irrationally assuming for the moment that you want to expand a welfare state? Cut taxes. Especially cut corporate taxes. You will collect less revenue every time you nick a dollar but you will have many more dollars to nick - and you will almost certainly find yourself with more tax revenue than you know what to do with. Iceland is a good example."

Willem Buiter, January 21, 2009, Financial Times (London):

"Iceland’s largest three banks with border-crossing activities collapsed last fall, as did its currency. The three banks are in administration and new state-owned banks with a purely domestic focus have been set up. Strict capital controls make external borrowing all but impossible and discourage foreign investment. The country now has an IMF program.

...

Iceland’s government had to let the country’s three main banks go into administration because it did not have the fiscal capacity to bail out financial institutions with balance sheets amounting to 600-700 per cent of annual GDP. Any attempt to commit further government resources to the rescue of the banking system would have precipitated a sovereign default.

...

The excesses in Iceland during the past decade were greater than in the UK, but not qualitatively different. In both countries, the regulation of banks was laughably lax.

...

Households were permitted, indeed encouraged, to accumulate excessive debt - around 170 per cent of household disposable income in the UK, over 210 percent in Iceland.

...

Both countries permitted the real exchange rate of their currencies to become materially over-valued, more so in Iceland than in the UK, but still to a worrying extent even in the UK. The same version of the ‘Dutch disease’ - the crowding out of the non-financial internationally exposed sectors (exporting and import-competing) by the excessive growth of the financial sector and the construction industry - occurred in both countries, again to a greater extent in Iceland than in the UK, but to an highly undesirable extent even in the UK. Iceland’s gross and net external indebtedness are much greater than that of the UK, and its current account deficits during the years just prior to the crisis were much larger than those of the UK.

Both countries pay the price for the hubris of policymakers who believed that they had engineered the end of boom and bust and replaced it with perpetual boom. The risks associated with asset market and credit booms and bubbles were dismissed (”how can you be sure it is a bubble? Do you know better than the market etc.”). In neither country have the responsible parties (the prime minister, the minister of finance, the governor of the central bank and the head of banking regulation and supervision) admitted any personal responsibility for the disaster. Instead we are told tales of a once-in-a-lifetime calamity, coming at us from abroad, that ruined a perfectly sensible and sustainable set of domestic policies, regulations, rules and arrangements. As if!"

Neil Reynolds, January 9, 2009: Globe and Mail:

"Why Government Can't Stop Market Crashes"

The man really has no shame. But of course there are always going to be ideological hacks who move on blithely from failed prediction to failed recommendation and back to failed prediction without ever a word of apology, a reconsideration of their premises or a questioning of the ideology that blinds them. The question is why the Globe and Mail thinks one of these people should be one of their columnists.