jamesz

Legalising drugs

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At Obama’s recent online town hall meeting the most popular question was whether he favoured legalising marijuana. There are plenty of persuasive arguments in favour: the revenues from sales tax and taking drugs out of the hands of gangs to name but two. It was suggested to Obama that taxation of marijuana might be a good way to put a dent in the budget deficit! Of course, there are negative externalities in terms of health costs and negative internalities from addiction (OK, that’s more contentious). According to drug and alcohol rehab centers, one of the worst side effects is addiction, which can also lead to death in extreme cases.

Recent posts here have shown commenters to be against regulation where no externality can be shown. My question is, if the externalities are removed via taxation, is there any good reason to ban drugs? Can the harm from them ever be so high that banning them doesn’t markedly reduce welfare? Here we also need to bear in mind the extreme highs that result from taking drugs and their positive effect on welfare. Read more

jamesz

John Key: big government conservatism?

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Yesterday Nick Smith was thinking of taxing plastic bags. Today John Key threatened legislative intervention in an employment dispute. Now the government’s planning to spend $1.5b on telecommunications infrastructure. Now I’m not necessarily opposed to what they’re doing, but they do seem awfully interventionist for a right wing government.

How do people that voted for limited government and a retreat from the recent years of big government feel about all this? Is John Key living up to his promise to pull back from the days of the government ‘meddling’ in people’s lives?

Matt Nolan

The assault on homo-economicus

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Interesting article proclaiming the end of “homo-economicus” (ht Economist’s View).  This is an issue I care about a lot – so one day I’ll attempt to discuss the article in some detail.  Today however, I’m just linking to the article and waiting to see what interesting comments you guys have about it 😉

It also reminds me of this awesome comic from XKCD:

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Source XKCD

Will Taylor

Aligning tax rates (again…)

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As a brief follow up to my previous post saying I’m glad that the government intends to align the top tax rates, this article I just read illustrates why I think it is stupid having different top tax rates.

I particularily liked the reference to “dopey politicians” 🙂

jamesz

Nick Smith is the bag man

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It’s great to see the government taking economic incentives seriously. Their latest initiative considers imposing a 5c/bag tariff on plastic bags in supermarkets. The idea is that the market price for the bags doesn’t take into account the full environmental cost of non-biodegradable bags. By taxing the bags the government can adjust the market price of the bags to match their social cost.

What gets me so excited about it is that green regulations usually seem to take the form of rather arbitrary quotas and limits. Read more

jamesz

Earth Hour

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Earth Hour came and went over the weekend. There has been a lot of debate on the blogs over its merits: some support it, but many think it’s a waste of time. The goal of Earth Hour isn’t to save the world in one hour by reducing emissions from lighting; it’s to raise awareness of climate change. Given the amount of discussion about it that’s been generated I can only imagine that it’s been a huge success, regardless of whether everyone turned their lights off. I haven’t seen so much discussion of the best way to save power across the blogs and news media in ages!

Of course, any major environmental cause causes some crazies to come out of the woodwork. A few obtuse people have promoted the alternative Edison Hour, where people celebrate technology by turning their lights on. Read more