That’s the reasonable version, but in the hands of an expert like Deirdre McCloskey, a rant is a lot more entertaining. From her post, lightly edited for continuity:

The High-Liberal political philosophers … rely on a factual story which they take to be so obvious as to not require defense. The story is: Modern life is complicated, so we need government to regulate. Since markets fail frequently the government should step in to fix them. Antitrust works. Businesses will exploit workers if government regulation and union contracts do not intervene. Unions got us the 40-hour week. Poor people are better off chiefly because of big government and unions.

But no. The master narrative of High Liberalism is mistaken factually. Externalities do not imply that a government can do better. How do I know this? The experiments of the 19th and 20th centuries tell me so. American Progressive regulation and its European anticipations protected monopolies of transportation like railways and protected monopolies of retailing like High-Street shops and protected monopolies of professional services like medicine, not the consumers. Unions raised wages for plumbers and auto workers but reduced wages for the non-unionized. Minimum wages protected union jobs but made the poor unemployable. Building codes sometimes kept buildings from falling or burning down but always gave steady work to well-connected carpenters and electricians and made housing more expensive for the poor. Zoning and planning permission has protected rich landlords rather than helping the poor.

If you missed the point, here are examples from Montreal and Bogota.  I wouldn’t say government can’t help, but history tells us to keep our goals modest.

After spending nearly one-third of a $3 billion budget to build four of the world’s most advanced submarines, the project’s engineers have run into a problem: the submarines are so heavy that they would sink to the bottom of the ocean. Miscalculations by engineers at Navantia, the construction company contracted to build the S-80 submarine fleet, have produced submarines that are each as much as 100 tonnes (110 US tonnes) too heavy.

From Quartz, via Gian Luca Clementi. A question to test yourself:  how important is $3b to Spain’s overall fiscal situation?

Update (May 23):  Facebook update from a friend: “Doesn’t this count as stimulus whether it sinks or not?”

What to do? Congress — the source of the loopholes — has decided to grill Apple CEO Tim Cook. The Times quotes Senator John McCain: “Apple claims to be the largest US corporate taxpayer, but … it is also among America’s largest tax avoiders.” And Senator Carl Levin: “Apple successfully sought the holy grail of tax avoidance. It has created offshore entities holding tens of billions of dollars while claiming to be tax resident nowhere.”

Once we get past the posturing, what are the issues? First, there’s overwhelming support among economists for a lower corporate tax rate with fewer exceptions. That’s been part of all tax reform proposals to date, including Simpson-Bowles. Lots of countries have done this, why not us? Second, there is no simple answer to the question of how countries tax multinational corporations. There are lots of ways to move profits around, and we can expect companies to use them. Perhaps we should be taxing something else. In the meantime, we’re shocked — shocked! — that Congress is picking on Tim Cook.

Which got us thinking. If FRED becomes the source of choice — the iTunes, so to speak, of the business — would it make sense for private data producers to post some of their data there? Should S&P post some of its data on FRED to reach a broader audience? Bloomberg? What would you do if you ran a data company? What would you do if you ran FRED?

Kim Schoenholtz passes on this WSJ piece suggesting that the International Swap Dealers Association is trying to close the loophole. From the article: “the [proposed] newly imposed credit event would include any action taken by a governmental authority leading to a write-down; expropriation; conversion, exchange or transfer of debt obligations; or any action that otherwise affects creditors’ rights in a way that reduces what they are owed.” Well, duh!

1. A viewing of our new pilot, Onion News Empire
2. A review posted on Amazon (linked to in application)
3. Three (3) reasons why the candidate is qualified for the position (either on resume, cover letter, or attached as a separate document)

If interested, please apply here: http://bit.ly/12jfFLA

Second: Billie Sol Estes has died. His connection to Global Economy fans and survivors: he collected millions in bogus cotton subsidies. I’m sure he’d laugh at the deal the US struck to pay off Brazilian cotton growers, too. If them, why not him?

With that as background, one of us received this email about our duties at a journal run by Elsevier, a publisher of academic journals (lightly edited for continuity):

The Office of Foreign Assets Control (OFAC) of the US Department of the Treasury administers and enforces economic and trade sanctions. As a result of OFAC sanctions we have been made aware that US editors, US Elsevier staff and US reviewers are now unable to handle scientific manuscripts where any of the authors are employed by the Government of Iran. …

Elsevier is legally obliged to ensure that all reasonable efforts are made to avoid submissions from Iranian government agencies and companies being handled by US editors, US Elsevier staff and US reviewers. Elsevier staff and reviewers from outside the US may still handle these manuscripts and OFAC regulation does not pertain to manuscripts where the authors are based at Iranian academic and research institutes. Manuscripts originating from a clinical setting that are not government run, for example, a hospital or clinical practice are also exempt from this regulation.

Evidently this is a byproduct of trade sanctions against Iran. There may be good reason for this particular aspect of the sanctions, but at first glance it seems to preclude interaction that doesn’t exist. There are lots of good economists of Iranian descent, but for obvious reasons they’re no longer in Iran. Those left seem to have little knowledge of economics.

So we’re going to do the professional thing and ask for punchlines.  Best one gets a free drink at the Malt House.

The question is what happens next if the government runs out of funds. They can’t print euros, but can they pay workers in something else? This surely isn’t the end of the story.

In our business, the textbook market has been infamous for charging different prices for the same book in different markets. My colleague Bill Greene’s best-selling econometrics book sells for roughly USD 200 in the US and EUR 75 in Europe. The publisher argues that the “Global Edition” has more non-US content, but how much US content is there anyway in a statistics book? It should come as no surprise, then, that purchasers of foreign editions resell them in the US through eBay, Amazon, and college bookstores.

But is that legal? The Supreme Court scored one for buyers last week, ruling “that  buyers of foreign copyrighted works may resell them in the United States without the copyright holder’s permission.” The quote is from Wired, via Kim Ruhl, but see also here.

What’s next? Drugs from Canada?

Update (3/28):  John Asker notes that Australia has restrictions on foreign books.  This report suggests that the cost to consumers is significant, and that most of the benefits go to foreign authors and publishers. It reminds me of US quotas on Japanese cars in the 1980s, which did wonders for theprofits of Japanese carmakers.

Update (3/30):  Clever idea for airlines via Alex Tabbarok.