Archive for March, 2011

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Intrusive TSA searches create profit opportunity for Adidas

March 2, 2011

Lynne Kiesling

A concise public choice analysis of the distortionary economic rents created by the ever-increasing “layers” of TSA security theater, as reported today on the Wired gadget blog:

Airport “security” theater may be sickeningly pointless, but this stealthy introduction to a police state brings certain commercial advantages to those willing to cash in. First, it was the baggie makers that got rich. Then, it was the turn of laptop bag and sleeve manufacturers. Now its the turn of sneaker makers.

Adidas’ SLVR S-M-L Concept shoes are neither a concept nor “slvr” (silver?). What they are is TSA-friendy, with a stretchy upper and expandable sole which makes it easy to slip them off when being forced to undress and submit to the “security” “officers” of our totalitarian state. Sure, they may look like lace-up shoes, but that’s just a trick so you don’t look like you bought them on the over-60s shopping channel.

This pathetic genuflection to our governmental overlords has one neat side-effect: The shoes only need be made in three sizes, and they will stretch to fit. This also means that your girlfriend can now steal your shoes, along with your sweaters, socks and anything else that will fit her.

The SLVR S-M-L Concept shoes are $140 per pair. I told you somebody was getting rich. And what next? Crotchless pants to make invasive TSA groping a little bit easier?

In addition to Charlie Sorrel’s recognition of the rents that the TSA policies have created for Adidas, I applaud and echo his rhetoric. However,  in his list of those who have profited from the expansion of the police state, he forgot to list the whole-body imaging scanner manufacturers, who have paid through the nose to get those rents, through the politically-connected lobbyists they have employed to persuade Congress of their fear-driven, security-industrial complex “business” model. Any rents that Adidas gets to enjoy from shoe sales will pale in comparison.

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Faruqui and Toney debate smart meters and dynamic pricing

March 2, 2011

Michael Giberson

Dr. Ahmad Faruqui of The Brattle Group and Dr. Mark Toney of TURN discuss dynamic pricing for retail electric customers in a February 17, 2011 event in San Francisco.

Part 1:

Part 2 Q&A:

I’ve only had time to watch a bit of this, but with Faruqui and Toney the program is self-recommending for anyone interested in electric power prices.

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Zone pricing ban proposal advances in Connecticut, zone price ban law in New York still not working

March 2, 2011

Michael Giberson

Gasoline consumers in well-off Fairfield County, CT, pay gasoline prices that tend to be higher than prices in the rest of the state. The consumers don’t like it.

State legislators representing the region believe the issue is “zone pricing,” a practice by gasoline wholesalers which sets wholesale prices to different levels in different areas based on beliefs about how much consumers are willing to pay. These legislators are proposing to ban zone pricing in Connecticut.

Meanwhile, in New York, a law banning zone pricing went into effect about 2 1/2 years ago. It hasn’t had a noticeable effect on gasoline prices. (See WHAM-ABC 13: “Zone Pricing Law – Why it Didn’t Work.”)

Insight from economics: zone pricing may affect whether retailers or wholesalers capture a larger share of the profit, but a zone pricing ban probably won’t have much affect on retail prices. If the law has an effect, it will tend to raise prices in lower-income areas at least as much as it lowers prices in higher-income areas.

Question for proponent of a zone pricing ban: why do you think your law will succeed where a very similar New York law has failed?

NOTES:

  1. Current text of committee bill.
  2. More info from the CT General Assembly.
  3. Editorial from the Fairfield County-based Connecticut Post.
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Our next fear: peak rocks?

March 1, 2011

Lynne Kiesling

Economist and teacher extraordinaire Steve Horwitz has done a great video for Learn Liberty on the question “are we running out of resources?”

We’ve done our share of “peak oil” debunking here over the years, so it won’t surprise you that I find The Onion’s take on the question of running out of resources highly amusing:

Geologists: We may be slowly running out of rocks

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Streetwise Professor: Bootleggers and Baptists in Russia

March 1, 2011

Michael Giberson

Craig Pirrong, blogging at Streetwise Professor, posts “Bug or Feature?, or Bootleggers and Baptists Go To Russia.”

I have been told by people who were involved in the “gaming industry” in Russia pre-ban that even legal operations had to pay to survive.  But “banning” the activity only enhances the authorities’ opportunities for personal enrichment.  Thus, it is more than plausible that this was a major reason behind the ban: that is, many of the ban supporters didn’t intend to reduce gambling, but to increase their take from it.

No doubt there were some in Russia who sincerely believed that banning gambling was a desirable social goal.  But just as bootleggers in the American South who profited from the banning of alcohol benefited from the well-intentioned efforts of Baptists to drive out the demon rum, the sincere opponents of gambling in Russia were played, and played well, by those who cynically saw the ban as an opportunity.

 

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