In 1960, F. A. Hayek published an important book that acted as the positive counterpart to his more famous The Road to Serfdom. Whereas the latter fiercely critiqued the very idea of a centrally planned economy, the former provided his view of what should take its place. This spring, a distinguished panel convened in the Cato Institute's F. A. Hayek Auditorium to discuss the new, definitive edition of that work, The Constitution of Liberty, edited by Ronald Hamowy.
The panel included Bruce Caldwell, Hayek's intellectual biographer; Richard Epstein, the brilliant legal scholar; and George Soros, the hedge-fund billionaire and founder of the Open Society Foundations. Soros opened his talk with his own interpretation of the great economist.
"Hayek is generally regarded as the apostle of a brand of economics which holds that the market will assure the optimal allocation of resources as long as the government doesn't interfere," Soros said. He went on to describe what he considers the two main pillars of this brand — the efficient market hypothesis and the theory of rational expectations — which, he insisted, place Hayek firmly in the dominant strain of American economics. Most label this breed the Chicago School. "I refer to it as market fundamentalism," Soros said.
Richard Epstein did not concur. "In some sense, I'm taking exactly the opposite side of George Soros," he said. While Soros praised Hayek's warning "against the slavish imitation of natural science" in the social sciences, Epstein thought his ideas weren't systematic enough. In acknowledging that they were "enormously instructive," he ultimately concluded that those ideas were "incomplete." Epstein argued furthermore that Hayek's work points not to unfettered markets but to a "presumption against regulation."
Giving voice to some of the raised eyebrows in the audience, Bruce Caldwell responded to Soros. "I think that George has a handle on some parts of Hayek, but misunderstands other parts," he said. With a better grasp of the missing pieces, Caldwell was convinced that Soros "would identify himself, I'll say it provocatively, as a Hayekian." He then countered some of the billionaire's specific claims. Hayek actually rejected the usefulness of the socalled twin pillars in "capturing the workings of the market process," Caldwell told Soros, demonstrating that "he's not the sort of market fundamentalist that you're describing. I think a pithy way of putting this is that there's definitely a difference ... between Chicago and Vienna."
Continuing his earlier call for all sides to acknowledge that they only have half of the truth, Soros made some concessions. "Maybe we can find common ground," he said. "I think that we would all agree that government regulation is a necessary evil ... so if you can avoid regulations, you should." Many observers picked up on Soros's criticisms of the less-than-savory political and legislative processes that produced the recent health care and financial-reform bills. In the end, the discussion was both provocative and civil. The event mirrored a long-standing debate over the great economist's influence. Last year, Kate Zernike wrote in the New York Times that Tea Party activists were resurrecting "long-dormant ideas [found in] once-obscure texts by dead writers." She was referring, of course, to writers like Hayek. But she may have sold him short.
This is the same man, after all, who won the Nobel Prize in Economics in 1974. Years later, he met with President Reagan at the White House. He also met with Margaret Thatcher, who, in reference to The Constitution of Liberty, declared: "This is what we believe." Hayek was described by Milton Friedman as "the most important social thinker of the 20th century" and by White House economic adviser Lawrence H. Summers as the author of "the single most important thing to learn from an economics course today." He was the mind behind The Road to Serfdom, a book that has never gone out of print and, in fact, sold over 100,000 copies last year alone. Cato is proud to note that, in the last years of his life, Hayek became a distinguished senior fellow at the Institute.
But even that doesn't do him justice. "On the biggest issue of all, the vitality of capitalism, he was vindicated to such an extent that it is hardly an exaggeration to refer to the 20th century as the Hayek century," John Cassidy once wrote in the New Yorker. Hayek, however, was much more than an economist. He also published impressive works on political theory and psychology. He embodied the type of intellect that influenced disciplines across the spectrum, remaining relevant long after his own lifetime.
As executive vice president David Boaz wrote on Cato@Liberty, "He's like Marx, only right."
Tại các thành phố Mỹ, việc mua dâm diễn ra khá công khai song có một góc của ngành công nghiệp tình dục lại được bảo vệ và giấu kín. Đó là thế giới của gái điếm cấp cao, nơi khách hàng bỏ vào đó hàng trăm nghìn đô la mỗi năm. Một thế giới bí mật với những quy định và cách hành động có thể thay đổi mọi thứ mà bạn nghĩ là mình đã biết về nghề mua bán dâm.
Tuy nhiên, thế giới bí mật này đã được hé lộ phần nào qua lời của người trong cuộc. Đây là một phụ nữ ở San Francisco lấy tên là Elise Vanderhoff. Cô vào nghề năm 28 tuổi, sau khi đã học hành xong xuôi và đang làm cố vấn cho những thiếu niên gặp rắc rối.
Bắt đầu nghề gái gọi...
"Tôi làm gái gọi khi đã tốt nghiệp và có bằng Thạc sĩ về tâm lý, đang làm bác sĩ thực tập. Tôi vào nghề một phần là để thanh toán các hóa đơn còn nợ, vốn không ngừng tăng lên sau khi tôi tốt nghiệp. Công việc bắt đầu khi tôi kết thúc giờ thực tập. Ngoài ra, tôi làm việc đó còn vì những lý do cá nhân khác, ví dụ tính chất phiêu lưu của công việc.
Không cần nói cũng biết, làm gái gọi, tôi kiếm được nhiều tiền hơn làm bác sĩ thực tập và cũng như giàu hơn nhiều nhà trị liệu khác mà tôi biết. Tuy nhiên, lại một lần nữa, tiền chỉ là vấn đề thứ yếu. Tôi hiện làm gia sư và hành nghề tổ chức hội thảo trong khi vẫn làm gái gọi cấp cao.
Bận bịu chăm sóc khách hàng...
Công việc này hay thay đổi và mang tính mùa vụ, vì vậy, khó nói con số chính xác ở đây vì nó thay đổi thường xuyên. Trung bình, tôi gặp 2-4 khách một tháng, ở bất cứ đâu từ khoảng 4h tới vài ngày một lần. Xin hãy nhớ rằng việc làm này không phải là lúc nào cũng gặp khách hàng.
Tôi dành khá nhiều thời gian để duy trì quan hệ với các khách hàng hiện thời, tìm các vị khách mới, chăm chút cho vẻ bề ngoài (gồm hẹn làm tóc, móng, chăm sóc da, tập luyện 3-5 lần một tuần với người huấn luyện, chăm sóc xương, mát xa..), chụp ảnh mới, quảng cáo, bảo trì website, theo dõi các sự kiện đang diễn ra, học về rượu, thức ăn và văn hóa.
Đây là việc bảo dưỡng cần phải làm bất kể tôi phải làm những việc gì trong tuần. Tôi chỉ được trả tiền cho thời gian ở cạnh khách hàng trong khi thời gian còn lại là tương đối lớn.
Quan hệ với khách hàng...
90% công việc kinh doanh của tôi được hình thành từ các sự kiện thường xuyên. Tôi xin lặp lại rõ ràng một lần nữa là lý do tôi làm việc này không phải chỉ vì tiền. IQ của tôi là 150+, tôi nói được 4 ngoại ngữ và tôi có bằng thạc sĩ. Tôi có thể kiếm nhiều tiền ở các lĩnh vực khác.
Tôi coi trọng mối quan hệ đã có với khách hàng và tôi coi việc dành thời gian với họ là đem lại lợi ích cho họ trong cuộc sống. Ngoài ra, làm gái cấp cao tôi cũng thấy thích thú. Do đó, tôi tập trung vào việc thiết lập những mối quan hệ lâu dài với khách hàng mà tôi thích. Mỗi năm, tôi chỉ tiếp xúc với một vài khách hàng mới.
Tiền công…
Giá tối thiểu trong vòng 4h mà khách hàng phải trả tôi là 2.500 USD, nếu chỉ trong thành phố, nhưng sẽ là 3.500 USD cộng phí di chuyển cho các cuộc hẹn ở ngoài San Francisco. Khi đi lại, tôi tính thêm phụ phí vì tôi tốn thời gian cho di chuyển. Khách hàng cũng sẽ phải trả tiền đi lại cho tôi.
That meagre bank lending is due to, not in spite of, low interest rates is an idea that has never occurred to the Fed.
The logic behind keeping interest rates low seems to be as follows, to use an analogy. If the price of wheat is kept low, even the poor can afford it and demand will be high. Then, if the government supplies wheat at low prices to grocers, they will add a small mark-up and supply it to consumers.
The analogy seems apt, if you replace grocers by banks and the low price of wheat by the low supply cost of money. But in practice the analogy does not seem to have worked. Why?
To begin with, money is not wheat. When a grocer sells a kilogram of wheat to a customer he collects the price for it and that is the end of the transaction. When a banker lends money that is just the first leg of the transaction. He needs to get the money back and make sure that the value of the money he gets back is not only more than the value of the money he lent out but also meets all his costs and yields a profit besides.
During a period of near-zero interest rates the chances of this are bleak. The reason is inflation. If inflation is 0% when the bank lends at, say, an interest rate of 5% and is 5% at the end of a year when the load is repaid, the bank will have clearly sustained a large loss, if lending costs and provisions for bad loans are taken into account. And high inflation is not just a remote possibility. It is a certainty considering that it is the Fed's avowed aim to raise inflation. And given the Fed's record before and after the Great Recession, what guarantee is there that inflation will be just 5%? In such an uncertain situation why blame banks for not lending? Their chances of losing money are smaller if they don't lend than if they lend.
The other reason that banks don't lend when the cost of money is low is just plain common sense. But in an era of complex mathematical economics, common sense has been a prime casualty, so that I need to invoke an economist who has for long been held in considerable contempt: Alfred Marshall.
This is what he said in Principles of Economics (edition of 1920):
"If a person has a thing which he can put to several uses, he will distribute it among these uses in such a way that it has the same marginal utility in all. For if it had a greater marginal utility in one use than another, he would gain by taking away some of it from the second use and applying it to the first."
Now, loans are not the only use that money can be put to. Banks can also use money in trading, which has the singular advantage of not tying up money for long periods and so does away with the uncertainty connected with those long periods. If banks can earn profits through trading, they would naturally not risk making loans. The return of huge bank bonuses just a year after the financial crash is proof that this was what happened.
Why has such a commonsensical idea not occurred to the Fed or to most economists? I think the reason is that Keynesianism has held economics in thrall for more than half a century so that economists are unable to see past the demand side of an equation.
To illustrate the point he makes in the above quotation Marshall considers a housewife with a limited number of hanks of yarn who must make a decision about how to divide the yarn between making socks and making vests.
In the footnote he says:
"Our illustration belongs indeed properly to domestic production rather than to domestic consumption. But that was almost inevitable; for there are very few things ready for immediate consumption which are available for many different uses. And the doctrine of the distribution of means between different uses has less important and less interesting applications in the science of demand than in that of supply."
It almost sounds like an admonition to Keynesians from beyond the grave.
I hope readers will be interested in the following graph which plots a) Commercial and Industrial Loans at All Commercial Banks against b) the Effective Federal Funds Rate from January 2001 to June 2011 [The data are from (where else?) the web site of the Federal Bank of St Louis.]
Especially interesting is the period from around the beginning of 2001 when the Fed began to reduce interest rates to get out of a recession and kept reducing rates until the middle of 2004. All through that period, commercial and industrial loans shrank. From the middle of 2004 the Fed started raising rates to curb the housing bubble and immediately commercial and industrial loans began to rise.
Only an amazing coincidence, I'm sure.
