Fiscal thrill seeking

I'm sure I'll have more to say about the Fiscal Cliff, as the kids are calling it, in the weeks to come. First I'd like to point out a prediction that is itself a logic puzzle. For the moment I am considering only the tax policy possibilities.

1. I believe that the most likely outcome is that no legislative changes occur (the tax increases, resets, etc. are allowed to transpire). 
2. I believe that it is most likely that there is legislative action that alters or avoids the tax increases, resets, etc. in some fashion. 

These two statements may seem to the casual observer to be contradictory. They are not. Re-read them and then check below the fold for my reasoning.

If you build it, they'll make you keep it

Like a bad penny, the infamous Gold Dome of northwest, central OKC is back in the news. It is one of those “classic” and “iconic” architectural features of a neighborhood that is too vital to lose. You know, one of those buildings so important that supporters insist that someone else must (be made to) pay to have it preserved lest a cultural heritage be demolished. It is a classic lesson in be careful how creative you are in what you build; for if ugly enough, it shall never be destroyed.

Okay, so some tastes may have been acquired for it. De gustibus non est disputandum. But that should come with a caveat, solvat aut sedatos esse (pay or be quiet). Sadly, we don’t live fully in that society. But aside from the principled case against this kind of a taking, there is a pragmatic one. Property rights uncertainty begets conservative choices that stifle creativity and experiment. No doubt about it; the Gold Dome as “the bank of tomorrow” was a creative chance taken. It worked until tomorrow came (a few decades later), and then it stopped working. And I can say it stopped working with strong confidence because the best indicator that we have says so. Namely, individuals in the market willing to risk capital were attempting in the 1990s to replace the Gold Dome with another idea. How free that market is largely determines how confident we can be. More on that another day. Suffice it for now to assume that the market was speaking and saying, “it is believed that these resources will be better used if used differently”. The market was denied and may be denied again.

Now let me connect the dots to another “ugly” building in OKC that may stay ugly if that lesson from before is heeded. The thermal plant in downtown OKC needs a makeover according to The Oklahoman’s Steve Lackmeyer. His idea is to turn the plant into “a great canvass for public art or for glitzy Times Square style billboards”. Take something plain and make it not so plain. I could be persuaded. I’m sure the question of who is going to pay for it is more important to me than to Lackmeyer, but again that is not my point here. Clever readers may think I’ve gotten the lesson/analogy from the Gold Dome backwards here, but cleverer readers will know better. The lesson is if you allow your building to be too far out of the norm, too creative, stand too far forward, you run the risk of having something politically powerful people won’t let go away—despite the fact that you own it. Turn the thermal plant into a graffiti mural and then in ten years when the neighboring hotel wants to raze the plant and expand onto the lot that option might not be allowed.

It's spelled Southern Comfort ...

But it is pronounced Kool Bay-Bee:

The Bettor's Oath

An excellent concept. I agree and pledge myself to it.

Hat tip: Bryan Caplan

YIMBY

A few positive externalities from a house in suburbia:

• The neighbor's tree that perfectly blocks harsh evening Sun from my house and backyard
• The inviting aromas from another neighbor's grill
• The sound of kids splashing in a nearby pool
• Moving to the front yard, the mostly well landscaped gardens of the houses up and down the street especially the neighbor's right across the street
• (more to come)

A spur of the moment theory: our marginal choice of where to live (perhaps many other choices as well at the margin) are largely explained by finding circumstances where positive externalities outweigh negative externalities.

You Speaky Two-Year Old?

Me: "Max, do you need to go potty?"

Max: "No." [translated: "Yeah, I could probably use a bathroom break."]

"Max, do you need to go potty?"

"NO!" ["Hell, yes."]

"Max, do you need to go potty?"

<silence> ["I am going potty."]

<unsolicited>
"I need to go potty." ["I just went potty (not in the bathroom)."]

<unsolicited>

"Oops . . ." ["Get the wipes, dad."]

<unsolicited>

"Don't be mad!" ["I'm about to make you doubt everything you think you know about order and justice in this universe, dad."]

Back to School

So, last night was back to school night at my daughter's school. Keep in mind that this is a private school, which means we pay for this school as well as for a public school program we do not derive benefit from. Regardless, there appears to be a non-free-market failure well beyond the obvious one-for-the-price-of-two situation.

My daughter was on a trip with her mother, brother and sister leaving me the duty (honor and joy in my daughter's mind) of checking in for the year. That privilege includes finding out who my daughter's teacher will be and who else will be in her class and who will be in the other third grade class--vital intel to a third-grader. And of course there is more.

There was the purchase of the school shirt, the purchase of tickets to the end of summer pool party next weekend, and the PTO dues--all of which seems reasonable. But then another task was left to complete. This is a phenomenon that takes various forms but consistently lacks logic. I needed to drop off three items requested ahead of time and purchased by me. In this case for a third grader the scavenger hunt entailed a ream of Xerox printer paper, a box of Ziploc bags, and a cylinder of Clorox wipes. I'm sure generic would have been fine in all cases, but that is not the point (or the point of confusion from my point of view).

I don't bring straws with me to McDonald's. I don't bring sheets to Marriott. I don't bring gauze to the doctor's office. Why am I bringing a few general supplies to the school? How is this efficient?

Adding to the confusion is the fact that some kind of efficiency has been discovered in this process. When I was in third grade, we had to truck down to the store to purchase a wide assortment of supplies for the coming year. The list of necessities always left room for debate: Did glue allow for a glue-stick? Did a paint set mean an eight or a sixteen color palette? Can I convince mom that I need Dukes of Hazard folders rather than the generic multi-colored set? Today the middle man has been removed from this process. All the school supplies the third-grade teachers are planning for each student to need are pre-purchased in bulk by the teachers through the school who we then pay directly. This makes sense. The teacher gets exactly the supplies desired and presumably purchases at a discount. Something similar happens at the school attended by the daughter of a colleague at work. In that case the parent goes to Staples and purchases the pre-selected bag of school supplies. Why not just ship the lot of them to the school? I don't know. Perhaps the just-in-time inventory system of this particular public school won't tolerate the risk of an under or over supply.

Back to my particular mystery. Is it some attempt to build a vague sense of commitment on the part of parents that they are made to contribute some token amount of supplies? Some how I doubt it is that well thought through.

--FS