Saturday, May 10, 2014

Should the Farmer Have Been Allowed to Replace His Horse with a Tractor?

An excellent video from Bryan Caplan.


  1. Luckily for the U.S. when the farmer did replace his horse with a tractor, it was a U.S. tractor and not a Chinese tractor.

    1. Why was it lucky for the U.S. that it was a U.S. tractor and not a Chinese tractor?

  2. vs doctoring up the profit statement bias?

    Making Ends Meet at Walmart

    But Walmart executives aren’t feeling the same pain. While the company’s malaise is clearly laid out in financial tables — numbers don’t lie, after all — when it comes to figuring the performance pay of top executives, let’s just say the numbers can be made to fib.

    I’ll let Walmart’s proxy filing explain.

    Each year, when measuring top executives’ performance for pay purposes, the company says it makes various “adjustments” to its recorded financial results. In 2014, those adjustments resulted in better performance than reported in the audited statements. That enhanced performance meant higher incentive pay for executives.

    Walmart routinely adjusts its results for pay calculations, the proxy said, so they can be “computed on a comparable basis from performance period to performance period.” The company wants to exclude the impact of what accountants sometimes call extraordinary items — events not likely to happen again the next year.

    This year, the company included far more adjustments than in recent years. The impact of 11 “significant” items — including store closings, delays in store openings and the sale of operations — was eliminated from its results. In each of the four previous years, the number of adjustments never exceeded five.

    The current adjustments essentially make the costs or lost income disappear when figuring performance pay.

    Mary Pat Tifft, who lives in Kenosha, Wis., is a longtime Walmart shareholder as well as an employee — an associate, in Walmart parlance — of more than 20 years. She thinks these adjustments are the equivalent of an athlete moving the goal posts. “Walmart associates are having their hours cut because of declining sales but executives are still getting their bonuses,” she said. “It’s ridiculous that they can keep receiving their compensation because they keep moving the numbers around.”

  3. I was wondering if you have come across any speculative articles on about the elimination of most work with automation. Would we still have welfare payments to subsidize low wages? What about immigration policy? Its not just low end jobs either like the kiosk introduced here at the local Chili's that has eliminated half the wait staff. Reggie Middleton was just talking about his patented bitcoin protocol based transaction clearing house that eliminates nearly all third parties involved in most financial transactions. It just feels like we are setting up a society not based on growth but on conservation of a limited supply of resources with all this progress. Any thoughts?