Chinese Exports Are Everyone's | Daniel J. Ikenson and Alec van Gelder | Cato Institute: Commentary

Chinese Exports Are Everyone's | Daniel J. Ikenson and Alec van Gelder | Cato Institute: Commentary: "Global economics is no longer a competition between 'us and them,' between 'our' producers and 'their' producers. Instead, because of cross-border investment and transnational production and supply chains, the factory has broken down its walls and now spans borders and oceans. Competition is often between international brands or production and supply chains that defy national identity.

So what does all of this have to do with China's status as the world's biggest exporter?

The vast majority of Chinese exports are hugely dependent on imports from the rest of the world: iron ore from Australia; microchips from Taiwan, South Korea or Singapore; software from teams in Redmond (in the state of Washington) and Bangalore (India); new designs from Cambridge (whether Massachusetts or England) and Toulouse (France); investments raised from consortiums based in New York City, S�o Paulo or Johannesburg.

China has become the world's largest exporter primarily because of the global division of labor that has helped reduce poverty and create wealth: China provides lower-value-added production. The components of Apple's iPods and iPhones are put together in China, but their designers in California are worth more to the company's bottom line. Denmark's Ecco has shoe factories across Asia, but its most valuable footwear is still designed and manufactured in Europe, where the quality is guaranteed and the workforce highly trained – and higher paid."

"simple trade accounting rules attribute the entire value of those exports to China, even when the Chinese value embedded in those goods accounts for a small fraction of the total.

That accounting method helps explain why China's exports have surged over the decades, as the division of labor evolved and manufacturing chains proliferated."

"the Chinese-added value embedded in a 30G Apple iPod accounts for only $4 of the total $150 cost, yet the entire amount is chalked up as a Chinese export. Other studies estimate overall Chinese value added in all products exported from China to average somewhere between 35 percent and 50 percent, a large proportion but a lot less than gross export figures imply."

Beware the hidden costs of this federal stimulus | Scott Walker for Wisconsin Governor

Beware the hidden costs of this federal stimulus | Scott Walker for Wisconsin Governor

Afghans Have to Want to Help Themselves | Malou Innocent | Cato Institute: Commentary

Afghans Have to Want to Help Themselves | Malou Innocent | Cato Institute: Commentary: "the U.S. Army and Marine Corps' Counterinsurgency Field Manual deems the legitimacy of the host nation's government a critical component for combating an insurgency."

"there is no legitimate host government in Afghanistan. Graft and corruption are extremely pervasive, from President Hamid Karzai himself down to the lowliest traffic policeman."

"the COIN manual suggests 20 to 25 troops per 1,000 indigenous inhabitants, a ratio that would force foreign troop levels to 200,000 in southern Afghanistan alone and to well above 650,000 overall (particularly given insurgent inroads in the north)."

"as demonstrated by the failed Christmas Day bomber, the fact that terrorists can still make it into America throws into question the entire notion that we must amass hundreds of thousands of troops in Muslim-majority countries. If America must start a war wherever terrorist groups hide, then wars of armed nation building must commence in Somalia and Yemen, too. Most importantly, if America's national security strategy is not about protecting America but rather bringing countries out of poverty at the barrel of a gun, what about Bangladesh? Or Congo? Or Haiti? As I wrote last night while liveblogging, 'Haitians might want to pray that al Qaeda swims over to Hispaniola, maybe then America and its allies can pave Haiti's roads, build Haiti's schools, and create a self-sufficient, noncorrupt, stable electoral democracy there, too (I won't hold my breath).'"

FOXNews.com - With Money on the Line, Local Governments Urge Illegal Immigrants to Fill Out Census

FOXNews.com - With Money on the Line, Local Governments Urge Illegal Immigrants to Fill Out Census: "Jurisdictions across the country are reaching out to illegal immigrant communities, some of which are reluctant to participate, in an effort to convince them that filling out the census form is safe and that the information they provide won't be used against them. Counting every last resident is vital for these districts, because the census numbers will be used to determine funding as well as legislative districts. The more people an area has, the more money it is eligible for, and the more representation it can get in Congress -- which usually means even more money."

"In Phoenix, officials estimate every resident counted is worth about $400 in government funding."

"Sharon Bulova, chairwoman of the Fairfax County Board of Supervisors ... said every counted resident is worth about $1,000 to the county."

The Race Against Government - Robert P. Murphy - Mises Institute

The Race Against Government - Robert P. Murphy - Mises Institute: "isn't there a way we could tap into people's philanthropic side without doing something intrinsically useless, like having a bunch of fourth graders walk around the school parking lot eight times, or asking people to spend money on candy or magazines they don't really want?"

"Suppose there were an organization that eventually gained a reputable name in the community, such that all the schools and many types of charities relied on it to coordinate their fundraising. Rather than kids selling boxes of almond candy bars or asking for pledges based on laps around the school, instead what the students would do is ask people to buy volunteer hours from them.

For example, a fourth grader would show up at your door explaining that he's raising money for his school's winter trip to the ski lodge, and that he's selling volunteer hours at $20 each. You say, 'A ski trip, heh? Sounds fun. OK I'm game, put me down for $5.'

Then, after the kid had raised a bunch of money, he'd turn it into his school, which would relay the information to the organization. Let's say the kid had collected $80 from the people in his neighborhood. Then on some Saturday he'd go down to the organization, where they would assign him to teams with other kids. Depending on their ages and abilities (and the number of adult chaperones available), they might ladle out soup in a homeless shelter, pick up litter in the local playground, help an elderly widow clean her yard up, or go to an orphanage and play with younger kids."

"I bet it's perfectly fine to pay $20 to have a fourth grader walk aimlessly around his school, whereas it's a violation of child labor laws to pay the same kid $20 to vacuum old lady Jenkins's living room."

Wage Earners and Employers - Ludwig von Mises - Mises Institute

Wage Earners and Employers - Ludwig von Mises - Mises Institute: "In the market economy, the only way left to the more gifted individuals to take advantage of their superior abilities is to serve the masses of their fellowmen.

Profits go to those who succeed in filling the most urgent of the not-yet-satisfied wants of the consumers in the best-possible and cheapest way. The profits saved, accumulated, and plowed back into the plant benefit the common man twice: first, in his capacity as a wage earner, by raising the marginal productivity of labor and thereby real wage rates for all those eager to find jobs; then later again, in his capacity as a consumer when the products manufactured with the aid of the additional capital flow into the market and become available at the lowest possible prices."

Challenging the Rule of Law | Richard W. Rahn | Cato Institute: Commentary

Challenging the Rule of Law | Richard W. Rahn | Cato Institute: Commentary: "Do you think the General Electric Co., which owns NBC, should have freedom of speech, but not FedEx, which does not own a media company?"

"Other corporations will now have the same rights that media corporations enjoy. One overlooked aspect of the ruling is that in the Internet age, almost any company can create a low-cost electronic newspaper, making it easy to get around the restriction if the Supreme Court had left the old rule intact."

"An IRS official said, 'We expect the Swiss government to continue to honor the terms of the agreement' — despite the agreement having been deemed unlawful."

"IRS Commissioner Doug Shulman, in a Jan. 26 speech, said some 'taxpayers would be required to annually disclose uncertain tax positions in the form of a concise description of those positions and the maximum amount of U.S. income tax exposure if the taxpayer's position is not sustained.' The Fifth Amendment to the Constitution clearly states: 'No person ... shall be compelled in any criminal case to be a witness against himself, nor be deprived of life, liberty or property, without due process of law.' Perhaps Mr. Shulman and his colleagues have never read the Constitution.

The 16th Amendment to the Constitution states: 'The Congress shall have power to lay and collect taxes on incomes,' yet the IRS routinely assesses taxpayers for taxes on 'imaginary' income, such as the portion of capital gains that are solely a result of inflation. For instance, if you paid $1,000 for 100 shares of stock in a company in 1983, and sold the stock for $2,000 in 2006, the IRS would claim you had 'income' of $1,000 and tax you on that. In fact, the consumer price index more than doubled in that period and you would not have been able to buy as much with the $2,000 in 2006 as you could have bought with the $1,000 in 1983. By any economic or dictionary definition of 'income,' you had none — yet the IRS lays what is, in effect, an unlegislated wealth tax on the inflation, which was caused by the government (i.e., the Federal Reserve)."

Foreign Aggression - Morris and Linda Tannehill - Mises Institute

Foreign Aggression - Morris and Linda Tannehill - Mises Institute: "In a laissez-faire society, defense against foreign aggression would be offered for sale on the free market, just as would any other type of defense. Because of the close natural connection between insurance companies and defense agencies, it would probably be most feasible to sell defense against foreign aggression in the form of insurance policies. That is, insurance companies would sell policies agreeing to protect their insureds against foreign aggression and to indemnify them for losses resulting from such aggression (the contract to be void, of course, if the insured provoked the conflict by his own aggressive actions). The insurance companies would see to it that whatever defenses were necessary to prevent the losses were provided, and they would make sure that a very efficient job of defense was done, since any losses would cost them large sums of money."

"A major portion of the cost of defense against foreign aggression in a laissez-faire society would be borne originally by business and industry, as owners of industrial plants obviously have a much greater investment to defend than do owners of little houses in suburbia. If there were any real threat of aggression by a foreign power, businessmen would all be strongly motivated to buy insurance against that aggression, for the same reason that they buy fire insurance, even though they could save money in the short run by not doing so.

An interesting result of this fact is that the cost of defense would ultimately tend to be spread among the whole population, since defense costs, along with overhead and other such costs, would have to be included in the prices paid for goods by consumers. So, the concern that "free riders" might get along without paying for their own defense by parasitically depending on the defenses paid for by their neighbors is groundless."

Obama's Targeted Killings in Yemen | Nat Hentoff | Cato Institute: Commentary

Obama's Targeted Killings in Yemen | Nat Hentoff | Cato Institute: Commentary: "'So the president claims the power to order U.S. citizens killed anywhere in the world, while engaged even in the most benign activities carried out far away from any actual battlefield, based solely on his say-so and with no judicial oversight or other checks.'

In addition to the corollary death of innocent civilians, these strikes do kill terrorists, don't they? But Greenwald reminds us, it is 'the U.S. Government (that) has accused them of being a terrorist.'

On what evidence? Remember Donald Rumsfeld assuring us 'the worst of the worst' were being held at Guantanamo Bay? But, as Greenwald notes, federal judges reviewing habeas petitions of prisoners there have found, in some cases, 'an almost complete lack of evidence to justify the accusations against them.'"

It's the Language of Action, Not a Trick - Predrag Rajsic - Mises Institute

It's the Language of Action, Not a Trick - Predrag Rajsic - Mises Institute: "In our everyday life, money is generally seen as the good that is being given up in return for consumption goods and services. Actually, what is being given up is the alternative use of that money.

When deciding on a purchase, a person assesses the value of an item and compares it with the values of other things that could be obtained using the money needed to make that purchase."

"Offering two pairs of shoes for $150 would create an artificial unit for mental analysis. For most people, the appropriate unit of shoes is one pair. People rarely have a single immediate end that would be satisfied by purchasing two pairs of shoes. Thus, when offered two pairs up front, people first need to disaggregate the offered two-pair unit into one-pair units and align them with different ends on their value scales, together with different combinations of money prices that add up to $150."