📈 first Derivative [102]
🔰 Georgism—🇸🇪 gangs of Uppsala—🇦🇷 Argentine elections—🇯🇵 revolt of the salaryman
🦃 A belated Happy Thanksgiving to everyone! The main page now has a Notes and Chat section. Notes is like Substack’s version of Twitter and where I’ll post articles and quotes in between newsletter issues. I’ll also post articles to Chat, which will be for paid subs. As for the main newsletter, instead of sending it out a day later for free subs, I’m considering paywalling content below the top one or two pieces, any thoughts?
📱🎬 Cellphones long ago ruined the premises and plots of many older movies and shows, especially comedies of errors like Seinfeld. But writer-director Tony Tost tweeted recently about how cellphones are visually boring compared to landlines (with some exceptions like Euphoria, Decision to Leave) and I tend to agree. Also, RIP answering machines
Good reading,
-Teddy
🔰🏗 The New York Times recently ran a good piece on Georgism, and the land-value tax, which taxes land in place of other economic assets like wages and investment:
I’ve always really liked the idea of the land-value tax but honestly need to do more deep dives into the topic.1 The illustration I always think of this the High Line in New York which was built in 2009 and not only revitalized that stretch of Chelsea but really made it quite high-end. Who should get the increase in value that comes from that (mostly) publicly funded project? The people who happened to own the land nearby? Or should most of that value go back to the people, either in the form of lowering other taxes or being spent on other services? Same with subway lines and stops.
More broadly, it makes sense to me that you want to structure your economy to promote productive activity and discourage rent-seeking. Not only is better for the economy, but it’d improve quality of life and the health of our communities as lived.
The notion that land is an undertaxed resource — and that this distorts markets in destructive ways — unites libertarians and socialists, has brought business owners together with labor groups and is lauded by economists as a “perfect tax.” And yet despite all that agreement, there are just a handful of examples of this policy in action, and none in America that match the Detroit proposal in scale.
They encourage housing development instead of discouraging it, she noted. They don’t discourage work or investment, like taxes on income and capital gains. They’re also hard to dodge, since land is hard to move.
The article looks at the case of Detroit where the current mayor, Mike Duggan, is trying to enact a land-value tax:
Mr. Duggan’s scheme to fix the blight: a new tax plan that would raise rates on land and lower them on occupied structures. Slap the empty parcels with higher taxes, the argument goes, and their owners will be forced to develop them into something useful. In the meantime, homeowners who actually live in the city will be rewarded with lower bills…
When I asked him if he’d heard of Henry George at the beginning of our interview, his answer was “nope.” He was surprised to learn that he had become something of a Georgist hero, and that his plan was being cheered as a step toward restoring Georgism to the American conscience.
“This isn’t any deep philosophical movement,” Mr. Duggan said. “I’m trying to cut taxes.”
That last bit reminded me of the John Maynard Keynes quote: “Practical men, who believe themselves to be quite exempt from any intellectual influences, are usually the slaves of some defunct economist”
🇸🇪🔫 Sweden is experiencing a surge in gang-related violence, particularly in the cities of Uppsala and Stockholm:
At its worst in September and October, barely a day went by without a shooting, bombing or hand grenade attack — sometimes several…
Well-established criminal gangs, largely run by second-generation immigrants, are no longer just killing each other but increasingly relatives… Many of the perpetrators are children as young as 14 who are groomed by gangs to carry out hits.
The rise in gang violence is leading to uncomfortable conversations. A wealthy nation famed for its welfare state, Sweden has over the past three decades taken in more asylum seekers escaping various conflicts from the Balkans to the Middle East than most European countries. As the violence increases, the far right feel emboldened, while the left are nervous about vilifying immigrant communities. But both sides of Swedish politics accept that the country has failed to properly integrate some of its new arrivals
Immigration continues to be a major issue in Europe, just look at the riots in Dublin this week. I think if incumbent governments fail to successfully integrate their immigrant populations and address social unrest, the more they’ll drive voters towards parties and leaders, however unseemly, that are willing to speak to that unrest and not treat debate as taboo. It seems to me that it’d benefit pro-immigration advocates to also be tough on crime.
🇦🇷🗳 Argentina elected Javier Milei, a libertarian political outsider, as its new president. Milei won decisively with 56% of the vote to Economy Minister Sergio Massa’s, 44%.
The victory of the firebrand economist over the ruling Peronist movement opens the door to a broadscale economic overhaul that he has promised for this country of 46 million people. Milei’s proposals include adopting the U.S. dollar as the national currency, scrapping the central bank, prioritizing commerce with capitalist nations like the U.S. over China, and dramatically reducing a bloated state sector.
The NYT calling this a “victory for the far right” is lazy US-centric framing based on overactive Trump pattern matching. Milei’s persona is definitely kooky, but his policies are more accurately described as radically libertarian. I see his bizarreness as a sign of just how desperate the electorate was for anything other than the usual failed Peronism. But it remains to be seen if Milei’s “shock therapy” plan for the economy will find success.
Among the most daunting challenges for Milei when he takes office on Dec. 10 will be trying to narrow a gaping budget deficit and sort out about $41 billion in unpaid import bills left by the unpopular and free-spending government led by President Alberto Fernández and his vice president, Cristina Kirchner.
Inflation is running at 143%, more than 40% of the population is living in poverty, and factories have been forced to halt production because of a shortage of dollars to pay for imports…
An interesting fact:
As a result, about 10 percent of all U.S. currency in circulation is in Argentina, according to some estimates, or roughly $200 billion, more than in any other country outside the United States. That’s an average of about $4,400 in cash for every Argentine, compared to $3,100 for every American. (NYT)
🇯🇵💹 Younger employees and start-up companies are challenging the long dominant corporate salaryman work culture in Japan, the world’s third-largest economy
By the end of 2021, more than a fifth of job transitions from large companies in Japan were people leaving to join start-ups, according to the Japan Venture Capital Association, compared with 8 per cent in 2018. That proportion has continued to push towards 25 per cent, according to JVCA members.