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PaperclipPerfector  3mo ago (text post)   26237 thread views

Culture War Roundup for the week of January 22, 2024

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Can you imagine a US Constitutional amendment that, if proposed, would actually get passed these days?

The relevant part of the US Constitution is:

The Congress, whenever two thirds of both Houses shall deem it necessary, shall propose Amendments to this Constitution, or, on the Application of the Legislatures of two thirds of the several States, shall call a Convention for proposing Amendments, which, in either Case, shall be valid to all Intents and Purposes, as Part of this Constitution, when ratified by the Legislatures of three fourths of the several States, or by Conventions in three fourths thereof, as the one or the other Mode of Ratification may be proposed by the Congress; Provided that no Amendment which may be made prior to the Year One thousand eight hundred and eight shall in any Manner affect the first and fourth Clauses in the Ninth Section of the first Article; and that no State, without its Consent, shall be deprived of its equal Suffrage in the Senate.

So, either 2/3 of both the House and the Senate, or 2/3 of the states must propose it, and then 3/4 of the state legislatures or conventions in those states must support it, for it to become part of the Constitution... as I understand it at least.

What sort of possible amendments could you imagine would actually pass and become part of the US Constitution in today's political climate, if they were proposed?

I find this to be an interesting question because it is a barometer of what the various factions of US politics actually agree on, despite their various differences, and also a barometer of how much polarization there is in today's US political situation.

The most likely candidate I can think of is an amendment regularising the administrative state if it appears to be under serious threat from the conservative majority on SCOTUS. Nobody wants to live in a world where the clownshow that is Congress has to deal with the technical detail of bank capital adequacy or aviation safety, and very few people want to live in a world where those things are not regulated at all.

Before the McCarthy speakership fiasco, it looked like an Administrative Procedure Amendment would pass easily if needed with votes from Democrats, moderate pro-business Republicans, and conservative Republicans bought by the incumbent banks, airlines etc. I suspect in today's climate a lot of Republicans would be afraid of being primaried if they supported it (a majority of the voters in low-turnout non-Presidential Republican primaries appear to be the kind of anti-establishment conservative who would be happy to watch the world burn if libs were sufficiently owned as a result), so it would be difficult to get the required supermajority.

* IANAL, but my reading of the Constitution is that the administrative state is unconstitutional for the same reasons as the Air Force under any sensible interpretation scheme other than "living constitutionalism". But both the administrative state and the Air Force are good ideas, and should have been regularised by constitutional amendments which would have passed easily at the time.

very few people want to live in a world where those things are not regulated at all.

Do you mean "not regulated at all" or "not regulated by a federal bureaucracy"? If you mean the first, then yes I think no one really wants to live in that world, but also that is not what is at stake in this SCOTUS decision. The latter statement is what is at stake, and I think many people would want to live in that world if they could actually experience it. I wrote this comment in last week's thread. There are serious and fundamental problems with centralized bureaucracy. The kind of problems that constitutional amendments don't fix.

There are three serious alternative to centralized regulation by a bureaucracy:

  1. Market regulation. If there is a functioning and competitive market its not clear to me that anything really needs to be done to protect people involved in the market. Companies will have to compete with each other on every margin, including quality, price, and reputation. They will police each other on these things. This will cover nearly all of the minor stuff.
  2. Court and legal regulation. If there is a functioning common law court system then many of the serious fuckups can also be addressed. Deaths, serious property rights violations, and uses/threats of violence could all be addressed. This will cover nearly all of the major stuff.
  3. Localized government regulation. This will suffer from many of the same problems as a large centralized bureaucracy that regulates things. But it at least has a pressure valve. If the local regulations become too onerous and annoying, people can leave that jurisdiction.

#1 is striking in its naïveté. A free market, one that is functional annd competitive, actually requires a certain amount of governmental regulation to remain free, functional, and competitive. It does not happen by magic. Even the holy texts of capitalism make this point explicitly. For example, companies can do a number of things to stifle new entries to existing markets, which breaks the system. There are clear mechanisms that keep the system going, and they are somewhat easily circumvented with lax enforcement. Companies can temporarily collude or take other related actions to undercut a rising newcomer’s prices (the Walmart strategy), blanket them with legal fees (the IP/copyright route), contractually freeze them out (the Microsoft strategy), deceptively manipulate popular perception, or even outright lie, snipe key hires, unleash massive financial war chests, the options go on and on.

Walmart for example should not have been possible. They deliberately bankrupted thousands of companies if not more in their rise to the top. Do you remember this era? They are like the classic case of using their financial heft to artificially lower prices, drive local grocery stores out of business, and then raise the prices again. (And cheat countless suppliers and business partners along the way). And the scandals don’t stop. Why, even just yesterday I saw a story about how Walmart enriched itself by ignoring massive fraud and even lied to the government in the process. Note that Walmarts are too physically entrenched in various communities for much meaningful action to be taken, and boycotts just don’t work very well anymore.

IMO selling at a loss to push market share and destroy competitors is already illegal. Probably not enforced enough.

I don't understand why. Uber is a great recent example of that. Their shareholders basically funded them selling below market price for a while. And then Lyft comes along and it turns out people that are price sensitive really don't have that much "brand loyalty". The shareholders bought a whole bunch of cheap rides, not a monopoly.

I thought it was more illegal than Wikipedia claims or I’m forgetting a key features of that.

https://en.wikipedia.org/wiki/Predatory_pricing

It becomes illegal if it bankrupts Lyft and the man Uber have a credible threat of doing another price war with a new entrant discourages competition. At which point Uber can hike prices.

Things with network effects seems more prone to these claims. Things with weaker network effects wouldn’t. Truth is it’s stupid to sell below costs (unless you just forecasted wrong) unless you have a plan to make more from those sales later.

Predatory pricing is BS. Almost any company can be "guilty" of it. The courts have over time had to reign in the excesses in enforcement. But the original applications of those laws were comically and transparently political. As I sort of asked of Jiro: consider what kind of price change disproves predatory pricing. The answer is 'nothing' as far as I can tell.

Economists have a saying "dont reason from a price change". It naively applies to just understanding how supply and demand have changed. But it can also be some sage wisdom about not rushing to judge the activities of some company.

I don’t think it’s BS. It is tough to prove though.

That phrase I believe was coined by Scott Sumner and popularized my marginal revolution. I once had a prof use it all the time and didn’t know where it came from. Golden Age of the Econ blogosphere.

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